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Without government assistance Chrysler and General Motors would be out of business now. But the federal loans the companies were able to acquire came with stringent demands on our union.
There’s no question the economic crisis has been particularly brutal for the auto industry, domestic and foreign. Chrysler LLC’s bankruptcy filing brings to light the magnitude of this problem.
The severe recession that brought this about wasn’t caused by the auto companies, UAW members or working people. Just the opposite. The worldwide economic downturn began when the U.S. housing market sank and continued to erode as credit markets tightened and consumer confidence was at an all-time low.
Our union did what we had to do while trying our best to limit the pain for our active and retired members. That doesn’t mean it isn’t painful. Without government assistance Chrysler and General Motors Corp. would be out of business. But the federal loans the companies were able to acquire came with stringent demands on our union. The Bush administration and now President Obama’s auto task force required deep concessions from UAW members and other company stakeholders. We were left with a choice between making those concessions or watching the companies collapse.
In the case of Chrysler, our union was in bankruptcy court on day one, and we will remain there fighting for our members until the company emerges. We made every attempt to avoid the bankruptcy filing but to no avail. However, we are confident that the new Chrysler will emerge strong and positioned to take its rightful place in the auto market.
The April 27 announcement by GM that it will eliminate another 21,000 jobs by next year was a devastating blow, and the prospect of bankruptcy looms as we continue to negotiate with the company, the administration and the auto task force. The company has to submit a new, leaner restructuring plan to the government by June 1 in order to get the additional capital it needs to survive. We are working to reach an agreement before that date, but we will not be rushed into a deal that does not include concessions from all GM stakeholders.
UAW members at Ford Motor Co. are also feeling the effects of the auto crisis. Although the company did not take federal loans, in March our membership at Ford agreed to accept concessions that will help Ford compete in a very difficult environment.
The same factors that brought about such a rapid and steep fall of automakers and parts suppliers have also caused hardship for UAW members and their families across the different sectors of our union. Whether you’re a manufacturing worker or university faculty or a public employee, chances are you’ve been – or soon will be – impacted by the auto crisis.
The domestic car companies’ ripple effect on the U.S. economy is well known. Each job at Chrysler, Ford and GM supports nine other jobs in the United States – from auto parts to hospitals to public schools. As the auto industry contracts, we’re seeing the impact in these areas as well. Local and state tax bases are imperiled as workers are laid off and homes are foreclosed, causing even more layoffs. And the circle of pain widens to touch us all.
But if we stand together, in solidarity, against the currents of yesterday’s bad policies (unfair trade agreements, failure to enact national health care and deregulation of financial markets, to name a few) and today’s economic pandemic, we won’t be pulled under.
Our solidarity is our strength.
Working with our brothers and sister throughout the labor movement and our progressive allies, we can reverse the policies that brought our economy to this point and turn the tide in favor of working people.