The Spark

the Voice of
The Communist League of Revolutionary Workers–Internationalist

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

Using Auto Bankruptcies to Drive the Working Class Back 100 Years

Jun 8, 2009

GM’s pre-planned, government-managed bankruptcy has one clear aim: to extort enormous sacrifices from current and future generations of auto workers. While auto workers are targets today, tomorrow the crosshairs are on every worker.

It’s by design. And it’s from the top. President Obama’s chief of staff, Rahm Emanuel, said in an interview late last year, “You never want a serious crisis to go to waste. What I mean by that is, it’s an opportunity to do things that you think you couldn’t do before.” When the auto companies were caught in the banks’ financial meltdown and could not get their essential loans, the government took the “opportunity to do things it couldn’t do before.” It set up an auto task force manned by Wall Street wizards, whose job was to blast away at workers’ wages and conditions and, by doing so, protect the interests of the biggest banks and investors.

The scale of the cuts at GM and Chrysler is beyond what any CEO could imagine extorting in any ordinary period. Work is speeded up. Workers must put in more weeks, more days, more hours, with less rest and less pay. Hourly wages are frozen and yearly lump sums are eliminated. Workers’ protections are wiped out in many situations, ranging from the way checks are paid, to the assignments they must accept, to the jobs that will be resourced to contractors.

Already, these changes lead toward what the new contract calls an “all-in labor cost” of $35 an hour–compared to what the companies said it was just a few years ago, $75. Compensation for labor is to be sliced by more than half! At one blow.

But there is even more to come. First, every future new hire will be paid less than half of today’s standard wage, and have only minimal benefits. Second, the government task force cancelled workers’ right to vote on their 2011 contract. Instead, the government imposed binding arbitration–and the arbitrator is instructed to use the industry’s lowest wages and benefits as a benchmark. By 2011, how low will the non-union car companies set their wages? $10? $8?

The stage is set to wipe 100 years of workers’ gains completely off the map.

The standard of living of auto workers will fall dramatically, and every other boss in every other industry will try to reset their workers’ standards accordingly. The ripple effects will put the entire working class into poverty.

By these measures, the Obama administration expects to protect not just the GM and Chrysler companies, but the whole capitalist class. The government began by suggesting that it would provide only a few billion dollars to Chrysler and GM. Now the total committed to these companies and their financial arms controlled by Cerberus Capital is 100 billion dollars. The government fully intends to protect the interests of the dominant capitalists–not least by ensuring that in the future, they will be able to reap richer profits by paying workers far less while pushing them harder and harder.

This is the future that the capitalists and their government are preparing for us. When the Obama administration says that things are getting “better,” this is what they mean–much better for the wealthy class that owns and controls the production apparatus of this society.

For the working class, “better” can only depend on the workers’ beginning to fight for the interests of themselves and the whole laboring population.