The UAW As Whipping Boy, Solidarity As Answer

I worked in a Ford Assembly Plant for 31 years and for much of that time I was a rep in my United Auto Workers Local Union. I knew in my early days in that factory most of the best trade unionists I have known in my life. They were very principled people. Very tough. Very honest. Very hard-working. Very friendly and funny.

What they held in most in common was an absolute faith in God and the goodness of common men. (They had a lot of faith in women too but in 1972 when I started, there were only two women in the 2500-member UAW workforce.) They expected one worker to support another and they fought as hard as they could to keep their jobs fair and as comfortable as line work can be.

Against us was the hated stopwatch of Taylor and Fordism. But the Solidarity of lineworkers was a powerful force and each time the company cut jobs out of the line and passed the work to those jobs that remained, we managed to leave this extra work undone. Within a couple of weeks the cut jobs were reinstated, the war was ended, civility returned.

It was this fight against speedup and the emergence of Solidarity to win it that always defined the union for me. It was such a great and successful moral resistance to the assembly line and to all those who were so determined to make us robots that it made us all proud to be union. We were proud of our union even as the UAW hierarchy joined Ford against us. By the mid-70's, however, the UAW Bigs had persuaded most Local Union reps to go against us too and there was a short-lived, fairly broad rank-and-file rebellion against this new UAW and it's turn to company unionism. The speedup fights are long gone now. Here and there you can still see the best union members standing up for each other even though they are closely surveiled by UAW/Ford appointees and reps. Getting back to Solidarity means putting these rebels and fighters in touch with each other.

Why did this rebellion against worker against worker competition fail to make a revolution - that would be a return to the UAW's original family and community virtues? I think it was because none of us knew anything of Chesterton or Distributism in those days. We were boxed in by Left/Right ideas and never found the core of things, the things that most good people believe in. For one thing, we were coached through all sorts of very spendy industrial psych programs, that we didn't understand why the very idea of friendship, community and Solidarity had to go. We lined up with wrong ideas and the wrong people. We worked with the Left then left the Left when we discovered they didn't have the answer either. The Association of Catholic Trade Unionists dwindled away in anti-Communism, failing to provide us the Church's truths on Economic Justice, Subsidiarity and Solidarity.

The UAW was telling us that some of us had to go and the rest of us had to work harder to compete first, with the Japanese and later with everyone who needs a decent job. In 1982, we lost the fight for Solidarity amongst ourselves. We lost the fight for Solidarity with the Japanese. In 1984, we lost the fight for Solidarity with our own Canadian members as they abandoned the UAW's dog-eat-dog philosophy. In the 1990s we lost the fight to stop the assasination of Mexican Ford workers. Basically, we lost the fight for the respect and love one worker has for another. We lost the fight for the Christian belief that God wants us to be fulfilled by our jobs. All of us.

The UAW has a long Left history. It started from the Old Left but that Left was much different to me. The old Lefties in my Local were family guys with plenty of kids. they actually liked children more than cats, dogs and vegetables! They were Socialists and Communists because they were anti- Capitalists and the Left was the only other game in town. They were gutsy, highly principled, self-educated men. I expect many of them would have been Distributists if they could have been turned on to Chesterton and logged on to The Distributist Review. Most of all they would have loved Chesterton's belief that The Good Fight actually meant a fight.

Today, the UAW retains Lefties at the top, mostly in research departments where they are allowed to do little more than Bigs butt kissing and inform on the rank and file Left and true trade union fighters who continue to work real jobs in the factories.

About 10 years ago, my friend, Chestertonian Jeff James, a fighting, UAW rank and file activist in Ohio started me on Chesterton thus saving my activist life.

Five years ago I became friends with the fearless Santino Scalici who I immediately was able to add to my long list of noble Pros, UAW, Vets, family business people - all friends who will never stop standing up for others.

Last year I discovered the perfect sense of John Medaille and his terrific colleagues. Our side is looking up!

The dog-eat-dog, fear-mongering opposition is well-healed, everywhere, persuasive and persistent. The UAWs politics of fear work against us everywhere these days. It is a tough, tough thing to fight back in the shops and offices. But it is loco no? - that most of us have to go so the few can do well. You all are providing us lifeline ammunition we need to reason ourselves back to Solidarity.

I hope everyone here in this blog, understands what a wonderful thing you do, especially for us factory folk, in reinforcing our common sense, hope and courage.

We have, for many years, tried to make some sense of what the powerful preach to us on the necessity of selfishness. We have tried to argue for Solidarity against this false duty they assign us to attack ourselves.

Our job is to pass along all this great JUSTICE stuff for common sense, the common good and in particular, The Good Fight. Pass it on to everyone we know. Everyone can do something as MLK said. It doesn't have to be a big deal just buy someone coffee or start a workplace newsletter and spread the truth that Solidarity still works.

Thank you all for giving us the arguments and confidence to carry on this work.

God bless all!


Ioannes Augustus Monday, January 5, 2009 at 8:20:00 PM CST  

Mr. Laney's paean to the UAW is poetic and moving. To put things in practical terms, though, hasn't it been a direct effect of all this solidarity that it has bankrupted the Big Three?

From what I understand, the Big Three now pay more in benefits to retirees than they do in payroll! How is this sustainable for any enterprise, be it a corporation or a cooperative?

I'm not saying all the blame lies with the union. Management has been improvident and perhaps overpaid. But while GM has a CEO who makes an outrageous $15.7m, compare that to pension costs of $89 BILLION with further healthcare costs of $64 billion. That means something like $1,600 per car in costs (versus a little over a buck for CEO pay).

Though I find distributism fascinating in all its forms, I fail to see how any firm, whether it was a joint-stock corporation or a workers' cooperative, could incur those kinds of fees and survive, much less profit--and so, rather than a capitalism/distributism issue, I think this is more along the lines of an ideals/reality issue. Sure, we'd all like to see, in an ideal world, retirees be well taken-care of. But if that's what the costs for the care-taking look like, I think reasonable people can agree we need to look for a different caretaker.

If anything, I surmise a workers' cooperative would have been forced to face up to these figures a long time ago and rethink how they provided benefits, at least if they wanted the workers they were currently employing to have any kind of future.

Tom Laney Tuesday, January 6, 2009 at 7:46:00 PM CST  

It's hardly a paean to the UAW. I thought of it as testament to the virtues of ordinary workers and their ability to win justice fights.

I don't think of the pension costs as $89 billion. I think of it as the $1400 a month I receive and as the $800 a month one of my older friends gets. I think of us taking this pension money and going out and blowing it all on food, clothing and the grandkids. I think of it as money that stays in circulation and benefits the small shop keeper and the family grocer.

But you're right, the pension programs are in big trouble and not just at the Big 3.

In 1950 the UAW asked the Big 3 to fight in Congress for a national pension and health care program to cover every person. The Big 3 were not interested and the UAW pursued improvements to their late 40s and early 50s pension victories at Ford, Chrysler and GM. Wages were deferred from active workers to the pension programs.

As UAW membership fell from 1.6 million members to less than half a million at the Big 3 and as the membership continues to fall the pensions are increasingly threatened. Still, at Ford the funds were more than solvent for 2007 but that is not likely for 2008.

We agree that in an ideal world it would be nice to see all retirees be well taken care of. The Ancient Celts and Middle Age Guilds managed to do that and we can too but we need to move to a Distributism to make it work.

Let's say that Walter Reuther in 1950 saw another option from Capitalist and Leninist production systems being something like an Auto Guild and the UAW moved to buy the Big 3. The UAW could have moved towards cooperative production, placing engineers and design staffers in an inspirational setting with tradesmen and production workers. We could have moved on to a successful, community-based, high-value, democratic production system like Mondragon with our own parts systems and banks.

But the UAW would have also had to operate on Solidarity & Subsidiarity, control a just trade system and maintain full employment to make this work.

Could we still do this? Of course. The sole moral purpose of business is to make this happen.

The different caretaker required for the community is us.

Tom Laney Wednesday, January 7, 2009 at 4:20:00 AM CST  


I received the letter below yesterday as an email. I'd value your opinion of it:

ESOP Investment Bankers and Justice-Based Management Consultants
P.O. Box 40711 • Washington, D.C. 20016
Phone (703) 243-5155 • Fax (703) 243-5935 • E-mail:


TO: The Hon. Rev. Walter E. Fauntroy

FROM: Norm Kurland

DATE SENT: November 8, 2008

SUBJECT: How Walter Reuther would have saved today’s Detroit auto industry

As you know, prior to my joining with Louis Kelso, I served as director of planning for the Citizens Crusade Against Poverty, a liberal establishment private sector counterpart of President Johnson’s War on Poverty that was chaired by the late Walter Reuther, then visionary head of the United Auto Workers. I succeeded in bringing Louis Kelso together with Reuther. On February 20, 1967, shortly before his untimely death in an airplane crash, Reuther gave the following testimony to the Joint Economic Commiittee of Congress:

“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.” (Extracted from Page 774 of Part 4, Hearings, The 1967 Economic Report of the President, Joint Economic Committee, Nineteenth Congress, First Session.)

Had Reuther lived and implemented his ownership policy and promoted the complete array of Kelso’s “full production” ideas as national economic policy, I am convinced General Motors and the auto industry would not be coming hat-in-hand for a Federal bailout, nor would the US and global economy be in its current financial meltdown, threatening massive unemployment, protectionist trade policies, and rising levels of global poverty, and what David Walker (who remembers favorably the meeting Kelso and I had with him around 1975) calls an “unsustainable debt system.”

Today the Washington Post’s lead editorial suggested that President Obama impose strict conditions before approving Detroit auto industry’s request for $50 billion in Federal bailout money, including a pre-arranged top-to-bottom corporate reorganization for the companies applying for aid, including a wiping out of the equity shares of existing shareholders, buying out creditors at “pennies for the dollar,” and firing current top management. I totally support such conditions, but would add others that would have to be adopted by the United Auto Workers to change the culture in each of the companies that undergo re-organization from the conflictive “wage system” culture to a more synergistic and efficient ownership culture in which all workers and management have a stake in maximizing the efficiencies and bottom-line profits of the companies in which they work. Among the additional conditions we would recommend are:

1. Require that the UAW agree to Reuther’s call for ownership sharing and profit sharing for renegotiating future income and benefit for all workers, plus a restructuring of future labor-management relations on the basis of participative management and other refinements of “Justice-Based Management” as described in and

2. Arrange for each of the reorganized auto companies to restructure themselves as S-Corp companies with all new equity shares acquired on a 100% leveraged basis by a tax-sheltered ESOP covering all new management and rehired non-management workers. With all shares held by an ESOP trust, and future pre-tax profits flowing through the tax-exempt trust for the repayment of corporate debt and the payout of dividends to ESOP participants, there would be no taxation of corporate profits, all of which would accrue to the benefit of the worker-shareholders. Distributions from the trust to worker-shareholders would however be subject to Federal and State income taxation, unless below income levels exempted by such tax reforms recommended in the proposed Capital Homestead Act described in the book Capital Homesteading for Every Citizen. (As you know, I orchestrated the first successful 100% leveraged buyout in 1975 of a Steelworker-organized South Bend Lathe, a company months from liquidation, from its parent Amsted Industries of Chicago. I later designed the first 100 % bank-financed leveraged buyout of the highly successful Mid-South Building Supply. And UAW members would have acquired 72% of the ownership of Chrysler under the strategy I advocated when Chrysler sought a $1.2 billion Treasury loan guarantee in 1984, but for short-sighted thinking by the UAW Washington Counsel, who settled for the token ownership stake arranged for workers by Senator Long. Without conditioning ESOP benefits to a new ownership culture, union leaders who adopt ESOPs in failing companies often fear that workers will no longer be loyal to them.)

3. Instead of promoting the traditional “conflict model” of industrial relations, however, the UAW as a labor union would be encouraged to transform itself into an “ownership union” covering all non-management workers as well as future outside shareholders. Thus a new model of democratic unionism would become society’s primary institutions for promoting a free market version of economic justice, while continuing to negotiate and advance the expanded economic interests, including ownership rights, of a broadened membership constituency resulting in a new check on management accountability and transparency. By broadening their services, negotiating concerns and membership base, unions would also be expanding their revenue base, as well as their contributions to a more just and democratic market economy.

4. The Federal Reserve would adopt a policy to support use of its discount powers to create new asset-backed interest-free money for facilitating member bank loans (subject to competitive transaction fees and risk premiums) for the acceleration of sustainable future growth and the commercialization of advanced energy technologies through new shares issued by Justice-Based Management companies that meet conditions 1-3 above. Such new shares would be offered through leveraged ESOPs to workers and through leveraged Capital Homestead Accounts or leveraged IRAa to other qualified citizens.

Anonymous,  Thursday, January 8, 2009 at 4:43:00 PM CST  

I recently posted this in the Yahoo Group and got no response. Check this video out that my sister just sent me. In light of the GM Assembly plant that just closed permanently here in Dayton, I'd like to hear your thoughts about this plant in Brazil. There is an obvious shot at the UAW near the end with regard to supplier integration on the assembly line - which may or may not be warranted - I don't know what their issue is with the UAW in that regard.

I don't even begin to pretend to know all the "issues" that surround
the auto companies, but I look at this video and wonder where they get the gall to come the the US taxpayer and ask for a bailout, and how can the Congress be so spineless as to not say NO!

Remember when GM built the much bally hood Saturn Plant and how that was going to be the future of GM? Now they are trying to figure out what to do with it. What I'm really interested in hearing is from a distributive perspective how could this Brazil plant have been built in the US. Where would that initiative come from - the top ? the bottom ? somewhere in the middle ? would it be an ESOP ? a Co-Op ? I really look forward to your response.

Gabriel Austin Saturday, January 10, 2009 at 12:21:00 PM CST  

It seems to me that the pension plan for the auto workers / companies made a great mistake in not separating the plan totally from the companies. A parallel successful plan is that of the teachers - TIAA and CREF. That plan is run by the teachers.

Viking Tuesday, January 13, 2009 at 12:50:00 AM CST  

Mr. Laney,

It seems to me that you're not distinguishing between Distributism and Monopoly Capitalism. (Not "Monopolistic", btw, which is something quite different.) If the UAW had bought out the Big 3, there would be only one main auto maker in the country, and with the political pull that'd give the union, perhaps soon only one, period. Now, monopolies are always quite pleasant - for the monopolists. For everyone else, they can be quite miserable. You may not realize it, but this belief in "cooperation" heralding the arrival of the Golden Age is quite similar to what many in the late 19th century were saying about the great trusts of that era.

As to how you think of the pensions you and your buddy receive rather than the $89B: think of it that way if you like, but it doesn't change matters, it's still a drag on the economics of buying an American car. How can there be so much in pension cost anyway?! If you are a fairly typical pensioner (we'll assume your friend is atypical), there are over five million such pensioners. That's rather an impressive number for a union that apparently reached its peak at 1.6 million and then declined precipitously. As to how you're spending it on necessities and loved ones: Sir, we all can make the same claim.

Neither American Tory, who you asked to, nor any of the rest of us, who you didn't, has commented yet on the Kurland letter. Let me remedy that: I found it appalling. In addition to having much the same ideas as you, which I'm inclined to think you believe good-heartedly, he also "totally support"s the Washington Post's conditions. That is, to wipe out equity shares, buying out creditors for pennies on the dollar, and firing the management. Mr. Laney, many of these shareholders and creditors would also like to waste their pension money on food, clothes, and grandkids. Wouldn't their chances be somewhat diminished by these actions? As to the management, it may be un-PC here, but I question the justice of punishing people for giving people what they want. Did anyone put a gun to the temple of SUV buyers, commanding them to buy the vehicles?

Such are my thoughts anyway. Sorry if I offended by frankness.


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