On November 29, 2019, Peter Schwarz writes on WSWS.org:
On Tuesday, the German automaker Audi announced 9,500 job cuts over the next five years, with one out of every six workers losing his or her job.
This announcement is part of a global jobs bloodbath in the auto industry. Since the beginning of the year, some 350,000 auto jobs in India and 220,000 in China have been destroyed. With the agreement of the union-aligned works council, Volkswagen has eliminated 30,000 jobs over the past three years, while increasing productivity by 25 percent over the same period.
Ford is currently eliminating 12,000 jobs in Europe and 7,000 in North America. Nissan is cutting 12,500 jobs worldwide. General Motors is closing four plants in the US and Canada and slashing 8,000 jobs. Similar plans exist at Daimler, BMW, PSA and other automakers.
The situation is even more dramatic in the parts industry. Continental has announced plans to eliminate 20,000 jobs in the coming 10 years. Bosch has already slashed 2,500 jobs in Germany this year and plans to cut a further 3,000 by 2022. Other parts suppliers, including ZF, Schaeffler and Mahle are also doing away with thousands of jobs.
An autoworker prepares a chassis to receive an engine on a new aluminum-alloy body Ford F-150 truck at the company’s Kansas City Assembly Plant in Claycomo, Mo. (AP Photo/Charlie Riedel)
These developments make clear that workers need an internationalist perspective and a socialist programme to oppose the attacks on their jobs, working conditions, and wages.
They confront not only globally operating automakers and their billionaire shareholders, but also the trade unions and works councils, which collaborate with management to draw up the cuts and help implement them. Without breaking from these corrupt, pro-company apparatuses and establishing independent rank-and-file committees to unite their struggles internationally, workers cannot defend a single job.
This is made particularly clear by events at Audi. The elimination of jobs at the company was prepared and planned in months-long secret talks between management, the trade unions and the works council.
“There are no desperate demonstrations with red flags in front of the plant gates,” wrote a somewhat surprised Süddeutsche Zeitung. “On the contrary, the plan and the number of cuts were worked out by (Audi CEO Bram) Schot in cooperation with the works council, and both sides almost sounded euphoric on Tuesday.” Works council Chairman Peter Mosch praised the jobs massacre as an “important milestone.”
The automakers and trade unions justify the attack on jobs and the wages by pointing to the global decline in sales and the introduction of autonomous and electric vehicles, which entails high development costs but fewer steps in the production process.
In fact, developments in the auto industry show the absurdity of the capitalist system, under which technological development is used to intensify the exploitation of the workers, fill the pockets of a tiny super-rich elite, and throw hundreds of thousands into poverty. It provides a powerful argument for the transformation of the global auto industry into socially owned property, its placement under workers’ control, and its organisation on a world scale according to a rational plan to meet human need, not private profit.
The global automakers are using new technologies as a battering ram to destroy the rights and achievements secured by workers in the course of decades of bitter struggles. These attacks began in the 1980s and autoworkers’ wages have stagnated or declined ever since.
Temporary and contract employment and other forms of precarious work have long become a prominent feature of the auto plants, with the approval of the trade unions. In the United States, the Obama administration restructured General Motors and Chrysler by halving the wages of all new-hires. Starvation wages in Asia, Latin America, Africa and Eastern Europe are being exploited to push down wages everywhere.
The introduction of automation and artificial intelligence is not being used to make work easier, but to “Amazon-ize” it, i.e., to oversee and control every action and every second of the work day. To slash development and production costs, and conquer new markets, automakers are merging to form ever larger companies. PSA (Peugeot) and Fiat-Chrysler recently agreed to join forces to form the world’s fourth-largest automaker, behind Renault/Nissan, VW and Toyota.
The world market is dominated by huge monopolies that dictate wages and prices, and wage a bitter struggle for market share, which increasingly coincides with the imperialist powers’ preparations for war.
Growing numbers of workers are resisting these attacks. In Matamoros, Mexico, tens of thousands of highly exploited workers in the auto parts industry downed tools for several weeks earlier this year. In the United States, 48,000 GM autoworkers participated in the longest strike in 50 years. Strikes by autoworkers have also taken place in India, China, Romania, Hungary, the Czech Republic, Germany, France, Britain and other countries.
But wherever these militant struggles break out, they immediately come into conflict with the trade union bureaucracy, which sabotages them and sells them out. Germany’s IG Metall, the United Auto Workers in the United States and the other unions long ago ceased to be workers’ organisations that struggle for social improvements and reforms. Instead, they function as co-managers and a labor police force in the plants, tasked with intimidating workers and imposing management’s diktats.
This role is determined both by the trade unions’ social position and their political program, which are inextricably connected.
The trade union functionaries and works councilors earn incomes that workers can only dream of. This may take different forms from country to country, but the essence remains the same. In the United States, UAW President Gary Jones and other leading officials were forced to resign after stealing millions of dollars in trade union funds. In Germany, payments for the trade unions’ services are legally codified in the system of so-called “co-determination.” Works council chairs like Berndt Osterloh (VW) and Peter Mosch (Audi) earn annual salaries in the upper-six-figure range.
The trade union bureaucrats are hostile to the class struggle and are nationalist to the core. Like the corporate executives, they see their task as securing a competitive advantage for their “own” corporation against its domestic and foreign rivals. To achieve this, they are prepared to agree to anything, from wage cuts to mass layoffs and the shutdown of plants, like the Opel plant in Bochum. If they occasionally call strikes or protests, they do so only to let off steam and prevent the mounting opposition among workers from escaping their control.
To suppress the class struggle, the union executives aim to establish the closest cooperation with the governments and the corporations. For example, Roland Zitzelsberger, IG Metall head in the state of Baden-Württemberg, a centre of Germany’s auto industry, recently boasted in an interview about the so-called transformation council. This council includes trade union officials, works councilors, corporate executives, government representatives and academics, who gather around a table to discuss economic strategies. This form of class collaboration found its most finished form in the corporatist state of Italian fascism during the 20th century.
To break out of the trade unions’ suffocating grip, the World Socialist Web Site and Socialist Equality Party call for the formation of rank-and-file committees opposed to the trade unions and works councils.
In contrast to the unions’ pro-capitalist and nationalist policies, these action committees will base their strategy on the rights and requirements of the workers, which are irreconcilable with those of the capitalists.
In response to the global strategy of the transnational auto companies, rank-and-file committees will advance their own international strategy aimed at unifying autoworkers across the world in a common struggle to defend the right to secure and good-paying jobs for all workers. The World Socialist Web Site will do everything in its power to assist autoworkers in building rank-and-file action committees, establishing lines of communication across factories and national borders, and building the leadership in the working class that is necessary to put an end to capitalist exploitation once and for all.
https://www.wsws.org/en/articles/2019/11/29/pers-n29.html
Gary Reber Comments:
This is an interesting article that proposes solutions from a purely socialist point of view, which are not the solutions needed for workers to earn more and stay competitive globally.
The reality is that tectonic shifts in the technologies of production will continue to destroy jobs and devalue the worth of labor throughout the world, while at the same time raising productivity due to the efficient application of the non-human factor of production.
Yet, socialists and others such as the labor union movement want to defend their jobs, working conditions, and wages, while ignoring the necessity for workers to become actual owners.
Historically and in its present form, the labor movement is destructive in that it agrees with the idea that propertyless people should exist to serve those who own property. The labor movement doesn’t seek to end wage slavery; it merely seeks to improve the condition of the wage slave. If it actually cared about human rights and freedom, it wouldn’t call itself the “labor movement.”
The labor union movement needs to transform to a producers’ ownership union movement and embrace and fight for economic democracy with workers sharing in the ownership of the corporations that employ them. They should play the part that they have always aspired to — that is, a better and easier life through participation in the nation’s economic growth and progress. As a result, labor unions will be able to broaden their functions, revitalize their constituency, and reverse their decline.
Unfortunately, at the present time the movement is built on one-factor economics — the labor worker –– defending every single job.
The insufficiency of labor worker earnings to purchase increasingly capital-produced products and services gave rise to labor laws and labor unions designed to coerce higher and higher prices (wages) for the same or reduced labor input. With government assistance, unions have gradually converted productive enterprises in the private and public sectors into welfare institutions. Economist Louis O. Kelso stated: “The myth of the ‘rising productivity’ of labor is used to conceal the increasing productiveness of capital and the decreasing productiveness of labor, and to disguise income redistribution by making it seem morally acceptable.”
Kelso argued that unions “must adopt a sound strategy that conforms to the economic facts of life. If under free-market conditions, 90 percent of the goods and services are produced by capital input, then 90 percent of the earnings of working people must flow to them as wages of their capital and the remainder as wages of their labor work… If there are in reality two ways for people to participate in production and earn income, then tomorrow’s producers’ union must take cognizance of both… The question is only whether the labor union will help lead this movement or, refusing to learn, to change, and to innovate, become irrelevant.”
Unions are the only group of people in the whole world who can demand a real, justice managed, equal allocation Employee Stock Ownership Plan (ESOP), who can demand the right to participate in the expansion of their employer by asserting their constitutional preferential rights to become capital owners, be productive, and succeed. The ESOP can give employees access to capital credit so that they can purchase the employer’s stock, pay for it in pre-tax dollars out of the earnings generated by the new assets that underlie that stock, and after the stock is paid for earn and collect the capital earnings income from it, and accumulate it in a tax haven until they retire, whereby they continue to be productive capital earners receiving income from their capital asset ownership stakes. This is a viable route to individual self-sufficiency needing significantly less or no government redistributive assistance.
The unions should reassess their role of bargaining for more and more income for the same work or less and less work, and embrace a cooperative approach to survival, whereby they redefine “more” income for their workers in terms of the combined wages of labor and capital on the part of the workforce. They should continue to represent the workers as labor workers in all the aspects that are represented today — wages, hours, and working conditions — and, in addition, represent workers as full voting stockowners as capital ownership is built into the workforce. What is needed is leadership to define “more” as two ways to earn income.
If we continue with the past’s unworkable trickle-down economic policies, governments will have to continue to use the coercive power of taxation to redistribute income that is made by people who earn it through owning “tools” as inputs to production or their labor and give it to those who need it. This results in ever deepening massive debt on local, state, and national government levels, which leads to the citizenry becoming parasites instead of enabling people to become productive in the way that goods, products, and services are actually produced.
When labor unions transform to producers’ ownership unions, opportunity will be created for the unions to reach out to all shareholders (stock owners) who are not adequately represented on corporate boards, and eventually all labor workers will want to join an ownership union in order to be effectively represented as an aspiring capital owner. The overall strategy should assure that the labor compensation of the union’s members does not exceed the labor costs of the employer’s competitors, and that capital earnings of its members are built up to a level that optimizes their combined labor-capital worker earnings. A producers’ ownership union would work collaboratively with management to secure financing of advanced technologies and other new capital investments and broaden ownership. This will enable American companies to become more cost-competitive in global markets and to reduce the outsourcing of jobs to workers willing or forced to take lower wages.
Kelso stated, “Working conditions for the labor force have, of course, improved over the years. But the economic quality of life for the majority of Americans has trailed far behind the technical capabilities of the economy to produce creature comforts, and even further behind the desires of consumers to live economically better lives. The missing link is that most of those un-produced goods and services can be produced only through capital, and the people who need them have no opportunity to earn income from capital ownership.”
Walter Reuther, President of the United Auto Workers, expressed his open-mindedness to the goal of democratic worker ownership in his 1967 testimony to the Joint Economic Committee of Congress as a strategy for saving manufacturing jobs in America from being outcompeted by Japan and eventual outsourcing to other Asian countries with far lower wage costs: “Profit sharing in the form of stock distributions to workers would help to democratize the ownership of America’s vast corporate wealth, which is today appallingly undemocratic and unhealthy.
“If workers had definite assurance of equitable shares in the profits of the corporations that employ them, they would see less need to seek an equitable balance between their gains and soaring profits through augmented increases in basic wage rates. This would be a desirable result from the standpoint of stabilization policy because profit sharing does not increase costs. Since profits are a residual, after all costs have been met, and since their size is not determinable until after customers have paid the prices charged for the firm’s products, profit sharing [through wider share ownership] cannot be said to have any inflationary impact on costs and prices.”
Unfortunately for democratic unionism, the United Auto Workers, American manufacturing workers, and American citizens generally, Reuther was killed in an airplane crash in 1970 before his idea was implemented. Leonard Woodcock, his successor, nor any subsequent union leader never followed through.
The union movement should also expand beyond representing corporate employees and represent capital ownership empowerment for all propertyless citizens.
