The United Automobile Workers has been effectively decertified as the collective bargaining representative of workers at General Motors, Ford and Chrysler. And the main union buster was not management, but rather the Congress of the United States.
That’s only a slight exaggeration of the facts. The UAW, fearing that its contracts at the Big Three would be voided if the automakers filed for bankruptcy, has made major new contract concessions to satisfy Congressional critics of a bailout that the auto companies insist is the only way they can avoid Chapter 11. In order to save its union contract, the UAW is being forced to destroy it.
It is infuriating that the UAW was put in this situation. First, there’s the obvious and widely noted double standard. The federal government has spent vastly more on the rescue of the financial sector while imposing no real conditions beyond token restrictions on executive compensation. By contrast, the auto industry, especially its workforce, is being put through the wringer.
Second, many of the members of Congress speaking out against the auto industry bailout are from Southern states where Japanese, Korean and European automakers have set up non-union plants with the aid of huge state subsidy packages. These lawmakers are functioning more like foreign agents than legitimate representatives of the United States.
And then there are the Congressional leaders who think they can remake the auto industry by insisting that the Big Three come up with new business plans to merit the federal intervention. Pressuring Detroit to move faster on the development of clean cars may be a good thing, but these would-be industrial policymakers are ignoring the fact that a bailout of the auto industry at this point is justified mainly as a way to prevent an accelerated collapse of the overall economy.
Yet, by pressuring the UAW to give up, for instance, what remains of the jobs bank program (a job security measure that provides nearly full pay for laid off workers), Congress is assuring that more people will end up on the unemployment rolls instead, thus taxing already strained state government budgets. Another of the main givebacks consented to by the UAW were delays in company payments to retiree health plans. This raises the odds that those plans, over which the UAW was previously pressured to assume administrative control, will collapse, forcing participants to turn to taxpayer-funded healthcare.
And these measures, which UAW leaders could implement without a vote of the membership, will apparently be followed by more wage concessions. Just when Congress is desperately trying to stimulate job creation and prop up family income in the larger economy, it is pressing the auto industry to take steps that will have the opposite effect.
The notion that the problems of the U.S. auto industry are the result of overpaid union workers (as opposed to managerial incompetence) is a long-standing myth that has been trotted out time and time again over the past quarter century. What’s amazing is that this fairy tale continues to be employed even after the UAW has made repeated concessions, and basic union wage rates (especially for new hires) are now not significantly different from pay levels at the U.S. operations of companies such as Toyota and Nissan. And what’s even more amazing is that the Democratic leadership of Congress has in effect compelled the UAW to make sacrifices that diminish the difference between union and non-union working conditions almost to the vanishing point.
The Democrats will be congratulating themselves if the auto bailout is approved, but they should be held accountable for making union workers pay so dearly for their survival.
Full disclosure: I am a member of UAW Local 1981, the National Writers Union.