By Dale Russakoff
Washington Post Staff Writer
Sunday, March 26, 2006
DETROIT -- The signs in the parking lot of United Auto Workers Local 22 still blare the defiant 1980s warning, "Union Made American and Canadian Cars Only." But inside the hall, the conversation has turned strikingly philosophical. In the wake of General Motors' buyout and retirement offers last week to its entire unionized workforce in America, workers and their local leaders spoke with jarring realism about the global forces converging on them.
"In ways, we brought it on ourselves," said George McGregor, vice president of Local 22, which proudly advertises its lineage from the militant 1930s local of legendary UAW president Walter Reuther. "When TV and stereos went overseas, did we say: 'Don't let them go?' I tell people to buy American cars and they say, 'Where are your clothes made? When my job went overseas, where were you?' "
No one needs to explain the lessons of globalization to the 113,000 GM hourly workers now pondering their futures. More than half started working in the 1970s, before the rise of foreign competition and high technology. Over three decades, they watched the twin forces upend their industry, their jobs and their sense of security. "We know more about globalization than the globalization people," McGregor said on Friday. "We've lived it."
The buyout and retirement offers symbolize dramatic acknowledgment by the company and the union of their diminished place in the 21st-century U.S. auto industry.
"Do you think Dick Shoemaker [the UAW vice president for GM], one of the best negotiators the union has ever had, wants to go out on an end note like this?" asked Craig Nothnagel, president of Local 22, who started on a Cadillac assembly line 38 years ago, when he was in high school. "No, he doesn't. But he negotiated a way out for all of us. Left to GM, they could push us out with nothing. UAW made sure we had a choice."
The UAW negotiated the deal with GM and its parts supplier Delphi, which is under bankruptcy protection and was moving to impose 60 percent wage cuts on union workers through a bankruptcy court. Such a cut would almost certainly have triggered a strike and a catastrophic chain reaction--shutdowns of Delphi and GM, and possibly a GM bankruptcy that would jeopardize not only jobs but the health care and pensions of hundreds of thousands of retirees.
The agreement could help avert a strike if enough high-cost workers accept the offer and leave both companies. Delphi could then hire new workers at lower wages already negotiated with the union. And General Motors could proceed with already announced plans to eliminate 30,000 jobs and close 12 plants. GM told industry analysts that the company expected to exceed that goal with the buyout.
Even as the UAW's ranks are shrinking, foreign automakers such as Kia and Toyota -- whose U.S. plants are non-union -- have vastly expanded. The foreign automakers pay comparable wages and benefits for active workers, in part to ward off unions, but they do not have the staggering retiree benefits of the Big Three. GM, for instance, has 2.5 retirees for every active worker.
Critics of the UAW fault it for insisting on these benefits. Until last fall, retirees didn't even have a copay on their health care. The union says the problem is that GM hasn't designed cars people flock to buy, causing its market share to plummet.
Among the predominantly middle-age men and women of Local 22 emptying out of the immense Cadillac and Buick assembly plant on General Motors Boulevard on shift change last Thursday, there was more pragmatism than anger about the reshaping of their world. "It doesn't make me angry," said Andy Butterworth, who at 48 has worked 30 years for GM. "The global market has dictated this. The Kias and China are just blasting away at us. It's time for management and the union to get together."
In another century, Butterworth followed his father into GM right out of high school. "That's how it worked back then: No tests, just come to work," he said. The Big Three had the U.S. market essentially to themselves, and the UAW had clout to insure workers shared the wealth. Now, Butterworth said, he will likely take the retirement offer, which for him includes $35,000 cash, along with a $3,000 monthly pension and health benefits for life.
Even with college tuitions yet to pay for two children, he said, he has saved enough from 30 years as a United Auto Worker -- by far the highest-paid workers in American manufacturing -- to provide for his family. And if necessary, he can fall back on the builder's license he got during a long layoff -- training paid for by GM.
The altered landscape is dramatized in the reaction of younger workers to buyout offers of $140,000 and no other benefits for those with 10 or more years; $70,000 for those with fewer. Most of those interviewed said they would pass up the cash -- they could make that much in another year or two with GM, and the next job wouldn't come close to matching their pay and benefits. Besides, those with children said, they can't afford to forgo the health coverage.
But unlike old-timers who once called their employer Generous Motors, they have no illusions of lifetime security at a GM that lost $10.6 billion last year.
"This is a signal to the younger people: Make the best of my time here," said James Williams, a 34-year-old father of three and third-generation autoworker wearing a black T-shirt emblazoned with a Chevrolet SSR, which GM recently discontinued. With nine years in the factory, and 21 until retirement, Williams said, "This tells me if I do stay, I better get on the ball with Plan B." He has taken courses in home remodeling and construction, paid for by GM.
Even here in Motor City, where the Big Three loom larger than anywhere else, the conversation is moving pointedly beyond them. A news anchor on WWJ Newsradio (950 AM) asked a career counselor at Lawrence Technological University how he would counsel an engineering student who wanted to work for GM and design "the Chevy Camaro of the future." The counselor said he'd tell him or her to check out biomedical engineering, life sciences and the hottest new opportunity center: homeland security.
The Autos Talk chat page on the Detroit News Web site has been dominated by autoworker-bashing in the wake of the retirement offers. "Let me enlighten you morons," read a message posted last Thursday and signed Mr. Reality. "When you can not get a job for the same money as the last one you had, YOU WERE OVERPAID. Welcome to the Real World, I hope you can manage!"
"Where were all of you 'loyal' Michiganders when Kmart was struggling and I was losing my job???" asked a chatter named L. Sacker. "You were shopping at Wal-mart, cause [its] prices are cheaper."
Back at Local 22, George McGregor says that L. Sacker is right: Global market forces have engulfed the country, not just the United Auto Workers. But inside his office, the golden age is preserved, as if in a museum.
There are framed yellow newspaper clippings of the massive union picket lines that in 1941 forced Ford to recognize the UAW. There are models of every Cadillac he ever worked on in the assembly plant. There are pictures of his beloved Detroit Tigers winning the World Series in 1968 -- the year he came to Detroit and to GM, when everything here seemed golden.
McGregor grew up in Memphis, when his dream job of firefighter was off limits to African Americans. Instead, he went to work in a handle-making factory at 18, where his take-home pay was $46 a week. Drafted into the Army, he went to Vietnam as a paratrooper and one night was comparing paychecks with buddies from Detroit. "They worked for Chrysler. I said my paycheck was $46 and they had hundreds of dollars," he said. "I said, damn, I'm going to Detroit when I get out."
He did, and when he got to the Fisher Body Fleetwood plant, he saw a sign on the bulletin board that he will never forget: "If you know anyone who needs a job, please bring them tomorrow." They put him to work that very day, welding back seats to car trunks. His first paycheck was $216, more than four times what he'd made in Memphis. To this day, it hangs framed on the wall in his den. "I didn't want to cash it. I just wanted to look at it," he said.
Overnight, he had become middle class--and has remained so. Now 59, he looks back in amazement at what feels like the rise and fall of a way of life, all under his nose. "First they were begging me to come. Now I'm holding an offer that says we'll pay you to leave!" he said. "How can things go from the top of the mountain to halfway down in so little time?"
Gary Wilson, the union financial secretary who has lived similar experiences, said it is the well-off who don't understand the global forces that can level companies, jobs and the good life. "Our kids are on the line fighting and dying," he said. "When we came home from Vietnam, we had jobs to come back to. These kids in Iraq are fighting for the American dream, and what do they have to come back to?"
As the pain spreads, he said, more Americans will see the world as the UAW sees it.
"One day the workers are going to take a stand against the people who don't see what is happening," he said. "Capitalism has been great for our people. How can we sit here and let it destroy us?"