Employers Use Crisis to: Get Union Concessions

by David Bernt / May 2009

As the economic crisis deepens, the ruling rich and their stooges in Washington have sharpened their attacks on working people. While media attention has focused on the massive concessions forced on autoworkers at the Big Three domestic auto companies, workers throughout the economy have suffered from the bosses offensive against their jobs, wages, and social benefits.

The economic meltdown has compelled the bosses to nearly obliterate the remaining gains workers won in the post-war era, making the "blue collar middle class," already out of reach for most workers, on the verge of extinction.

Since the beginning of the recession in December 2007, some 5.1 million jobs have been lost. Layoffs have been heavy in several industries with high union density, including auto and auto parts, transport, steel, and other manufacturing. Manufacturing has accounted for 1.5 million of those jobs lost, a 10.6% decline in that sector’s employment.

In addition to the mass layoffs in auto, large manufacturers such as Caterpillar—which has laid off more then 25,000 workers over the past few months—have devastated the lives of workers who had found jobs that at least paid wages above the poverty level standard of retail work, and in many cases allowed workers to live a reasonable comfortable life.

Bosses have used the threat of layoffs to leverage concessions from unions. Contentious negotiations between AT&T and the Communications Workers of America continue after the April 4 expiration of the contract that covers over 100,000 telecom workers.

AT&T, despite racking in $12.9 billion in profits last year, is demanding workers drastically increase their health-care contributions. The CWA says the health-care concessions AT&T is proposing would amount to a 7-10% cut in take-home pay for workers.

Yellow-Roadway Corp. convinced Teamster President Jimmy Hoffa Jr. to open the National Master Freight Agreement last December, to cut workers’ wages by 10%, and to give back annual cost-of-living increases for the duration of the contract—shifting $1 billion from workers pockets to YRC. To add insult to injury, YRC has now proposed deferring payments into Teamster pension plans by putting up the companies’ real estate holdings as collateral.

Public employees, the last refuge for the union movement, are also under immense pressure as Governors, both Democrat and Republican alike, demand concessions and threaten layoffs. In New Jersey, Democratic Gov. Jon Corzine is demanding state union workers agree to a wage freeze and force them to take 3 weeks unpaid leave, which combined would amount to a 5 percent cut in pay. Union workers in CWA Local 1037 are following Corzine around the state and organizing pickets in protest. And 15 states have proposed or imposed similar furlough plans. In California, 238,000 state employees are being forced to take two furlough days per month.

In Los Angeles, Mayor Antonio Villaraigosa, a former union organizer and heavily union-backed candidate, is proposing one hour a week furlough along side a 2% increase in workers’ pension contributions and eliminating cost of living increases. The same scenario is playing out throughout states and municipalities across the country, with essential services being gutted while public employees are getting squeezed.

Despite the hundreds of millions spent on electing Democrats by unions in the last election, "the friends of labor" politicians are leading the attacks on public employees from New York to California. The Obama administration has played the role of union buster in negotiations to restructure the auto industry, demanding UAW give back much of the historic gains of the once powerful union.

The president and Congress have approved trillions of dollars to bail out the banks and continued funding by the hundreds of billions the occupations of Iraq and Afghanistan, while workers are told there is no money for basic social services, mass transit, health care, and jobs.

The working class and its unions need a political party of their own, independent of the corporate-sponsored Republican and Democrats. A labor party alongside a fighting labor movement could fight for an alternative program to the layoffs and concessions, a program based on the interests of working people. Workers could demand a real mass public works program to employ all unemployed workers at union wages to build what we need: affordable housing, mass transit, schools, renewable sources of power. Nationalize the auto industry, rehire all laid off auto workers and retool auto plants to build buses and trains for mass transit and wind turbines and solar panels.

It is clear that the era of “partnership” between unions and employers is over. The boss class is not interested in trade-offs anymore. They are out for blood, and will not stop their offensive until workers push back. A class-struggle fightback, such as a nationwide strike against AT&T, could inspire a new generation of workers to strike back against a system that offers no future to the people who create all its wealth.