Two-tier wage in UAW-GM contract means drastic pay cuts for US workers

[Slowrider5]

****NOTE: Just posting this for purpose of seeing different perspectives***** The news article comes from a socialist organization.

http://www.wsws.org/articles/2007/oct2007/uaw-o05.shtml

Within four years, up to one third of unionized General Motors workers will be working at half the current pay scale, with sharply reduced medical benefits and without a company-paid pension plan if the tentative contract agreed to by the United Auto Workers union (UAW) is ratified.

Such will be the impact of the two-tier wage structure contained in the contract, according to auto industry analysts cited in press reports this week. This historic reversion toward the type of low-wage, sweatshop conditions that prevailed in the 1930s, prior to the mass industrial struggles that gave birth to the UAW, will rapidly extend to all US manufacturing and lead to the devastation of living standards and working conditions for all American workers.

The UAW leadership is backing this catastrophic attack on its own members as the quid pro quo for GM’s agreement to hand over to the union $30 billion out of $50 billion in healthcare liabilities owed by the company to more than 300,000 retired UAW GM workers and their family members. If the UAW is successful in pushing through similar deals at Ford and Chrysler, it will become a business enterprise controlling a healthcare trust fund, a so-called Voluntary Employee Beneficiary Association (VEBA), worth $70 billion, making the union one of the largest healthcare insurers in the US.

The auto companies will be freed of any obligation to fund the healthcare of union retirees, and the UAW bureaucracy, headed by President Ron Gettelfinger, will seek to secure its own financial future and vastly increase its income by directly imposing cuts on the benefits of UAW retirees, while overseeing the destruction of the wages, jobs and benefits of active and future workers.

This is the essence of the tentative contract currently being voted on by UAW members at GM locals across the country. The contract is the culmination of decades of betrayals carried out by the UAW and the transformation of the union into a right-wing bureaucratic apparatus utterly hostile to the interests of autoworkers and entirely unaccountable to them.

The UAW is an organization not for the defense, even in the most limited sense, of workers’ needs, but rather an instrument of, by and for a privileged upper-middle-class social layer that shares in the exploitation of the workers who are trapped within the union and compelled to pay dues into its coffers.

Gary Chaison, professor of industrial relations at Clark University, summed up the meaning of the GM contract as follows: “It’s going to mark the beginning of the end for the concept of good, high-paying manufacturing jobs...with job security.”

The October 4 Detroit Free Press noted that the lower-tier wage and benefit structure would likely be extended to all GM workers. “In many cases in which organizations have implemented a two-tier wage,” the Free Press wrote, “it is eliminated in the next contract when a workforce replete with lesser-paid workers votes to even the playing field, resulting in one lower wage-and-benefit scale for all, Chaison said.”

[wolverine]

Originally Posted by Slowrider5

****NOTE: Just posting this for purpose of seeing different perspectives***** The news article comes from a socialist organization.

http://www.wsws.org/articles/2007/oct2007/uaw-o05.shtml

Even though I disdain Socialists and much of what they stand for I cannot argue with the bulk of what Slowrider5 has quoted from the article that he has referenced. This "agreement" is, indeed, the beginning of the end of the UAW and all of the hard won gains it has made for it's membership throughout the last sixty-some years.

[throwback]

The article makes sense. However the larger question is does gm have an "obligation" to provide jobs and healthcare for life? If GM maintained the status quo they would end up declaring bankruptcy and the UAW members would be in worse shape. On a side note I have yet see any sucessful socialist country. There have always been priviledged classes in any society that has ever existed. We are humans and looking out for "our own" is hard wired into our DNA, it's called survival.

[1BadPig]

I agree with throwback. Even France appears to be turning away from socialism with the election of Sarkozy.

[W.A.F.U.]

They should have started the article like this......

Within 4 years, 100% of GM unionized workers would be making 0% of the current pay scale because GM went bankrupt. Thankfully, the UAW showed some common sense and made changes to allow it's survival into the future.

Do any of these people that write stories like this even bother to consider that no company can exist when you lose money hand over fist? You can't continue to bleed a company dry that has nothing left to bleed.

[chrisbenz]

Originally Posted by W.A.F.U.

They should have started the article like this......

Within 4 years, 100% of GM unionized workers would be making 0% of the current pay scale because GM went bankrupt. Thankfully, the UAW showed some common sense and made changes to allow it's survival into the future.

Do any of these people that write stories like this even bother to consider that no company can exist when you lose money hand over foot? You can't continue to bleed a company dry that has nothing left to bleed.

I agree with you

[Havasavana]

There seem to be several reasons for GM's situation and the apparent acceptance of UAW members of big give-backs. One is years of poor quality followed by excessive focus on large fuel-hungry vehicles which seem to be in declining demand. But another huge factor is free trade that tilts the field in favor of low-wage and low-currency nations.

The WSJ had an interesting article on Oct. 4 about shifts in public attitudes about free trade. A WSJ/NBC poll indicated that 60% of Republicans believe free trade has been bad for the US. A poll in March of '07 of Democrats found that 54% thought free trade was harmful. A poll in 1999 found that 31% of Republicans thought free trade harmful. The recent stories about tainted imports seemingly have had an effect, the duration of which is unknown.

Free trade damage is not a one way street. Products that are subsidized by whatever means do damage to the countries that buy them. The agricultural sectors of even poor countries have been devastated by cheap US agricultural imports.