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Bill Fletcher on the GM/UAW settlement
Source Dave Anderson
Date 07/10/12/01:59

from ZNet
October 01, 2007

Another take on the GM/UAW settlement
By Bill Fletcher

The GM/United Auto Workers settlement may turn out to be quite historic, but not necessarily in a good or pro-worker way. As former UAW Regional Director and one-time UAW presidential candidate Jerry Tucker noted recently, the shift of health care liability to the UAW by GM could be catastrophic if there is a severe economic downturn.

Yet there are some matters that are not getting much press attention which need addressing. The first issue is the matter of the two-tier wage system. Two tier wage systems, where newer workers start at wage rates and benefits far lower than their predecessors, are not new. During the 1980s when corporate America was placing concession demands on workers-both those in unions and those unorganized-this became a familiar refrain. Allegedly the introduction of a two-tier system provides financial breathing space for distressed employers. Whether it does or does not, it can definitely be said that it stresses out the workers.

It has been demonstrated time and again that two-tier systems have a demoralizing impact on the workforce. In the case of the UAW, the Washington Post notes that some entry level jobs that paid $28/hour will now drop to $14. That is one hell of a drop! The impact on the union cannot be overstated. The new workers, even if they are now making more than they previously did, will see themselves as having been sacrificed by the longer-term workers, which also means sacrificed by the union.

The other piece of this overall puzzle, however, has to do with how the UAW got itself into a situation like this. In considering this critical situation, there are some who might conclude that this turn of events was somehow sudden and unexpected. That is not the case. There are at least three sources of this problem. The first has to do with the failure of the US to enact universal healthcare. It is noteworthy that GM's costs in Canada are lower precisely because Canada has national healthcare. A reasonable person would wonder, then, why GM does not push for national healthcare in the USA? There are probably many reasons, but one for certain is that it is far easier to place the burden of healthcare on the backs of workers and their unions, rather than joining in a national campaign to shift the way that healthcare operates in the USA. While the UAW has had plenty of good rhetoric to offer regarding national healthcare, there is little that they have done in practice over the years to advance the growing demand for universal coverage. Thus, the UAW is now handed what may quite literally be a bill of goods.

There is another side to the healthcare issue. The GM/UAW settlement may very well set a pattern for other companies. The result could be a further distraction away from the need for universal healthcare in favor of a proliferation of Voluntary Employee Beneficiary Associations. This is ironic coming at a point when renewed calls AND energy have surfaced in favor of universal healthcare. The proposed GM/UAW healthcare exploratory committee, allegedly to be established to consider alternative national healthcare options, cannot be taken seriously. With the healthcare insurance liability off the books of GM, what incentive do they now have to explore genuine solutions to the national healthcare crisis?

A second piece of the puzzle has to do with the ideological orientation of the UAW going back at least to the early 1980s. The notion of "jointness" which emerged in the early 1980s in the midst of the automobile manufacturing crisis (ignited by the Chrysler near collapse) brought with it the idea that the principal role of the union was not to defend the interests of the members (let along the larger working class) but to promote the competitiveness of the particular company. Supposedly enhancing competitiveness would enhance the job futures of the members. Yet, few of the UAW leaders stopped to consider-or at least discuss-who was competing against whom, and toward what end? Thus, in the name of quality and competitiveness, auto manufacturing plant was played against auto manufacturing plant, sometimes in the same company. Rather than promoting solidarity, this promoted something akin to the narrow Japanese enterprise unionism…at best. There is only a short distance between embracing the mission and expansion of the corporation as the manner of protecting the interests of one's members and taking on the company's healthcare liability in order to promote the competitiveness of the company.

Third, one must add that the UAW's failure to construct an effective organizing strategy lies at the heart of the union's dilemmas. Contrary to those who believe that all manufacturing is disappearing overseas, in the case of the auto industry it is quite the opposite. Automobile manufacturing is coming to the USA FROM overseas. Toyota, Volkswagen and others have moved to the USA-they are called transplants-in search of cheaper labor, believe it or not, which is what they usually find in the so-called right to work (non-union) South and in rural parts of the USA.

While the UAW embraced the language of organizing the unorganized, and admittedly attempted some small-scale organizing, the resources of the union were never fully committed to the sort of venture that needed to unfold. In addition to organizing non-union facilities, there has been a critical need to organize the increasing numbers of non-union parts facilities, plants often staffed with immigrant labor working under abysmal conditions. Yet, that is not where the UAW chose to put resources. Instead, the focus was on those currently unionized, even as their numbers decreased and the waters of the non-union auto and auto-parts industries rose steadily towards their heads.

It is in such a situation that the choices of the UAW leadership are not particularly surprising, though nevertheless quite problematic. Letting the Big Three off the hook with regard to universal healthcare; permitting the further growth of two-tier systems; and an anemic organizing program to reach non-union transplant facilities and parts manufacturers, has added up to an industrial purgatory for the union.

The UAW not only needs a new type of leadership, but in some ways more importantly, it must convince its existing membership that a new type of unionism is needed for the 21st century. No, this is not a call for further so-called partnerships with employers, but actually a call for a return to militant organizing and struggle that embraces the demands and needs of workers irrespective of whether they happen to currently be in a union. The alternative? Well, actually in this case, there really is not one since the demise of a labor movement cannot be an option.


Bill Fletcher, Jr. is a co-founder of the Center for Labor Renewal ( and the immediate past president of TransAfrica Forum. He can be reached at

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