By David Sole
General Motors (GM) announced on November 26 plans to end production at five plants in North America in 2019. Three of them are auto assembly factories located in Detroit-Hamtramck, Michigan; Lordstown, Ohio; and Oshawa, Ontario. Transmission plants in Baltimore, Maryland, and Warren, Michigan, are also on the list, as well as two unnamed overseas facilities.
Together, the jobs of over 6,000 union workers are threatened. Another 8,000 salaried GM workers face layoffs in the coming year. The closing of entire factories has broad effects on the surrounding communities, as each job lost has a ripple effect throughout the local economies and neighborhoods.
Workers at the Oshawa plant immediately walked off the job to protest the announcement. These workers had given concessions on their pensions to GM in their 2016 contract negotiations in order to strengthen job security. Canadian government officials expressed anger at the company; the Canadian government had contributed to the 2009 bailout of GM and had provided funds to modernize the Oshawa plant in 2005.
The United Auto Workers (UAW), representing autoworkers in the United States, contested GM’s claim that declining sales was the cause of the plant closings. According to the UAW, General Motors had “a long term plan to move more production out of the country.” According to a statement given to the Detroit News, it involved “intentional strategic investment decisions and product movement…that was planned…long before sales numbers were known.”
Analyzing GM’s decision, Automotive News writer Michael Wayland wrote that GM executives want to “implement billions of dollars in cost-cutting measures in preparation for the next economic downturn.” He reported that these moves are “expected to save the automaker $6 billion annually.” Unlike the workers and community people, Wall Street was happy to hear the news: GM stock initially jumped 4.8 percent in the days following the announcement.
In addition, GM had no problem spending $10.6 billion to buy back its own stock since 2015. Buying up the corporation’s stock makes the remaining shares more valuable. While this doesn’t help the workers or improve productivity, it enriches investors and top executives who often get paid in stocks.
Sales numbers of the six car models slated for elimination were 225,000 in the first 10 months of 2018. The Chevy Cruze, produced at the Lordstown plant, is GM’s third-largest selling car.
GM avoided using the words “closing” or “idling” the plants. Instead, the corporation said it was ending production with no vehicle assigned. This is an attempt by the auto giant to avoid a contract fight with the UAW. A memorandum of understanding included in the 2015 UAW-G.M. National Agreement states on page 356:
Subject: Plant Closing Moratorium
… this will confirm that during the term of the new Collective Bargaining Agreement, the Company will not close, idle, nor partially or wholly sell, spin-off, split-off, consolidate or otherwise dispose of in any form, any plant, asset, or business unit of any type, beyond those which have already been identified, constituting a bargaining unit under the Agreement. In making this commitment, it is understood that conditions may arise that are beyond the control of the Company, (i.e. market related volume decline, act of God), and could make compliance with this commitment impossible. Should such conditions occur, the Company will review both the conditions and their impact on a particular location with the Union.
With the UAW set to negotiate with GM in 2019 and Unifor (the Canadian union representing auto workers) facing GM contract talks in 2020, there is speculation that the corporation will use these plant closing threats to secure ever more concessions from the workers. The moratorium on plant closings in the contract, which was a product of the fight against plant closings led by the “A Job is a Right” campaign from 1986 to 1988 described below, should be invoked by the union and the workers to mount a struggle to stop the closings.
Anger at the corporate giant is much wider than just from the workers and their unions. The public is widely aware that General Motors was saved from bankruptcy with a bailout by the U.S. government in 2009. The cost to the taxpayers is estimated at $11.3 billion. This intervention was made with the understanding that GM would reorient more toward fuel efficient cars, like the Chevy Volt (produced at Detroit-Hamtramck) and Chevy Cruze (produced at Lordstown).
Detroiters also remember that the Detroit-Hamtramck Assembly Plant was built on the site of a large and stable community. Over 4200 people were driven from their homes in what was commonly known as Poletown. This multi-national community fought to keep their homes but were told by the Michigan Supreme Court that eminent domain could be used to benefit a giant corporation. Thirteen hundred homes, six churches, 144 businesses, a hospital and a school, spread over 465 acres, were seized and bulldozed for the GM plant’s construction in 1981.
The State of Michigan has also propped up GM for many years with special Michigan Economic Growth Authority (MEGA) tax credits. While the precise amount of these credits has been kept from the public, they totaled $3.41 billion when first granted in 2009, and are likely more today. Under the MEGA tax credits, which stay in effect until 2032, the corporation can claim a credit on state taxes owed for any year they are profitable. They are expected to maintain job levels to qualify for the credit, not shut down plants. And local governments across Michigan have regularly granted tax breaks to encourage GM to build plants in their jurisdiction.
GM’s announcement also puts to rest any illusions that President Trump’s huge corporate tax breaks and tariff policies will keep factory jobs in the United States or even bring back “good jobs.”
Public officials and union leaders have long complained about plant closings, the loss of jobs and the resulting devastation of communities, but they have been unable to launch any serious struggle due to their limited view respecting capitalist property relations both in the courts and in contract negotiations.
When GM announced its plans to close down 19 plants in 1986, a struggle emerged, led by rank-and-file workers and radical activists for a moratorium on plant closings. Spearheaded by the Stop Plant Closings Committee of UAW Local 15 (Fisher Body Fleetwood Plant), the demand was made that a job was a property right of the workers. This became a national movement led by the “A Job Is A Right Campaign.”
This organizing included mass meetings in Flint, Michigan union halls, mass in-plant meetings at the Detroit Fleetwood Plant, mass marches and rallies in Michigan and Ohio and a protest outside the national conference of governors in Traverse City, Michigan. A tent city of laid off workers, victims of plant closings, also took place on the grounds of the state Capitol in Lansing, Michigan, in 1988.
Although the campaign got no support from top leaders of the UAW, they did adopt language in the next UAW-GM national agreement providing for a moratorium on plant closings, albeit only after GM closed the 19 plants. The 1990’s saw another massive round of plant closings by GM, which ultimately eliminated 70,000 of 80,000 auto jobs in Flint, Michigan.
Only a mass militant movement of the workers together with the affected communities can succeed in stopping the giant corporations from doing whatever they please. Driven by the desire and need to maximize profits, corporations have no concern for the lives of the workers who create all the wealth, nor for the destruction to surrounding communities. The Moratorium NOW! Coalition to Stop Foreclosures, Evictions, and Utility Shutoffs along with other community organizations, like the National Action Network, have already announced plans to fight the closings. Moratorium Now has presented a Freedom of Information Act request demanding the precise figures for the Michigan MEGA tax credits and the precise figures on jobs that were supposed to be preserved. Unifor has been mobilizing its members from day one. The UAW must join the fight and mobilize the workers to join the community in beating back this latest outrageous attack on the working class.
Workers have a property right to their jobs, which they have more than paid for with their stolen labor for years. The community has a property claim on the plants as they have paid for them with massive tax breaks and blighted communities caused by the company over the years. If General Motors persists in their closings, the workers and the community have the right and duty to occupy the plants to assert their property rights and run them under worker-community control. The battle is just beginning.
David Sole worked at GM’s Fleetwood Plant from 1970 to 1987. He served on the Executive Board of UAW Local 15 and was co-chair of the Stop Plant Closings Committee of the local union. He also served as an organizer for the “A Job Is A Right” campaign.
To get involved in this struggle contact the Moratorium Now Coalition at firstname.lastname@example.org or on Facebook @MoratoriumNowCoalition.