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International Socialism, Spring 1968


Steve Fox

US Motor Workers


From The Notebook, International Socialism, No.32, Spring 1968, pp.5-7.
Transcribed & marked up by Einde O’Callaghan for ETOL.


Steve Fox writes: At the April 1967 UAW convention in Detroit a demonstration of production workers was organised, at first by the official leadership. At the last moment Walter Reuther, UAW International President, put pressure on local leaders to have it called off. In spite of this effort, several thousand auto-workers turned out in the pouring rain during a working day to express their feelings. Out of the hundreds of signs that were hoisted by the workers, not one called for a wage increase. There were some signs for improved retirement provisions (30 years and out) but mostly the signs called for improved working conditions: an end to speed-up, more relief time, etc. That is not to say that the production workers were against a wage increase, but rather they were expressing what were their most pressing problems.

In June 1967 six to nine thousand UAW skilled tradesmen turned out at a demonstration called by the Dollar-An-Hour-Now Committee at the Ford Administration Building in Dearborn. One of the leaders of the Committee, Joe Molotke, was removed as chairman of the GM negotiating committee by vice-president Woodcock for his part in organising the demonstration.

Reuther made the most of the publicity about how good the contract settlement is. The ‘historic’ package, however, breaks down under close scrutiny.

First, the pay package. The optimum amount will result in $0.91 an hour over three years for skilled tradesmen; production workers will receive about $0.58 an hour over the same period. This averages out to about $0.63 per hour for all Ford workers.

It should be noted that if the old contract had simply been extended, workers at Ford’s would have received a minimum of $0.53 an hour over the next three years. This means a net increase for production workers over what they would have received with a contract extension of about $0.05 an hour over the entire next three year period.

Based on the New York Times estimate of the pact (6.5 per cent a year) and the US News and World Report estimate of total present compensation ($5.33 per hour wages and fringe benefits) the increase over the next three years will supposedly total $1.04 per hour. This is the general figure put out by the UAW leadership. This would mean that increases in fringe benefits would have to amount to over $0.40 an hour. Below we deal with the reality of the fringe benefits.

One of the basic protections that auto-workers had, the cost-of-living escalator clause, was completely emasculated. In the old contract, pay rates were adjusted quarterly according to government cost of living indexes. There was no ceiling. Workers received approximately $0.18 an hour by the end of the three-year contract. The new contract has a ceiling of $0.08 per year to be adjusted at the end of the contract year rather than quarterly. In this time of rapidly advancing inflation, the most that Ford workers can get is $0.16 during the whole duration of the contract. A basic principle has been given away. Every cost of living increase will now have to be fought for, instead of being automatically added.

Another ‘big’ gain for auto workers was increased supplemental unemployment benefits (SUB). Under the new agreement, a worker who is laid off can receive almost 95 per cent of his weekly wage for up to one year. There is just one catch. The worker must have at least seven years seniority, the majority of auto-workers have under seven years seniority and it would take a major depression before any significant benefits were paid out. For this the union gave away the Christmas bonus. The figures haven’t come out yet, but it is highly probable that workers actually come out on the short end of the deal with this horse-trade.

Another fraud perpetrated on auto-workers is the new pension advances for retirees. Since the most complete figures available are from General Motors (GM) and because the contracts on such basic issues are generally the same for all the Big Three, we will use figures from the GM pension fund as a basis for evaluating the net gain for workers in dollars and cents figures. In December 1965 the GM pension fund had $1,671,908,985 in it. During 1966 GM paid $237,200,000 into the fund. The return on interest and dividends was $83,037,911. The net profit realised from sale of securities amounted to $32,538,366. The total paid into the fund in 1966 was $352,776,277, and what was paid out in retiree benefits was $116,072,657. (GM has complete control of the fund and all profits realised from dividends, interest, and sale of securities are controlled by the company.) The amount put into the fund through interest, dividends and sale of securities alone offsets what was paid out. The total put in was over three times what was paid out. The fund at the end of 1966 was close to $2 billion. If the pattern at Ford’s extends to GM (which it will) the increased benefits for the approximately 63,000 GM retirees (who have an average of about 25 credit service years) will be approximately $25 per month plus $3 per month medicaid. This comes out to a yearly cost to GM of more or less an additional $22 million per year. This amount barely makes a dent in what GM has in the fund in the form of what was added to it in 1966 alone. Essentially this ‘big’ part of the UAW package costs the companies next to nothing. The only real thing that production workers gained that they needed is the additional 12 minutes relief time. But this too has so many holes in it that it leaks like a sieve. First, the majority of production workers are not covered by the additional relief time. Only those who are on an assembly line get the extra relief. Other production workers, including those in the foundries who also work on a rapidly moving conveyor, get nothing. Further, while in the old Ford contract relief could not start until an hour after work starts, now relief can be given a half-hour after work starts. This of course cuts down on the meaning of relief time. Relief is necessary towards the middle of the workday when one gets more tired. This provision cuts the cost of relief time for the company because the company does not have to hire too many new relief men.

Above is the content of the ‘historic’ 1967 Ford auto pact which will be the pattern for all the Big Three. The question is, what is needed by the some 650,000 workers covered by the new contracts?

First and foremost for the production worker is protection against inhuman speed-up of the production lines. Ever since the UAW signed away the right to control production standards in 1948 there has been a steady deterioration of working conditions. Since 1948 there have been instances of such intense speed-up that workers are putting out 2, 3 and even 400 per cent more than in 1948 without the introduction of automated equipment. To understand what this means, the situation on the lines must be described. The production worker works continuously 8 hours a day except for the 18 minutes (now 24 minutes) break before lunch, the lunch break, and the 18 minutes after lunch. The worker has no chance to, stop working, even for a minute to go to the john, except during those periods. In some shops, there is a time-study set-up which ‘rationalises’ production. Workers’ motions are broken down with a stop-watch into hundredths of a minute. Every motion is clocked for efficiency. The company is eliminating ‘wasted’ motion. The workers are worked like machines. It is not only continual work, but it is also extremely fast. It takes all one can do to keep up with the line, a line which stops for no one.

One of the promises that Reuther made before the contract settlement was the elimination of compulsory overtime. That is, the company has the right to schedule overtime and force workers to come in as if it were part of the regular schedule. If a worker wants his job, he has no recourse but to come in. This may entail as much as ten or twelve hours a day, six and seven days a week. (Incidentally, Chrysler had up to the deadline of its contract been working some of its plants ten hours a day, six days a week. The International Union has done nothing to stop stockpiling. On 8 November 1967 when the Chrysler plants were slowed down by trucker wildcats, Reuther stated about the struck trucks, ‘They’ll be running if we have to drive them ourselves.’) The Company in the new contract still retains the right to compel overtime work. The Reuther leadership in the UAW promised protection for auto-workers from company subcontracting out of work. This means protection through the right to strike if jobs are contracted out to plants where either wages are lower, conditions worse or workers less militant. Protection was not established. Another basic thing that was not done was the establishment of a grievance procedure which would ensure speedy resolution of problems for workers. As it now stands, a grievance, for instance involving work standards may not come up for resolution for months while the worker continues to work under the worsened conditions. Too often the grievance becomes meaningless because of additional changes in jobs and model changes before it is dealt with.

The policies of the Big Three are to discriminate against workers with criminal records. They will not generally give jobs to those with records. Workers therefore usually falsify their job application in order to get jobs under these circumstances. What happens is that if the worker has a somewhat poor attendance record, comes in late too often for the company’s liking (but still not quite meeting the discharge requirements), if the foreman dislikes him, or if he becomes too militant the company investigates his application. The company has the right to discharge any worker who has falsified his application, up to five years after hiring. Under the present set-up workers with less than one year’s seniority obtain no SUB benefits. They are not covered by the new contract either.

Another of the demands promised but not obtained was an escalator cost-of-living clause for retirees. In other words, it all adds up to a sell-out and the overwhelming majority of workers know it. After the settlement at Ford’s, a farce which took a fifty-odd day strike, the workers did vote for it. The question is why? First, the workers were not then too sure of what the contract involved. Second, Reuther, over radio, TV and in the press promised the Ford workers that if they did vote the contract down they could stay out for another three months and he (Reuther) would still not get them anything more. However, the resistance of the workers is stiffening. The present rash of wildcat strikes indicates the sentiment. Further, for the first time in over a decade, a national organised opposition in the UAW is beginning to develop.

The Federal government has attacked the UAW-Ford pact as inflationary, as they have other union pacts. It does it rather quietly though. LBJ has come out and stated satisfaction at the destruction of the ‘inflationary’ cost-of-living escalator protection. It is necessary to look at the economic realities to judge whether the demands of the auto-workers are the real cause of inflation.

The government bases its evaluation of the contract supposedly on the rate of increase in compensation (wages and fringe benefits) as compared with the rate of increase in productivity.

From 1947-1966 real compensation (adjusted to inflationary tendencies) amounted to an annual average of 3.2 per cent per man hour for workers in manufacturing. Productivity in that same period in manufacturing amounted to 2.9 per cent. Supposedly this would show that the present 6.5 per cent package for UAW workers is inflationary. First, however, the 6.5 per cent yearly package is not adjusted to inflationary tendencies. Adjusted it would amount to about 3.2 per cent a year. By the above statistics this would still seem to be inflationary. Let us look into it a little further.

In fact, though productivity has increased in manufacturing at 2.9 per cent as a yearly average from 1947-1966, from 1960-1966 the yearly rate of increase in productivity has been 3.9 per cent in all of manufacturing. In reality productivity is outstripping real compensation. To say that the settlement, based on the above figures from the Bureau of Labor Statistics, is inflationary is sheer nonsense. However, even this does not tell the whole story. The fact is that productivity is far higher in the automotive industry than in manufacturing in general. This is indicated by the fact that the rate of profit in the automotive sector is nearly twice that of manufacturing as a whole.

The truth of the matter is that the gap between what the workers produce and what they receive is growing greater.

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