Wednesday, September 26, 2007


OK, I realize those are harsh words, but I can’t help feeling real sadness today as I read reports of what the UAW agreed to in its settlement with GM. As I am sure you have all heard already, the strike was ended today (after just two days), with the announcement by Gettelfinger that a tentative agreement had been reached. The exact details of the agreement won’t be known till at least late this week, when the members vote to ratify (or not) the contract.

You can listen to audio of Gettelfinger’s announcement here…

Now I am not saying we should relish the idea of a long strike. Strikes are always much harder on the individual worker than they are on their corporate bosses. No one wants a long drawn out strike that leads to workers losing their homes, pulling kids out of college, sinking deeper into debt, etc., etc., etc. Let me say right of the bat, even though I have been a labor activist for 15 years, I have never myself had to endure the pain of a strike. But I have seen what it can do to working families who are forced to endure them. And I have suffered through my own bouts of unemployment. I know what it is like to eat Ramen noodles for breakfast, lunch and dinner for days on end. I know what it is like to live with cold showers and cold food because the gas was cut off when I couldn’t pay the bill. I know what it is like to move out of an apartment and into small room in someone else’s home, because that is all I could afford. Hell, with my current meager income and mountain of debt, I am still only one or two paychecks away from disaster. I have no desire to see other workers in the same situation. But from what we know so far about the deal struck between the UAW leadership & GM, it seems hardly even worth the two days pay the members gave up.

Again, the full details of the agreement are yet to be revealed, but most reports are pretty consistent. The best article I have read so far, detailing the wins and losses for the UAW & GM can be found here…

Here is a summary of the situation…

Loses for the UAW & it’s Members:
1. Acceptance of an under funded VEBA (Voluntary Employee Beneficiary Association) for retiree health care.

2. A two-tier wage structure where new workers receive lower wages.

3. Lower wages for "non-core" jobs.

4. No actually wage increases for current workers.

Gains for the UAW & it’s Members:
1. Some 6-7,000 temporary workers will be made permanent (but will fall into the lower wage, new worker category).

2. Lump sum payments equaling around $4-5,000 (or bribes as some have called them).

3. Vague promises of job security for the current workforce.

VEBA (Vandalizing Employee Benefits Again):
I confess. That line is stolen from the Soldiers of Solidarity (SOS) website. But I think it sums up the situation pretty well. Gettelfinger is upholding the VEBA agreement as a victory. Some analysts are arguing that some retiree health care funds under union control is better than no retiree health care funds if GM eventually goes bankrupt. But the truth of the matter is the UAW has accepted an under funded retiree health care package that will be a boon for GM and its investors, but might very well spell disaster for retirees in the future. GM has been let of the hook, and the union has taken on a tremendous burden. Increased co-pays and benefit reductions are a practical financial certainty. As Greg Shotwell of SOS points out, at least there are legal and contractual obligations with the retirees and GM under the current arrangement. It is a very dangerous gamble, with market forces, and talents and trustworthiness of UAW money managers playing a huge role in the success or failure of the plan. And if it fails, the workers will have the UAW to blame, and not GM. As former UAW executive board member Jerry Tucker suggested in his interview with Building Bridges in May, at least the UAW could have demanded that GM agree to use its political muscle and financial resources to push for universal health care legislation.

Two-Tier Wage Structure – Selling Out the Next Generation:
The death knell of worker solidarity, there is nothing worse than two tier wage structures. No union can accept such conditions and remain health. New workers will inevitable feel stabbed in the back. The inequality will be felt on the shop floor. And future retirees will have less credibility when they look to the future workforce to defend their pensions and benefits.

Of course, many will say GM’s workers can’t ask for more from a company with such a bleak financial outlook. They will argue that Gettelfinger and the UAW leadership have gotten the best deal they can without jeopardizing the future of the U.S. auto industry. But I’m sorry, that is really just a load of B.S.! The bastards running GM aren’t going to arrest the race the bottom because of the goodwill of the UAW bosses. To whatever extent they can, and at every opportunity, they will keep outsourcing jobs to labor markets where workers are as close to slavery as our diminished governmental institutions will allow. They will take this round of concessions the same way they have taken every other concessionary contract in the past – as a sign of the weakness of the U.S. labor movement.

This country is in such desperate need of a real working class victory. After decades of being beaten down by declining real wages and benefits cuts – longer work days and less control over conditions of work– de-industrialization and corporate globalization – the U.S. working class is demoralized, degraded and disempowered. We need a break, a turning point, a line in the sand. We need a battle of Gettysburg & Vicksburg, of Midway & Stalingrad, in the class war that we are so badly losing right now. We need the UAW of the 1930’s sit-down strikes which checked the power of capital for decades. Or at least the UAW of the 1960’s with it’s commitment to social movements and civil rights. Instead what we got is the UAW of the 80’s and the 90’s, and one more in a long line of concessionary contracts. One more nail in the coffin of the U.S. industrial working class.

OK, my hyperbole is exhausted. UAW rank & file, it is up to you now to turn defeat into victory - VOTE NO!


  1. This is great commentary - it is really great to hear labor news on the mainsteam national press and then get the real story with you, Jerry!

    Keep up this analysis (like you wouldn't if I didn't say that).

  2. Remember that Toyota is non-unionized. That should tell you something about the way things are going.

    Remember also that unions have historically voted to have new workers paid less than the older workers.

    And guess who the new workers are?

  3. Who are the new workers?

    Please tell more about this point.

  4. Good analysis.

    In other words, the union appears to be giving up its bargaining rights when it comes to setting future health benefit levels. If it turns out that the VEBA isn't covering workers and retirees adequately, what is the union to do? It can't address matters like co-pays, deductibles, coverage exclusions, caps and benefit limitations in future contract negotiations, because GM no longer is responsible for these matters.

  5. As a former steelworker I would like to point out that an lot of steelworker retirees lost all their health insurance when their companies went bankrupt. If there is any chance of GM going bankrupt, the VEBA gives the retirees something rather than nothing.

  6. Response to anonymous 1: Yes, of course the UAWs greatest failing in recent years was (is) its in-ability or unwillingness to organize workers at the "foriegn" automakers in the U.S. Toyota, Honda, and the others make plenty of cars in the U.S., but all non-union. It is not just "foriegn" workers who are undercutting our union brothers & sisters. Actually its is non-union Toyota workers undercutting Japanese & American union workers. I disagree however that two-tier wage structures have been supported by unions historically. Too many unions have excepted them in recent concessionary bargaining however.

    Response to anonymous 2: I think anonymous 1 is refering to the fact that the new workers are more likely to be people of color and immigrants, and he has a good point here. Just another way two-tier wage structures encourage division amoung workers - generationally, racially, by immigration status, by gender, etc., etc., etc.

    Response to James: Thank you for you comment and quoting me on your blog. You have a great blog and I look forward to reading more.

    Response to anonymous 3 (Steelworker): Yes, your right, both options have their risks. I hope you are right and Gettelfinger bet on the right horse (though that means I guess GM will be gone, and all its jobs with it sometime in the future - it is kind of like betting on lossing your own race). But every UAW activist I respect (SOS, Jerry Tucker, and many more) see the VEBA as a mistake.

  7. Thanks for this, Jerry. I'm just catching up on the news on this. I also scanned David Moberg's article.

    Unfortunately, Chicago JWJ does not have a regular UAW representative in our coalition so we haven't gotten news or perspective more directly.

    By the way, I've started posting more at