EDITORIAL
Auto Contracts—Setting in Motion a New Spiral to the Bottom

Sep 22, 2003

The contract the leaders of the United Auto Workers union (UAW) just negotiated with Ford, GM, Chrysler, Visteon and Delphi has been hailed by bosses throughout the country. UAW leaders were praised for their "realistic" and "cooperative" attitude. Business analysts reported that the union put the welfare of the companies first. The bosses’ most important newspaper, the New York Times, called this the "biggest concession contract since the 1980s."

When a contract makes the bosses this happy, the workers must be getting screwed. And they are. Even on health care–where UAW President Gettelfinger had pledged the UAW would hold the line–there were important give-backs. As for pensions–about which the same pledge was made–they will fall still further behind inflation. Current retirees were really stabbed in the back–getting no increase of any kind for the next four years, only a small lump sum.

As for wages, two years from now, workers will be behind where they are today, since cost of living adjustment on wages is reduced once again, and there are no wage increases for two years. A two-tier wage system is to be brought into Visteon and Delphi–meaning that wages for new hires are to be set much lower.

The most cynical part of the new contract is the ready agreement the union made with the companies’ proposals to close or sell plants, giving up in advance at least 20,000 jobs–on top of the 73,000 lost since the last contract began. In exchange, they got a promise the companies will let the union gain a foothold in other plants with just a card check of employees, and will encourage their suppliers to do the same thing.

Gettelfinger even went so far as to brag that the union’s aim in these negotiations was to show other companies that they had nothing to fear from the UAW.

This contract certainly shows that. But if the bosses had nothing to fear from a union, what would be the point in joining a union?

This contract is just one further–but very big–step down a path that the UAW itself opened up in 1980–giving back gains workers once had to companies that claim to be in bad shape. In the 1980s, Chrysler gave the appearance that it was about to go under–although that was nothing but a charade, as Chrysler’s almost miraculous recovery, starting to make enormous profits within two years, showed. The concessions contracts settled earlier this year in airlines and steel were sold based on declarations of bankruptcy, or threats to do so. There too, there was more charade than reality. Smaller bankrupt steel companies may have been bought up by bigger ones–but if the bigger ones bought them up, it shows they had the money to do it–even while getting more concessions from all the workers.

But what is striking about the current UAW contract is that these companies, some of the biggest in the world, came asking for concessions just as soon as they went through the usual down part of the cycle which auto always goes through. Just like telephone unions did when they gave away the store to Verizon, the auto workers union is ready to hog-tie the workers into a four-year concessions contract, just because the bosses asked.

No wonder the corporate world celebrates these new agreements. It’s a signal that the country’s once powerful unions can be had just for the asking. And if they can be, the bosses surely believe that the way is clear for new demands to be made on everyone else, unionized or not, in a new tightening of the spiral to the bottom.

The agreements unions have cut in this last year in the airlines, telephone, steel and auto–all major industries–show that the working class cannot depend on today’s top leaders of the unions to defend their interests. Working people need to mobilize themselves to fight for their own interests–in the process either taking back the old unions or forming new unions that they themselves control.