As the big boys from the big three pressed their case this week for a taxpayer funded bridge or bailout (pick your metaphor), the role of big labor in Mr. Obama’s coming administration is being seriously tested even before the guy gets to say “so help me God.”
Of course, at issue is the fact that he promised the proverbial moon to an interest group not really known in recent years for its capacity to pack too much of an electoral punch. Whether or not he will be able – or inclined – to actually keep his pledges is quite another thing.
It is likely that many months ago, when Barack Obama was assuring various union dense audiences of his support for them, he never anticipated having to really do anything about it so soon. But it will be on his plate on day one and the issue may just keep him up some nights until 3:00 a.m. – in case the phone rings in the wee hours.
The problems with the American automobile industry are legion, but likely the most glaring is the cost of labor and management. Bloated salaries in the boardroom and borderline outrageous wages on the assembly lines have pretty much brought the entire U.S. auto industry, once the envy of the world, to its knees - if not the brink of disaster.
Workers at a Toyota plant in Kentucky, a non-union shop, receive about $47.00 per hour in wages and benefits. That translates to about $98,000.00 per year (not counting overtime). Those doing essentially the same job at GM, Ford, or Chrysler – whose assembly line workers are members of the United Auto Workers union – receive roughly $71.00 per hour – or about $150,000.00 annually (again, minus any overtime).
Public school teachers across the country make, on the average, no more than a third of that.
Detroit has been losing money on every car sold for quite some time. The easy criticism is that they have been building “gas guzzlers.” But that dog won’t hunt because one of the reasons they have had difficulty shifting gears (so to speak) to smaller, cheaper, and more fuel efficient models is that they would lose more money per unit on them. They have not been competitive for a long time and there isn’t a bailout number big enough to fix the problem without changing management (getting rid of the guys who ran the place into the ground) and renegotiating labor contracts downward.
And there’s the rub. The United Auto Workers is a formidable foe with a new best friend moving into the White House.
The irony is that this union looks and acts these days more like the guys they fought against back in the 1930s and 1940s. It began as an advocate for hard working people who had been getting the shaft. Who’s holding said shaft now?
I grew up in the suburbs of Detroit hearing the legendary stories about “sit down” strikes and an epic encounter called “the battle of the overpass” - where Ford Motor Company “muscle” beat up Walter Reuther, his brother, and other union organizers who were passing out leaflets.
My father was a long time member of the Teamsters (same local as Mr. James Riddle Hoffa) and all the kids on the block had dads who loved and depended on the unions. I know that back in the day the UAW did some good stuff for those who had no real influence or voice. The union effectively helped its members “to free them from the tyranny of arbitrary decision or discriminatory action in the work place,” as Neil Chamberlain wrote nearly half century ago. I get that.
But we have come along way since those days. This is an age of change – remember?
Ford Motor Company was the last of the big three to agree to let its employees organize after a lengthy and brutal battle. Led by Harry Bennett, a close confidante of old Mr. Ford (who later wrote a book about his boss entitled, We Never Called Him Henry), a “goon squad” spied on and intimidated workers for years, keeping them in line and out of the UAW.
In the spring of 1941, as the nation was reluctantly preparing for inevitable involvement in the growing global war, Bennett fired several employees unwittingly creating the catalyst for the first real strike (exclusive of episodic “wild cat” actions) the company ever experienced. For ten days, work at the massive River Rouge Plant was at a standstill and tension was in the air.
Through surrogates like Bennett, Henry Ford insisted that the strike was the work of communist agitators. He had been working closely on the sly with a key, though out of favor, labor leader - Homer Martin. The first president of the UAW, Martin was, in fact, on Ford’s payroll, retained ostensibly as an in-house liaison to the increasingly restless workers.
Homer Martin is now little more than a footnote in the story of the rise of the UAW, having been outmaneuvered by the Reuther brothers and largely written out of the “official” history of the movement. A former Baptist minister, he had been fired by his rural Missouri congregation for outspoken support of workers who were pro-union. He then went to work in a Kansas City automobile plant and soon rose to the top of the fledgling labor movement. Known as “an orator of the evangelical, stem-winding school,” he could “draw fire from an audience.”
Under Homer Martin’s leadership, union membership experienced exponential growth in its early years. A strong anti-communist in a movement rife with socialists, Martin is largely characterized today as an incompetent leader and erratic personality. The truth may actually be that he was bitterly opposed by the Reuther brothers because of his religious faith and the strong support he had from southern workers who connected with his “preacher” persona. Whatever the case, though out of power he continued to spend significant time and energy on the labor cause in the auto industry. And he played an ironic role in the Rouge Plant strike.
As the walkout continued during the first week of April in 1941, Martin – at the urging of Harry Bennett - used his rhetorical skills to try to persuade strikers to quit and get back to work. Meanwhile, the Reverend J. Frank Norris, a fiery fundamentalist Texas preacher who was also pastor of a mammoth Detroit congregation, preached a sermon that was broadcast on WJR radio and printed word for word in the Detroit Times. Norris called the Rouge Plant strike the work of “revolutionaries” and “Bolsheviks,” and suggested that anyone participating in it was not being patriotic in light of the war clouds looming on the international horizon.
But on April 10th, Michigan Governor Murray Van Wagoner intervened and the strike was suspended. Mr. Ford was beat. For a brief time he pouted and moped around his 1,300-acre Fair Lane Estate in Dearborn - even threatening to shut his whole company down. But his wife Clara disabused him of the notion. And in a secret ballot – emphasis on that word secret – Ford workers elected to go into the UAW by a 97 percent vote.
Now, fast-forward sixty-seven years to current day. There is a curious and ominous piece of legislation floating around Washington, D.C. called the Employee Free Choice Act (EFCA), which has been nicknamed the “card check” bill. In effect, it would eliminate the idea of using the sanctity of the secret ballot for elections when employees of a company vote on the issue of whether or not to join a union.
So imagine you are working one day – and a guy comes along and says, “sign this.” Would you feel the pressure and the potential for intimidation?
Sadly, the UAW has in some ways become what they used to fight against – autocratic, coercive, intimidating, and manipulative. If such a bill passes and is signed by our 44th president, Harry Bennett wannabes will be back on the job, only this time they will twist arms for the unions. Even someone whose liberal bona fides are as unimpeachable as George McGovern thinks this is a terrible idea.
President –Elect Obama supports the EFCA. I would hate to think that democracy in America might one day find itself on a slippery slope toward becoming a “thugocracy.”
We are now at a crossroads. Labor unions grew during the Great Depression and peaked just after the Second World War. They have been in decline for years, but now as the economy tanks they seem to be getting another lease on life. The current scenario with the auto companies asking for money in Washington with one hand, while in the grip of the UAW with other, is going to yield powerful and revealing clues as to what the future will look like for American businesses.
The corporatism that came out of the New Deal, and took decades to even begin to undo, is knocking at the American door once again. And the man who, after January 20th, will be in a position to let labor back into the economic living room has already given every indication that he has a pro-union welcome mat in the moving van.
Be prepared to hear much more talk about “fair” competition than “free” competition. They are both four-letter words, but that’s where the similarity ends.
Long after the 1941 strike was settled (by the way, the company offered more generous terms than those the union was seeking), Henry Ford met with UAW leader Walter Reuther to congratulate the man now representing his workers. During an odd exchange, he told Reuther, “It was one of the most sensible things Harry Bennett ever did when he got UAW into this plant.” Caught by surprise by the comment, he asked, “How do you figure it?”
Henry Ford then told the man who became for a generation - Mr. UAW: “Well, you’ve been fighting General Motors and the Wall Street crowd. Now you are here, and we have given you a union shop and more than you got out of them. That puts you on our side, doesn’t it? We fight General Motors and Wall Street together, eh?”
His analysis may have been flawed – but then again, maybe the old man was on to something. I wonder what Henry Ford would think about company executives jetting privately to Washington to beg for money to “save” an industry he invented in his little backyard shop?