The UAW Contract’s Downhill Spiral

Ron Lare & Judy Wraight

ON SEPTEMBER 19, 2003, the New York Times said the United Auto Workers (UAW) had concluded negotiations, “granting its most significant concessions in two decades.” Of the many concessions — including those implicitly “in progress” — in the Big 3 auto contracts, we’ll focus primarily on health care.

We will focus on two aspects of the contract struggle and their political implications. These are, first, health care as one example of the UAW’s qualitative leap backward in agreeing to concessions; second, the role of U.S. nationalism in the bureaucracy’s ratification campaign.

We use some examples from our experience as 25-year activists in UAW Local 600, Ford Rouge Plant, and from the 2003 contract struggle in the local.

What They Delivered

“Contract delivers on health care …” began the headline in the contract “Highlights” from the UAW. Highlights are all that members are given before they vote.

“Traditional UAW health plan to die under pact” read a Detroit Free Press headline days after ratification. Angry workers posted this article in the plants. The president of our Ford Rouge Plant Tool & Die Unit sent a worried letter to Solidarity House. But even if workers had the entire contract before voting, they could have read only an outline of the health care changes.

The UAW bureaucracy postpones its biggest contract concessions by referring them to union-company committees for later action. This provides deniability at ratification time. The company tried this out in the 1999 contract, implemented co-pay concessions mid-contract, didn’t get enough flack for it, and is now going for more.

It’s not just health care that got this treatment. The national contract ratified, in advance, whatever comes of later negotiations over reduced new-hire pay at Ford and GM spinoffs Visteon and Delphi. The estimates are that this will mean close to $10 an hour less for new hires.

This also makes ambiguous the relationship between the settlements at GM, Ford and DaimlerChrysler on one hand, and on the other those at Delphi and Visteon, even though all five contracts were negotiated together. And all the contracts lay the basis for combining job descriptions within and across both production and skilled trades classifications.

For example, two weeks ago, to the surprise of members at the Rouge Diversified Manufacturing (formerly “Frame”) Plant represented by our UAW Local 600, several production classifications were combined into “Production Floor Associates.”

Labor Notes estimated the attrition replacement formula in the 1999 contracts would cut UAW Big 3 jobs by 17%. But management hasn’t even stuck to that formula.

Ford agreed to continue jobs “owed” into the 2003 contract because they won’t fulfill either contract’s requirements — as the companies assured Wall Street after the new agreements were signed. The Rouge Tool & Die Unit is still waiting on the National Ford Department’s promise to arbitrate grievances over unfilled positions from 1999 requirements.

The national contract referred to a “blueprint” for saving the Rouge Tool & Die Building from closing. Workers voted nationwide without seeing that blueprint. Even Tool & Die members didn’t see it.

Subsequently, Tool & Die members were told Ford and Solidarity House would impose their plan if workers didn’t ratify a Unit concessions contract. That passed 264-231 — with more details yet to come.

Cutting Costs, Choice and Quality

The Traditional Blue Cross plan is the current choice of 307,000 of 522,000 auto workers and retirees. Among retirees, 72% choose it. The 2003 contracts will replace Blue Traditional with a Preferred Provider Organization (PPO) plan that forces workers to choose doctors from a panel or pay more out of pocket.

How seriously do auto workers take tampering with health care? Even GM white-collar retirees picketed the 2003 Detroit Auto Show to protest cuts, but the UAW bureaucracy wouldn’t embarrass the company at the Auto Show.

Earlier this year, GE workers struck against health care concessions. But there hasn’t been a national Ford strike since 1976.

At first the benefits provided by the PPO will probably match Blue Cross Traditional. But once the Blue Cross Traditional right to choose doctors without increasing co-pays is dead, other changes can be made.

The company got medical costs excluded from the Consumer Price Index (CPI) used to calculate auto workers’ cost of living (COLA) payments. The rationale is that auto workers with company-paid medical don’t need medical inflation protection. But this very move suggests the company expects health care costs to rise rapidly.

Rising medical costs for uncovered extended-family members affect auto workers’ finances. And this “health care costs don’t count” argument comes with a contract increasing co-pays! For now there’s a cap on some co-pays. But that’s easier to change in the future than the exclusion of health care from the new “auto worker CPI.”

Meanwhile, the rate at which COLA pays off for changes in the remaining CPI was given a substantial (overdue) boost: “A spoonful of sugar helps the medicine go down.”

The contracts were voted up by large margins – 86% at Ford, highest among the Big 3. A few locals voted down the national contracts, for example at shop-floor newsletter campaigner Gregg Shotwell’s Delphi plant near Grand Rapids.

The fight will continue on the shop floor — and may be centered at Delphi and Visteon, as older workers with Big 3 rights are pressured to retire or transfer to the parent company, and younger workers suffer as Big 3 workers did before the UAW won its historic gains. UAW Solidarity Coalition reformers have opportunities.

International Whipsawing

Internationally the auto scene is inspiring. Belgian and Brazilian Ford workers recently struck against job losses and made gains. Volkswagen flew Brazilian CUT union officers to Germany to threaten them with the consequences of a strike. But they struck anyway. The UAW needs to be part of the international action. New rounds of international whipsawing require a response.

Meanwhile, U.S. media, auto companies and UAW bureaucracy “foreign bashed” in unison to get the 2003 contracts passed. An enormous Detroit Free Press headline crowed: “PACTS HELP CARMAKERS FIGHT FOREIGN RIVALS.” Next to a Vote No leaflet, someone posted statistics on U.S. manufacturing job loss and scrawled across them: “NO JAP CRAP.”

This reaction is promoted by our local leadership and the UAW bureaucracy overall. Rouge Steel, once owned by Ford, is in our local. Local officers wrote that workers’ problems are “caused by the actions of foreign governments.” This poisons campaigns against NAFTA and FTAA. U.S. capitalism gets off the hook.

After ratification, our local president said the contract showed “we” could compete with the “transplants,” Japanese and German U.S. plants with younger workers, little to pay in pensions, few job classifications, and no unions. But concessions will not convince transplant workers to reverse previous votes against UAW representation, for example at Nissan in Tennessee.

Meanwhile, the bureaucracy hopes to organize the many U.S. parts suppliers. (The UAW bureaucracy has permitted more auto jobs to be outsourced to non-union plants inside the United States than remain at the Big 3. They talk about the few that went overseas, not the many outsourced right here.)

The UAW tops hope that U.S. parts supplier bosses will see that labor peace can be bought at bargain prices if they stay in this country and let the union in.

UAW Vice President for Organizing Bob King was a president of our local. He is active against the School of the Americas, Coca Cola’s role in murdering Colombian unionists and the invasion of Iraq. And he actually discusses UAW policy when others just bring down the hammer.

But the August 27, 2003 Detroit Free Press reports:

“In an August 13 conference call with investors and Wall Street analysts, UAW Vice President Bob King said the union is trying to build a reputation for adding value to organizations where its members work. “If we want to keep manufacturing jobs in the United States, which is a major objective of the UAW, then we can’t be fighting management where we represent members,” he said. “If we have an adversarial relationship, then we’ll see more work go overseas.”

Even if Brother King were misquoted, this statement summarizes UAW policy in action. But if the UAW “can’t be fighting management where we represent members,” where and when can it fight? No culture of struggle means workers won’t want the union — so management won’t have to take it.

UAW Vice President Dwight Gooden boasted during negotiations that the DaimlerChrysler-Mercedes plant in Alabama would soon be a UAW shop because the company agreed to card check recognition. But the company denied there was an agreement.

Reform Movement Debate

Some UAW reformers say the union is now utterly corrupt and we shouldn’t even ask workers to join the UAW. These sincere reformers — and often brilliant activists<197>have seen the bureaucracy give up what workers have won, abandon striking UAW Local 2036 members, eliminate a UAW Region to punish a dissident, etc.

We disagree. The most important problem isn’t the bureaucracy’s greed. Workers are ready to reject that. The biggest problem is the bureaucracy’s ability to convince many workers of a wrong interpretation of workers’ interests in the international context.

Workers do not have the political leadership they need. Many see the headline about the contracts’ helping to defeat foreign rivals. They join the company and the bureaucracy in cheering — or say sadly, “Yes, it’s unfortunate but necessary.”

Reformers need to replace the bureaucracy with a fighting UAW leadership, with strong emphasis on international labor solidarity.

The bureaucracy argues that the reformers are wrong because international competition means the union democracy and militance of the 1930s would no longer work for U.S. workers. The bureaucracy says this for corrupt reasons, but the reform movement still needs a progressive modern response saying what is needed beyond militance and democracy.

The bureaucracy has been moving further in the wrong direction since abandoning the Reuther brothers’ anti-protectionism of the 1970s. To be sure, the Reuthers were anti-protectionist when the U.S. auto industry dominated the world. They also made contract concessions, gave up control on the shop floor, backed Democrats and up to 1968, supported the Vietnam war.

But while the Reuthers were red-baiters, some internationalism made at least pragmatic sense to them. The current UAW President Ron Gettelfinger represents the further triumph of neoliberalism over the old social-democratic thinking at Solidarity House.

What We Need to Do

The two newspaper headlines, “Traditional UAW health plan to die under pact” and “Pacts Help Carmakers Fight Foreign Rivals,” symbolize two newly difficult and newly important tasks for socialists in the UAW and the labor movement.

First, the capitalists as a whole will have to pay for workers to get anywhere on health care. For national health care to work, government — the “single payer” — has to take over the health care industry. Only socialists are going to argue for that consistently and understand the importance of bringing the issue up strongly in the unions.

Workers know the union bureaucracy is half right when they say that the answer is political. But we’re not going even to preserve auto workers’ health care without an alternative to the bureaucracy’s Democrats.

Second, the UAW and the U.S. labor movement as a whole cannot break new or even retain old ground simply by returning within U.S. borders to the militance and union democracy of decades past, as important as that is.

Coordinated international labor solidarity, including joint contract expirations and strikes, are required in the face of globalization. Most Big 3 operations worldwide are unionized, so outreach is possible. For that, U.S. unions would have to deal not only with unions abroad, but<197>given these unions’ structures and relationships — with radical political parties abroad. Unions are unlikely to do this while tied to the Democratic Party.

We need to fight day-to-day on the shop floor. That fightback opens the door to broader answers. But the shop floor and the national and international political tasks are connected. Unless reformers act on this reality, they will continue to be demoralized, dispersed into competing factions, and lose.

Socialists need to provide more political leadership in the reform movement. We need to argue for linking the unions to new internationalist opportunities, from the global justice or “anti-globalization” movement to U.S. Labor Against the War.

ATC 108, January-February 2004