Federal corruption probe of UAW officials continues
The federal investigation into corruption by officials in the United Auto Workers union (UAW) is continuing, according to a report earlier this week by the Detroit News, despite the settlement reached between the US government and the UAW last December.
The years-long investigation has revealed widespread criminality among the top echelons of the UAW, including bribe-taking in exchange for company-friendly agreements, embezzlement of union dues, and kickback schemes with vendors. The illicit funds were used to pay for lavish lifestyles for UAW executives, such as months-long getaways at Palm Springs, endless golf outings, luxury goods and high-priced meals. While the incomes of UAW officials swelled though both illegal and “legal” means over the last 40 years, workers’ jobs and livelihoods have been decimated in one sellout contract after another.
To date, 12 UAW officials, including two of the last four union presidents, and three Fiat Chrysler employees have pleaded guilty to various charges stemming from the investigation.
In December, the UAW and federal prosecutors settled the government’s case against the union itself. Neil Barofksy, a former regulator of the bank bailouts during the Bush and Obama administrations, was selected in April by the US Attorney’s office as the independent monitor tasked with overseeing and enforcing the terms of the six-year consent decree established by the settlement.
According to the Detroit News, federal prosecutors requested last month that Barofsky be granted access to search warrants and related documents from earlier in its investigation. As monitor, Barofsky is nominally tasked with continuing to investigate corruption within the UAW and has the ability to initiate disciplinary proceedings against UAW officials for criminal behavior or for associating with “barred persons,” including those indicted in the corruption probe.
Significantly, the US Attorney’s court filing states that “[s]ome of the overall investigation remains pending,” and asked that the search warrant documents remain sealed and unavailable to the public. Federal prosecutors had indicated in a filing earlier this summer that the government had “not yet completed its criminal investigation of all targets of the UAW corruption investigation.”
Additionally, Barofksy is reportedly set to meet with former UAW President Gary Jones, who oversaw the sabotage and betrayal of the 40-day General Motors strike in 2019. Jones was indicted and pleaded guilty for his role in a scheme to embezzle over $1 million in workers’ dues.
Clearly desperate to serve as little as possible of his slap-on-the-wrist sentence of 28 months in a white-collar prison, Jones may well be seeking to rat out more of his fellow gangsters. The Detroit News reported that Jones aided federal prosecutors in securing the indictment of Dennis Williams, Jones’s predecessor as UAW president. Williams also pleaded guilty to his role in the embezzlement scheme and received a similarly light 24-month sentence.
The News points to one current UAW vice president, Cindy Estrada, and one former, Jimmy Settles, as potential targets of the ongoing federal investigation.
Settles oversaw the UAW’s Ford department until his retirement in 2018, after which he received a lucrative appointment from Detroit Mayor Mike Duggan as head of the city’s Department of Neighborhoods. According to the News, members of Settles’s staff were previously questioned by federal investigators, who also issued grand jury subpoenas, as part of their probe of his ties to a top union vendor.
Estrada, for her part, currently oversees the UAW’s Stellantis department, as well at its department of higher education, having previously led the union’s GM department. Estrada is particularly despised among autoworkers for her role in negotiating secret agreements with GM to outsource jobs at its Lake Orion and Lordstown Assembly plants, which in the latter case was the prelude to the shutdown of the plant.
Like her fellow top UAW executives, Estrada has seen her pay rise dramatically over the last decade, taking in $220,506 in compensation in 2020, up from $167,000 in 2015, while autoworker pay has consistently failed to keep up with inflation. UAW tax filings also show that the union paid more than $7,000 in legal fees for Estrada between 2019 and 2020. Estrada had previously been vying earlier this year for the position of UAW secretary-treasurer but withdrew from the running.
Charities run by Estrada and Settles were reportedly the subject of earlier investigations by federal prosecutors. A charity run by then-UAW Vice President for Chrysler General Holiefield, the “Leave the Light on Foundation,” was found by prosecutors to be the conduit for payouts from company executives. Holiefield died in 2015, before he could be indicted.
While the Detroit News, which has maintained close ties to federal officials throughout their investigation, pointed to Estrada and Settles as targets, they are by no means the only possibilities. Rory Gamble, who retired as UAW president at the end of June, was previously cited as the subject of investigations by the News. Current UAW President Ray Curry, who was union secretary-treasurer from the beginning of the federal corruption probe, has also had legal fees paid for by the UAW for unexplained reasons over recent years.
As the WSWS Autoworker Newsletter previously explained, Barofsky’s powers as independent monitor are limited to responding to only the most egregious misconduct within the union, and he does not have oversight over contract negotiations between the companies and the UAW, which will retain their pro-corporate character.
At the same time, the selection of Barofsky—a prominent critic of the Wall Street bank bailout program following the 2008 economic crisis—is an indication of the seriousness with which the government continues to view the question of the UAW’s stability. The Biden administration and broader sections of the state are no doubt concerned that the UAW’s credibility among workers continues to disintegrate despite the years-long effort to “clean up” the most blatant criminality by union executives.
The growing hostility of workers toward the UAW has been increasingly apparent this year, above all in the rebellion of workers at Volvo Trucks in Virginia. Workers there carried out two strikes and rejected three UAW-backed concessions agreements in recent months, with the Volvo Workers Rank-and-File Committee leading the opposition to the union’s attempts to force through sharp increases in health care costs and the continuation of the tier system.
Contrary to prosecutors’ claims, any attempts by the state to carry out a further mopping-up operation of the worst criminals in the UAW are not aimed at making it into an organization that “represents the membership.” Rather, it is an effort to perform a cosmetic makeover on a fundamentally pro-corporate, anti-worker institution, one that has become a business in its own right, with over a billion dollars in assets.
Workers cannot place any trust in the Justice Department, which represents the interests of the corporations and the financial elite. To reverse the decades of wage and benefit concessions given up by the UAW, a real movement of the workers from below is required. To help meet this need, the WSWS Autoworker Newsletter is assisting workers in establishing a network of rank-and-file committees. To learn more about joining or forming a committee at your workplace, sign up today.
The policies of the Biden administration have been driven by the interests of Wall Street and the super-rich.
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Don’t be fooled by Joe Biden
Chris Hedges | NAFTA, Clinton, and Obama BETRAYED Americans... and Joe Biden was right there with the worst of them!
Six months of the Biden administration—A balance sheet
Six months ago, Joseph Biden was inaugurated president of the United States, under conditions of unprecedented crisis of US capitalism and the entire social and political order.
His predecessor, Donald Trump, did not attend the ceremony, signaling his refusal to accept the outcome of the 2020 election. Only two weeks before, on January 6, Trump’s supporters had stormed the Capitol and temporarily halted the congressional certification of state electoral votes. The aim of the attempted coup was to stop the transfer of power and establish a personalist dictatorship. In the words of Chairman of the Joint Chiefs of Staff Mark Milley, it was Trump’s “Reichstag moment.”
When Biden took office, 400,000 people were dead from the COVID-19 pandemic, while millions were unemployed. Just months earlier, every city, town, and village in America had seen protests in opposition to police violence.
Biden marked the six-month anniversary with brief remarks presenting American society in glowing terms. “For all those predictions of doom and gloom six months in, here’s where things stand,” he said. “Record growth, record job creation, workers getting hard-earned breaks.” He added, “Put simply: Our economy is on the move, and we have COVID-19 on the run.”
Summing up his prognosis, the US president proclaimed: “It turns out capitalism is alive and very well.” The truth is that the policies of the Biden administration have entirely failed to resolve the social crisis in America and they cannot, because they are based on the framework of American capitalism.
The pandemic, far from being “on the run,” is undergoing a new resurgence. Since Biden took office, an additional 225,000 people have died from the pandemic. All indications are that by the winter, with the new surge accompanying the spread of the Delta variant, the death toll under Biden will have exceeded that under Trump.
The policies of the Biden administration have been driven by the interests of Wall Street and the super-rich. This is why, despite occasional criticisms of Trump’s callous and anti-scientific response to the coronavirus pandemic, Biden has pursued the same policy of restoring corporate profit-making by forcing workers back to work and children back to school as quickly as possible, regardless of the dangers to their lives and health.
Trump’s response to the economic depression that accompanied the onset of the pandemic was to pour trillions into bolstering the banks, hedge funds and corporations, with bipartisan bills like the CARES Act. Biden pursues essentially the same policy, although with less support from the Republicans than the Democrats gave Trump. He boasts of success on the economic front, although seven million fewer workers have jobs today than before the pandemic began, and millions face wage cuts, poverty, eviction and foreclosure.
Only in foreign policy is there a significant shift from Trump to Biden, and this in tactics only, not strategy. Biden has placed more emphasis on the US utilization of NATO and the “Quad,” a de facto alliance with Japan, Australia and India. Significant sections of the military-intelligence apparatus backed Biden against Trump because they sought a more effective mobilization of US power against Russia and China.
And if Biden’s statement that “capitalism is alive and very well” were true, it begs the question: Why is there a mounting fascist threat to American democracy?
In the six months since Biden’s inauguration, the Republican Party has maintained its intransigent opposition to any serious investigation into the events of January 6. Half-hearted Democratic proposals, first for an “independent” bipartisan commission to investigate the attack, then for a bipartisan congressional investigation, have been blocked outright or endlessly delayed.
Meanwhile, evidence continues to emerge of the central role played by Trump and his allies in Congress in seeking to carry out a political coup d’état to overturn the results of the election and maintain himself in office. But neither Trump nor his accomplices have even been questioned, let alone tried, convicted and jailed.
Instead, Trump has renewed his agitation against the election, seeking to transform the Republican Party into an openly fascistic movement subordinated to his personal authority. And his supporters in the Republican Party are using their control of state legislatures to enact unprecedented and sweeping attacks on the right to vote.
Biden himself acknowledged something of the reality of the crisis of American capitalism in a speech last week in Philadelphia, when he declared “We are facing the most significant test of our democracy since the Civil War.” But he offered no way forward, except to appeal to “my Republican friends in the Congress, states and cities and counties to stand up” against this assault—although they are the very ones carrying it out.
In an effort to prop up illusions in the Democratic Party, the representatives of its “left” wing, portray Biden’s policies in extravagant terms. Last week Senator Bernie Sanders claimed that Biden’s “reconciliation” bill on social spending amounted to “the most consequential piece of legislation for working families since the 1930s.” Or, like Bhaskar Sunkara of Jacobin, affiliated with the Democratic Socialists of America, they express disappointment in what has been achieved so far, but express the hope that “Biden has shown a willingness to think big,” and that additional pressure should be brought to bear on congressional Democrats.
For his part, Biden uses every possible occasion to make clear he has no intention of implementing any measures that challenge the interests of the financial oligarchy, declaring last weekend, “Communism is a failed system, universally failed system. I don’t see socialism as a very useful substitute.”
The truth is that the Biden administration is based on Wall Street and the military, mobilizing behind it sections of the upper middle class through the utilization of identity politics. Well aware of the explosive social conditions developing in America, moreover, the administration supports the union “organization” campaign at Amazon and the PRO Act, to make it easier to install unions at work locations where they otherwise would have difficulty convincing workers to pay dues for the privilege of having their wages and benefits cut.
It is telling that when workers engage in genuine anti-corporate struggles, like the strikes waged by autoworkers against Volvo Trucks in Dublin, Virginia, the supposedly “pro-labor” president falls completely silent. Biden is for the unions, not for the workers, because he correctly sees the unions as an instrument of the US ruling class in policing the working class.
Workers must draw the lessons of six months of the Biden administration. None of the problems confronting the working class, from the disastrous pandemic response to unparalleled levels of social inequality, to the danger of imperialist world war and fascist dictatorship, can be addressed without breaking the grip of the financial oligarchy over every aspect of society.
This means breaking with both the Democratic and Republican parties and building a new, mass political party of working people, based on a socialist program. All those who seek to reorganize society to meet human need and not the demands of Wall Street
Ford targeted older salaried employees during 2019 layoffs, documents in age discrimination lawsuit reveal
Ford Motor Company specifically targeted older salaried employees for layoff in a bid to shed pension and other employment expenses during its years-long, multi-billion-dollar cost-cutting campaign, according to recently unearthed emails. The documents, uncovered as part of a class action lawsuit against the company, were obtained by the Detroit Free Press, which published extended interviews with a number of the employees involved in the suit on Friday.
The layoffs took place in 2019 under then-CEO Jim Hackett, who was elevated to his position in 2017 and tasked with carrying out a sweeping restructuring of the company’s global operations to reinvigorate Ford’s slumping share price. Despite an international campaign involving plant closures and thousands of cuts to white and blue collar jobs, Hackett’s “turnaround” plan was ultimately judged to be insufficiently aggressive by Wall Street and he was ousted in 2020, replaced by current CEO Jim Farley last October.
Ford laid off at least 7,000 salaried employees in 2019, 10 percent of its global white collar workforce, as part of its euphemistically named “Smart Redesign” restructuring, as well as 12,000 mostly hourly workers in Europe.
The layoffs were part of what the WSWS Autoworker Newsletter characterized at the time as a jobs bloodbath throughout the auto industry, including most notoriously the 14,000 job cuts and five plant closures by General Motors announced in November 2018. Despite years of record profits, the corporations were seeking to offset stagnating sales and the investment costs in electric vehicles by slashing their workforces and ramping up the output of those who remained.
The lawsuit by a group of salaried employees at Ford, many if not all of whom were in management positions, was initially filed in June 2019, shortly after their termination the prior month. Their suit accuses Ford of violating federal labor and tax law, as well as civil rights protections against age discrimination, when it targeted employees for layoff who were older and had higher pension costs. Ford employees hired before 2004 qualified for pensions, which have come to be viewed as an intolerable drain on profits by America’s financial oligarchy.
In one December 2018 email quoted by the Free Press, a director of a Ford vehicle line at the time told his ex-wife: “As you probably have heard, Ford is in the process of a ‘Smart Organization Redesign’ that is targeted to eliminate 25% of the LL6 through LL2 [a salaried pay grade rating] population by 2nd quarter 2019. They are targeting the most senior leaders first (29+ years of service and 50+ years old).”
According to the suit, Ford hired an outside firm, Boston Consulting Group, which developed an algorithm to find which employees’ termination would reduce costs the most, using birthdates and the number of years employed as factors.
The Free Press cited an email from Ford’s “chief people and employee experience officer,” Kiersten Robinson, who wrote to the consulting group in May 2019 shortly before the layoffs were carried out. Robinson described a board of directors meeting on the layoffs in which they “challenged” whether the layoffs were “aggressive enough” and pressed to make sure “junior” (i.e., younger and lower-cost) employees would be elevated after the cuts: “Thank you again for your help with the BoD [board of directors] discussion on SRD [Smart Redesign]. Overall it went well. There was sensitivity in the room to the employee sentiment, a desire to understand the communications plan, challenging whether we are being aggressive enough and a request to understand/ensure we are using this process to identify and elevate junior talent in the organization. Not sure how we realize this last request. Would love your thoughts.”
A number of those interviewed by the Free Press say that they were months or even weeks away from reaching pension milestones, with the result that their termination left them with only a fraction of the retirement income they had expected. Requests to find some means to bridge the time to reach full retirement age, even if it meant demotion or pay cuts, were coldly rejected by Ford, they said.
One parts distribution manager told the Free Press, “I would have retired at age 50, which is next year, making $60,000 a year in pension. Now I have to wait until age 62 to get $10,500 in pension a year.”
Describing the abrupt manner of his firing, he said he was called into a Ford facility and told his employment was ended “that hour.”
“I had my company car, a Flex, and had to give up my only means of transportation. I couldn’t even get home. I couldn’t pick up my daughter from school. They told me to call Uber but it was such a small town.”
While Hackett himself was ultimately pushed out from his position as CEO, his fate stands in stark contrast to those who suffered the jobs axe below him. Hackett received total compensation of $17.4 million in 2019, and in 2020, he received $16.7 million for just nine months.
Meanwhile, Ford’s large investors are reaping the benefits of the staggering rise in the stock markets during the course of the pandemic, fueled by the provision of virtually free money by central banks. Ford’s share price has risen substantially over the last year, more than tripling since it hit a low of nearly $4 a share in April 2020. The company’s stock is now trading at its highest level in over five years.
Although the lawsuit centers on Ford’s ruthless treatment of white collar employees—whom in many cases it tossed aside after decades of employment—it is of a piece with the brutal attacks the company has been carrying out on its global workforce for decades.
Ford, along with the other automakers and large industrial firms, has long been seeking to rid itself of “legacy” workers, particularly those with pensions and relatively better benefits, which themselves were the product of struggles carried out by earlier generations. The Big Three companies have relied upon the willing assistance of the United Auto Workers union to shred these gains and force out older workers through speedup and other means, increasingly replacing them with low-paid temporary workers, an employment category with virtually no job security or benefits.
Pointing to the connections between the company’s callous treatment of both salaried and hourly employees, a Ford worker in Louisville, Kentucky, told the WSWS Autoworker Newsletter, “The exact same thing is happening in the plants, especially to people who have been injured.”
He said he had seen management harass senior coworkers, looking for ways to push their output to the limit. “They do a time study on older people, and ride them hard. I’ve seen them make fun of an older guy because he couldn’t keep up. They changed his job so he was doing two people’s work. He was walking like 15 miles a day, while he was on dialysis two times a week after work. He never complained, always did his job and kept up. They’re ruthless.”
General Motors announces massive profits in second quarter as new COVID-19 surge builds strength
General Motors made $2.8 billion in profits in the second fiscal quarter, the auto giant reported on Wednesday. The results, which shattered analysts’ expectations, followed similar huge profits by crosstown rivals Ford, which reported $1.1 billion in profit last quarter, and Stellantis, which reported $7 billion for the first half of the year.
The financial results are a further demonstration of the continuing profit orgy by American capitalism, which has largely reversed losses incurred during 2020 by ending whatever remains of public health measures and reopening the economy despite the impact on human life. During the second quarter, which runs from April to June, 3.2 million Americans were infected and 50,000 died of coronavirus.
This figure likely includes thousands, if not tens of thousands, of infections and dozens of deaths among autoworkers, although a precise count is not publicly known because of an ongoing coverup of information relating to COVID-19 in the plants by the auto companies and United Auto Workers.
At the same time, GM and other auto companies, with the full complicity of the UAW, have imposed brutal levels of forced overtime and hired thousands of low-paid temps to replace workers who have taken time off out of health concerns or lack of child care.
The sharp increase in profits came despite the global microchip shortage, which has forced the company and its competitors to idle many of its plants for weeks at a time. The industry largely compensated for this, however, by shifting what supply of chips remained to plants making the most profitable models, mainly sports utility vehicles and pickup trucks. In addition, the company’s financial division benefited from the sharp spike in the prices of used cars caused by the ongoing shortages in new vehicles.
The Detroit-based automaker increased its sales by a whopping 40 percent. GM’s biggest surge came from high-end models produced at its Arlington Assembly Plant near Dallas, including the GMC Yukon (126 percent increase), Chevy Suburban (90 percent) and Cadillac Escalade (120.3 percent). The combination of rising sales and tightening supply has contributed to a situation where dealers are selling vehicles almost as soon as they arrive on the lot, with one dealer telling the Detroit Free Press his “turn rate” has declined nearly 90 percent from 112 to 12 days.
However, in many cases the auto companies have continued production at plants even without chips, stockpiling tens of thousands of unfinished vehicles awaiting chips before they can be shipped to dealers. The Detroit Free Press counted tens of thousands of such vehicles sitting in lots outside GM plants across the country, including 10,000 in Arlington alone. A local news report in May found that Ford was taking similar measures at its two auto plants in Louisville, Kentucky, with vehicles crammed into lots as far as 53 miles away from the plants.
One would expect that GM’s earnings would have been cause for sunny optimism among its investors. It also increased its year-end earnings forecasts, and CEO Marry Barra said in a statement that she expected the chip shortage to begin to clear up by the fourth quarter.
But for Wall Street, drunk on the biggest stock runup in history driven by the infusion of trillions in cash from the Federal Reserve, GM’s record quarter was not enough. According to Barron’s, which ran an article with the headline “GM Earnings Destroyed Expectations. Its Stock Is Dropping Like a Stone,” the automaker “also raised full-year operating-profit guidance from a range with a midpoint of $10.5 billion to a midpoint of $12.5 billion, implying earnings of about $4 billion in the second half of the year. Investors, however, wanted more.”
Wall Street punished the company by tanking its stock by more than 8 percent, the worst reaction to an earnings report in nearly a decade, according to Barron’s.
Investors are sending the message that they will not countenance any letup in the runup of profits by the increased exploitation of the working class. This is the chief consideration behind the elimination of all remaining safety measures by the Biden administration and state and local governments, including the planned reopening of schools to in-person instruction this fall. The reopening of schools in Detroit is seen as particularly vital for the auto industry to force workers, particularly mothers, back into the plants.
For workers, the past three months have been a continuation of the social disaster they have experienced for the past year. The auto companies and the UAW, following the lead of the Centers for Disease Control and Prevention, announced an end to all remaining safety measures, including temperature checks, cleaning breaks, social distancing measures during shift changes and universal mask requirements. However, the latest surge in cases has forced the UAW and the companies to reverse themselves on this last measure, first, in individual plants in states with high case rates, and then nationwide earlier this week.
One of the plants to officially reinstitute safety measures early was the Wentzville Assembly plant near St. Louis, Missouri, which produces the Chevrolet Colorado and GMC Canyon mid-sized trucks. GM reopened the plant on July 12, when it was already apparent that a new surge of the coronavirus was erupting in the state, which has been among the hardest hit in recent weeks. The company and the UAW waited a week before reintroducing a mask requirement at the plant on July 19.
However, a worker at the plant told the WSWS Autoworker Newsletter that in practice virtually all COVID safety precautions have been discarded. “It’s ridiculous. We don’t have sanitizer all over the plant anymore. Everyone is touching the same napkin dispenser to get a mask, no gloves, no sanitizing your work area, no temp taking. It’s a mess.”
She said that the mask requirement has been only haphazardly enforced. “Yesterday, I went to the snack machine, and the guy filling it up with products: no mask anywhere. The outside contractors are still working here: no masks. It’s a mess. What if someone gets really sick or dies? Is GM liable?
“They said today that the plant manager is supposedly going to be at the door to make sure people are wearing their masks when they leave. How’s the manager going to be at all three exits? There hasn’t been any social distancing on the shift change. They have been doing it like a herd of cattle.”
Neither the company nor the UAW has released any information on new cases of COVID-19 at the plant, either confirmed or suspected, she said. “Our dumb committee man hasn’t said anything.”
The state government is completely ignoring the crisis, she continued, as has been the case elsewhere. “Our governor is mostly concerned with holding the Missouri State Fair, which is going to be another super-spreader event. He has livestock and cattle he’s trying to sell. And [Chicago’s outdoor concert] Lollapalooza too, it was crazy. There’s no way they could monitor everyone coming in, a 100,000 people, was vaccinated or tested negative.”
A social and public health disaster is looming in the fall and winter. Only one month after Biden declared the pandemic over and called on people to “take [their] masks off,” coronavirus cases are up sharply, with more than 100,000 new cases a day. This will be compounded by the ending of temporary social assistance, such as the federal eviction moratorium, which Biden has only given a brief extension. Such measures will undoubtedly impact autoworkers heavily, among whom there are many who were working two or three jobs to makes ends meet even before the pandemic.
While no official figures have been released, it is likely that new outbreaks are already underway in plants throughout the country. There have been sharp increases in cases in Southern states with substantial auto production, such as Missouri, Tennessee and Texas, with Michigan not far behind. Yesterday, UAW Local 1264 sent out its first text alert in months notifying workers of a new COVID-19 case inside the Stellantis’ Sterling Stamping Plant north of Detroit.
“They don’t care about the workers,” a Louisville, Kentucky Ford plant worker told the Autoworker Newsletter about the auto companies raking in profits. “If that would be the case, they could distribute some of those profits to supplement workers’ food, rent, and other needs. It’s a travesty.”
However, the critical role in the auto industry’s profits has been played by the UAW, without whose assistance the Detroit automakers could not have posted such results. While concealing information the true spread of covid outbreaks in the plants through corporatist bodies such as the Joint COVID-19 Task Force, the UAW has worked to suppress and quarantine outbreaks of the class struggle in the auto industry.
For more than a month, the powerful strike by Volvo Trucks workers in Virginia was subjected to a total information blackout by the union, which did not even inform its membership in other plants that the strike was happening. However, when informed the strike by the World Socialist Web Site, autoworkers immediately expressed immense support for a joint struggle with Volvo workers. Indeed, only days after news of the Virginia strike reached a Volvo cars plant in Belgium from a WSWS campaign team, autoworkers at the plant carried out wildcat strikes against a company-union deal to extend their workweek.
The UAW eventually shut down the Volvo Trucks strike by forcing workers to vote again on a contract they had just rejected a week prior, claiming the re-vote passed by only 17 votes.
In March 2020 it was the action of autoworkers in Michigan, Indiana and Ohio, who conducted wildcat strikes in defiance of the UAW which led to the temporary shutdown of the auto industry saving countless lives. The subordination of human lives to the profits of the auto companies will only continue unless autoworkers continue to develop an organized opposition to the UAW’s betrayals through a network of rank-and-file committees in every plant.
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Blue State Blues: The Infrastructure Deal Is a Swampy Hoax
The $1.2 trillion “infrastructure deal” is a progressive-sounding label on old-fashioned pork. It will not grow the economy; it will not be “fully paid for,” as promised; and it will not even focus on the “roads and bridges” that are always being cited as the reason for the spending.
Though the media tell us that it will be a “huge political victory” for President Joe Biden, and a boon for Democrat-aligned interest groups, it is not clear what this bill does for the country.
Start with the economic news.
A major purpose of government investment in infrastructure is to provide the means for the private sector to generate economic activity. Public roads let firms move goods to market; aqueducts provide water to farms; trains help people get to work. Infrastructure projects also create direct and indirect jobs.
An infrastructure plan that fails to generate economic growth is worse than useless, a waste of public money that could be better spent.
So when the University of Pennsylvania Penn-Wharton Budget Model declared Thursday that the infrastructure deal would “have no significant impact” on economic growth, that ought to have ended debate on the matter.
That should also warn us that the main effect of the $1.2 trillion will be to divert capital that could actually have generated growth and will instead boost inflation even as lobbyists, unions, and the politicians who passed it eventually take their cut.
The Congressional Budget Office (CBO) also panned the deal, revealing Thursday that it would add a staggering $256 billion to the federal budget deficit. President Biden promised that the deal would be “fully paid for,” assuming that Congress also passed his “corporate tax plan.”
Even if taxes are raised to cover the shortfall, Biden would be asking taxpayers to pay more for a plan that will not grow the economy — in short, simply for the sake of paying the taxes.
Biden is constantly talking about how the infrastructure deal is necessary to spur investment in the technologies of the future, like the electric vehicles he was touting on Thursday. And yet the White House chose an outdated, hopelessly fossil-fuel dependent diesel locomotive as their symbol of the deal.
That reflected Biden’s romantic attachment to the Amtrak railroad service, a perpetual money loser except for the Acela line that Biden uses and which few can afford.
There was a New Deal quality to the White House advertisement — and that may be exactly why Biden likes it. He always promised to deliver the most “progressive” policies since FDR, and the $1.2 trillion deal gives him his chance.
Trump wanted to invest even more — $1.5 trillion — but to limit the federal government’s portion to $200 billion, with much of the rest coming from the private sector. That terrified Democrats and Republicans alike: no pork to spend!
What will the infrastructure deal actually do? The much-touted “roads and bridges” amount to $110 billion, less than ten percent of the total bill. The rest is a variety show that pointedly excludes “shovel-ready” infrastructure projects that are urgently needed, but which Democrats don’t like, such as the border wall or the Keystone XL pipeline.
Sen. Marsha Blackburn (R-TN) has proposed amendments to include them; it is notable that negotiators excluded them.
It is not clear what, in fact, Republicans obtained from their negotiations with Democrats on the deal, other than pork for their own constituents.
Sen. Mitt Romney (R-UT), that paragon of virtue, even admitted as such: “It’s fair to say if Democrats alone write an infrastructure bill, my state of Utah won’t be real happy by the time that’s done.” He had to be in on the deal, lest Utah be last in line at the trough. (I am certain there are Utahns who take a less pecuniary view.)
The Republican negotiators pride themselves on the $1.2 trillion price tag, which is something like half of what Biden initially demanded. But while Biden appeared to meet them halfway, he also promised another “infrastructure” bill, which would include everything Republicans rejected and would cost some $3.5 trillion.
Democrats still hope to push that bill through reconciliation, which Speaker of the House Nancy Pelosi (D-CA) said is a necessary prerequisite.
So there is no actual “deal” — just a vote on whether Republicans are going to share the blame for inflation, debt, and corruption. And if Blackburn’s amendments fail, then Republicans will share the blame for Biden’s decision to stop building the border wall during a migration crisis, and to kill the Keystone XL in the midst of an economic crisis.
The infrastructure deal is a swampy hoax — or, in more “progressive” terms: it restores the Washington wetlands.
Joel B. Pollak is Senior Editor-at-Large at Breitbart News and the host of Breitbart News Sunday on Sirius XM Patriot on Sunday evenings from 7 p.m. to 10 p.m. ET (4 p.m. to 7 p.m. PT). He is the author of the recent e-book, Neither Free nor Fair: The 2020 U.S. Presidential Election. His recent book, RED NOVEMBER, tells the story of the 2020 Democratic presidential primary from a conservative perspective. He is a winner of the 2018 Robert Novak Journalism Alumni Fellowship. Follow him on Twitter at @joelpollak.
“Workers are starting to wake up”
Tensions high in Volvo Trucks plant at end of first week back after strike
Tensions remain high inside the Volvo Trucks plant in Dublin, Virginia, as workers complete their first week back after being on strike for five weeks. For most workers, today will be their last day before a regularly scheduled two-week summer shutdown for maintenance and equipment upgrades at the New River Valley (NRV) plant.
Nearly 3,000 workers conducted a courageous fight against both Volvo and the United Auto Workers (UAW). The UAW colluded with the Swedish-based multinational to impose a six-year contract, which will continue to boost profits at the expense of workers’ wages, benefits and working conditions. Since mid-April, the workers struck twice and rejected three UAW-backed agreements before the union forced a revote on the company’s “last, best and final offer” on July 14. The UAW claimed the deal passed by 17 votes out of the 2,369 ballots counted and shut down the strike.
The new contract will impose higher out-of-pocket health care expenses, force younger workers to labor six years or more to reach top pay and allow the continued imposition of forced overtime. Raises for the top-paid workers average only 2 percent a year, well below the current rate of inflation of 5.4 percent.
Since the return to work there has been a virtual standoff in the factory. Supervisors want to ramp up production to make up for lost output during the strike. Workers are steadfastly refusing to accept extra duties and faster line speeds. Anger has been further fueled by the release of Volvo Group’s second-quarter profits of $1.1 billion earlier this week, bringing its total income for 2020 to $2.4 billion.
“The first shift got their checks today, and it did not include the bonus or the raises from the new contract,” one worker told the WSWS. “Everybody gets two checks before the shutdown, and the raises are supposed to take effect right away. That didn’t happen, but the amount of money the UAW is taking out in dues is going up,” he said.
According to workers, management is scouring the plant for volunteers to work during the two-week shutdown, but they are getting very few takers. “Usually, they canvas once or twice a week for overtime, but every single day the bosses are coming around and asking, ‘You sure you don’t want to work?’ People are telling them, ‘Hell no, I’m not working.’ Workers are saying, ‘I’m going to work for what I’m worth to them.’ This is not going to be short-term but from now on.”
Newer workers who have been employed less than 90 days have no choice but to work during the shutdown, the worker told the WSWS. He also said there is a rarely used stipulation in the contract that allows management to make workers with fewer than three years work during the summer downtime if they get vacation time another time of the year.
“They are using that stipulation now with the full backing of the UAW to round people up for work,” the worker told the WSWS. “They’re going to run 20 trucks a day, which is a lot fewer than the 60-70 they ran before the strike.”
He also said workers are concerned that Volvo and the UAW might try to bring in 10-hour workdays after the break. “They said they took their demand for a four-day, 10-hour ‘alternative work schedule’ out of the contract, after we voted that one down. But there is fine print in the contract saying the UAW and the company can revise it by ‘mutual agreement.’ The union never showed us the full contract, and we only saw the tip of the iceberg of what is going to be changing. If they try to do this, it is going to open one big can of worms.
“It’s the little things they kept hid that’s going to start coming out. We found out this week the new hires who didn’t get their 90 days in before the strike but stood out on the picket line all these weeks with us are not going to get the signing bonus. That’s not right. They deserve it just as much as anyone else.
“We should have voted down the contract on principle, even if they tried to send us back to work. A lot of people are mad, and not a lot of work is being done. But all over the country and the world, workers are starting to wake up. If we don’t, they’re going to try to take everything away from us.”
A veteran Volvo worker told the WSWS, “Overall, I thought the third TA [tentative agreement] sucked. Our last two contracts were brutal, but this one was the worst. The biggest complaint I’ve heard is on health insurance. For workers who are married and/or have children, the insurance cost increases have really upset them. Several people I know said they are turning in their union cards. They’re going to use the dues money of $70 per month for their health insurance premiums instead. They figure they don’t get anything in exchange for their dues money anyway.”
The worker explained how the UAW conspired with the company to ram through the contract. “Of course, there was economic pressure to vote ‘yes.’ Many of my friends were dead up against it, terrified. Some of them care for their grandchildren and said, ‘I have to take whatever they offer.’
“Several workers who ended up voting ‘yes’ were in the process of applying for a home mortgage, and the bank told them they would have to cross the picket line by August or lose their approval and the home they were getting. They were in the middle of this huge purchase—their home—and felt that they had to vote ‘yes’ because the bank was basically forcing them to.”
Commenting on the pittance the UAW paid in strike benefits, the worker said, “Where do they come up with $275 per week? I know they have millions in the strike fund. The UAW took a long time on both strikes in April and June to get us our checks.”
He continued, “There was never any communications from anyone at the UAW during both strikes and leading up to them. It is sickening the way everything was handled. They were so misleading and underhanded through every bit of it.”
To oppose the sabotage of their struggle by the UAW and provide workers with a voice and real leadership, workers formed the Volvo Workers Rank-and-File Committee (VWRFC). With the assistance of the WSWS, the VWRFC broke the UAW’s news blackout and deliberate isolation of the strike and won support from Mack Trucks workers, autoworkers in Detroit and other cities and Belgian Volvo workers.
The VWRFC is campaigning for the expansion of a national and international network of rank-and-file committees to conduct a real fight to overturn decades of union-backed concessions.
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