This started out as a rant to my wife last night and turned into a Facebook post this morning, so I figured it would be better to preserve it for later review as a diary.
From The Globe and Mail.
"Two-tier wage deals like those inked recently by Ford Motor Co. and General Motors Co. are spreading across the U.S. border into Canada’s labour landscape – again – as companies struggle to compete with lower-cost global rivals.
The Canadian Auto Workers union agreed to deals last week with Ford and GM that will see new hires start at a lower rate – $20 an hour rather than $24 currently – and reach the top salary scale of $34 an hour after 10 years, rather than six years for existing workers.
The CAW fought off an unpopular provision in place at Ford and GM’s U.S. plants that keeps new hires permanently at a lower wage level with a pay scale that never achieves parity with existing workers. But the union did agree to a wage freeze and bonuses instead of a cost of living allowance, reflecting in part how unions are on the defensive amid a sluggish economy, and the battering Canada’s manufacturing sector has taken because of globalization and the rise in the value of the Canadian dollar."
A few things. Note how crossing the border is almost like going back in time in US labor history. Canada's unionization rate is about 3 times the US rate, although it has fallen in recent years, and until this deal, Canadian auto workers--folks who started out with high school educations--could find steady careers that started at $24 an hour (keep in mind the Canadian dollar is as strong as the US dollar) and rise to $34 an hour after six years. They could raise families, buy homes, and send children to college on these wages, before retiring at the end of a long career with a good pension.
Now, however, US automakers bargained the UAW (the US version of the CAW) when bailed out in '09 and established starting salaries of $14 an hour (although they might have increased to $16 with GM), which is still just a fraction (half, actually) of what veteran workers earned for doing the same work earn for doing the same work, which was still less than what their Canadian brothers and sisters earned for doing the same work. To get an idea of what Canadian workers earn, see above. They also agreed to a two-tier system where new workers got paid less and received fewer benefits than existing workers. And now, emboldened by their successes, the US automakers are trying the same tactics in Canada.
People argued when the UAW deals were struck that US workers were paid too much, that they weren't competitive, that cars would be cheaper after the deals, etc. However, car prices haven't gone down (and they won't be dropping). The big three are doing very well again and the top members are getting huge bonuses (but the profits don't seem to be trickling down). And now they're trying to drag Canadians down to the American level with the same arguments about global competition. They're also directly attempting the same union-busting, 1% treasured divide and conquer strategy of pitting the new workers against the old ones (somewhat like the current Republican VP candidate arguing that seniors should support destroying / reforming Medicare since Ryan's proposed changes won't afflict citizens under 55).
Interestingly, if you read the comments beneath the article, you'll see a few arguments in favor of the plan that are very reminiscent of the arguments US conservatives pushed when the bad deals sprang up here some years ago. However, you'll see many more commenters arguing against the plan with progressive arguments in relation to how bad of an idea this is for the working class. I particularly liked this one:
"It was jobs like the auto jobs, and their Unions, that raised working class people to middle class wages, every dime of which was plowed back into the economy. No off shore bank accounts there.
Its all now just a race to the bottom and you only have to look south of our border to see where it's heading. Those high paying Union jobs paid lots of taxes that provide you with the quality of life you have sir, educated your children, give you health care, public services, parks, etc."
By "south of the border", s/he was referring to the US. We're kind of like their Mexico when it comes to labor rights. In Mexico, by the way, US automakers wasted no time in bringing the two-tiered model and lower wages, as new unionized autoworkers there manufacturing Ford Fiestas started at
$2.25 an hour, with some as low as $1.50 an hour. They did it, naturally, under the same excuse foisted by 1%s (the CEOs) over 99%ers (the laborers, which means you, I, and almost everyone we know) across the globe: to stay "competitive."