Defend the auto workers world class wages

April 22, 2009

It is easy to get sucked into the mainstream ideology around the issue of bailing out the Big Three auto companies. The race-to-the-bottom ideology lends itself to jealousy over the success of some workers to get high wages. But why should workers not get as much as they can bargain for – especially when their bosses get obscene “compensation” even when they bring their companies to the brink of destruction?

And why should we abandon these workers and their wages just because the CEOs and the extreme right politicians in the current federal government say so? Workers didn’t cause the economic collapse or the subsequent crash in auto sales and they should not be singled out for special punishment.

This is, as the CAW’s Jim Stanford says, an effort “… to exploit the wedge, in an anti-union political culture, between workers who've managed to win a little more - and those who have yet to do so.”

Why defend these high wages and benefits? Because they are the model of what all workers should aim to get. Get rid of that model and there is less to shoot for. For the past 20 years capital (corps and their shareholders) has received virtually all the benefits of increased wealth and productivity. The net increase in the real median wage (in constant dollars) from 1980 to 2005 was $51. Yet GDP per capita more than doubled in that period. It doesn’t take a genius to figure who got the money.

Write a letter to your local paper (remember, the email addresses for letters pages are on the Council of Canadians web site: www.canadians.org - go to “Publications” then to “Word warriors”)

Read Jim Stanford’s excellent G&M article to get a reality check on auto workers’ wages and their relationship to saving the companies.

FRAMING: We need to reframe the issue as one of the maniacally free market govt of Stephen Harper colluding with global capital to crush one of the most successful unions in the world. We would not put up with this union busting in any other context - why now? 

[Most of the following facts/arguments have been taken from Jim’s article.]  Pick 2 or 3 to craft a short, pointed letter.

• Canadians should not be fooled into believing that slashing auto worker’s wages and benefits will “save” the industry. This is just another example of Naomi Klein’s “shock doctrine” - using a crisis to achieve a political end - this time, the destruction of a strong voice for workers/employees.
• Wages make up a relatively small part of the cost of an auto in North America - about 7%,  less than the cost of capital, materials, and the money that goes to dealers. Reducing that by 20% (to 6% of the total cost) will not save the companies. Only selling more cars will do that. (Acc to Jim Stanford, CAW economist – JS in the G&M)
• The auto industry is in trouble everywhere but nowhere else are governments and companies slashing the wages and benefits of auto workers - not in Germany or Japan (where they earn more), not in Brazil or Korea.
• All this means is that if and when the companies get back on their feet, decades of  workers’ progress in getting their fair share of the wealth will be lost.
• In these days of outrageous CEO “compensation” - bonuses for failing and millions for inept management - salary and wage earners, who actually work for a living and produce stuff, should stick together. If auto workers are forced to take big cuts, it will open the floodgates for other employers threatening their employees with closures.
• This attack on the CAW will be just the beginning.
• Due largely to pro-business policies of governments, the net increase in the median Canadian wage (in constant dollars) from 1980 to 2005 was $51. Yet GDP per capita (total wealth divided by total population) more than doubled in that period. It doesn’t take a genius to figure who got the money. Does the government want to punish the auto worker for resisting this assault on our standard of living?
• Fiat’s CEO “demands” a 20 % cut in Chrysler workers’ pay yet when he restructured Fiat successfully he did not so such thing: he thinned out fat management ranks, developed popular, low priced products and boosted foreign sales. (JS)
• Workers are always told they have to increase their productivity if they want higher pay. Well, the auto workers have increased their productivity much faster than every other major sector of the economy. Their value-added per worker per year averages $300,000 -  the world's best, far exceeding compensation. (JS)

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