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Automakers and the Voice of the UAW
'I'm a third generation autoworker, and am damn proud of it'
Ronda Hauben (netizen2)     Print Article 
Published 2006-03-06 17:01 (KST)   
Delphi Corporation, the world's second largest auto parts manufacturer, filed for bankruptcy for its North American operations on Oct. 19, 2005. Delphi employs 185,000 workers world-wide and 33,650 hourly workers in its U.S. operations.

The company has threatened that if it doesn't get significant cuts in auto worker wages and benefits via its negotiations with the United Auto Worker (UAW) union leadership, that on March 30, 2006, it will ask the bankruptcy court to impose substantial cuts in wages and benefits on its unionized workforce in the U.S. This threat was made by the CEO of Delphi, Steve Miller. What is the significance of such a threat being made to workers of the union which helped to provide the benefits and wages that have set a standard for other workers in the U.S. and elsewhere around the world?(1)

In 1999, the General Motors Corporation spun off its auto parts division, setting it up as the Delphi Corporation. The new company had certain obligations to supply General Motors with parts, but the workforce, which had previously worked for General Motors under their GM/UAW contract, was now working for a new company. The Delphi Corporation at the time of its creation did not have any debt.

Six years later, in October 2005, Delphi claimed that its North American operations are heavily in debt. The relief it wants from the bankruptcy court, is help to drastically slash the wages and cut back on the benefits of its unionized workforce.

Many workers at Delphi denounce the corporation's claims and actions. Some are organizing and meeting with other workers from different Delphi factories to discuss strategy to fight against what they believe is a fraudulent effort to drastically cut their wages and make draconian changes in their working conditions. They say that Delphi and General Motors would be hurt if they go on strike.

Delphi claims that it cannot function in the competitive world market if it has to pay union wages and benefits to its workforce. While wages for long time General Motors workers who were transferred to Delphi when the corporation was created are $27 an hour, or about $56,000 a year before taxes, Delphi claims that it costs the company $140,000 a year for each of these union workers, when benefits like pension and health care costs are factored into the wage costs.

Workers explain the $27 per hour wage is barely enough for them to have a minimum standard of living, consisting of a place to live, food and some other expenses such as occasionally eating at a restaurant. With taxes taken out of their salaries, workers end up with less than $50,000 a year. Given the high prices of housing and food in the U.S., this leaves little left over for other expenses. Only by working overtime, up to 12 hours a day and up to 7 days a week, do union workers at Delphi say they manage to have enough money for a vacation and education for their children.

In December 2005, several U.S. Congressmen sponsored an online Congressional hearing, "The American Automobile Industry in Crisis." (2) They invited Delphi workers and retirees to submit descriptions of the conditions of their lives and what would happen to them if they lost the retiree benefits and union wages that Delphi said it was going to ask the Court to help it slash.

Over a thousand Delphi workers and retirees responded in writing. Their submissions are posted on a Congressional Web site maintained by the Education and the Workforce Committee of the U.S. Congress. Many of the workers responding describe the dangerous conditions they endured at their workplaces over a number of years which left them injured or sick.

Other responses from workers describe how they worked for General Motors and its parts division for 20 to 30 years with the commitment that they could retire with a certain minimum level of pension and health care benefits. Now they are told that Delphi will use a bankruptcy court to reduce the company's obligation to pay wages, pensions and health care benefits.

While Delphi has claimed its North American operations are losing money, some workers propose that this is the result of accounting practices that misrepresent what Delphi has actually spent.

For example, Randall Musielak of Frankenmuth, Michigan writes (3):
"The large corporations such as Delphi, GM, Ford, and Chrysler which lost money according to budget and have never made profit, still hide millions in black accounts due to creative bookkeeping. For example, I worked in a trades area where we would be issued a twenty hour job that takes only two hours to complete. When finished I would be issued another job. The assembly line would be charged the full estimated twenty hours of service into hidden black accounts and would also be written off in taxes as maintenance...

Delphi can show any loss it chooses and executive's bonuses surely do not justify a bankruptcy. To plan, implement, execute, and deliberately use bankruptcy as a tool in business for greater profit should be reason for investigation. The sticker price on an automobile clearly shows wages, benefits and bonuses for GM and Delphi. The bankruptcy should be thrown out of court and any company owned by another should not be allowed to use bankruptcy as a business tool; but instead have to settle thru collective bargaining.
Testimony from another worker, describes the questions the Delphi tactics are raising among workers (4):
"My name is Patrick Mitchell and I have been employed with GM/Delphi for almost 29 years... The question that begs to be answered is: How can a corporation that was spun off from GM in 1999 with a fully funded pension, pockets full of lucrative contracts with General Motors Corp, Toyota, Nissan, Ford, and Diamler Chrysler end up going bankrupt in 6 short years and wreck so many lives? They cooked their books, took advantage of shareholders and investors and have Chief Corporate executives under investigation and they have the chutzpah to point their fingers at the hourly worker using the media to their advantage while trying to reward themselves with millions of dollars they actually stole from all who believed in them. Something is wrong in corporate America if the leadership in Washington allows this to happen... Thank you for these hearings."
Just as workers present a different view of why Delphi is declaring bankruptcy in its
North American operations from what is being presented in the mainstream press in the U.S., workers also remember the hard fight it took to get GM to recognize their right to be represented by the UAW. As Lars Christensen, of Clio, Michigan writes (5):

"I am a third generation autoworker, and am damn proud of it. My father and grandfather were both sitdowners. My grandfather used to walk from his car to the house with a baseball bat, fearful of the beating he would take had the company found him to be a part of the union."

Some militant workers are organizing at Delphi to protest the company's efforts to "break the contract", as they explain. They have begun what they call a "work to rule" (WTR) campaign. As one of the workers explains (6):

"We should Work to Rule. We need to stay inside to preserve income, save jobs, and fight back. If we follow every rule in the book, production will slow to a crawl. We can control the flow of parts by ensuring quality and following rules. It's perfectly legitimate."

This group of dissidents call themselves "Soldiers of Solidarity." They want to recapture of the Spirit of '37, the militant spirit of the auto workers which resulted in sit down strikes and culminated in the victory of the Great Flint Sit Down Strike in 1937. (7)

These rank and file workers describe how General Motors and then Delphi had taken the profits from the work they and other workers did and invested it in other parts of the world like Mexico and China.

Essentially, the dissident workers raise the question of whether the spin off of the General Motors Parts Operations was mainly intended as a plan to force drastic cutbacks in unionized parts workers' wages and benefits. These dissident workers not only criticize General Motors and Delphi. They also are critical of the leadership of the United Auto Workers union, which includes the President of the UAW, Ronald Gettelfinger, and other union officials.

The dissident workers believe that previous concessions given by the UAW union leadership in exchange for setting up "Joint UAW-General Motors" activities and structures, were contrary to the obligation of the union to fight for the well being of the worker. The Joint UAW-GM structures and activities are aimed at making GM more competitive, rather than protecting the workers' wages and working conditions.

While a number of non union auto factories have been set up in the U.S. in the last few decades, the dissident Delphi workers point to how these companies often have higher levels of injuries and a greater attrition rate among the workers, so a smaller percentage of workers actually get to retire from those factories when compared to the percentage that are able to retire from the unionized auto factories. Also the dissident workers point to the fact that if the unionized auto workers in the U.S. get lower wages, this will also result in lowering the wages of workers in the non union auto factories.

The dissident workers criticize the mainstream press in the U.S. for repeating General Motors or Delphi claims about the cost of employing union workers, without doing their own investigation into the reality of such claims. For example, some in the auto industry claim that it costs Delphi $140,000 a year to employ a union worker. Dissident workers ask where these figures come from. They point to the fact that this is a figure created by inaccurate accounting practices. That the cost of the current union workforce is being said to include the amount of money the corporation has to pay to retirees. But that retirees had pension contributions put into tax exempt funds that General Motors used for purposes other than paying for pensions.

Also dissident workers point out that there are many fewer workers currently producing the same volume of production or more which in the past required a larger workforce. Paying workers who have high productivity a higher wage in return for that productivity is not inappropriate, they argue.

One of the most well known of the dissident workers is Gregg Shotwell. He writes and distributes a publication called "Live Bait and Ammo." He explains that workers at Delphi have nothing to lose by fighting against union officials and management when they are trying to cut back the wages and pensions of rank and file workers. Shotwell writes (8):
"Concessions don't save jobs, improve products, or sell vehicles. If UAW members agreed to pay for their own medical insurance, GM would not reduce the price of its cars. The Board of Directors would simply reward themselves. The only legitimate solution is Universal Health Care. The UAW should take the lead and reject all concessions until All Americans have health care."
His newsletter documents an ongoing effort to expose what he believes is the fraud and lies that are being used to cut wages and benefits that rank and file auto workers have earned through many years of hard work and struggle.

If Delphi succeeds in imposing the draconian wage cuts and cutbacks in union benefits via a bankruptcy court as it is trying to do, he believes that this will send a message to other U.S. corporations that they can use the same strategy to void their collective bargaining union agreements. He writes (9):

"Delphi is a test case. If the court allows Delphi to bankrupt US operations while sheltering assets overseas, other multinational will follow suit. When the smoke clears, they will return under another name."

The result will be that instead of U.S. workers helping to set a standard for a living wage, less dangerous working conditions and better benefits that workers elsewhere can strive for, the U.S. unionized workers will be helping to lower wages, set the basis for worsening conditions for workers in other countries.

How this drama will unfold is yet to be decided. Remarkably, there is a spirited opposition movement within the UAW, at the shop floor level, which believes that it is important that the actual conditions of the shop floor worker be known and that the workers themselves be an active part of the ongoing struggle to protect the gains won by auto workers during the past 70 years.

In his book, "The Wealth of Nations," the economist Adam Smith, describes the importance to society of good conditions for its workers. Smith writes (10):

"No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable."
1) For background about the history of the UAW and the role it has played in the American Labor Movement, see Ronda Hauben, "Lest We Forget: In Tribute To the Pioneers of the Great Flint Sit Down Strike". http://www.ais.org/~jrh/searchlight/lest.we.forget.txt

2) http://edworkforce.house.gov/democrats/autointroduction.html

3) http://edworkforce.house.gov/democrats/autoworkerstestimony2.html

4) http://edworkforce.house.gov/democrats/autoworkerstestimony2.html

5) http://edworkforce.house.gov/democrats/autoworkerstestimony2.html

6) Live Bait and Ammo # 54

7) Michael Hauben, "In Celebration: A Past to Remember, A Future to Mold. The 50th Anniversary of the Flint Sit-Down Strike." Originally published in "The Searchlight," the newspaper of UAW Local 659, Flint, Michigan, February 11, 1987.

8) Live Bait and Ammo #50

9) Gregg Shotwell, "The Answering Machine", 01/28/06, MR Zine.

10) Michael Hauben, "The Real Voice of Adam Smith"
©2006 OhmyNews
Other articles by reporter Ronda Hauben

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