Labor Advocate Online

Week In Review, June 13, 2005
The image “” cannot be displayed, because it contains errors.
by Bill Onasch, webmaster,

Democracy In Bolivia
Bush and Rice were making a lot of noise about democracy in Latin America last week. But their hectoring of the Organization of American States was drowned out by the working people of Bolivia–who have some different ideas about how democracy should work. Fed up with being the poorest country in South America, and getting poorer as the government sold off their national assets to global capital, the workers and peasants took over the streets of the major cities.

Little was reported in the mainstream media about these massive mobilizations–at least until the president resigned and parliament couldn’t find a secure place to meet. The number three man in line of presidential succession, a relatively unknown jurist not directly associated with past government policies, finally negotiated a truce with the mass organizations holding virtual dual power. An quick election and an assembly to rewrite the constitution was promised.

This inspiring fight is far from over. American workers can learn a lot from these struggles in Bolivia with our common foes in the corporate boardrooms and the IMF. Not surprisingly, the best coverage and analysis is not to be found on the network evening news but instead mainly among the left press. Two particularly good articles are: Bolivia’s Mass Organizations—Trade Unions, Peasant Unions, Neighborhood Councils—Unite to Form Their Own Governing Body, from Labor Standard, and, from Socialist Action, Mass Mobilizations Convulse Bolivia.

GM’s Legacy
General Motors was long the largest private employer in America, the biggest by far of the Big Three auto makers, the bluest chip stock on Wall Street. But a combination of technology, outsourcing, offshoring, and loss of market share to Asian and European based competitors, has greatly reduced the GM workforce.

There are more retirees drawing pensions and health care benefits than there are active workers–and that ratio is growing. Pensioners, of course, no longer generate profits. GM bosses and major share holders complain bitterly about this "legacy" debt they feel weighing like an anchor around their neck.

They also moan about benefits presently guaranteed to the current UAW workforce. Transplants, such as Hyundai’s brand new assembly operation in Alabama, generally have no pension plan and offer substandard health insurance--accompanied by stiff deductions from employee paychecks. If they have to continue to pay this huge differential in labor costs, GM argues, then they will no longer be able to compete. That’s why they have to get leaner, and especially meaner, to survive.

Of course, pensions and health care are only part of the retiree’s legacy. Far from being parasites, it was their labor that built GM into the powerhouse of the past. They left behind enough for GM to expand in the last decade by acquiring Saab and Hummer–and still have a huge cash reserve. They deserve every penney promised to them.

GM’s current UAW workers work hard for their money and benefits. Their productivity entitles them to their relatively good compensation. They are certainly not out of line with what their counterparts in Canada, Germany, and Japan earn.

But there’s no hint of gratitude, no sentimentality, among those calling the shots at GM. They have announced their intention to close plants, eliminating 25,000 UAW jobs. And they are going to demand big changes in health care and pensions. They are setting into motion a drive, that left unchecked, could devastate the auto industry in the same way steel was restructured a generation ago.

Early reactions from the UAW leadership are not inspiring. They still want a reasonable "partnership" with GM. Now that’s a legacy that could drown us all.

Will Bankruptcy Success Inspire Copy-Cats?
"After 2 ˝ years in bankruptcy, United Airlines is poised to emerge in the fall with an enviable cost structure that could tempt rival carriers to strive for similar cost cuts through court protection," begins a Reuters article. They speculate that Delta, Continental, and Northwest may soon follow the Chapter 11 route that got United relieved of pension obligations, along with massive concessions in wages and working conditions.

An Early Split?
It’s beginning to look like the "group of five," as the dissident unions in the AFL-CIO have come to be known, may not even wait until the federation convention in late July to vacate the "house of labor." As expected, the SEIU board has authorized Andy Stern to do whatever he pleases, including a split before, during, or after the convention. A press conference is scheduled for Wednesday (June 15) to announce the "Change to Win Coalition." The G-5--SEIU, Teamsters, UNITE-HERE, Laborers, UFCW--expect to be joined by the Carpenters, who split four years ago.

As always, much of the material in this column was based on stories posted on our Daily Labor News Digest.

That’s all for this week.

Sign Up For KC Labor List