Does fighting back still matter? The Canadian autoworkers,capitalist crisis and confrontation

Neoliberalism and trade unions

Neoliberalism, Gamble argues, ‘first made its appearance in the form of political economy as a critique of Keynesianism and a wider critique of state involvement in the economy’ (2001: 128). The neoliberal response to Keynesianism meant a restructuring of capitalism to ‘provide a means by which capital could begin to disengage from many of the positions and commitments which had been taken up during the Keynesian era’ (2001: 131). The neoliberal critique of Keynesianism contained an implicit critique of trade union rights: whereas unions had a legitimate role within the Fordist-Keynesian mode of regulation, neoliberalism sees unions as barriers to flexible accumulation. Neoliberal theory also criticises state involvement in the market. Neoliberals hope to shrink the state, as they argue that state involvement in markets distorts markets, which leads to an inefficient allocation of resources and, subsequently, reduced levels of profit. Hence, neoliberals have sought to dismantle the Keynesian welfare state, and replace it, in theory, with some version of a nightwatchman state.

Neoliberalism entails the deregulation and liberalisation of national economies. A core assumption is that inflation represents a greater threat to economic development than unemployment, and that state intervention causes unemployment and inflation in an otherwise efficiently functioning, free-market economy (Bieler, 2007: 111-112). These fiscal policies hold direct implications for unions and union politics: the dual pressures from states and capital put a downward pressure on wages: ‘employers and governments seek price advantages through wage and benefit cuts’ (2007: 113).

Although neoliberalism emerged from the crises of Keynesianism, it is much more than a response to Keynesian orthodoxy. As Peck and Tickell argue, ‘Neoliberalism cannot be reduced to an outcome of this after-Keynesian environment … Neoliberalism’s ascendancy has been associated with the political construction of markets, coupled with the deliberate extension of competitive logics and privatized management into hitherto relatively socialized spheres’ (2002: 395). Neoliberalism was actively constructed to extend markets, increase the spaces for accumulation, and remove barriers to accumulation – such as trade unions and the welfare state – that were constructed and strengthened during the Keynesian era. The crisis of the Keynesian state provided the opportunity for capital to advance the neoliberal agenda and tear down perceived barriers to profitable accumulation.

While neoliberalism has, in part, been a response to Keynesianism, and neoliberal fiscal policies first emerged as both a challenge and a way to dismantle the Keynesian welfare state, neoliberalism is much more than a simple political–economic response to Keynesianism. David Harvey defines neoliberalism as ‘a theory of political economic practises that proposes that human well-being can be best advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterized by strong private property rights, free markets and free trade’ (2005: 2). Harvey’s analysis of the neoliberal project makes clear that neoliberalism was ‘a project to achieve the restoration of class power’ (2005: 16).

Neoliberalism is a class-based project, designed and implemented by global capital in order to restore levels of accumulation that tapered off in the post-war period. The class compromise of the Keynesian era saw a marked reduction in capital’s ability to generate profits. Hence, the neoliberal agenda has the explicit goal of restoring high levels of capitalist profits. Neoliberal ideology speaks to this: markets are seen as the best way to achieve human freedom, and freedom is defined by the freedom to accumulate wealth. Hence, neoliberal ideology seeks to ‘free’ markets from practices that may restrict unfettered wealth accumulation.

The ideology of neoliberalism and neoliberal practices converge around the theoretical and practical rejection of the active state that had emerged in the Keynesian post-war era, and its replacement by laissez-faire free-market doctrines and practices (McBride and Shields, 1997: 18). Neoliberal policies are designed to free markets and increase capitalist accumulation, but were actively constructed and introduced by an active neoliberal state. The neoliberal state apparatus’s ‘fundamental mission is to facilitate conditions for profitable capital accumulation on the part of both domestic and foreign capital’ (Harvey, 2005: 7). Bob Jessop also emphasises the role of the state in managing the internal tensions of neoliberalism: the state must mediate between potentially mobile capital’s interests in reducing its place-dependency and the state’s interest in fixing (allegedly) beneficial capital in its own territory (1993: 14). The neoliberal state creates, protects and enforces markets. It also introduces policies to create and maintain the conditions for capitalist accumulation by removing perceived economic barriers to profit. The neoliberal state is, in theory, a night-watchman state; but in practice, is very active.

The shift to neoliberalism from Keynesianism has had a profound impact on trade unions. As Martin et al. note, ‘increased capital mobility [present under neoliberal globalisation] means that the fear of individual workers of being fired has been replaced by a fear of the closure of the entire plant’ (1994: 65). Workers thus may come to be engaged in a struggle with other workers in order to keep plants open, rather than against capital. Capital attempts to extract concessions from workers with the promise of ongoing production (which ensures ongoing jobs). These concessions benefit capital, enabling higher levels of surplus value to be extracted from labour during the production process.

Neoliberal orthodoxy holds that ‘unions operate to distort the natural price flexibility of the marketplace, resulting in higher levels of unemployment and wage-based inflationary pressures. Consequently, government policy should be directed towards eliminating these sources of inflexibility’ (McBride and Shields, 1997: 26). Hence, neoliberal governments have introduced wide-ranging policies to restrict trade union rights and freedoms, and to narrow the scope of the activities of unions. Restrictions on union organising and union security arrangements are a cornerstone of neoliberal trade union legislation.

Neoliberal policies have made it much harder for workers to join trade unions. This serves the neoliberal agenda twofold. On the one hand, fewer unionised workers means a lower-waged workforce, which means greater capitalist accumulation. On the other hand, unions’ declining membership means less economic resources for unions. This has broad implications for trade unions. Fewer economic resources often mean that unions have less political clout, and are restricted in their ability to advance an agenda. Further, it means that less money can be directed towards broad organising campaigns to bring new workers into the union. Hence, a vicious circle is born: fewer workers in unions means less money with which to organise, which brings about fewer workers in unions.

Labour-market restructuring and the assault on trade union freedom has come in two successive waves. Peck and Tickell note that the early stages of neoliberalism could be characterised as ‘roll-back’ neoliberalism: ‘blaming the economic crisis of the 1970s on Keynesian financial regulation, unions, corporatist planning, state ownership and “overregulated” labour markets.’ Thus, the neoliberal roll-back of the late-1970s involved ‘freeing up markets, restoring the right to manage, and asserting individualizing opportunity rights’ (Peck and Tickell, 2002: 388). One of the major sets of early neoliberal rollbacks were restrictions on union organising, strikes, and rollbacks of collective bargaining rights.

Roll-back neoliberalism involved a great deal of destruction of institutions and already existing social structures. The destructive elements of neoliberalism entail ‘assaults on organized labour and national collective bargaining agreements; dismantling of the family wage and the spread of generalized economic insecurity; downgrading of national regulations ensuring equal employment, occupational safety and worker’s rights’ (Brenner and Theodore, 2002: 364). Roll-back neoliberalism stripped away the protective coverings established under Keynesianism, many of which had been established by trade unions. Trade union powers were curbed and dismantled and, subsequently, ‘flexible’ labour markets were established.

The second wave of neoliberalisation, in the 1990s, was characterised as ‘roll-out’ neoliberalism. Roll-out neoliberalism involved ‘new forms of institution-building and government intervention which have been licensed within the neoliberal project’ (Peck and Tickell, 2002: 389). Roll-out neoliberalism involved the active neoliberal state restructuring and remaking institutions to better facilitate capitalist accumulation. It was roll-out neoliberalism that saw the normalisation of part-time, low-wage contingent work, the rise of self employment, and the switch from welfare to workfare, amongst many other labour-market changes. Brenner and Theodore note that neoliberalism has a creative element, as well as the aforementioned destructive element. This creative element became evident in roll-out neoliberalism. The creative roll-out neoliberalism saw ‘atomized renegotiation of wage levels and working conditions combined with expanded managerial discretion, and a promotion of labour flexibility’ (Brenner and Theodore, 2002: 364).

These policies also involved a major challenge to trade unions. The expansion of management rights saw collective agreements, many of which had been in place for decades, come under attack as management demanded more and more concessions in the name of ‘the right to manage.’ The reorientation of negotiations of wage and working conditions to the individual level, rather than the workplace, saw the raison d’être of collective bargaining challenged. While roll-back neoliberalism assaulted the gains that organised labour had made during the Keynesian compromise, roll-out neoliberalism challenged the very nature of trade unionism.

Neoliberalism is grounded in ‘common sense’ in the Gramscian meaning: ‘sense held in the common’. Harvey (2005) argues that neoliberalism has its own common sense, often grounded in rhetoric surrounding ‘freedom’ which has been fostered and built since as early as the 1950s and 1960s. This freedom of which neoliberals speak is made up of individual, market-based freedoms. The ideological attack on trade unionism has involved the creation of a common sense that rejects the very principals of trade unionism. Stephen Gill argues that neoliberalism ‘tends to generate a perspective on the world that is ahistorical, economistic, materialistic, “me-oriented”, short-termist and ecologically myopic’ (1995: 399). These perspectives fundamentally challenge trade unionism’s emphasis on collective economic action and long-term workplace planning through collective agreements. Neoliberalism is exceptionally hostile to rhetoric of collective social or economic activity, and attacks collective action at its core. While neoliberalism is intended to expand personal freedom at the expense of collective freedom, individuals are not supposed to ‘choose to construct strong collective institutions’, since these collectives act as a barrier to capitalist accumulation (Harvey, 2005: 69).

As the emphasis on individual economic action was stressed and repeated by neoliberal rhetoric, trade unions have had to resort to defending their very existence: unions are challenged as being a barrier to both accumulation and to individual activity in the market. Rather than fighting an offensive battle, continuing to democratise the workplace, expand workplace benefits and increase wage levels, trade unions have become involved in a defensive battle. ‘Neoliberalism, which emphasises individualism and competition, has contributed to a general hostility towards unions’ (Yates, 2007: 66). The effects of this roll-out ideological attack on trade unionism have resulted in segments of the working class, and some trade unionists, internalising the logics of neoliberalism and becoming extremely hostile towards trade unions. When the ‘common sense’ is that trade unions are bad for the economy, members of the working class – including trade unionists – may start to embrace that idea. With ‘the undermining of sentiments in favour of trade unions with the promise of joining the system, the working class is being turned against the very mechanisms that protect it from the system’ (Teeple, 2000: 99).

If members of the working class, and trade unionists, internalise the logics of neoliberalism, then unions themselves risk internalising the logics of neoliberalism. In the long run, this has profound and dangerous effects on the labour movement. Accepting the logics of neoliberalism means, implicitly, accepting the logics of the capitalist class. As both neoliberalism and capital seek to destroy trade unions and the goals of unions, this means that unions begin, metaphorically speaking, to dig their own graves.

Union responses and revitalisation

Much of the North American literature on union renewal and responses to the neoliberal challenge places unions into two overarching categories: business unions and social movement unions (SMUs). Business unions are essentially built around the model of servicing members - the union’s activity is limited to the workplace through collective bargaining, shop steward activities, and grievances. SMUs generally take a role in electoral politics, they build international solidarity and solidarity with other unions, are engaged in projects of building internal union democracy and develop links with their local communities. Perhaps more importantly, SMUs see themselves as part of a larger social movement with the active desire to change society. In this sense, SMUs have a broader sense of solidarity than business unions: SMUs see the labour movement as having a broad sense of solidarity with the greater working class, and as a leader of the working class, and seek to improve society for the working class.

Business unions regularly engage in partnerships with employers to ensure production continues for employers, and that the products they produce remain competitive. In this sense, business unions are concerned with generating high levels of capitalist profit. Business unionism is a fundamentally flawed project - the high levels of capitalist profits they are complicit in generating can only be created through the exploitation of their members. Further, ‘business unionism, or any other type of unionism involving partnerships with employers are bound to fail in an era where both business and government are openly hostile to unions’ (Schiavone, 2008: 25). This said, it must be recognised that many unions adopt business unionism as a response to the challenges facing the union: they see cooperating with capital as the only way to ensure production in an era of neoliberal globalisation and deindustrialisation.

Social movement unionism has thus been heralded as the only way forward for trade unions. SMUs behave as if they are part of a broader social movement concerned with changing society. The key tenets of social movement unionism include revitalising internal union democracy, organising the unorganised, rank-and-file involvement in organising, militant collective bargaining, alliances with community organisations, and international solidarity. SMUs also engage in grassroots political organising to involve rank-and-file members in union politics; build ‘solidarity alliances’ at the national and international level with community groups and other unions, to push for social and economic change; and expand programmes of union education to build rank-and-file awareness of the changing environment in which they live (Kumar and Schenk, 2006: 36; Robinson, 2002: 191; Schiavone, 2008: 62).

In their analysis of Swedish union response to the challenges of neoliberal globalisation, Bieler and Lindberg (2008) suggest that there are two main strategies that unions can employ to respond to challenges: ‘defend and restore’ and ‘modernise and adapt’. ‘Defend and restore’ unions highlight the domestic role of unions, support the existing welfare state arrangements and see unions having a ‘national inwardness and longing for good old days’. These unions tend to overstate the degree of national sovereignty in relation to global capitalism. ‘Modernise and adapt’ unions see the role of unions as that of upholding national agreements and responsible levels of wage increases so as to not undermine competitiveness. They accept new production patterns, including new types of flexibility, and collaborate with managers and employers to develop the long-term competitiveness of production. ‘Modernise and adapt’ unions, then, are less likely to fight back against neoliberal restructuring and instead attempt to do as well for themselves as they can within neoliberalism. These responses are quite similar to the union strategies developed by those interested in US union renewal. ‘Modernise and adapt’ unions share many characteristics of business unions, perhaps most importantly their collusion with capital to ensure short-term capitalist profitability. ‘Defend and restore’ unions share a number of qualities with SMUs.

The theoretical propositions that the union renewal literature makes are somewhat problematic. Much of the literature assumes that there is a clean breaking point between business unions and SMUs. The literature seems to ignore the possibility that unions may have characteristics of both a business union and a social movement union, or that it is possible for unions to drift between the two categories. Similarly, Bieler and Lindberg present two separate strategies, while it is possible for unions to have a number of different strategies drawn from both ‘defend and restore’ and ‘modernise and adapt’ unionism. The literature on both business unionism and social movement unionism assumes that unions seek to exist within a neoliberal climate. Business unions and social movement unions both recognise, to some extent, that neoliberalism is hostile towards trade unions, so both types of unions seek to exist the best they can within neoliberalism: business unions by focusing all their energies on reforms within the workplace, and social movement unions by involving themselves with social movements that seek to reform society. As neoliberalism is by its very nature hostile to unions, a sustained renewal effort must challenge neoliberalism, seeking to construct a new ‘common sense’ or seeking to replace neoliberalism with some other political-economic ordering of society. By way of example, most of the success stories of SMUs deal with new organising tactics within the neoliberal climate; there is virtually no discussion of how the labour movement can create a movement for a post-neoliberal political economy.

Strategies that unions employ to renew and resist can be ordered as points along a continuum: it is possible for unions to have characteristics from multiple typologies, and for their characteristics to change. Indeed, Byford (2009) argues that ‘Social Unionism is contentious in terms of whether it represents a significant and new focus for union activity at the workplace, in local communities and in bringing about wider societal change through political activity or whether it is purely an extension of a strong organising model,’ suggesting that is possible for unions which aggressively organise to have characteristics of both business and social movement unionism. The CAW (Canadian Auto Workers union) exists somewhere between ‘defend and restore’ and ‘modernise and adapt’, but is tending towards the latter. The CAW is not, however, a solitary actor, but instead has been pushed along the continuum by political and economic forces, which has sped up its transformation into a ‘modernise and adapt’ union. This argument also suggests that as neoliberal common sense has been adopted and internalised by CAW members, the transition towards a ‘modernise and adapt’ union has been sped up. The 2008-09 round of collective bargaining is used as the central case to show how the political and economic structures are putting pressure on the CAW.

Background to the case study: The CAW leading up to the 2008 collective bargaining round

As the largest private-sector union in Canada, the CAW often has a higher profile than the Canadian Labour Congress or provincial labour federations, putting it at the forefront of organised labour in Canada. Further, the CAW has long been considered part of the left axis of trade unionism in Canada, along with the Canadian Union of Public Employees (CUPE) and the Canadian Union of Postal Workers (CUPW). The militancy of the CAW has been described in institutional terms: the lower value of the Canadian dollar vis-à-vis the US dollar, the presence of a public healthcare system in Canada and a more robust social security net meant that car manufacturers could reduce production costs by manufacturing in Canada, giving Canadian autoworkers ‘greater economic manoeuvrability’ (Yates, 1990: 74). Yates suggests that this argument is flawed, and argues that the internal union culture is based on militant syndicalism, rank-and-file activism, solidarity, and the idea that ‘fighting back matters’ (Yates 1990). This internal culture sustained Canadian autoworkers’ militancy during the 1980s and early 1990s. The shifts within the CAW towards an internalisation of neoliberalism can be partly attributed to a changing internal culture of the union. This follows from the work of Offe and Wisenthal (1980) and Charles Sabel (1981), which showed how unions themselves can be sites of struggle for the working class; these theoretical propositions have been previously applied to the CAW, and the union has been shown to be an area of contestation by different internal factions (Yates, 1998; Frost, 2000). Changing internal culture in the face of neoliberal restructure is certainly not limited to the CAW. Bieler has noted that some European trade unions have been criticised for accepting neoliberal restructuring and thus being ‘of no importance to anti-neoliberal movements’ (2007: 113).

The internal dynamics of trade unions play an important role in understanding the culture of a union, especially in times of union renewal. For example, Iona Byford (2009) argues that social movement unionism ‘furthers both the potential for union revitalisation and wider societal change through a reconnection between trade unions and local communities. However, the strength and depth of this reconnection may be open to challenge in terms of whether rhetoric at national level of the union matches reality at workplace level.’

When the CAW confronted the Great Recession, the union was already attempting to combat the decline of manufacturing jobs in Canada. Plant closures, downsizing and the creation of the ‘rust belt’ have been ongoing in Canada and the USA since 1969 (High, 2003). The decline of manufacturing has profoundly affected the CAW: fewer jobs in manufacturing means fewer members for the CAW, and fewer members reduces the union’s political capacity. There has been a steady decline in the number of manufacturing jobs in Canada since the union’s inception. When the CAW was formed, 90 per cent of its members worked in manufacturing. As of 2009, only 45 per cent of the membership worked in manufacturing. In 1987, 42 per cent of CAW members worked in the auto industry; but that number has been reduced to a mere 10 per cent as of 2009 (CAW, 2009). Of course, the Great Recession exacerbated an already serious problem for the CAW: ‘We are losing members … The haemorrhaging of jobs in the manufacturing sector, the bankruptcies of GM and Chrysler, closures all along the auto supply chain, and recessionary cutbacks in sectors all along the economy have thrown thousands of our members out of their jobs’ (CAW, 2009).

Coupled with a decline in manufacturing jobs, the CAW has been faced with a massive restructuring of auto production over the past 15-20 years as a result of broader restructuring of industry. Specifically, there has been a rapid movement towards continental economic integration and an increasing in outsourcing and in the modular manufacturing associated with lean production (Holmes, 2009: 10). This restructuring has seen jobs that were once based in the manufacturing belt of Ontario and the US Northeast move to the US South, Mexico and overseas. As Holmes notes, this restructuring has fragmented the North American labour movement, which has allowed management to foster competition and extract concessions by forcing unions to compete amongst each other (2009: 13). This internal North American competition, along with increased competition from Japanese and German imports, has dramatically reduced the CAW’s membership.

As Table 1 shows, the overall union density in Canada has declined over the past two decades, as has the union density in the manufacturing sector. A reduction in members for the CAW seriously curtails the options available to it as a union. The most obvious consequence of a decline in membership is a decline in financial resources. Lower membership numbers also means a major decrease in bargaining power in collective negotiations, and a decline in overall political power. The CAW has had a strong commitment to organising since the mid-1980s, but has had mixed results, especially in the automotive sector (Yates, 2000: 652). The onset of neoliberal policies in Canada has steadily eroded union freedoms, making it more difficult to organise workers into unions. Coupled with a decline in union density, the percentage of Canadians employed in manufacturing has steadily decreased since 1987, with the drop off intensifying between 1998 and 2008. Table 2 notes a sharp decline in manufacturing jobs starting in the late-1990s and continuing forward. Countless manufacturing jobs – many of which were once organised under the CAW – have left Canada for Mexico or Asia. The decline of manufacturing jobs and the declining union density in the manufacturing sector have had a major effect on the CAW: there are fewer manufacturing jobs in Canada, and of those that remain, fewer of them are unionised. These declines have, in turn, decreased the CAW’s financial and political capacity.

Part of the CAW response to declining membership rolls has been to organise outside of the auto industry, and this has seen the CAW organise workers in the airline, retail, hospitality and health sectors (Robertson and Murningham, 2006: 161). Further, there has been a change in the CAW’s organising strategy towards increasing union density at almost any cost. The best example of this strategy is the much criticised Framework of Fairness, best known as the ‘Magna deal’. In an attempt to organise workers at auto parts manufacturer, Magna, the CAW entered into an unprecedented agreement: Magna would grant voluntary recognition to the CAW if Magna workers voted in a majority to join the CAW (this framework circumvented Ontario Labour Relations Board certification regulations). In exchange, the CAW agreed to waive the right to strike in these plants, instead having all disputes go to binding arbitration. Further, Magna would have a hand in selecting ‘employee advocates’ on the shop floor, doing away with traditional union-only elections by secret ballot of shop stewards. The deal was heavily criticised by other sections of the labour movement, left academics, and some activists within the CAW, as a deal that undermined the very principles of democratic trade unionism (Bickerton, 2007; Van Alphen, 2007). Many in the labour movement saw the Magna deal as the thin edge of the wedge, undermining the right of union members to elect their own stewards. Union militancy has been built, in large part, by building militancy on the shop floor through stewards. Without worker-selected stewards, the ability to build militancy is constrained. The CAW defended the agreement, saying that it would increase membership in the CAW, and that increasing union density was the best way to increase CAW strength both at and away from the bargaining table. The Magna deal is a clear example of a shift towards the ‘modernise and adapt’ strategy and of business unionism, and the acceptance of it by rank-and-file CAW members is an example of the CAW internalising neoliberalism. The CAW agreed to work with the employer in order to secure members for itself and future production in Canada.

Case study methodology

The story of the round of collective negotiations during the Great Recession was initially gathered through newspaper searches. The database Canadian Newsstand, which aggregates all major Canadian daily newspapers, was used to search for articles pertaining to this round of negotiations. Searches using the keywords “Canadian Auto Workers”, “CAW” and “Canadian Autoworkers” yielded hundreds of results, some of which were duplicates, since stories may appear in multiple papers owned by the same production group. Editorials and letters to the editor were ignored, since they tended, as a rule, to be opinionated and anti-union rather than dealing with the facts of the case. While newspapers in Canada contain an anti-labour slant, that was not the focus of this paper: it was possible to extract the facts of the case from the opinions of the editorial board.

The newspaper research was supplemented with interviews and archival work with the CAW itself. Jim Stanford, an economist in the research department of the union, and Rick LaPorte, president of CAW Local 444 and a member of the Chrysler bargaining team, were interviewed in the course of the research for this article. Also accessed were documents that the union produced before, during, and after this round of bargaining, in order to supplement the information gathered from the newspapers and the interviewees.

Case study: The 2008-2009 round of collective bargaining

While auto production in North America has arguably been in crisis for well over thirty years, the most immediate crisis can be tracked back to 2007, when Chrysler had been sold to a private equity firm, Ford had closed half of its North American plants, and GM had filed a loss of $39bn on an already negative net worth (Vander Dolen, 2008: F3). CAW negotiations with the Big Three began in March 2008 under the shadow of decreased sales revenue for the auto manufacturers: Canadian sales were down 6.9 per cent while import sales were up 6.2 per cent, and in the USA, the Big Three had lost 19 per cent of sales volume (Vander Dolen, 2008a: E9). Under these conditions, the auto manufacturers were able to pressure the CAW into accepting an agreement in May 2008 that saw a cost-of-living increase in the first year of a three-year collective agreement, but wage freezes for the rest of the deal, and reduced vacation pay (Popplewell, 2008: A3). The CAW grudgingly accepted capital’s concessionary demands since the material sacrifices would ensure the short-term future of auto manufacturing in Canada, and thus keep its members employed. This strategy is indicative of the shift within the CAW to accept neoliberal economics and follow a ‘modernise and adapt’ strategy. Bieler and Lindberg (2008) note that ‘“modernize and adapt” unions accept responsible levels of wage increases so as to not undermine competitiveness,’ and certainly the union accepting concessions in exchange for continued work for its members is a variation on this theme.

Even after this round of concessions, the rank-and-file members at GM and Chrysler were afraid for their jobs, knowing that production was only guaranteed in the short term. In an interview, LaPorte (2011) characterised the mood of the rank-and-file: ‘I would suggest that the mood back in 2008 was nervousness. Our workers understood the industry and the way the industry was going. Chrysler was already struggling, we already knew that. The nervousness seemed to snowball from 2008, and got more intense from that point. A lot of our members were unsure that Chrysler would survive. A lot of our senior members thought, “Holy shit, this could be the collapse of the company.”’ Stanford (2011) confirmed this, saying, ‘The mood of the rank-and-file membership was one of fear. They had uniquely well paid jobs and their families depend on keeping them. The retirees have uniquely generous pensions and their families depend on keeping them. The dominant mood would have been, “I want to hold on to what I can, whatever it takes.”’ The union’s hesitancy to engage in a full-fledged fight-back campaign can be partially attributed to the internal shifts within the culture of the union towards a mood of fear, and a willingness to accept concessions.

The onset of the Great Recession put further strain on the Big Three, and they pressured the CAW into a second round of negotiations: the CAW agreed to renegotiate the already ratified collective agreements in the hopes of securing the future of the automotive industry. The pressure on the CAW was twofold: auto manufacturers had appealed to both the Ontario and federal governments for bailout funds to allow the companies to remain solvent and continue to produce cars. The Canadian and Ontario governments had a vested interest in keeping auto manufacturing in Canada. These governments also prioritised capitalist accumulation above the financial security of CAW members. The governments made bailout money contingent on restructuring plans that would include cuts to labour costs: the CAW was under pressure from both capital and the state to accept concessions. The willingness of the CAW to engage in concessionary agreements in order to protect production suggests a shift within the CAW towards business unionism.

The CAW agreed to a renegotiation of the collective agreements, and in January 2009 met with GM at the bargaining table. At this time, GM was in the process of securing a $3bn loan from the Canadian and Ontario governments, and one of the requirements for this loan was the extraction of $150m in concessions from the CAW (Van Praet, 2009: A1). Federal Industry minister Tony Clement (quoted in Van Praet, 2009a: FP2) made it very clear that public funds would not be used to ‘maintain the standards of living for Canadian autoworkers’. The CAW acquiesced under the joint pressure of capital and the state, and signed a concessionary collective agreement on 9 March 2009. The new four-year collective agreement saw wages and cost-of-living increases frozen for almost the entire term, a week of vacation pay lost, and the ending of a $1,700 annual bonus. Further, workers and retirees under 65 would pay an annual healthcare premium of $360, while retirees over 65 would pay a premium of $180, and the monthly pensions of almost 30,000 retirees were frozen. 87 per cent of rank-and-file CAW members voted to ratify this deal (Van Alphen, 2009: B3). The CAW itself argued that the cuts were necessary to secure the future of auto manufacturing in Canada and indeed, this agreement saw GM agree to maintain 17 per cent of its North American production in Canada.

On the same day that CAW workers accepted the new agreement with GM, Chrysler rejected said agreement, claiming that it wanted to extract even more concessions from the CAW than GM had. The die had been cast: GM was able to secure deep cuts from the CAW as the company had the full and willing support of the governments of Ontario and Canada to extract concessions. Chrysler was negotiating an $8.25bn loan with these governments, and again a condition of this loan to Chrysler was the auto manufacturer cutting labour costs (McCarthy and Keenan, 2009: B1). Acting like a ‘defend and restore’ union, the CAW balked at this and made public statements that it would fight back and not give further concessions to Chrysler, and would stick to the pattern agreement negotiated with GM (Stanford, 2011). In response, Tony Clement again said that Chrysler could not expect a loan from the government – thus putting the very future of Chrysler in Canada in question – unless the CAW made further concessions to Chrysler.

Initially, the CAW took a hard line with Chrysler, refusing to give up more concessions. As negotiations broke down, both the union and management took their fight to Chrysler employees and began negotiating in public. Chrysler threatened complete closure of Canadian operations if concessions were not made, and pointed ominously to a government that was threatening to call for loan repayment if a deal had not been reached by 30 April 2009 (Van Alphen, 2009a: B1). Chrysler began negotiating directly with the workers, sending letters to all employees outlining the dire position of the company and the need for concessions. The CAW resisted these cuts, holding mass demonstrations where Chrysler workers symbolically burned these letters en masse (LaPorte, 2011). It was also in mid-April that the CAW led a demonstration of 15,000 workers and retirees at Queen’s Park. The rally was designed to defend good jobs and good pensions, and to ‘show government and corporations alike that the current crisis will not be solved on the backs of our retirees’ and CAW members (CAW, 2009a: 1). This rally was ‘the biggest labour demonstration in Ontario since the days of action’ against the Mike Harris government in the 1990s (Stanford, 2011). The CAW also responded by pointing out that labour costs made up only 7 per cent of Chrysler’s total costs, and blamed Chrysler’s failure on poor sales, poor marketing decisions, and government inaction: excusing their members of any responsibility for Chrysler’s dire economic condition (Van Praet, 2009b: A6). The fact that the CAW did engage in a fight-back campaign does show that the union has many characteristics found in a social movement union, or a ‘defend and restore’ union.

On 21 April 2009, the Canadian government took the virtually unprecedented step of intervening in free private-sector bargaining and ordered Chrysler and the CAW to return to the bargaining table. The government then went one step further and demanded that the CAW accept all the concessions that Chrysler was demanding, or Chrysler would not receive government bailout money (Keenan et al., 2009: B1). The CAW was now under unprecedented levels of pressure from the state and from capital at the bargaining table, and eventually granted Chrysler concessions. It should be noted that the CAW was forced to the table by the Canadian state, and thus that giving in to concessions at this point should not be construed as a trait of a business union, since the union did not give into the concessions through free collective bargaining. Rick LaPorte, the CAW negotiator for Chrysler plants, highlighted the intensity of the pressure on the union: ‘The government was clear. They said if we don’t give up $19 per hour then there would be no loans for the company. There was no bargaining with the company – it was the pressure the government was putting on us at the time. We struggled at giving back things. We had to do what we had to do – that was the bottom line’ (2011). On 25 April 2009, the CAW agreed to these cuts of $19 per hour (Sacheli and Lajoie, 2009: A1).

The CAW bargaining team argued that the concessions given to Chrysler were deep, but that they could have been much worse. The CAW was able to guarantee no cuts to base wage, no cuts to pensions, and maintain production commitments in Windsor, Brampton and Etobicoke (CAW, 2009a: 1). The CAW did, however, make concessions in the areas of healthcare contributions, drug plans, hospital coverage, tuition refund programmes for members and their children, and the elimination of the vacation buydown and annual Christmas bonus, amongst other cuts (CAW, 2009a: 2-3). Even granting these concessions, however, it was clear that while there would be a commitment to production in Windsor, there also would be workforce reductions there, since Chrysler would be eliminating a shift (CAW, 2009a: 4). With the concessions secured from the union and the bailout secured from the government, Chrysler entered into bankruptcy protection at the end of April 2009.

Before the CAW even began negotiations with Ford, GM, facing bankruptcy, demanded that the union return to the table and give up even more concessions. Again the CAW publically declared that the union could not and would not give up more to GM, but again pressure from the government, which threatened to withhold loans to GM, meant that the CAW returned to the table. On 23 May 2009, the union re-signed a collective agreement with GM that saw total labour-cost reductions of $22 an hour. In this agreement, the CAW made similar concessions to the Chrysler agreement - cuts to the drug plan, hospital coverage, and a vacation buydown. The agreement also involved a two-week shutdown of production during the summer. In exchange, the union was able to safeguard pension plans, preserve retirees’ healthcare benefits, and maintain production commitments in Oshawa and St. Catharines (CAW, 2009b: 2). This may be a clear and early warning that accepting the logics of neoliberalism does not work. Once the union had initially agreed to accept concessions, it could no longer hold out against further concessions. The CAW found itself in a position where it had to cede to essentially all of capital’s demands without winning any significant gains in return.

After the second round of GM negotiations were concluded, it was now Ford’s turn to try to extract concessions from the CAW. The situation between Ford and the CAW was somewhat different from the situation with the other two manufacturers: Ford had not asked for, and did not want, a bailout from either the Ontario or Canadian government. This meant that the negotiations with Ford were not undertaken at the frenetic pace that they were with Chrysler and GM, and more importantly it meant that the Canadian state would not be in a position to actively intervene in the negotiations. At the end of May 2009, Ford announced that it was at a competitive disadvantage to Chrysler and GM and to US auto production, and that in order to continue production in Canada, the CAW would need to cede major concessions to the company (Macaluso, 2009a: A5).

Negotiations between Ford and the CAW began in September 2009, with Ford calling for concessions that would bring its labour costs in line with those of GM and Chrysler. Negotiations between the two broke down at the end of September, as the CAW believed the negotiations were nothing more than a red herring: the CAW saw no future commitment to Canadian production from Ford, so it did not see a reason to negotiate with the producer. At the end of September, the two parties walked away from the bargaining table with no deal intact (Owram, 2009: A17). Here we see a shift, perhaps, in the CAW’s strategy: the CAW refused to negotiate with Ford, as they saw that they had nothing to gain from Ford. The union was, at least at this point, refusing to engage in concessionary bargaining.

At the end of October 2009, Ford echoed its calls for concessions, again threatening to cease all Canadian production as Ford was uncompetitive with its US peers and rival car manufacturers GM and Chrysler (Van Alphen, 2009b: B6). The CAW, at this point, was willing to make concessions in exchange for a commitment from Ford to continue operations in Canada. The CAW did, however, refuse to sign an agreement similar to the one the US UAW signed with Ford, which banned strikes over wages and benefits (Anon, 2009: T8). On 2 November 2009, the CAW and Ford signed an agreement that saw the CAW give concessions to Ford. Labour costs were cut by $5 an hour and wages were subsequently frozen for the duration of the agreement; further cuts were made to benefits; and there was an increase in employee payments for healthcare costs (Anon, 2009a: A8). The CAW was able to ensure ongoing production of Ford engines in the Essex engine plant until 2014.

November 2009 marked the end of almost 19 months of concessionary bargaining between the Big Three auto producers and the CAW. Over the course of these negotiations, the CAW granted major concessions in wages and benefits, and managed to extract a few small promises to continue production in Canada in the short term. At the same time, GM and Chrysler were able to guarantee billions of dollars in loans from the governments of Ontario and Canada, some of which will not come due for fifty years. The CAW has set a dangerous precedent for concessionary bargaining in exchange for short-term promises. The promises of continued Big Three production in Canada are tenuous, at best, as there are no laws in Canada that prevent plant closure during the tenure of a collective agreement. Indeed, GM has already shown that it is willing to sign a collective agreement promising continued production and then months later shut down plants, as it did in Oshawa in June 2008 (Roth, unpublished manuscript).

Both Stanford and LaPorte argue that the concessions could have been much worse, and that the membership was willing to give up much more than it had in order to save their jobs. LaPorte, who presented the concessionary agreement to Chrysler workers, said of the concessionary agreement, ‘our workers were scared to death that they wouldn’t have a job. It’s that simple. I think we could’ve come back with a $30 concessionary plan and I think they would’ve bought into it’ (2011). Stanford also explains that the high ratification vote for the concessions was in part because the rank-and-file was expecting the cuts to be much deeper: ‘I don’t think anyone in the rank and file wanted to give up SPA weeks, Christmas bonus, or semi-private hospital rooms, but they did see the union fighting for them, and they saw a package at the end which was much better than expected’ (2011).

Ken Lewenza, the current president of the CAW, remains resilient, claiming that the membership approval of concessionary agreements does not equate to membership satisfaction with concessions: ‘Members had faith in the union to negotiate the best agreement possible and protect their interests over the long term, but the problems faced by industry cannot be resolved at the bargaining table’ (quoted in Van Alphen, 2009c: B5). Indeed, the CAW has shown that the Big Three’s losses, centred in the US market, are so large that workers in Canada cannot possibly rescue them through wage cuts. CAW members could agree to work all year without wages, and the resulting savings would offset the Big Three’s average 2008 losses for only 11 days (CAW, 2008).

The question must be asked then: if not at the bargaining table, where does the fighting back that matters occur? It is questionable whether attempting to solve the problems on the picket line is a viable strategy: it is entirely possible that widespread labour unrest in the auto sector would have the result of further reduction in Big Three production in North America. Further, the CAW has been attacked for its perceived high levels of compensation, and even for the auto bailouts: ‘Opponents of the bailout invoked … anti-union sentiment, to oppose the proposed rescue. This sentiment was widely shared, and the proposed rescue and the unions were all vilified by political and media commentators, as well as by the public at large through call-in radio shows and letters to the editors of newspapers’ (Stanford, 2010: 398). Neither the Canadian nor US government have shown any interest in a long-term revitalisation of the auto sector. While The Big Three may be reinventing themselves, competition from Japanese, German and Korean auto will not disappear; further, it is unlikely that the CAW will be able to win back any of the concessions made while the Big Three are in the process of reinventing and renewal. Indeed, it is entirely possible that the Big Three will ask for more concessions in the upcoming 2012 round of collective bargaining with the CAW (LaPorte, 2011).

Conclusion: Does fighting back still matter?

The main concern of the CAW during the round of bargaining in 2008 and 2009 was to maintain production in Canada, which would, in turn, maintain jobs for its members. Production was maintained in some plants: work continued at the Oshawa, Ingersol, Oakville and Windsor plants. Even with concessions, however, the Ford plant in St. Thomas and the GM transmission plan in Windsor were slated to close (Lewenza, 2010). In order to keep production going, the CAW entered into concessionary agreements with Chrysler, GM and Ford, which ‘set collective bargaining in Canada back 15 to 20 years. Some of the benefits that we gave up we got 15 years ago. We were going backwards, rather than holding the line. Period. It can’t be any simpler than it is. We were moving backwards 15 years in order to secure the government loans [which would secure production for the Big Three]’ (LaPorte, 2011). The union did recognise how difficult it was to give up these concessions at the table, and a fight-back campaign against the most egregious demands was made: the union ‘mobilized 15,000 pensioners at Queen’s Park. We occupied the offices of MPPs. And we pushed back hard against the most outrageous proposals we faced at the bargaining table’ (CAW, 2009b: 7).

This article asks if fighting back still matters. Even though the autoworkers fought back against the concessions being pushed on them, they were not able to stave off all clawbacks, nor were they able to secure long-term investment in Canada. Part of the reason the fightback was not a total success was due to the fact that the union was up against the dual pressures of the Big Three automakers and the Canadian state. It was the Canadian state that pushed for labour concessions as part of the auto bailout package, and the Canadian state that forced the CAW to return to the bargaining table to bargain for the concessions that the Big Three were already demanding. The ‘pressure on our union was incredible. The companies would already be bankrupt, if it weren’t for government support on both sides of the border. But that support came with a price – in this case, an incredible series of demands for huge concessions from the workers’ (CAW, 2009b: 1). Even at the bargaining table, the union fought against the capital-demanded and government-mandated concessions, and while the union was able to fully protect pensions and wages, there were ‘intense battles’ that did result in concessions (Stanford, 2011). Stanford notes that without the government bailout there would have been a shift to US production, rather than the (albeit limited) commitment to Canadian production (2011).

In the short term, the union was able to secure some production and maintain wages and benefits. It is questionable, though, whether the concessions actually saved the company: ‘I don’t think labour concessions saved these companies. We argued from the beginning they were irrelevant, and I’d still argue that they are irrelevant. I would argue that the actual reduction in labour costs were minuscule and have had no impact in the Canadian setting on the return to health for those three companies’ (Stanford, 2011). Further, and perhaps more importantly, the CAW widely expects to have more demands made by the Big Three, in exchange for renewed Canadian production, in the upcoming 2012 round of concession bargaining (LaPorte, 2011; Lewenza, 2010; Stanford, 2011). This could be troublesome for the union, as the precedent has been set that the CAW is willing to grant labour concessions in exchange for short-term production commitments. It is clear that the way in which the CAW fights back must be changed if it wants to remain viable in the long term.

In the long term, the CAW is calling for a new Auto Pact between Canada and the USA, to ensure long-term production and sales of Big Three autos in both countries. This would necessarily involve a shift away from free trade (Stanford, 2011). This long-term plan, then, would require the challenging of the political-economic foundations of neoliberal globalisation, as free trade is a key aspect of this political economy. The CAW’s response to the challenges of the Great Recession does not include a direct challenge to neoliberalism.

The CAW’s response to the challenges of the Great Recession and the concessionary demands made upon the union contains elements of business unionism, social movement unionism, the ‘defend and restore’ strategy, and of the ‘modernise and adapt’ strategy. As a business union, the CAW seeks to maintain the competitiveness of North American auto production at its own expense, and it does so while buying into the logics of neoliberalism: ‘The CAW is a mature and responsible union. We have ensured that our facilities remain competitive with other industrialized countries for new investment, and we will continue to do so’ (CAW, 2008). The union notes, however, that while the ‘overarching goal’ was ‘to do whatever we could to keep this company in business’, that was because the union had a ‘responsibility to the more than 25,000 retirees, and 9,000 active members and their families’ (CAW, 2009b: 1). The CAW still sees itself as a domestic actor, although the production arrangements in the automotive sector have made it very difficult for a cohesive pan-North American multi-union strategy to emerge. The CAW certainly shows a ‘national inwardness and longing for good old days’, while at the same time recognising that the good old days are gone. In its electoral policy, which has not been the focus of this paper, the CAW shows strong support for the existing welfare state arrangements. The CAW has shown that it is willing to cooperate with capital to ensure levels of wages and benefits that do not undermine the competitiveness of individual employers, and that is has a focus on maintaining the competitiveness of Canadian auto production, suggesting the union has some traits of a ‘modernise and adapt’ union.

The CAW also shows a very solid commitment to social movement unionism. Social movement unions see themselves as having a wider responsibility to the working class, something the CAW certainly believes. Throughout the entire concessionary bargaining round, the CAW has argued that its dedication to manufacturing jobs goes well beyond protecting the jobs of CAW members. For every job in a major auto facility (assembly or powertrain), a total of 7.5 jobs depend on that job, including ‘upstream’ jobs in the supply and parts industries, and ‘downstream’ jobs in consumer industries and services (CAW, 2008). Because of the importance of manufacturing jobs to the greater Canadian economy, the CAW recognises that its bargaining is not just about getting jobs for their members: ‘It’s about getting a job for lots of Canadians’ (Stanford, 2011). Further, Stanford argues that the union also sees itself as a leader for broader social change in Canada: ‘We have always said that union activity cannot be limited to the bargaining table. That is a defining feature of our strategy and our culture. That is how we define social unionism, a union that takes its fights into the broader arena and not just working at the bargaining table to improve our own condition, but working in communities and in policy and politics to improve the conditions of all workers’ (2011).

Some evidence of the CAW’s internalising neoliberalism can be found in shifts within the internal culture of the union. The CAW has always had a strong internal culture of fighting back and solidarity; but some of these principles came into question during the bargaining during the Great Recession. The union rank-and-file seemed to accept the concessionary agreements largely because they thought that a much more disastrous package could have been presented, containing even deeper cuts. The question of fighting back wholesale against concessions was not on the table. Perhaps more concerning is the slow acceptance of the rank-and-file of the ‘me-oriented, shortermist, and myopic’ features of neoliberalism that Gill highlights (1995: 339). The US counterpart to the CAW, United Autoworkers, has accepted a two-tiered wage structure in the union, which the CAW has vehemently fought off. It seems, however, that the rank-and-file would be willing to accept two-tiered wages, and that it has been the union leadership that has kept this out of the plant: ‘Our workers would’ve gladly accepted a two-tier wage system. The workers in the plant don’t care about the new worker coming in. It’s all about me - why should I give up wages? Take from the guy who doesn’t even work here today. But the union doesn’t believe in a two tier wage system, because it comes back and bites you in the ass’ (Laporte, 2011).

The CAW has increasingly accepted arguments made by capital on the necessity of labour flexibility and competitiveness, and has there has been a slow acceptance, both by the CAW as an institution and the union’s rank-and-file, of the logics of neoliberalism. This is not to suggest that the CAW has consciously, or willingly, accepted neoliberalism. The example of the 2008-09 bargaining indicates that neoliberalism amounts to nothing less than full-on class war from above. Capital and the Canadian state used the Great Recession as the impetus to extract unprecedented demands from the CAW. These concessions were supported, by and large, by a population that has grown increasingly individualistic and anti-union. The Canadian government fully supported the Big Three in their demands for concessions. The Ontario government, which enjoyed the support of the CAW through the union’s call for strategic voting in the last provincial electoral campaign, did not provide any assistance to the CAW through these negotiations. The CAW is struggling to survive in a political and economic climate which is exceptionally hostile to organised labour, and which recognises the supremacy of capital as a policy maker.

Does fighting back still matter? A better question, perhaps, might be ‘what kind of fighting back matters?’ By fighting back, the CAW was able to fend off the harshest concessionary demands made by the Big Three; but it has shown a willingness to engage in concessionary bargaining to ensure the short-term survival of capital. The CAW found itself in the corner it was in for a number of reasons. One of the end results of the crisis of the Great Recession was capital consolidating and intensifying control over the state and setting the political and economic agenda. The CAW was founded on the mantra that ‘fighting back matters’ – that concessions and concessionary bargaining could be stopped by fighting back against capitalist restructuring. It is hard to fight back, however, when you must fight back against the dual powers of both manufacturing capital and the neoliberal state. Further, concessionary bargaining only leads to greater accumulation for the Big Three, and allows for future concessionary bargaining.

If fighting back still matters, it is the type of fighting back that matters the most. Canadian labour, and the CAW as part of it, must confront neoliberal restructuring in the political realm as well as on the job, to show that fighting back can make a difference.