The press is filled with stories that GM is pushing the UAW to make"givebacks" as part of its restructuring plan under the auto bailout. Its "plan has to be approved by the Treasury. Neither the UAW nor the Obama administration should stand with GM on this issue. If there are concessions, they should be to workers and the government that is"saving" GM and Chrysler from collapse.
A little history, both recent and not so recent, should put this in some perspective for both trade unionists and progressives in and out of the administration. First let's jump back to 1979, when the Carter administration bailed at Chrysler and used its influence to push the UAW to "give Chrysler" givebacks, in effect to workers pay for Chrysler's building of high profit gas guzzlers and profiteering from military related subsidies to run itself into the grand. Carter proceeded to lose the election to Reagan and the U.S. auto industry joined other large industries in busting unions and exporting capital with Reagan administration support. Michael Moore's Roger and Me, shows powerfully what GM did with its givebacks and to its workers in the Reagan era, turning Moore's hometown of Flint, GM's most important industrial center, into a city of evictions, poverty and crime.
If anyone in the Treasury Department has any serious "faith" in GM and Chrysler today showing any real sense of social responsibility, they are still thinking in terms of the trickle down theory that revived under Reagan and hopefully ended under Bush – namely, that in good times you give corporations a everything they want on the principle that they will trickle down some of their profits to workers and in bad times you act like a conservative banker, giving corporations the capital they need to survive as long as they "reduce" labor costs. They are also failing to understand that without the support of labor and low income Americans generally, the administration cannot accomplish its economic goals and defeat the inevitable rightwing Republican attempt at a backlash.
These approaches didn't work for Carter and will not work today. Another approach is for the administration to work with the UAW, to see it as an ally in this process and bring its representatives, its economists, forward to become active participants in process of regulating GM and Chrysler's "bailouts." If the Obama administration established a national single payer health care system for all citizens as a matter of right (the standard and the rule in the developed world) GM's attempt to reduce the costs of health benefits for union retirees would of course become moot, because it wouldn't have the responsibility of paying for those benefits.
If the present UAW leadership studied a little history (not the red-baiting kind or even the former social democratic kind that glorifies Walter Reuther and leaves out Wyndham Mortimer, Bob Travis, Henry Kraus, and other CPUSA activists who led and won the General Motors Strike at Flint in 1937 and made by far the most contribution to the rise of the union) it might realize that it won its greatest victories when its leadership had a "social unionist" outlook, that is, an approach that led them to see that everything that concerned their workers and workers as citizens was their business, that they wouldn't make deals over the heads of the workers or take the position that management could do what it wanted outside of narrow contract enforcement issues.
Nor is it simply a question of "regulation" vs. no regulation of the auto bailout and the larger bank bailout. The New Deal government, for example, established under the National Recovery Administration in 1933, comprehensive industrial codes of conduct to be administered industry by industry by code authorities. Planning prices, production, and guaranteeing workers rights to union unions were in the codes. Labor and consumer representatives were supposed to have seats on the code authorities. But they didn't on most of authorities. The codes were drawn up by government officials with connections to the industries and attorneys representing the industries. The trade union provisions were gotten around by forming company unions. Workers came to call the NRA "national runaround" before it was abolished in 1935 by a rightwing Supreme Court for reasons that had nothing to do with these left criticisms.
The Obama administration can learn from the mistakes of the early New Deal in this regard, Just as it can't get bipartisan support from Republicans with a real progressive program, it can't get auto company managers to do anything more than what they did with the Chrysler bailout if it doesn't establish new ground rules from the beginning.
First, "givebacks" from workers, including retirees, reduces their overall purchasing power and contributes to more layoffs through the economy and more decline. It isn't "countercyclical" in the sense of Keynesian economic theory in that it doesn't act against the downward thrust of the business cycle but accelerates it. Maintaining jobs and wages and restructuring social benefits like health care in the interests of the workers (establishing universal single payer health care) is countercyclical and essential in sustaining and expanding mass purchasing power in Keynesian theory.
While I am not at this moment ready to start throwing stones at Secretary Geithner as some on the left are, the "bailout" should be broadened beyond the Treasury Department to include, from the government side, the departments of labor and health and human services. Most of all, the UAW should play a direct role in the planning and administration of the funds. The Obama administration can and should innovate in administering both the auto bailout and the larger nearly $800 billion rescue plan.
These are questions that will determine both the livelihoods and the quality of life for workers, students homeowners, consumers in the immediate future. The federal agencies which deal with labor, education, environment, health and human services should be part of the planning and administrative processes that will decide how and for what these huge amounts of public money are used. Representatives of labor, environmentalists, students and public sector education, representatives homeowner representatives, should all be involved in both the planning and subsequent administration of these funds if the banks and the corporations are to both held accountable and held in check.
