01) AUTOWORKERS ACCEPT 3RD CONTRACT IN 12 MONTHS

(The following article is from the June 16-30, 2009, issue of People's Voice, Canada's leading communist newspaper. Articles can be reprinted free if the source is credited. Subscription rates in Canada: $25/year, or $12 low income rate; for U.S. readers - $25 US per year; other overseas readers - $25 US or $35 CDN per year. Send to: People's Voice, c/o PV Business Manager, 133 Herkimer St., Unit 502, Hamilton, ON, L8P 2H3.)
By Liz Rowley, Ontario leader of the Communist Party

Punishing cuts that will reduce labour costs by another $15 an hour, on top of the $6 already taken by GM in March, have been accepted by 86% of the 7,500 CAW members who work for GM Canada last month.

     The agreement, the third the CAW has been forced to sign "with a cannon to the head" in the last 12 months, will freeze wages and COLA (cost of living allowance) until 2012. Workers will lose one week annual vacation; $1700 Christmas bonus; $3500 in one-time holiday pay; tuition reimbursement; semi-private hospital coverage, and will receive reduced dental and healthcare coverage, while paying a new $30 per month healthcare fee. New employees will pay $1 an hour into the pension plan. Retirees will see their COLA and benefit improvements frozen until 2015 and will pay $15 a month health care fee.

     The deal puts GM's labour costs on a par with non-unionized workers in the auto industry, undermining free collective bargaining and the closed shop in Canada.

     Workers who voted for the concessions were grim, some weeping, as they accepted the deal in late May. They were told that the alternative to the concessions being forced on them by GM, the Canadian and Ontario governments, the US government, and various creditors and bondholders, was corporate bankruptcy and the loss of everything: jobs, pensions, benefits, and the domino effect of catastrophic job losses up to seven times greater in the spinoff jobs.

     The federal and Ontario governments threatened to pull bailout funds if the workers didn't accept the concessions. A massive campaign attacking autoworkers' comparatively higher wages, pensions and benefits was orchestrated across Canada in media talk-shows and editorials.

     Drowned out in this mass vilification of workers and the CAW, was the fact that Canadian banks received $200 billion in bailouts just a few months ago, twenty times more than the government's gift to General Motors.

     Also drowned out were the terms: the bailouts bought no guarantee to keep GM plants in Canada operating, and no guarantees against further layoffs or further wage cuts. With GM planning 20,000 more layoffs and eleven more plant closures, this should have been the essential condition for bailout funds.

     Further, the terms of the deal require the federal and provincial governments to sell their shares in the company by 2018:  30% in three years; 65% in six years, and 100% by 2018. The US government on the other hand can keep their shares or sell them when the price is high: their choice.

     The only concession Canada got was a qualified offer to keep 16% of GM production here until 2016, except in the case of "major corporate events or transactions", when GM retains the right to do whatever it wants.

     Is it really likely that GM and its new partner, the US government, would lay off 20,000 US workers and close eleven or more US plants, instead of closing up shop in Canada?

     The Canadian bailout of $10.6 billion has given us the outside date for the wrap up of GM operations in Canada; it could be earlier.

     The Ontario government refused to take responsibility for the GM pension shortfall of $6.5 billion (which it deliberately allowed GM to underfund). But the union was successful in embedding in the deal a "filter" arrangement, whereby the government bailout will be directed into the pension fund, and GM will repay the remaining shortfall over the next 10 years. Short of this piece, 25,000 GM retirees would have lost 60% of their pension; deferred wages in fact, owed to them by this company.

     The Communist Party is calling for the nationalization of the auto companies in Canada, demanding that the federal and provincial governments step up to really protect Canadian industrial jobs and the Canadian economy.

     Taking over these operations would allow for the development of a Canadian car, one that is small, affordable, fuel-efficient, and environmentally sustainable. This should be partnered with the development of public transit, light rail, and inter-urban transit systems that can make use of alternate sources of energy, and provide good jobs to Canadians.

     In exchange for the plants and property, the Canadian government should take over responsibility for the legacy costs:  pensions and benefits to Canadian autoworkers.

     Canada is the only advanced industrialized country in the world without a national automobile industry. For the first time, auto jobs have dropped below 100,000 in Canada, with the just published reports on the first quarter of 2009.

     Meanwhile, Frank Stronach has moved to buy a majority stake in GM's German Opel unit, and plans to expand assembly and production of Opel into Ontario within 24 months. A close friend of PM Stephen Harper, Stronach plans to sell and export the new Canadian-made Opel all over Canada and the US.

     But the Opel plants in Canada will be union-free, just like the Magna auto parts plants. A supporter of the right-wing Austrian Freedom Party, Stronach said in recent Toronto Star article that "there is still too much of an adversarial and confrontational environment... We need the right structure and (entrepreneurial) environment. The key is if you're not competitive you won't make any monies. Then business wouldn't be a benefit to society. In fact you would become a liability to society as we see now."

     Stronach offered to let the CAW organize his parts plants two years ago, but without either the right to strike or union representation in the plants or on the shop floor. Worries that the Magna deal would set conditions that would work their way into the assembly plants now seem to be well-founded.

     From union stronghold to union-less or union-free, the auto sector in North America is changing rapidly.

     So is Canada. Without a strong auto sector, Canada loses its economic engine, and the largest part of the manufacturing sector.

     Nationalization is looking like a better and better option for workers, for trade unions, for Canada.