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Concessions: First Time Defeat, Second Revival?

[On February 4, 2006, the Socialist Project organized a labor forum in Windsor to get an update on the struggle at Delphi and to consider its implications for Canada.  Speakers at the forum included Dennis Delling, a Delphi worker and activist in mobilizing the resistance against the corporation; Jerry Tucker, former head of New Directions which led the fight against concessions within the UAW in the 80s and 90s; Mike Vince, the President of CAW Local 200 (Ford Engine); and Sam Gindin of the Socialist Project.  Below is an expanded version of Gindin’s comments at the forum.  For background articles on Delphi, check the Socialist Project Bullet at http://www.socialistproject.ca/bullet/index.html and the publication of a UAW rank-and-file group at http://futureoftheunion.com/. — Ed.]

 

In the early 80s, the implications of neoliberalism were quickly revealed as the auto majors reversed four decades of steady growth in wages by successfully forcing concessions on the once powerful UAW.  That working-class defeat had not just continental but global ramifications.  A little over two decades later, when Delphi — the largest parts manufacturer in North America — declared in 2004 that it would reduce workers’ wages by over 60%, it seemed that another even more dramatic round of concessions was about to begin.   But this time, a remarkable resistance emerged from below which, combined with worker scepticism of union-negotiated concessions at GM and Ford (and at Daimler-Chrysler, where workers are expected to be even more critical of concessions), raised a new possibility.  Rather than another defeat, could the push for concessions open the door today to a revival of the American labor movement?

Without mobilization from below, nothing is possible.  Yet, in itself, that is not enough.  As we’ve seen over the past decades, localized struggles come and go and may in the end not add up to much — no matter how heroic and impressive they are — if they are not able to extend their reach.  My comments are about what “extending their reach” might mean.

1. Putting National Health Care on the Agenda

Let me start first with the situation in the US.  The crisis in the US auto industry has many elements, but both GM and Delphi have highlighted one particular dimension that autoworkers must tackle: the contradictions in the privatization of the welfare state, primarily of health care (and secondarily of pensions).1  In the US, unlike every other developed country, no national health care plan emerged, but organized workers were able to negotiate private protection through collective bargaining.  As long as the economy was growing and competitors were marginal, things went relatively smoothly for these particular workers.  But as competitors emerged, the Big Three downsized, and its smaller workforce was carrying not just its own rising health care costs but those of the retirees.  As these costs and other factors led to a fall in the Big Three’s share of the market, there was an increase in the ratio of retirees to actives, and the burden of health care costs got even heavier (incentives to retire early, accepted as a way of limiting layoffs, further exacerbated the problem).

Trying to solve this problem by demanding worker concessions not only is unfair but  just sidesteps the larger issue of the absence of a national health care program.  Workers should be declaring, loudly and clearly: “Don’t talk to us about concessions, talk about National Health Care.”  When the companies are screaming “Crisis!” and putting a national focus on auto and other organized workers, workers shouting out “No to concessions, yes to national health care” will be heard.  They’ll especially touch a nerve when:

  • 47 million Americans don’t have health care (even though half the total health care expenditures in the world are made in the US);
  • all organized workers are increasingly feeling they may soon join the other 28 million Americans who have to buy their own health care (i.e. are not part of company plans of some sort);
  • health care is the number one American concern in national polls, ranking even ahead of the war in Iraq; and
  • even American business is now looking to some form of government intervention to bail them out of what they feel that their companies — and the country as a whole — can no longer afford (the US spends almost 16% of its GDP on health care; if it spent the same proportion that Canada spends, the savings would exceed the total US Defence and Homeland Security budgets!)

The point is that if Delphi, GM, and other autoworkers are able to put national health care on the national agenda by saying no to concessions, the union leadership — which is itself sympathetic to the demand for national health care but has to date not been ready or able to commit to it — will be forced to support the demand.  And if this spreads to other unions that confront the same problem, there is a chance that the labor movement might once again, as it did in the 1930s, be the social movement that really matters.  And in leading such a fight — who knows — the American labor movement might finally have an answer to the riddle of how to revive and renew itself after its decades-long sleep that has affected workers everywhere.

Canadian workers are of course extremely interested in this.  Not only are Canadian autoworkers, negatively affected by the American health care costs because of their integration into US auto production; and not only would a fight for national medicare in the US reinforce our fight in Canada against the erosion of health care; but an American labor movement in motion would, as in the 1930s, create the crucial space for us to intensify our own struggles.

2. Free Trade

For both Canadian and American workers, there is no panacea that will solve all our problems.  But it is clear enough that rejecting free trade is a condition for moving ahead and sustaining any future progress.  Free trade is essentially about the freedom of corporations, and that freedom comes at the expense of the freedom of the rest of us.  It not only allows corporations to unilaterally make decisions that may harm us but increases the power of corporations to pressure workers and governments to conform to their needs.  Rejecting the logic of free trade raises the larger question of power in society: whether we can really have a democratic society if the most important decisions affecting our lives and communities are made by a small minority, not by those affected.  That is, there is a contradiction between saying our society is democratic because we have the right to vote and leaving corporations with the economic power to limit what we can vote for.

In this context, it is important to be focused on who the enemy is.  We must not be diverted into blaming Chinese workers for our problems.  Like us, they are trying to address their needs and the level of struggle amongst Chinese workers has been escalating against both state companies and the multinationals.   In the case of Delphi, for example, investments in China to meet the growing Chinese market are one thing, but moving production from plants in North America and then expecting to export the products back here is quite another.  Delphi can’t be allowed to sacrifices workers’ livelihoods and standards in the name of “free-trade freedom.”

3. Regulation Competition and Excess Capacity

As important as it is to challenge free trade, it is not enough.  Honda, for example, now assembles more vehicles here than it does in Japan — the Japanese companies are not just shipping vehicles here but producing them here.  The problem with this is that every new plant creates excess capacity and leads to the closure of an existing plant.  Consider the recently announced investment by Toyota in Ontario.  Toyota received a $250 million subsidy from the two levels of government, but, at the end of the day, there will be no new jobs as Toyota sales replace other sales (in fact, because Toyota’s domestic content is lower than existing plants’, there will be fewer jobs); there will not be any new tax revenue (in fact, because of the subsidy, there will be less money available for other social programs); and the industry will be less unionized and democratic (as unionized plants are replaced by non-union ones).  Exactly how is this investment a plus?

Of course, if the plant was going into a depressed area or where a previous plant had just closed, that might be another matter.  But that’s the point.  There must be some democratic input into such decisions and they cannot be left to the market.  Raising such issues — bringing up a principle of democratic planning about the level and direction of investment — sounds pretty radical because it questions the right of private investors to do as they please.  And it is radical; we shouldn’t underestimate the kind of opposition we’ll get once we challenge property rights in any way.  But there are some precedents to build on:

  • In the early 70s, A Liberal minority government introduced the “Foreign Investment Review Agency” (FIRA), based on the commonsense notion that foreign investment had to be shown to be “in the national interest” before it was approved.
  • In the 80s, European governments looking to limit the Japanese penetration of their markets learned from the North American experience that trade limits could be circumvented by entering the market directly, so Japanese direct investment was included as part of the overall limit on their market share.
  • In the US, foreign investment has often been limited in the name of national security.  Why can’t worker security also be given such national status?
  • A further example is the successful mobilization against Wal-Mart coming into some local communities.  Though not quite comparable to auto plants (where communities have fought to get plants even though there may be no net advantage from an industrywide perspective), this does point to the possibility of blocking asocial investments through both legal and political means.

4. Work Time

Reduced work time is one way to share jobs in industries with relatively decent-paying jobs.  Overtime is particularly harmful to class solidarity when it occurs while others are laid off or young workers looking for a job see opportunities limited by the unequal distribution of work.  One way of promoting class solidarity is to limit the use of overtime after a layoff until everyone is called back (especially since such layoffs are often a mechanism for downsizing by not brining everyone back even when the market returns).  The CAW‘s policy of work-sharing at Ford, currently affecting Ford Engine workers — some weeks on and some off for the whole workforce as opposed to a few losing their jobs – has been controversial.  But it’s part of building the union; it’s something the younger workers will remember and appreciate, in contrast to seniority layoffs that cost them their jobs.  In the early days of the union at Ford, when the survival of the new union was so tentative and solidarity so crucial, the workweek was contractually lowered to 32 hours before any layoffs occurred.

But there is another dimension of work time that must be revived.  In the early days of the union, limiting the hours of work — regaining control over their own time — was so crucial because workers saw it as a matter of preserving their dignity, having the time to develop as a human being, and having the time to participate as an active member of the community.  Without this dimension of the struggle to limit work time — its link to having the time to learn and be active — it’s hard to believe that we will ever be able to really change our lives.

Conclusion

It’s easy to identify barriers to improving our lives.  The issue is how we develop the collective capacity to overcome those barriers.   This involves making links across plants, across unions, and across the labor and other social movements.  It means educating ourselves, so we fully understand what we are up against and where the openings for resistance might be.  It means learning from every struggle — defeats carry lessons and partial victories must be consolidated — and developing a sense of strategy.  And it means developing a vision that keeps us going and provides some direction as we manoeuvre between immediate and longer-term goals.  At any point in time, the options seem limited.   Expanding those options is what we must also focus on.

It’s this kind of capacity that, in forming the Socialist Project, some of us hoped to build.  Our ultimate goal is to replace capitalism — based on competitiveness, with some controlling the lives and potentials of others — with a society based on the full and mutual development of each of our potentials, where democracy is seen as a way of life, not just a mechanism for choosing who will administer the system.  We see forums such as this one as part of the process of capacity-building, but it will take much more to establish the kind of presence that can really start affecting things.  We urge you to check out our publications and Web site, find out about the activities of the SP in your community, and join us in addressing and debating how we can concretely build the kind of movement we so desperately need.

 

1  While corporations place monies into pension trusts to set aside monies for future pensions, health care — even for retirees — is paid for out of general revenue.


Sam Gindin grew up in Winnipeg, Manitoba and did his graduate work in Madison, Wisconsin. From 1974 to 2000, he was with the Canadian section of the Auto Workers, first as their Research Director and then later as Assistant to the President. He is currently the Packer Chair in Social Justice at York University, housed in political science. This article first appeared in Socialist Project‘s e-bulletin The Bullet.

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