UAW Redux (and how unions help non-union workers)

UNITE-HERE Union president Bruce Raynor has an excellent piece in Thursday's Los Angeles Times about the southern-fried union busting served up by Messrs. Corker, et al. and why, in the end, if the Foghorn Leghorn caucus succeeds, the sorriest sons of bitches are going to be those who toil for the foreign car makers on the assembly lines of Dixie (back to which in a minute).  Raynor also persuasively notes what a red herring the issue of UAW members' compensation is in the scheme of things versus the salaries that are paid in the financial sector to which few Republicans object.  In short, salaries account for 70% of the costs associated with the financial sector versus 10% of the cost of producing automobiles, one of the most capital intensive activities on earth. 

As Raynor notes, killing the UAW would be a boon to the foreign automakers producing in the southern United States:

But what the foreign car companies want is to level -- which is to say, wipe out -- the union. They currently discourage their workforce from organizing by paying wages comparable to the Big Three's UAW contracts. In fact, Toyota's per-hour wages are actually above UAW wages.
However, an internal Toyota report, leaked to the Detroit Free Press last year, reveals that the company wants to slash $300 million out of its rising labor costs by 2011. The report indicated that Toyota no longer wants to "tie [itself] so closely to the U.S. auto industry." Instead, the company intends to benchmark the prevailing manufacturing wage in the state in which a plant is located. The Free Press reported that in Kentucky, where the company is headquartered, this wage is $12.64 an hour, according to federal labor statistics, less than half Toyota's $30-an-hour wage. If the companies, with the support of their senators, can wipe out or greatly weaken the UAW, they will be free to implement their plan.

In other words, non-union workers benefit by the very existence of the threat to unionize.  Companies frequently pay wages that are only slightly below the union scale to keep workers from organizing.  In the construction industry, it is not unusual for employers to pay a higher take home wage than union workers get while providing much more modest (or no) benefits.  Such a strategy works particularly well with young men, who are by definition immortal, and immigrant labor, which often wants to maximize money that can be sent home to waiting families. 

Eliminate the union "threat" and there is no reason for an employer to be so generous.  What people seem to fail to comprehend is that any concession made in a unionized environment can be met and exceeded in a nanosecond, completely unilaterally by the non-union sector.  I have seen it happen.  In the early 1990s I participated in negotiating a couple of concessionary contracts for clients who ended up taking 10 to 15% cuts in their hourly wages.  The non-union sector was able to match or exceed those cuts within a day or two.  As a result, I have come to view concessionary bargaining that is not tied to specific gains in market share as being the ultimate fool's errand for unions.  

Mark my words -- if the UAW were to cease to be a viable entity because of what the Republicans are doing, the wages of the workers at the foreign-owned auto plants in the U.S. will be cut in half within a short time -- exactly the wrong recipe for an economy that is seeking to recover.    

Comments

[Corvus]

Well, that is all perfectly predictable when operating from a paranoid left-wing viewpoint. Nice to see it backed up by facts. Strange how that keeps happening. Next thing you will tell me that the president is a war criminal and the vice president has admitted to authorizing torture!

So, Sir Chuck, what's your thoughts on Solis at Labor? Worth the wait?

[jncam]

I like the Big 3 as much as I like the Hummer. However, the republican's tactics have solidified my support for the bailout. Lets have this battle. You're either pro-worker or you aren't.

[drip]

The article is dead on Sir C.

I'm with Corvis, What's the deal on Solis?

[Sir Charles]

Stephen was asking me about Solis as well. I was embarrassed to admit I knew next to nothing about her and I had never heard her name mentioned on the short list of candidates -- and I had actually been talking to a labor-oriented transition team member on Wednesday about this.

Everything I have learned to date though makes me highly enthusiastic. She has a labor background with both of her parents having been union members, her voting record is stellar, she is politically bold, having knocked off an incumbent Democratic Congressman who was too conservative for his district, and she is really tuned into the problems of the low wage work force. She seems like a really, really fine pick, a wonderful contrast to Mrs. Mitch McConnell, who is a true enemy of working people everywhere.

Solis is also terrific in other areas, such as the environment and reproductive rights.

This pick seems like a real win for the good guys.

[Joe Klein's conscience]

Sir Charles:
I am curious on your opinion. Depending on how bad it gets, do you think there is any chance for protest marches? Or is the USA as a whole too lazy and unmotivated to do that kind of thing anymore. Lets face it. Protest marches do work. See the Civil Rights marches.

[Sir Charles]

J K's C,

I don't think we'll see protest marches unless there is a perception that the government is doing nothing and conditions worsen. (And I think Obama will do everything humanly possible both to address the crisis and to let people know that he cares about it.) Even in 1981-82, when Reagan and Volcker put the country through the economic wringer, there was very little of that kind of thing. The AFL-CIO had a big "Solidarity Day" Rally in DC, but that was about it.

What you could have though is greater labor militancy -- more situations like the recent sit-down strike at Republic Door.