UAW Tops Enforce Obama’s Raw Deal

Wall Street, Washington Shaft Auto Workers

JUNE 2—Global auto giant General Motors, for decades one of the pillars of American capitalism, yesterday followed Chrysler into Chapter 11 bankruptcy under the guiding hand of President Barack Obama’s Wall Street cronies in his “auto task force.” The plunge in sales brought on by a global economy going to hell left the automakers scrambling for federal aid to stave off financial ruin. From the outset, we have opposed the bailout of the auto bosses, underlining that it “will be purchased through the further destruction of the jobs and livelihoods of working people” (“Bosses Declare War on UAW Workers,” WV No. 926, 5 December 2008). This is precisely what’s on order with the GM and Chrysler bankruptcies—to reshape the industry to again make it a lucrative source of profits for Wall Street by breaking the back of the United Auto Workers (UAW) union.

Obama, whose election was bankrolled to the tune of $5 million by the sellouts who head the UAW, celebrated “the beginning of a new G.M.” But for tens of thousands of auto workers it is the end of the line. Under the “bailout” deal, GM and Chrysler have announced that they will shut down 20 to 28 plants. The UAW, which was once the symbol of union power in the U.S., will be a shadow of its former self. The UAW’s membership has already withered from a high of 1.6 million in the 1960s to less than 500,000 today, with a scant 140,000 working for the Big Three (GM, Ford and Chrysler). In the 1970s, GM alone employed nearly 400,000 workers. With the plant closings the workforce will be reduced to fewer than 40,000. The gutting of the UAW is a heavy blow against all workers, organized and unorganized.

The UAW misleaders are helping to foot the bill for “restructuring” the automakers—at the cost of tens of thousands of jobs—by accepting worthless stock in GM and Chrysler to fund over half the union’s retiree health care trust (itself a sellout brokered in the 2007 contract to save the company $3 billion a year in health care costs). The head of the “New GM” boasted that this was a “defining moment” that would, as the New York Times (2 June) noted, allow the company “to ‘permanently’ unshackle itself from the cost of supporting hundreds of thousands of retirees.” Those “lucky” enough to keep their jobs will be shackled by a “no strike” pledge for the next six years while the auto bosses continue to hack away at their wages and benefits to bring them into line with labor costs at non-union auto plants.

Here is the bitter fruit of the trade-union bureaucracy’s program of class collaboration, which has long tied the interests of the unions to the profitability of their capitalist exploiters. “I’m very comfortable,” UAW head Ron Gettelfinger told National Public Radio on May 1, the day after Chrysler entered Chapter 11. “It’s not like we’re going into this bankruptcy fighting with Chrysler and [merger partner] Fiat and the U.S. Treasury. We’re going in there in lockstep to put our agreements in place.”

Gettelfinger’s agreements make the union joint stockholders in bankrupt GM and Chrysler. An article in the New York Times (2 June) titled “G.M.’s New Owners, U.S. and Labor, Adjust to Roles,” pointed to “industry experts” who “predict that the union, far more than before, will help management increase profitability—with the goal of pushing up the automakers’ stock prices.” In other words, as a “co-owner” the UAW will directly have a hand in ratcheting up the rate of exploitation of its own remaining members.

The attacks on the UAW highlight the attacks on all workers, in the U.S. and internationally, amid the world economic crisis. The auto industry’s devastation is a stark example of the anarchy and decay of capitalist production for profit to which there is no simple trade-union solution. But one thing is clear. If the unions are to fight not only in their own interests, but in the interests of the mass of unorganized workers and the unemployed, there must be a new leadership of labor, one armed with a program of class struggle. This is an integral part of the fight to forge a revolutionary workers party that champions the cause of black people, immigrants and all the impoverished masses brutally ground down under the heel of America’s capitalist rulers. As we wrote in “Auto Bailout Means Union Busting” (WV No. 931, 27 February):

“The fight for jobs is equivalent to the fight against the devastation of America’s working people. What is necessary is a massive program of public works at union wages to rebuild the dams, bridges and roads that are in an advanced stage of decay; to tear down and replace the crumbling public schools in the nation’s inner cities; to create an America that looks like a place that its inhabitants could survive in. It is necessary to call an end to the layoffs by shortening the workweek at no loss in pay, as part of the struggle for jobs for all.

“All must have full access to medical care at no cost and unemployment benefits must be extended until there are jobs, with all pensions completely guaranteed by the government. Such demands, the elements of which were laid out in the 1938 Transitional Program, the founding document of the Trotskyist Fourth International, will not be granted by the rapacious capitalist rulers. The capitalist state exists to defend the rule and profits of the bourgeoisie. It cannot be reformed or wielded to serve the interests of working people. The catastrophe of joblessness, threatening the disintegration of the working class, can be effectively fought only by a workers movement led by those committed to the struggle for socialist revolution and the establishment of a workers government where those who labor rule.”

Capitalism’s Labor Lieutenants

In return for allowing the automakers to cut in half the billions owed the health benefit program, the UAW will get 55 percent of the equity in the “New Chrysler”—and one seat on the board—and up to 20 percent in “New GM” once the companies emerge from bankruptcy. But what’s 55 percent of nothing? Until the private equity firm Cerberus bought Chrysler in 2007, the UAW head had sat on the board for almost 30 years. Chrysler first offered the UAW tops a seat when it was threatening bankruptcy in 1979, all the better for UAW chief Doug Fraser to help shove concessions and plant closings down the workers’ throats. Now, the UAW rep on the Chrysler board is obligated to vote “in accordance with the direction of the independent directors.”

Round after round of concessions from the labor traitors have greatly undermined union organizing, as workers rightly expect something to show for being members of a union. In 1982, GM closed its assembly plant in Fremont, California—a relatively new facility built in 1968—dispersing the heavily black workforce. The company reopened the plant as a joint venture with Toyota, with no union. After cutting a “sweetheart” deal with the automakers in 1985, the UAW got back into the plant. Now one Fremont UAW worker told WV that workers increasingly don’t see the benefit of the union. The very survival of the unions demands a struggle against the class collaborationism of the labor bureaucracy.

For Gettelfinger & Co., the overriding concern is not the livelihood of the UAW membership but the “competitiveness” of U.S. automakers. In testimony before Congress last year, the UAW chief went so far as to boast that “the gap in labor costs” between the Big Three and the non-union “foreign transplant operations will be largely or completely eliminated by the end of the [2007] contracts.” This is what the union misleaders’ poisonous “America First” protectionism means: railing against “outsourcing” of jobs abroad while not lifting a finger to organize the mass of unorganized auto workers in “foreign transplant operations” in the American South and elsewhere.

In an e-mail to UAW members at GM, the UAW bureaucracy called on Obama to “maintain the maximum number of jobs in the U.S. instead of outsourcing more production to foreign countries.” Such protectionism undermines struggle by poisoning workers’ class consciousness and solidarity, scapegoating foreign workers for the loss of jobs in the U.S. while reinforcing support to the American capitalist order.

The UAW bureaucracy has long been a leading force tying the working class to the capitalist rulers through support to the capitalist Democratic Party. A New York Times article (30 April) quoted Walter Reuther, who became UAW head in 1946, saying, “We have to fight both in the economic and political fields, because what you win on the picket lines, they take away in Washington if you don’t fight on that front.” For the social-democratic Reuther and his UAW successors, the Washington “front” has always meant subordinating the union to the Democrats. In service to this class-collaborationist alliance, the union tops have all but given up the class-struggle methods that built the unions in the first place.

The only way the labor movement can be revitalized is by returning to the road of class struggle. Immediately posed is the fight to organize the mass of unorganized workers, particularly in the “right to work” South. This will require actively combating black oppression, long used by the capitalists to divide and weaken labor as a whole. Against the government’s anti-immigrant raids, which have derailed one organizing campaign after another, the union movement must fight for full citizenship rights for all immigrants. Key to all such battles is the fight for the political independence of the workers from the capitalists and their government and political parties. Break with the Democrats! For a revolutionary workers party!

Reformist Nationalization Schemes

Having joined the labor bureaucrats in hailing Obama’s election, the reformist “socialists” now “hope” that he’ll bail out working people. Socialist Worker (6 April), newspaper of the International Socialist Organization (ISO), baldly stated: “Instead of using its billions to help auto executives push through attacks on workers or to create small surges in demand, the Obama administration could use its leverage as the auto industry’s creditor of last resort to implement a comprehensive plan that includes taking over the auto industry.” Obama is “taking over the auto industry” precisely to “push through attacks on workers.” The Obama administration is littered with Wall Street financiers—from Treasury Secretary Timothy Geithner to National Economic Council head Larry Summers—whose program is trillions for the capitalists and sacrifice by the workers.

Appealing to this bankers’ cabal to nationalize the auto industry, the ISO wrote in International Socialist Review (May-June 2009): “Nationalization of industries under threat of bankruptcy has historically been a demand of the socialist movement as a means to save jobs and ensure the provision of needed services.” The ISO would be more honest if it said that this has historically been a demand of social democrats who seek to tinker with and administer the capitalist state. Such nationalizations amount to nothing more than giving failing enterprises a new lease on life. The nationalization of the losers of capitalist competition has nothing in common with the socialist expropriation of the means of production by a workers government. Taking over and subsidizing bankrupt firms to “save jobs” was for many years a standard practice of British Labour Party governments by which they sought to promote the interests of British imperialism.

As our comrades in the Spartacist League/Britain observed in “New Labour Fleeces Working People” (Workers Hammer No. 205, Winter 2008-09): “In the context of British imperialism’s loss of hegemonic power, the nationalisations of coal, steel and other industries by the [post-World War II] Clement Attlee Labour government were in reality giant capitalist bailouts designed to help British capitalism to compete in the world market.” In competition with more efficient private firms, nationalized enterprises require massive subsidies financed by immiserating the working class through, for example, high taxation.

Polemicizing against reformist “socialists” who put forward nationalization schemes to rescue failing capitalist enterprises, Bolshevik leader Leon Trotsky declared:

“We can say to the miner, you wish nationalization. Yes, it is our slogan. It is only a question of conditions. If the national property is too burdened with debts against the former owners, your conditions can become worse than now. To base the whole proceedings upon a free agreement between the owners and the state signifies ruin of the workers. Now you must organize your own government in the state and expropriate them.”

—“Conversation on the Slogan ‘Workers and Farmers Government’,” Writings of Leon Trotsky, 1938-39

The program of the labor bureaucracy and its reformist tails—defined by what is “practical” under capitalism—has led to disaster for the working class. We Marxists put forward the revolutionary strategy offered by the Transitional Program, where Trotsky declared: “The question is one of guarding the proletariat from decay, demoralization, and ruin…. If capitalism is incapable of satisfying the demands inevitably arising from the calamities generated by itself, then let it perish.” The burning necessity is for a proletarian revolution to rip the productive wealth of society out of the hands of the greedy capitalist rulers and build a collectivized, planned economy where production is based on social need, not profit.