The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Driving wages down to a new level

Feb 2, 2004

The Auto Workers union (UAW) just accepted an agreement with American Axle last week that includes a first-time- ever three-tier pay scale.

American Axle was based on a former GM complex, Chevrolet Gear and Axle. Older workers remaining from the old GM plant make between $24 and $26 per hour. The second tier, made up of workers at seven newly-acquired plants and the Three Rivers plant, make between $13.50 and $17 per hour. New hires, which are expected mainly at the company's plant in Three Rivers, Michigan, will start at $13.50 per hour, but will get no cost-of-living increases for at least two years and will pay a higher amount for their health care.

Both the company and the union used the threat of jobs going to Mexico to convince workers to accept a contract that can only help the bosses to further divide workers and drive down wages and benefits. The city manager of Three Rivers, Joe Bippus, put it clearly, "The new agreement makes doing business here in Three Rivers on par with Mexico. They don't have to move the jobs to Mexico ...." The new third-tier wages certainly will put workers here on a par with Mexican workers. The next time American Axle wants to outsource some of its jobs to a low-pay region, all it has to do is move them over to Three Rivers, Michigan.

This company, which is supposedly having so much trouble competing with companies in Mexico or China, is the same company that has built a new 32 million dollar headquarters near the site of the old Chevy Gear and Axle Plant in Detroit. The two-tier contract the UAW accepted when GM set up American Axle as an "independent company" allowed it to build the new headquarters, expand its Detroit plant and acquire seven new plants. This third-tier concession contract will now give this company still more money – letting it construct plants in other countries whenever it wants.

Ron Gettelfinger, president of the UAW, called this latest deal, "shared abundance." The only "abundance" here is all that money going to the company – none of which is shared.