Making Things Anew
Alana Newhouse | The Rise, Fall, and Rise of U.S. Auto Unions | Factoids
Quote of the Moment
Sometimes the task of rebuilding—of accepting what has been broken and making things anew—is so daunting that it can almost feel easier to believe it can’t be done.
But it can.
| Alana Newhouse, Everything Is Broken
The Rise, Fall, and Rise of U.S. Auto Unions
I have been following the progress being made in U.S. union activities quite closely in the past five years or so. During this period, the activities around services unionization — like Starbucks and Amazon efforts — have occupied a great deal of media attention, but their impact to date has been negligible so far, principally since the companies involved have no union history aside from outright union busting. I reserve that an unwinding of those events for another day.
U.S. auto unions, on the other hand, have a long relationship with the big three U.S. auto manufacturers — GM, Ford, Stellantis — so the contention between a union like the United Automobile Works (UAW) today is about pay, benefits, and the length of the working week, not the basic push for union recognition.
Here’s a screenshot of a small section of my Obsidian graph, centered on the UAW. The grayed-out nodes are related terms, like Ford, Shawn Fain (UAW president), and Paul Krugman (Nobel laureate in economics). Just to get a flavor.
I’m going to pull a selection of observations from various observers and — perhaps because of my biases — their insights tend to cluster in a consistent direction.
Just this week, Paul Krugman returned to the shifting landscape of unionization in the U.S. from a political lens in Can Biden Revive the Fortunes of American Workers?. My take [italics are Krugman]:
The UAW wins at VW vote 3 to 1: 'It’s not silly to imagine that historians will someday look back at the Chattanooga vote as a milestone on the road back to the more or less middle-class society America used to be.'
Krugman seems to be saying that might be due to @Joe Biden. Why doesn't he cite @Shawn Fain, the head of the UAW, who was responsible for this win and last year’s victory over the Big Three? He does point to the tight labor market, which is his bailiwick as an economist. 'The most likely explanation for the sudden but persistent move toward relative equality was something else that was sudden but persistent: the rise of labor unions, which by the late 1940s represented more than 30 percent of American workers, and remained powerful until the 1980s’. That was when the 'Steel Belt' became the 'Rust Belt' according to Goldin and Margo (see below).
‘Strong unions were a force for equality because they were a counterweight to both the market power of big business and the political power of big money. And the decline of unions, which still represented around a quarter of workers in 1980 but then fell off a cliff, was probably a major factor in the emergence of the new Gilded Age we live in now.' What factors today are like the 1940s? 'A tight labor market: We’ve just experienced the longest stretch of unemployment below 4 percent since the 1960s. This tight labor market is probably the main reason we’ve seen an “unexpected compression” of wages in recent years, with earnings rising much faster at the bottom than at the top.'
As he has done in several times in past years, Krugman cites Claudia Goldin (Nobel in economics) and Robert Margo’s The Great Compression, and he restates the authors’ timeline of events from the 1940's — when WWII’s very tight labor market led to a compression of the inequality in wages between workers and management — until the demise of unions that grew during Les Trente Glorieuses: the thirty years following WWII. Note: we are in a tight labor market again.
The recent UAW win against VW in Chattanooga is a throwback to the old days of unionization since this is the first time a push for union recognition in a nonunion auto plant in a Southern state has succeeded.
The antiunionization climate that started with Carter and Reagan in the ‘70s and ‘80s never declined in the South. Actually, according to Jamelle Bouie, it was a continuation of trends going back to slavery. My notes [italics Bouie]:
Bouie lays out the history of anti-union policies in the South, starting with ante-bellum industrial slavery, leading up to the current day confrontation of Republican Governors and legislatures with the UAW. 'Organized labor was, is and remains an existential threat to the political and economic elites of a region whose foremost commitment is to the maintenance of an employer-dominated economy of low-wage labor and its attendant social order.'
‘The mere potential for union success was so threatening that the day before the vote began, several of the Southern Republican governors announced their opposition to the U.A.W. campaign. “We the governors of Alabama, Georgia, Mississippi, South Carolina, Tennessee and Texas are highly concerned about the unionization campaign driven by misinformation and scare tactics that the U.A.W. has brought into our states,” their joint statement reads. “As governors, we have a responsibility to our constituents to speak up when we see special interests looking to come into our state and threaten our jobs and the values we live by.”’ The ‘special interests coming to our state’ being a union voted on by Tennessean workers, note.
Even with the rise of unions in WWII outside Dixie, the South remained deeply antiunion.
Harold Meyerson, in American Workers Get Some Help From an Enlightened German Law, explores why VW, Mercedes-Benz, and BMW might be forced to accept unions in their Southern plants [italics Myerson]:
In 2021, Germany passed a new law because German unions feared German companies could ‘undercut their members by offshoring work to low-wage climes, even as environmental and human rights organizations feared the low standards that such offshoring could enable. The new law, the Supply Chain Act, which took effect in 2023, was designed to allay such fears. It empowered a German federal agency (the Federal Office for Economic Affairs and Export Control, or BAFA) to monitor the foreign-located factories and supply chain operations of German businesses with at least 1,000 employees to see if those facilities were violating any of 11 stipulated human rights standards, including the use of child labor, the violation of worker health and safety standards, and the right to form trade unions.'
'Fast-forward to last week. On the eve of filing for a unionization election at the Mercedes factory in Vance, Alabama, the UAW filed a complaint against Mercedes-Benz Group AG with BAFA, based on the company’s having fired workers active in its unionization campaign, on requiring workers to attend anti-union propaganda meetings, and other particulars of the anti-union playbook that managers in the U.S. (though not in Germany) routinely draw upon to squelch workers’ efforts to have a voice at work.’
’The UAW has lodged similar complaints with our own labor-law enforcer, the National Labor Relations Board. In both German and U.S. law, it’s a violation to fire workers for their pro-union activities. In the U.S., however, the only penalty employers face if they’re found in violation is to rehire such workers, give them the back pay they missed, and post a notice saying they’d done the rehiring and back-paying. That falls somewhat short of having to cough up 2 percent of annual revenues (roughly 3 billion euros in this case) and being blocked from government contracts.'
The German auto manufacturers intentionally picked anti-union Southern states to build their plants, as detailed by Luis Feliz Leon in Why Foreign Carmakers Set Up Shop in the US South [italics Leon]:
A state by state and auto company by auto company recitation of union activity and the companies efforts (and mostly successes) in blocking unions, a summary of the content of America’s Other Automakers by Timothy J. Minchin. The typical playbook: foreign auto manufacturer buys land in a rural, non-union, mostly white region of a southern state, builds a huge factory, hires white locals with little or no union background, and then conscripts local politicians to enact anti-union legislation and harassment. The UAW has a poor history of fighting these tactics.
'Today, these nonunion plants account for about half of auto production in the United States, undermining wages and conditions in union plants.'
What most surprised me was this: 'Between the 1980s and 2000s the foreign-owned plants became powerful exporters. The luxury vehicles Mercedes builds in Alabama are sent to 135 countries, while 70 percent of BMWs built in South Carolina are shipped overseas.'
So the German unions were right to demand the Supply Chain Act.
Neal Boudette looks ahead to the next battleground:
With the victory in Chattanooga, the U.A.W will turn its focus to other Southern plants. A vote will take place in mid-May at a Mercedes-Benz plant in Vance, Ala., near Tuscaloosa. The U.A.W is hoping to organize a half-dozen or more plants over the next two years.
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