Auto Workers Told to Take Concessions, Abandon Retirees
http://www.truthout.org/123008LA
President George Bush announced December 19 a $17.4 billion bridge
loan for General Motors and Chrysler, a day after it hinted that the
companies could be forced into "orderly" bankruptcy.
Auto workers who advocated for short-term aid to the auto
industry's crisis bristled at the conditions attached to the loan.
The
Bush administration's requirements mirror demands from anti-union
Republicans who torpedoed Congressional action last week. They would
decimate UAW contracts and place retiree health care funds into
company stock.
The plan hinges on a demand that UAW auto worker wages and work
rules become "competitive" with wages and work rules in foreign-
owned,
non-union transplant factories in the South.
Lost in the discussion, auto workers said, is any recognition
that
wages and benefits are less than 10 percent of the cost of a vehicle
and can't pull the Big 3 back to profitability.
"We've already taken concessions to help the industry become
viable," said Brett Talbot-Ward, a UAW Local 1700 member who works at
Chrysler's Sterling Heights Assembly plant. "Why are they asking for
more from us when there are all sorts of other costs in the vehicle
production process, much less the CEO pay, that haven't even factored
into the debate?"
Bush's terms will eliminate the jobs bank, a concession the UAW
signaled it would accept two weeks ago. The program gives laid-off
workers income and sends them into communities to provide public
services. Foreign-owned auto firms have similar programs, and often
use production downtime to train workers.
"The jobs bank was our safety net," Talbot-Ward said. "That in
and
of itself is a huge sacrifice, when we know that there will be a huge
amount of safety needed."
Chrysler announced plans this week to suspend all production for
a
month, two weeks longer than its usual holiday break.
The bridge loan calls for auto retirees to sink half of their
retiree health care fund, the UAW-administered Voluntary Employee
Beneficiary Association, into company stock. Auto workers questioned
the wisdom of putting the remaining VEBA payments into stock, having
watched GM's stock plunge from $29 a share in February to $2.79 by
November.
"It's not worth the paper it's printed on," said Tom Brown, a
member of UAW Local 600 who works at the Ford Dearborn Truck Plant.
"They're going to attack the retirees badly on this one."
The VEBA began as an underfunded vehicle: financial analysts
predicted at its outset that General Motors was only willing or able
to offer less than $35 billion of the estimated $50 billion that it
owes retired workers.
The underfunding could lead to a simple, grim arithmetic: each
dollar shortchanged translates into a dollar that can't be spent on
health care premiums, co-pays, deductibles, or quality of care. Under
a VEBA, the remaining costs of maintaining health care benefits will
have to be shifted back to the workers themselves.
"I don't think the rank and file will go for it - to bring our
wages down, to put our benefits into (company) stock, that'll be too
risky," said Tony Browning, UAW Local 1700 member at Chrysler's
Sterling Heights Assembly.
Browning said that his fellow union members are well aware that
non-union auto workers make similar wages, and predicted that UAW
leaders will have a tough sell convincing workers to take yet another
round of concessions.
Relentless Attacks on Union
The deal proves President George Bush is ready to extract from
auto workers what Republican senators were unable to secure last
week,
when they blocked a $14 billion loan package for the industry over
demands to cut wages and benefits for unionized auto workers and
retirees.
Republicans refused to hand over the loan without promises of
even
more UAW concessions. Republicans, apparently expert enough about
auto
to renegotiate contracts in a matter of hours, blamed the UAW for
refusing to drive down wages to parity with non-union, foreign-owned
auto facilities in the South by next year.
Auto workers, of course, already agreed to similar concessions in
November 2007, when they voted up contracts that put starting wages
lower than those in non-union plants. The major cost difference
between non-union and union auto makers in the U.S. is not wages but
retiree benefits, particularly health care costs. In demanding that
the UAW reduce costs to the auto makers, the Republicans were
insisting that more than a million auto retirees - 40 percent of whom
are not yet eligible for Medicare - put their health care coverage at
risk.
The UAW made a last-ditch effort to save the bridge loan and
placate viciously anti-union Southern senators. That wasn't enough
for
Republicans, who - along with four Democrats - voted down the bill.
"It's part of the right-wing agenda to do away with unions or to
severely cripple any kind of labor struggle in this country," Talbot-
Ward said. "Or maybe it's a little payback for union support of the
Obama campaign."
Fast disappearing is an era when workers on assembly lines can
afford to buy the vehicles they make. When the UAW agreed to a mid-
contract opener in 2005, and a 2007 agreement that lowered new-hire
wages to $14.50 an hour, the union struggled to squeak out approval
from an angry (and increasingly financially unstable) membership.
Blaming the Workers
UAW President Ron Gettelfinger himself later said his decision to
negotiate with a lone Republican senator was a mistake, especially
when the whole pantomime seemed like a warm-up act for Republican
opposition to the card-check bill, the Employee Free Choice Act. But
the administration's insistence on linking the bridge loan to wage
cuts angered auto workers even more.
Jim Theisen, a member of UAW Local 212 who joined the auto worker
caravan to DC, said the caravan brought the message to Capitol Hill
that rank-and-file wages aren't the industry's problem, and that
cutting union wages harms everyone.
"Our Southern brothers and sisters don't get $24 an hour out of
the kindness of the auto owners' hearts," he said. "If there wasn't a
union in the North they'd be getting $10 an hour."
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