General Motors in mid-February announced its highest annual profits ever -- $7.6 billion in 2011 profits on revenues of $105 billion. That’s not only an increase of 62% from the year before, it’s just two years since GM reorganized under federal bankruptcy law – helped by $82 billion in taxpayer money.
President Obama was praised for GM’s turnaround from the Left and the Right, from progressive talk-show host Ed Schultz, for example, and conservative Forbes magazine, which wrote, “Thanks to President … Obama, it restructured itself and emerged from bankruptcy. GM’s record profit for 2011 vindicates Obama’s action.”
However, labor had a profound hand in rescuing GM and the whole auto industry, too, and most of the back-slapping has overlooked that. Further, U.S. workers continue to make real sacrifices, much of which stems from “free trade” agreements overseas and shameless union-busting at home. Not recognizing that is a mistake.
The assistance given to Detroit saved a reported 1.4 million U.S. jobs, but the United Auto Workers since 2005 made a series of deep concessions -- from wage increases and overtime pay to holidays and two-tier pay scales cutting compensation for new hires -- key to saving others’ jobs.
The bailout, led by investment banker Steven Rattner, resulted in tens of thousands of GM and Chrysler workers losing their jobs. Federal funds also let Chrysler move an engine-production unit from Kenosha, Wis., to Mexico, and GM nearly doubled the amount of cars imported from Mexico, China and other countries.
If Democrats and Obama accept praise for GM’s profits, they should shoulder some blame for the free trade agreements they got through Congress and the adverse consequences for regular working people.
If Democrats and Obama accept praise for GM’s profits, they should acknowledge that attacks on labor include not just concessions unions had to accept, but literally unacceptable law-breaking by U.S. employers.
More than 31,000 workers get fired in a typical year while trying to unionize their workplaces, according to Philip M. Dine, author of “State of the Unions.”
Right-wing extremists often cry “class war” when Democrats, organized labor or citizens movements like Occupy Wall Street call for shared sacrifices such as modest tax hikes on the wealthiest Americans. But focusing exclusively on the tax debate ignores the ongoing assault on workers.
Milwaukee P.R. consultant Roger Bybee in the magazine In These Times wrote, “The richest 1% did not triple their share of the nation’s income during the last three decades -- to the current 24 percent -- simply through the tax system alone. Nor did the tax system allow the wealthiest 1% to capture nearly 9/10 of productivity gains in recent years -- representing a $3 billion upward shift in income.”
Besides the renewal of the North American Free Trade Agreement (NAFTA), Democrats and Obama went along with GOP efforts to pass three new free trade agreements, with Colombia, Panama and South Korea.
NAFTA caused the United States to lose more than 682,000 jobs, according to the Economic Policy Institute, which predicts an additional 159,000 jobs lost because of the pact with Korea and another 200,000 jobs lost to Panama and Colombia -- which have other problems.
U.S. Rep. Dennis Kucinich, an Ohio progressive Democrat, said, “Panama is home to 400,000 corporations that incorporate there for tax evasion. Panama is also the home of drug money laundering operations by Mexican and Colombian drug cartels.
“Colombia has a violent history opposing unions,” Kucinich continued. “Fifty-one unionists were killed in 2010 and another 21 survived attempted murders; 47 more were killed in 2009. These trade agreements are bad for America and for American workers.”
The Obama administration has also failed to enforce free trade pacts’ side agreements on labor, as weak as they are, repeating the bipartisan non-action of White House predecessors George W. Bush and Bill Clinton.
Particularly in an election year, the President and the Democratic Party must speak about labor and do something for regular working people. If not, this fall could see a repeat of the election in 2010, when angry blue-collar workers didn’t vote or supported Republicans. Unfortunately, the only protection against that now is not Democrats’ bold action or activism, but actions and rhetoric by Republicans.
Campaigning in Michigan the week GM issued its financial report, presidential contender Mitt Romney was reminded of his 2008 statement saying, “We should have let Detroit go bankrupt.”
Democrats shouldn’t count on the “lesser of two idiots” as an ongoing political strategy.
Led by a more engaged President Obama, Democrats must recognize workers’ sacrifices in the past and stake in the future -- and do something beyond making speeches and celebrating GM’s success.
Bill Knight is a freelance writer who teaches at Western Illinois University. The opinions expressed are not necessarily thos of WIU or Tri States Public Radio.