MOST OF THE FORTUNE 500 AND ALL BILLIONAIRES ARE GENEROUS DONORS TO THE MEXICAN FASCIST PARTY of LA RAZA "The Race". OPEN BORDERS KEEPS WAGES DEPRESSED AND PASSES ALONG THE TRUE COST OF "CHEAP" LABOR TO THE AMERICAN MIDDLE-CLASS.
GM makes record quarterly profit as US corporations accelerate cost-cutting
By Jerry White
1 November 2018
General Motors saw a 25 percent rise in
third quarter profits to a record $3.2 billion, the US automaker announced
Wednesday. The spike in profits, despite falling sales in GM’s two largest
markets, North America and China, is the result of relentless cost-cutting,
which has been enforced through the collaboration of the United Auto Workers
(UAW) union.
The Dow Jones Industrial Average, which
saw a sharp decline throughout October on fears of trade war with China, rising
interest rates and a minuscule uptick in wages, rose 241 points Wednesday in
response to profit reports from GM, Facebook and other companies.
US corporations are averaging around a
20 percent increase in profits chiefly through the suppression of workers’ wage
demands, the intensification of work and the spread of part-time and temporary
employment. This has been the principal strategy pursued by corporations in the
US and around the world since the global financial crash of 2008 and the brutal
reality behind the so-called economic recovery.
Just hours after announcing its profit
results, GM said it had sent out voluntary buyout packages to 18,000 of its
50,000 North American salaried employees, or 36 percent of its white-collar
workforce. Workers will have until November 19 to decide on whether to take the
offers, a GM spokesman told the Wall Street Journal,
and layoffs were possible if the buyout effort and other cost-reduction
measures did not achieve GM’s targets, he said.
While GM made $500 million in profits
in China, offsetting losses in South America, the center of the company’s
money-making operations was North America where profits shot up 37 percent to
$2.8 billion. The company’s North American profit margin was 10.2 percent
despite an 11 percent fall in US sales.
GM reported earnings per share were up
41.7 percent from the same period last year. The profit report, which beat
investors’ expectations, and the job cutting announcement drove GM shares up 3
percent Wednesday. GM is continuing to spend billions on stock buybacks and
dividend payments to its richest investors after squandering $6.7 billion on
buybacks last year.
Like GM, Ford and Fiat Chrysler
Automobiles (FCA) are relying on North America for the bulk, if not all, of
their profits. Although net third quarter profits for FCA fell 38 percent—due
to an expected settlement with the federal government over the illegal
manipulation of emission results—the Italian-American company’s operating
profit in the US and Canada surged 51 percent, to $1.9 billion, and it had a
profit margin of over 10 percent.
Ford Motor Co. reported North American
operating profits of $2 billion during the July to September period. With Wall
Street punishing the company’s stock for achieving a profit margin of just 8.8
percent, Ford announced plans to reduce its salaried US workforce of about
70,000 employees, without specifying a number. The company has already
temporarily laid off 2,000 production workers at its Kansas City assembly plant
from October 22 to November 4.
US automakers are facing increasing difficulties
due to rising costs associated with Trump’s tariffs on steel and aluminum
imports, and the rise of the US dollar, which undermines their exports to Asia
and other regions. The companies have increasingly relied on sales of higher
priced SUVs and pickup trucks in North America, but sales have already declined
since their peak in 2016. This could turn into a rout as interest rates on car
loans and gas prices rise, resulting in a new round of factory closings, mass
layoffs and demands for wage and benefit cuts for the industry’s hundreds of
thousands of workers.
The huge profits in North America are
due largely to the collaboration of the United Auto Workers union, which has
suppressed all resistance by workers to speed up and the decimation of autoworkers’
living standards and working conditions.
The American ruling class, which never
forgave autoworkers for their powerful struggles—from the sit-down strikes of
the 1930s to the militant wildcats of the 1970s—that wrenched significant
concessions from the corporations, used the 2008 crash as an opportunity to
intensify its attack on these gains and set a precedent for the whole working
class.
During the 2009 bailout of GM and
Chrysler, the Obama administration and the gang of Wall Street investors on Obama’s
auto task force collaborated with the UAW to destroy the hard-won gains of
generations of autoworkers, including halving the wages of new “second tier”
workers, abolishing the eight-hour day and eliminating income security for laid
off workers. UAW backed the purging of higher-paid “legacy” workers and their
replacement with temporary part-time employees who can be fired at will without
paying supplemental unemployment benefits or other costs.
The transformation of autoworkers—once
the highest paid industrial workers in the US, if not the world—into a largely
casual and disposal workforce epitomized the historic change in class relations
overseen by the Obama administration and continued under Trump. In exchange for
its collaboration, the UAW was handed billions in corporate shares and given
control of a vast retiree health care trust. In addition, top UAW executives
were showered with millions in luxury items and other bribes to sign
pro-company labor agreements, as federal prosecutors have exposed.
Angela, a Fiat Chrysler transmission
worker in Kokomo, Indiana, who is on temporary layoff, denounced the UAW for
collaborating in the ever-greater exploitation of workers, saying the UAW is
“nothing but a tool of management” that has ignored Kokomo workers’ unanimous
vote to strike over unresolved safety grievances. She also denounced efforts by
Trump to scapegoat immigrants for the loss of jobs and wages while all the
money was going to corporate executives and Wall Street. “It’s time we wake up
and realize there are powerful forces trying to divide us,” she declared.
“They’re using smoke and mirrors to distract us. My mother was a wage slave at
Chrysler; my father at GM; and I’m a wage slave too. All workers, no matter
where we are from, bleed the same and want the same thing: peace and security
for our loved ones. The working class is the majority and we have more in
common with workers of all nationalities and races than we do with the people
dictating our lives.”
Other major corporations, such as
United Parcel Service (UPS) and US Steel, are also making enormous profits even
as they demand more sacrifices from workers. UPS recently reported a 20 percent
year-on-year increase in third quarter profits to $1.5 billion dollars, while
US Steel, benefiting from Trump’s tariffs, has seen profits rise by 20 percent.
At both companies, the unions are doing
everything to prevent strikes, with the Teamsters going so far as to defy a
majority vote by UPS workers in order to impose a deal that will establish a
new lower-paid tier of drivers and maintain poverty wages for part-time
warehouse workers who make up 70 percent of the workforce. At US Steel, the
United Steelworkers union is trying to push through a sellout deal that would
raise wages by 14 percent over the next four years, barely above the rate of
inflation, and shift more health care and pension costs onto workers.
Far from the profit boom leading to
workers recouping the wages they have lost over the last decade, total
compensation costs—both wages and benefits—for private and public sector
workers rose by only 2.8 percent in the 12-month period ending September 2018,
according to report by the US Labor Department released Wednesday. For
manufacturing workers, compensation costs were only 1.9 percent, while teachers
and other state and local government workers got a miserly raise of 2.5
percent.
The current inflation rate for the
United States is 2.3 percent for the 12 months ending in September 2018,
according to the Labor Department. This means workers have seen a rise in real
wages of only 0.5 percent, while manufacturing workers suffered a fall in real
income.
After a decade in which the unions
limited the number of strikes to historically low levels and facilitated the
unprecedented transfer of wealth to the corporate and financial elite, millions
of workers in the US and around the world are coming into struggle. Since the
beginning of the year the number of major work stoppages in the US has nearly
tripled since 2017, including walkouts by more than five percent of all K-12
public education employees, the largest number in more than a quarter of a
century.
The fight for living wages, safe
working conditions and fully funded health and pension benefits requires the
building of new organizations of struggle: rank-and-file factory and workplace
committees, which are independent of the corporate-controlled unions and
democratically controlled by ranks of workers themselves. In addition to taking
up the responsibilities long ago abandoned by the unions, including opposition
to speed-ups, management abuse and victimization, these committees must link up
workers across industries and fight for the establishment of industrial
democracy and workers’ control over production.
The development of a powerful
industrial movement, including the preparations for a general strike, must be
combined with a new political strategy to unite American workers with their
class brothers and sisters around the world to fight for socialism and the
democratic and collective ownership of the wealth produced by the labor of the
working class.
Fiat Chrysler workers hit with temporary layoffs
across North America
By Jacob Crosse
1 November 2018
Six thousand workers at Fiat Chrysler Automobiles (FCA) plants in Windsor, Canada and 5,000 workers at the company’s assembly plant in Belvidere, Illinois have been temporarily laid off since October 22. Autoworkers were given no advance notice by the United Auto Workers (UAW) union or its counterpart in Canada, Unifor, about the pending layoffs and production stoppages.
Over 3,000 workers at FCA transmission plants in Kokomo and Tipton, Indiana who have also been on temporary layoff since October 15 will now be out of work at least an additional two weeks. After keeping workers in the dark, UAW Local 685 officials are holding informational meetings today to “dispel layoff rumors, discuss the actual layoff process and answer questions,” according to a leaflet that workers sent to the WSWS Autoworker Newsletter. The local has spent the last three months ignoring a unanimous strike mandate by transmission workers over more than 200 unresolved grievances, the majority over health and safety.
Statements from FCA US, FCA Canada, and Unifor Local 444 President David Cassidy, all say that the layoffs are needed to “adjust inventories.” In comments that could have been delivered by any corporate manager, Cassidy told the Windsor Star, “Inventory adjustment is nothing new in our industry…we often see this in the fall and at Christmas or just after. Sales can be up and down at those times of year.”
It is also, “nothing new” for autoworkers to be strung along, lied to and sold out by well-paid union bureaucrats who oppose any collective action to defend the jobs and livelihoods of the workers they falsely claim to represent. Autoworkers at BVA were originally told by management they would be laid off for a week, with the expectation of returning to work on October 29. However, an automated message was delivered on October 25, informing workers they would be out of work for an additional two weeks.
Workers in Tipton and Kokomo were encouraged by an FCA spokeswoman, speaking to the Kokomo Tribune, to apply for “Indiana State Unemployment Insurance and FCA US-paid Supplemental Unemployment Benefits (SUB).” The spokeswoman also informed workers that continuation of their “medical/dental/vision coverage, will be based on eligibility.”
Autoworkers spoke to WSWS Autoworker Newsletter about this outrageous situation. Felicity, a Belvidere assembly worker who used a pseudonym to avoid retaliation by the company and the union, said, “It has gotten less safe” in the plant since she began working there three years ago. Explaining a recent workplace injury, Felicity detailed a culture of indifference to workers’ safety exhibited by management and the UAW.
“Supervisors don’t understand that if the workers are telling you something is wrong, then it needs to get fixed. You just don’t leave it until someone gets hurt. But that is the culture they, they don’t want to fix anything until someone gets hurt. Once someone gets hurt, then it gets brought back on us.”
When asked by this reporter if the union has been any help, she responded, “No, you’re on your own. What is the union doing? They are not doing anything. They take our dues, that’s it. They take our money, build luxury cottages, and fund these luxury trips with our dues money,” she said, referring to the lavish lodgings being built for former UAW president Dennis Williams at the UAW’s Black Lake, Michigan resort. “I am barely paying my mortgage, yet you’re getting a cottage built? Workers are dying, yet you’re getting a cottage.”
Referring to the multi-tier wage and benefit system introduced by the UAW in the “transformational” contracts with the Detroit-based automakers in 2007, Felicity agreed that all tiers should be abolished. “Why, if we are doing the same job, I’m getting hurt, just like you are getting hurt, why should we be paid differently. It breeds hostility between the workers.”
Felicity continued, “When I see things that are wrong, I have to say something. Maybe if other workers see what is going, we can start to make some changes. If it weren’t for us workers, not a Dodge Ram, not a Jeep, not a thing would be built.”
Nearly 40 percent of New Jersey
households struggle to make ends
meet
By Erik
Schreiber
31 October 2018
The proportion of households in New Jersey that cannot afford
daily necessities reached 38.5 percent in 2016, according to a report published
by the non-profit charity United Way. These necessities include food, housing,
transportation, medical care, child care, and a smartphone. The percentage of
these households falling into this category has increased by 15 percent since
2010, the year that the recovery from the recession of 2008 is alleged to have
begun.
This proportion of struggling households includes 10.5 percent
who lived in poverty in 2016, along with an additional 28 percent in a category
that the report calls “Asset Limited, Income Constrained, Employed” (ALICE).
ALICE households, sometimes called the working poor, earn more than the federal
poverty level. This official figure is absurdly low, especially in a state with
a cost of living as high as New Jersey’s. Although not classed as poor, members
of these households find themselves skipping meals, sharing rooms with friends
or relatives, and forgoing regular doctor’s appointments.
United Way has tracked households in poverty and ALICE
households every two years since 2010. The percentage of households in poverty
has remained relatively stable, at 10.5 percent. The proportion of ALICE
households, however, has increased steadily from 23.8 percent in 2010 to 28
percent in 2016. Rather than sharing in the much-touted economic recovery,
these families have seen their situations worsen.
People aged 65 and older account for much of the growth in the
number of ALICE households. From 2010 to 2016, the growth rate in the number of
senior households (15 percent) and that in the number of senior ALICE
households (12 percent) have been almost identical. “Even with Social Security
benefits, 46 percent of New Jersey seniors have income below the ALICE
Threshold,” according to the report.
People between ages 45 and 64 also have contributed to the
growth in ALICE households overall. Although the number of households in this
age group did not change significantly between 2010 and 2016, the number that
earned less than the ALICE Threshold increased by 22 percent. “For a group in
their prime earning years, it is surprising to see one-third (33 percent) with
income below the ALICE Threshold,” said the researchers.
The percentage of households below the ALICE threshold increased
from 2010 to 2016 in nearly all of the 20 largest cities in New Jersey. Clifton
and Passaic are the two exceptions. Some of the greatest increases occurred in
two of the towns that suffered most during and after Superstorm Sandy. In Toms
River, ALICE households increased by 66 percent. In Sayreville, the increase
was 31 percent.
But the factor that unites ALICE households is not gender, race,
age, or location. “The data on ALICE households show that hardship in New
Jersey exists across boundaries of race, age, and geography,” said the
researchers. Rather, ALICE status is a problem of every section of the working
class. “Today, ALICE workers primarily hold jobs in occupations that build and
repair our infrastructure and educate and care for the workforce,” in the words
of the report.
The report provides a detailed picture of the situation that
workers face in New Jersey, which in turn reflects national trends. Low-wage
jobs are the rule, rather than the exception. Approximately 51 percent of jobs
in the state pay less than $20 per hour. What is worse, more than two-thirds of
such jobs pay less than $15 per hour. About 36 percent of jobs pay between $20
and $40 per hour, a wage that is itself insufficient, in a state with housing
that is among the most expensive in the country—to say nothing of New Jersey’s
notoriously high property taxes.
Since 2010, the unemployment rate has fallen. Although
capitalist economists would predict that wages would therefore rise, they have
stayed low for most workers. In addition, job stability has decreased following
companies’ growing reliance on contract work and on-demand jobs. Under these
conditions, it is no surprise that many households are unable to meet expenses.
The idea of saving money to establish even a modest financial cushion is
unimaginable.
While wages have stayed low, the prices of everyday necessities
in New Jersey have increased. From 2010 to 2016, the monthly cost of housing
increased by 9 percent for a family of two adults, one infant, and one
preschooler. The cost of childcare increased by 14 percent, the cost of food by
10 percent, the cost of transportation by 25 percent, and the cost of health
care by an enormous 99 percent.
The cost of the family budget overall rose by 28 percent from
2010 to 2016, and by 16 percent for a single adult. These increases have
occurred despite low national inflation (9 percent). In 2016, basic household
expenses in New Jersey cost $74,748 for a family of four and $26,640 for a
single adult. In contrast, the federal poverty level is a derisory $24,300 for
a family of four and $11,880 for a single adult.
The data in the United Way report lay bare the ruling class’s
intensified post-recession efforts to suppress wages and increase the rate of
exploitation to produce greater profits. Construction workers and public
employees such as teachers have been among the main victims in New Jersey. As
the researchers themselves note, companies have transferred ever more risk to
their workers, keeping wages low and schedules irregular, and making it
difficult for workers to arrange for child care, let alone pay their bills.
The report also singles out “the increasing importance of
short-term productivity gains” as a reason for the increase in ALICE
households. On this subject, it is worth quoting the report at length:
Instead of sharing gains in productivity with employees,
companies have chosen to spend more on capital and, more recently, on profits
and dividends to increase stock prices. Since most corporate leaders’
compensation is directly linked to stock prices, they have benefited hugely
from this practice; the compensation of top US executives has doubled or
tripled since the first half of the 1990s, while workers’ wages have remained
flat.
The report thus documents the shift to an economy dominated by
financial parasitism. This is not a simple matter of “choice” by companies
opting for greed, however. It is part of the structure of global capitalism.
Far from being unique to New Jersey, this shift can be observed throughout the
country and the world.
No comments:
Post a Comment