UAW: Unemployed Auto Workers

A Decade After Taxpayers Bailed Them Out, UAW Union Bosses Are Still Destroying Autoworkers’ Jobs

Americans who were recently inundated with media reports regarding the November 26 announcement by Big Labor-impaired automaker General Motors (GM) that it intends to idle five of its plants in the U.S. and Canada, and eliminate up to 15% of its workforce and 25% of its executives, may easily have concluded it is no longer possible to manufacture passenger cars profitably in the U.S.

A November 28 report for Reuters suggested the “rapidly dwindling demand for traditional passenger cars from U.S. consumers” is the key problem for GM and fellow unionized automaker Ford. In early December, a Morgan Stanley analysis predicted Ford would also seek to make major cuts in its American and Canadian workforces in 2019.

And the only reason the third major unionized U.S. automaker, Fiat Chrysler Automobiles (FCA), is not expected to attempt a major downsizing is that it has already virtually stopped making passenger cars in North America!

BMW SC flags-with-building
BMW factory in Right To Work South Carolina

But if the indisputably dwindling U.S. market for passenger cars makes it impossible to manufacture them profitably here, why did Volvo begin producing its S60 sedan at a $1.1 billion plant in Charleston, S.C., just last September? And why is a Toyota-Mazda manufacturing joint venture now building a $1.6 billion plant in Huntsville, Ala., that is expected to produce (though plans remain flexible) 150,000 Corollas a year, as well as an equal number of crossover models?

The fact is, American autoworkers today have the skills and the industry to earn a good living for themselves and their families producing high-quality passenger cars that can be sold at competitive prices domestically and, if a trade war can be averted, internationally.

But the looming GM factory closings and the ominous, albeit vague, $11 billion “restructuring” plan announced by Ford last fall underscore the fact that the jobs of autoworkers who are hamstrung by counterproductive United Auto Workers (UAW) union work rules are not safe.

In Right to Work states like South Carolina and Alabama, union-free auto assembly and parts manufacturing facilities producing all kinds of vehicles and components have continued to be constructed and expanded in recent years, as federal data show.

From 2006 to 2016, according to U.S. Commerce Department data that were revised and updated in November, the total real value of automotive manufacturing production increased by 14.7%, to nearly $40 billion (2012 dollars), in the 22 states that had Right to Work laws on the books throughout the whole period.

Meanwhile, real annual automotive manufacturing output plummeted by nearly $12 billion, to less than $34 billion, in the 24 states that still lacked Right to Work protections for employees as of the end of 2016.

The net long-term decline in automotive manufacturing and production jobs in forced-unionism states is a result, overwhelmingly, of the shriveling of UAW boss-dominated GM, Ford and FCA.

The domestic workforces of these auto companies, the former “Big Three,” shrank dramatically even as two of the three, GM and FCA, received massive government bailouts. GM alone collected a total of $50 billion at federal taxpayers’ expense in 2008 and 2009.

Even though the wasteful work rules that UAW bosses, wielding their government-granted monopoly-bargaining power over employees, insisted on for decades are largely what drove the companies into bankruptcy, the UAW hierarchy was actually the primary beneficiary of the GM/FCA bailout. The Obama Administration even awarded the health-care fund controlled by UAW officials a 17.5% stake in the restructured GM that emerged after the bailout!

Today, roughly a decade after politicians bailed out top UAW bosses, the union’s current chiefs are embroiled in a still-unfolding corruption scandal involving the alleged misappropriation of millions and millions of dollars that were supposed to help train workers. Three former members of the UAW union’s FCA negotiating team have already pled guilty to taking part in the looting.

The D.C. Beltway has spawned innumerable problems by adopting the laws that foisted monopolistic unionism on the workforces of companies like GM and FCA. The Beltway’s last attempt to “fix” those problems in the automotive sector was a predictable disaster.

The genuine solution is the same as it’s always been: revocation of Big Labor’s monopoly privileges, including union bosses’ power to force workers to pay union dues or fees to get a job!