Auto Concessions Signal Need For A Sharp Left Turn

By Bruce Allen

Three years ago General Motors and Chrysler workers made massive contract concessions. In fact, GM workers experienced two rounds of concessions bargaining in less than a year, the Harper government enforcing even greater roll backs than GM said it needed. Following that enormous, historic defeat the Canadian Auto Workers (CAW) leadership loudly but unconvincingly assured their members that we would fight again another day.

Three years later “another day” has come and gone, without a fight and with more concessions at GM, Ford and Chrysler. The latest concessions are unprecedented, particularly with respect to new hires.

The CAW long denounced the two-tier wage agreements accepted by the UAW in the U.S.A. Now the CAW has all but completely acquiesced to that type of arrangement. New hires will be paid approximately $14.00 per hour less than regular workers. It will take them 10 years to attain the full rate, which will remain virtually unchanged for many years to come – plus it will take a full six years just to reach 70 per cent of the full rate. Worse, new hires will see deductions from their wages go towards the cost of their pensions, which will be seriously inferior to those available to current employees, while current employees experience no wage deductions going towards their pensions. In effect, the CAW has accepted a blatant system of two-tier pensions. New hires will also get much less vacation time.

All of this will result in a windfall of additional profits for the Detroit 3 auto corporations’ Canadian operations, and it will accelerate the general decline of living standards for industrial workers in Canada. The time when autoworkers led the way in raising the living standards for industrial workers in Canada are long gone. Now they are leading the way downwards. And the CAW is functioning like a conduit for Capital’s onslaught against labour.

Current active employees at the Detroit 3 in Canada will share in the pain of these long term collective agreements – in force until 2016. There are no wage increases at all. There will only be one cost of living increase – in the last quarter. Built-in COLA is replaced by lump sum payments cynically timed to be paid just before Christmas when autoworkers used to get a seasonal bonus. Simply stated, this means autoworkers will experience a steady decline in real income over the next four years. So will retired autoworkers. They have already been stripped of COLA on their pensions and they suffer a very inferior two-tier benefit package which is eroding.

None of this has been justified by declarations that new product investment has been acquired. There are no new products to be built in Canadian auto plants. Now the sorry, but all too familiar refrain is that we are living in tough times, faced with policies from hostile governments, including a high dollar. These excuses simply signal that there is no reason to expect anything but more of the same even with the aproaching CAW – CEP merger, with very serious consequences for labour as a whole, particularly in terms of living standards. No one is proclaiming we will ‘fight again another day’.

A very bleak future lies ahead, unless we see the emergence of a rank and file based left opposition to the current leadership – a class conscious movement which recognizes that calling a halt to the ongoing retreat is imperative to keep us from going from very bad to even worse.