Spartacist Canada No. 161

Summer 2009


Union Tops Surrender Hard-Won Gains

Bosses Wage War on Auto Workers

For an International Planned Socialist Economy!

With the most severe economic downturn since the Great Depression growing worse, the capitalists and their governments say that “all must sacrifice.” For the ruling class, whose anarchic system of production for profit wrought this disaster, “all” means the working class, who face layoffs, slashed wages and benefits, and draconian cuts in pensions and social services. Meanwhile, the capitalists are being handed billions of dollars in government bailouts.

Atop the agenda of the modern-day robber barons is making unionized auto workers pay for the financial collapse of the Big Three auto producers. From the start, the drawn-out auto bailout proceedings have focused on how best to break the backs of the unions, the United Auto Workers (UAW) in the U.S. and Canadian Auto Workers (CAW) north of the border. The attacks on these unions, once among the most powerful in North America, are meant to serve as a wedge against all working people, furthering a brutal “race to the bottom” of cascading concessions to the bosses.

The Obama administration in the U.S. and the Canadian and Ontario provincial governments have demanded that tens of thousands more auto jobs be axed and that the benefits and wages of the remaining workforce be reduced to the level of the non-union, mainly foreign-owned auto plants. Criminally, the union bureaucracies have surrendered across the board. The UAW under Ron Gettelfinger has agreed to enormous concessions including 16 plant closures at General Motors alone, in exchange for nearly worthless company stock. The union’s health-care trust fund is supposed to get up to a 20 percent “ownership” stake in GM and 55 percent of Chrysler as well as seats on the board. These sellouts, which flow from the union bureaucracy’s support for the capitalist system, are a flagrant betrayal of the workers’ interests, which can only go forward through class struggle against the capitalists.

In Canada, the CAW bureaucracy under Ken Lewenza has agreed to unprecedented wage and benefit cuts of $19 an hour to Chrysler and $22 an hour to GM. While complaining of government and company blackmail, including GM’s threat to liquidate its Canadian operations, the CAW tops have acceded to just about every demand. Lewenza even touted the massive givebacks to GM as “an agreement that protects the interests of our members” and “an important victory” (, 22 May)!

With various corporate bondholders balking at even these terms, Chrysler has gone into bankruptcy in the U.S. and GM is poised to do the same. Moreover, the bailout terms allow the governments to revoke their loans to GM and Chrysler in the event of a strike to stop the bloodletting. This underlines how there is no real difference in impact between bailout and bankruptcy: either the workers will concede “voluntarily” or the bosses’ courts will order them to do so.

Fearing that the companies may go under and seeing no way forward, workers have been manipulated into voting to accept such devastating givebacks. Yet to vote for such terms is to give up the sole advantage offered by unionization: the ability to collectively organize and fight to improve the workers’ lot. For the capitalists, “restructuring” means restoring profits by eliminating jobs and ratcheting up the rate of exploitation through wage cuts, longer hours and speed-up. Those few hard-won gains that remain today will be up for renegotiation tomorrow as the economy continues to go to the dogs. Not fighting will only assure greater misery in the future.

The Fight Against the Devastation of the Working Class

Auto workers across the globe are under the gun. Sales have collapsed, and company after company is contracting. Toyota reported its first annual loss in nearly six decades; taking its cue from Detroit, it has offered buyouts to some 18,000 workers in the U.S. while announcing wage cuts for those who remain. Auto plants across Europe are threatened with closure. Workers in Mexico, which has a significant auto industry composed of U.S. and other foreign-owned factories, are being hit with layoffs.

The crisis in auto is an example of the anarchy and decay that reign in capitalist production in general, to which there is no simple trade-union solution. In their drive for ever-greater profits, the capitalist rulers have looted the wealth produced through the workers’ labour and sabotaged vital infrastructure by refusing to invest in and modernize basic industries. The deindustrialization of the U.S. and Canada, underway for decades, has only exacerbated the current crisis.

In the U.S., black workers are especially at risk. The 1941 strike at Ford’s giant River Rouge plant in Detroit was a turning point in bringing black workers into the UAW and enabling it to become America’s most powerful union. That was then. With all but a few auto plants in the Detroit area shut down for good, black male joblessness in the city hovers at 50 percent. The jails are overflowing and social services and the housing market have collapsed, with the Detroit News (23 February) reporting that the average sale price of a house in the city is $7,000. Once a center of working-class black America, Detroit resembles New Orleans in the aftermath of Katrina; both disasters are the products of racist America’s capitalist order.

The auto industry has long been at the core of manufacturing in Canada. Even after the tens of thousands of job cuts over the past decade, last year it accounted for 135,000 direct jobs in Southern Ontario, and at least 300,000 more in industries that supply the assembly plants with materials and services. Now auto production centers like Oshawa and Windsor are becoming industrial ghost towns. Factory closures are similarly devastating the working class in cities like Hamilton, long the heart of the steel industry.

The capitalist economic crisis is throwing hundreds of thousands of workers here, and many millions globally, into the ranks of the unemployed. In this context, the fight for jobs is equivalent to the fight against the devastation of the working people. It is necessary to demand an end to layoffs by shortening the workweek at no loss in pay, as part of the struggle for jobs for all. Unemployment benefits must be greatly increased and extended to everyone who cannot find a job, and all pensions must be completely guaranteed by the government. A massive program of public works at union wages is needed to rebuild roads and bridges, fix the decaying health system and schools and expand public transit.

But such basic and obviously necessary demands, the elements of which were laid out in the 1938 Transitional Program, the founding document of the Trotskyist Fourth International, will not be granted by the rapacious capitalist rulers. The capitalist state, which is the executive committee of the ruling class, exists to defend the rule and profits of the bourgeoisie. It cannot be reformed or wielded to serve the interests of working people. The catastrophe of joblessness, threatening the disintegration of the working class, can be effectively fought only by a workers movement led by those committed to the struggle for socialist revolution and the creation of a rationally planned, socialist economy on an international scale.

While auto workers are in a precarious situation, people still need cars to get around, and the auto industry is vital to the military power of U.S. imperialism and its Canadian junior partner. Armed with a class-struggle program that is based on the understanding that the working class shares no interest with the bosses, unions with the power of the UAW and CAW could spearhead an internationalist fight against the ravages of capitalism, by enlisting support from and championing the cause of the rest of the working class and the unemployed.

But Lewenza, Gettelfinger and their ilk in the top echelons of the union bureaucracy are not going to lead such struggle. Aptly described by the early American socialist Daniel De Leon as “labour lieutenants of capital,” the union bureaucrats share with their capitalist masters a belief in the inviolability of the profit system. This belief is concretized in the U.S. by the labour tops’ integration into the capitalist Democratic Party, and in Canada by their fealty to the right-wing social democrats of the NDP or the capitalist Liberal Party. While it is possible, though unlikely, that the union tops may be moved to some militancy if their status is threatened, once that is secure they will again betray.

It is long since time for the labour traitors, complicit in the gutting of the unions, to go. The road forward lies in building a class-struggle leadership in the unions to carry out the vitally necessary battles against the capitalist masters. This will be part of the forging of revolutionary working-class parties on both sides of the U.S.-Canada border and beyond, parties dedicated to the overthrow of decaying imperialism’s world order.

Nationalism and Protectionism: Poison to Labour’s Struggle

The fighting power of auto workers in North America was vastly weakened by the nationalist split in the UAW in 1984, when Canadian director Bob White pulled the 120,000 members of the union’s Canadian region out to form the CAW. The UAW had been forged in the 1930s and 40s through bitter international class struggle against the auto companies who brutally exploited workers in both countries. The 1937 Oshawa GM sit-down strike, pivotal for organizing the UAW in Canada, came hard on the heels of the sit-down by auto workers in Flint, Michigan. Workers won union recognition at Ford in Canada through a bitter strike in Windsor in 1945, four years after the River Rouge strike across the river in Detroit.

By the early 1980s, the UAW had already been weakened by union misleaders on both sides of the border, who kneeled before the bosses’ demands for giveback contracts and watched as the ranks were decimated by plant closures and layoffs. Playing on his reputation as a supposed militant, White told UAW members in Canada that they would be better off going it alone because, he claimed, he stood for “no concessions” as against the givebacks rammed down the U.S. workers’ throats by the UAW leadership. Thus the union split along national lines, as the leaders of the new CAW deliberately isolated the Canadian locals from the potentially explosive black auto workers who laboured for the same companies in Detroit. We wrote at the time:

“The only winners in the UAW split are the auto bosses. Canadian auto workers are the losers. Now they face the greedy auto companies with 10 percent of their former potential strength.”

—“Bureaucrats Split UAW,” SC No. 63, April 1985

Stepped-up concessions were soon the order of the day in both countries, as the union tops scrambled to “protect” jobs at home at the expense of auto workers abroad. From the start, the CAW tops appealed to the Big Three bosses for more investment in Canada on the basis that auto workers here cost $7 an hour less in pay and benefits than their U.S. brothers and sisters. They’ve been singing the same tune ever since. A current CAW pamphlet beseeches the companies to keep jobs north of the border because “Canadian auto labour is cheaper than in the U.S., Japan, and Germany” (“Auto Industry on the Brink”).

The union bureaucrats tell workers that such protectionism is the answer to layoffs, closures and the drive to cut wages and benefits. This is false to the core! Protectionism means joining with the enemy class to help shore up profits—profits exacted from the labour of working people whether in Canada, the U.S. or elsewhere. For the capitalist rulers, “free trade” and protectionism are options that can be debated, but for the working class, protectionism is poison. It is a classic means of channeling discontent over job losses into hostility toward foreign workers and also immigrants.

GM has manufacturing plants in 35 countries. The best measure of protection for auto workers in Canada would be to fight alongside their working-class allies in other countries, including in the U.S. and in semicolonial countries like Mexico. But the only banner the Canadian labour tops have consistently unfurled during the decades-long withering of the union movement has been the yellow one of poisonous chauvinism.

During last year’s protests against the closure of GM’s Oshawa truck plant, the lead CAW banner read: “World Class Quality + World Class Productivity = OUR JOBS TO MEXICO. THANKS GM.” Such agitation for “Canadian jobs for Canadian workers” deeply undermines class consciousness and solidarity, scapegoating foreign workers for the loss of jobs and reinforcing illusions in the supposed benevolence of our “own” capitalists.

The CAW tops’ protectionism is especially dangerous when directed against China. The union bureaucracy has long demanded that Ottawa erect tariff barriers to keep out imports from Japan and South Korea; now, with the dramatic growth of China’s auto industry, these reactionary nationalist calls are being extended to that country as well. A “fact sheet” on the union website complains: “A growing one-way flood of auto parts from offshore jurisdictions (including China) is destroying thousands of jobs.”

China is a bureaucratically deformed workers state that was forged through the defeat of imperialist-backed rule in the 1949 Revolution. Thanks to its collectivized economy, it has brought hundreds of millions of workers and peasants out of dire poverty into social production and a vast advance in living standards. With their nationalist agitation against China, the union bureaucrats are making an anti-Communist alliance with the Canadian and American capitalist rulers against the gains of the 1949 Revolution.

Albeit on different scales, both the auto unions in North America and the workers state in China are the fruits of historic victories for the proletariat. One resulted from the formation of industrial unions in the 1930s, the other from the expropriation of capitalist class rule in the 1949 Revolution. Both must be defended unconditionally from attacks that seek to undo these gains, despite the fact that each is led by a bureaucratic layer that puts the gains in jeopardy. The bureaucratic misleaders of the unions here must be driven from their positions of leadership and replaced by a class-struggle leadership committed to the overthrow of the imperialist order through socialist revolution. The bureaucratic caste in China must be ousted by a proletarian political revolution to preserve and expand the working-class property forms established following the Chinese Revolution.

Reformist Nationalization Schemes

The pro-NDP “socialist” groups that populate the Canadian left apologize for, or openly propound, the nationalist protectionism typified by the CAW tops. The Communist Party of Canada’s (CPC) People’s Voice (1-31 July 2008) uncritically reported the CAW’s chauvinist anti-Mexico banner in Oshawa last summer. Deeply nationalist, the CPC has long devoted itself not to the cause of the workers but to defending “Canadian independence, jobs and farms” from “foreign” threat.

The International Socialists (I.S.) sometimes raise a few criticisms of the labour tops’ protectionism, only to end up pushing the very same perspective. Their March 16 Socialist Worker lead article affirms: “We must demand that the government keep steel production local.” This is a blatant call for protectionism, not a whit different from the demands for “Made in Canada” quotas raised by the CAW and Steelworkers union bureaucrats.

The same Socialist Worker article calls for the “nationalization and retooling of factories” as the way to “stop the lay offs and closures.” The CPC raises a similar call for the capitalist government to nationalize failing industries, dressing this up as a “made-in-Canada industrial strategy.” Nationalization of dying or bankrupt industries has long been used by capitalist governments to buy off working-class discontent and prop up failing enterprises. As is shown clearly in the de facto GM and Chrysler nationalizations that are now underway, this comes directly at the workers’ expense.

When Chrysler threatened bankruptcy in 1979, then-UAW head Doug Fraser drafted a tepid nationalization plan while pledging to exempt the company from strike action. Whether then or now, full nationalization would simply result in pay cuts, tax subsidies and import controls to make the auto plants profitable. In the end, Fraser settled for a seat on Chrysler’s board of directors—and proceeded to shove concessions down workers’ throats, which did nothing to stop the hemorrhaging of jobs.

As we wrote in our article on the 1979 Chrysler bailout, “No Government Handout for Bosses! Whatever Chrysler’s Worth—Give It to the Workers!” (Workers Vanguard No. 238, 17 August 1979): “The reformist practice of nationalizing only the least efficient capitalist operations is in a sense the exact opposite of socialist expropriation. Socialist economic planning is based precisely on appropriating from the capitalists the most advanced means of production.”

Organize the Unorganized!
For a Class-Struggle Labour Leadership!

Coming off the final shift at the now-closed GM Oshawa truck plant on May 14, one auto worker told CityNews: “It’s the reality of global trade today I guess…. All the manufacturing industries will go where cheaper labour is.” Yet “cheap labour” also exists in this country—indeed the union movement exists in large part because at one time low-paid workers (notably including immigrants) poured into its ranks. And now the CAW union tops are scrambling to “protect” their dues base by agreeing to their own “cheap labour” deals with the auto bosses.

Each giveback has fueled the withering of the auto unions. The UAW had 1.6 million members in the 1960s; today it has well under 500,000, of whom fewer than 150,000 work for the Big Three. The CAW’s growth since 1985 has come through mergers with other unions in different economic sectors, while its membership in basic auto has dwindled and is now disintegrating as plant after plant is shuttered. Yet they have failed abysmally to organize the Japanese and other foreign-owned auto plants as well as most of the parts plants, where wages and benefits have always been much worse than in the unionized Big Three.

The current assault on the auto unions threatens all workers in the industry, from the non-union plants here to the plants in Mexico and overseas. Historically, auto workers in non-union plants have been paid more than the unorganized in other jobs as the bosses attempted to ward off the scourge of union organizing. Now, with the slashing of CAW wages and benefits to the level of those in the non-union plants, these companies are starting to cut wages and benefits as well. In similar fashion, GM’s move to rob retirees of their pension benefits is now being copied in other industries, as companies like Air Canada threaten to default on their pensions. The message from the bosses is clear: just shut up, work hard and die.

The union tops give much lip service and little action to the crucial need to replenish labour’s ranks by organizing the unorganized, and a union that repeatedly rolls over is hardly attractive to the non-union worker. Yet a serious union organizing drive could have wide appeal throughout the working class. Such a struggle requires a leadership which does not seek “partnership” with the bosses but understands that the interests of labour and capital are counterposed.

Let Capitalism Perish!

The present crisis is not the first faced by a weakened labour movement. Throughout the 1920s, the craft-based, pro-capitalist labour leaders did little to organize the armies of workers who did the backbreaking work in the open hearths and on the assembly lines. In the four years after the October 1929 stock market crash, unemployment skyrocketed throughout North America and beyond. The jobless rate in Canada reached 30 percent by 1933, and never dropped below 12 percent until the factories were retooled for military production in World War II. The working class was torn asunder, confronted not just by joblessness but with homelessness and starvation.

It is normal that at the beginning of a massive economic recession or depression the working class will be gripped by paralysis. In the case of the Great Depression, in 1933 the economy in the U.S. experienced a slight upturn. The next year, citywide strikes broke out in several American cities—Minneapolis, San Francisco and Toledo—led by Trotskyists, the Communist Party and left-wing socialists, respectively. These strikes set the stage for a large-scale outpouring of class militancy. Workers in both the U.S. and Canada began to turn en masse to the very unions that had disdained them to demand organization, prompting a wing of the labour officialdom to start organizing industrial workers. Once organized, the workers fought the bosses tooth and nail, sacrificing, if necessary, their jobs, their freedom and their very lives.

There is only one possible explanation for this turn to class warfare. The very conditions that grind down the working class, that demoralize workers and set them one against the other in a fight to survive—that is, the capitalist mode of production—these same conditions also propel the working class toward unity in battle against its exploiters. As long as capitalism exists, it will generate the conditions that spawn class struggle. It is in the course of such sharp class struggle that workers will begin to become conscious of themselves as a class fighting for itself and for all the oppressed against the capitalist order. The crucial instrumentality for this is a revolutionary party that patiently educates the working class in the understanding not only of its social power but of its historic interests.

The class battles of the 1930s set the stage for the further development of class consciousness in the working class, the most advanced elements of which were receptive to the idea of forming a workers party in opposition to the capitalist parties. But in both the U.S. and Canada, the leaders of the new industrial union movement, including the Stalinist Communist parties, crippled it through their support to liberal bourgeois politics. In the U.S., this was expressed in support to the Democratic Party and Roosevelt’s New Deal. To this day the American labour bureaucracy’s ties to the imperialist Democrats, including the Obama administration, have produced only defeat for the workers.

In Canada, the labour tops channeled the aspirations of struggling workers into the social-democratic Cooperative Commonwealth Federation, predecessor of the NDP. Integral to this were the vicious anti-red purges of the 1940s and 50s that saw many of the most militant workers driven out of the unions. While organizationally independent of the bourgeois parties, the NDP has a thoroughly pro-capitalist, nationalist program. When they have had the opportunity to govern, as under Bob Rae in Ontario in 1990-95, the New Democrats have frontally attacked the working class and poor.

It was the Rae NDP government which, to cite but one example, gave GM an exemption from fully funding its pension requirements, helping to set the stage for the company’s estimated $6 billion pension deficit to retirees in Ontario today. By 1995, when they lost the provincial elections to the right-wing Tories, the New Democrats were widely discredited among Ontario workers. The CAW tops, then posturing militant, took the lead in a series of one-day local general strikes, the “Days of Action,” to protest attacks by the new Tory regime. The union tops utilized these protests to gradually rehabilitate the NDP under a new leader.

A few years later the CAW broke with the bulk of the pro-NDP labour bureaucracy and began supporting the big-business Liberals as a more viable “alternative” to the Tories. Today the Ontario Liberal government that the CAW helped elect is working hand-in-glove with the federal Tory regime—and Obama in the U.S.—to pursue the “bailout” attacks on auto workers. For his part, federal NDP leader Jack Layton echoes the bosses’ calls for “sacrifice,” lecturing the workers that they must have the “courage” to “take a pay cut so your friends at the plant can keep their job” (Toronto Star, 23 January).

The class struggle cannot go forward without a fight against the forces that divide workers one from the other. These include the “Canadian unity” chauvinism against the national rights of the Québécois that is especially promoted by the NDP, and the anti-foreign-worker nationalism that fuels anti-immigrant bigotry. It is necessary to advocate independence for Quebec, an oppressed nation long kept artificially and by force within an Anglo-dominated “united” Canada. This is necessary to get the national question off the agenda, to lay a basis for workers in English Canada to see that it is the Canadian capitalists (not the Québécois) who are their enemies and exploiters, and for the Québécois workers to break with their “own” national capitalists.

The union movement must stand unequivocally on the side of immigrants, who often bring traditions of militant struggle into labour’s increasingly multiracial ranks. A fight must be waged for full citizenship rights for all immigrants and against the deportations of undocumented workers. Such struggles can set the stage for the mobilization in common struggle of workers at home and abroad, including with auto workers in Mexico, Asia and elsewhere.

Against the tired and failed strategies pushed by liberals and fake socialists—from the Keynesian project of “benevolent” intervention by the capitalist state to the British Labour Party’s bourgeois nationalizations in the post-World War II period—we Marxists understand that no amount of tinkering with the existing system can wrench it into serving the needs of the proletariat and the oppressed. There is no answer to the boom-and-bust cycles of capitalism short of proletarian socialist revolution that takes power out of the hands of the irrational capitalist ruling class and replaces it with a planned, socialized economy. Only the achievement of a world socialist order can eliminate the age-old problem of poverty, scarcity and want. It is to this end that the Trotskyist League/Ligue trotskyste, Canadian section of the International Communist League, devotes all its resources.