How The Ford-UAW Agreement Erodes The Union's Basic Functions

Wednesday's Wall Street Journal contained an informative article concerning the UAW's tentative agreement with Ford. It explains,

"Meanwhile, a new buyout program will allow the Dearborn, Mich., auto maker to shed its most expensive workers and add more lower-cost workers to its U.S. assembly lines.

All of the new hires are expected to earn little more than half the roughly $28 an hour wage that veteran auto workers  make. The wage shift is paving the way for the hiring of up to 12,000 U.S. workers through 2015, including 7,000 previously announced jobs."

Signing bonuses and up-front one-time inflation adjustments replace COLAs in the agreement.

When I read those two paragraphs, I was reminded of this post from June of this year which I wrote on my companion political blog discussing a Journal editorial from this summer. In the editorial, a labor lawyer writes about how cheap labor in Southern US states will ruin American productivity and its economy. Thus, he excoriates Boeing for its building a plant in South Carolina, where wages are much less than in its Seattle plants. The author, Thomas Geoghegan, equates labor costs with quality and skill.

How, then are we to interpret the tentative new Ford-UAW agreement?

The agreement forces the union to basically toss its older, allegedly 'skilled' workers to the wolves, in favor of hiring younger, less-skilled, and cheaper, replacements.

Isn't this sort of competition to work for lower wages precisely what Walter Reuther & Co. established their unions to prevent? Now Bob King is turning 80 years of union policy on its head.

Moreover, the fact that the UAW head would accept that paying younger workers half as much as older, to-be-released so-called highly skilled workers is an admission that labor skill, seniority and expense are completely unrelated. Otherwise, the union would insist that Ford would be building lesser-quality cars with its new, younger, cheaper labor force.

And what if you were an older, allegedly-skilled worker who didn't want to lose your job? Could you offer to work for the new, lower-by-half wage? What would that say about the value of your so-called skill? Call it what you will, Bob King's proposed UAW contract with Ford is an admission of downward pressure on the value of auto assembly work and the jobs that come with it..

Curious, isn't it? When global competitive forces and trade finally push US labor unions to the wall, they violate their own stated goals of protecting all of their members, and abandon the older, higher-paid workers, whose jobs would be eliminated, in favor of younger, cheaper workers, in order to keep some jobs onshore.

So much for the myth that wage rates signify quality or skill.

Either in Detroit, or Charleston.