GM, Canada Post, and the death of the post-war social contract

On Monday, 26 November 2018 Canada’s post-war social contract finally died, after a long period of ill health. At her bedside were two who were present at her birth, Oshawa auto workers and striking postal workers. Her passing was due to systematic abuse and abandonment by corporations and government. She is survived by a labour relations regime of naked class war. In lieu of flowers, bring picket signs and burn barrels.

The shock announcement of the closure of the Oshawa General Motors plant, on the same day that back-to-work legislation against the Canadian Union of Postal Workers passed the Senate, represents the final nail in the coffin of Canada’s post-war labour compromise. It is ironic that it is the auto workers and postal workers who are the target of the present-day attack, as they were also the instigators of the struggles that brought about the attempt to regulate the class war in the post-war period

In 1937, workers at GM Oshawa struck for recognition of their union, organised on the industrial model where every worker is automatically part of the union (as opposed to the “craft” model that only organises select skilled workers). After two weeks of fighting the boss and the government’s goons, known as the “sons-of-Mitches”, the workers were victorious. This was the first victory for industrial unionism in Canada, and it sparked off a wave of strikes and -organising drives that eventually won the right to collectively bargain, the right to automatic dues payment by all workers benefitting from a collective agreement, and a regulated right to strike in the private sector.

These rights were not given away freely, and they were not won without a price. Running battles with cops and scabs were a regular occurrence during this period. Workers would down-tools at a moment’s notice. Many were injured, some even died. Defeated strikers would find themselves fired and blacklisted. But, by the end of WW2, the tide began to turn in the direction of the working class, and the capitalists sought a way to manage the turmoil and radicalisation of the class struggle.

In exchange for union recognition and collective bargaining, the workers gave up the right to strike while a contract was in force. Grievances that would have previously led to a spontaneous walkout were now to be sent to a labour board for arbitration. Power was taken out of the hands of workers on the shop floor, and instead a bureaucratic caste of lawyers and negotiators were given control of the movement. This hastened the bureaucratisation of the workers’ organisations, with the rank and file being relegated to the role of passive onlookers. But in the boom years of the 1950s and 60s the unions were able to negotiate real improvements, while the bosses were able to regulate the class struggle to make it more predictable and manageable. In this period, it helped that the crumbs gained by the workers were still only a small fraction of the total increase in profit, so the owners of capital could afford to buy class peace.

The weakness and unwillingness to fight by the labour bureaucracy made the capitalists arrogant. By destroying labour relations compromises, the bosses open up the real prospect of going back to the 1930s struggles / Image: fair use

However, while private sector unions had won the right to strike and negotiate, governments refused to extend such rights to the public sector. Throughout the 1960s, especially, government employees became increasingly proletarianised and there was a push for the formation of genuine unions rather than yellow staff associations with “no-strike” pledges.

This came to a head in 1965 when the Canadian Postal Employees Association – the forerunner of today’s CUPW – went on an illegal wildcat strike for union recognition and improved conditions. This forced the government to pass legislation in 1967 giving government employees the right to strike and bargain.

Subsequently, CUPW found itself at the forefront of the class struggle in Canada. Strikes in 1970, 1974, 1975, and 1978 regularly pit the postal workers against the state. Notably, in the 1978 strike, CUPW president Jean-Claude Parrot refused to submit to back-to-work legislation and was imprisoned for 3 months. In the following 1981 strike, bosses were afraid of a similar confrontation and the workers gained an historic victory of being the first major union to win parental leave. This paved the way for this to be won by other unions and eventually became a right of all workers to receive parental leave via the unemployment insurance system.

As we can see, the post-war social compromise was won by bitter struggles in the private and public sector. But it appears as if all the participants in this conflict have forgotten where the compromise came from. Labour leaders who have grown comfortable with the grievance and arbitration regime have forgotten that the system that provides their often-inflated pay cheques was negotiated on the backs of illegal strikes and street battles. Bosses who see the right to strike and bargain as hindrances forget that this regulated system was how they tamed the class war. The weakness and unwillingness to fight by the labour bureaucracy has made the capitalists arrogant. By destroying 1960s labour relations compromises, the bosses open up the real prospect of going back to the 1930s struggles.

GM – lessons and lost opportunities

General Motors is currently a profitable corporation, having raked in over $6 billion in the first 9 months of 2018. The Oshawa plant has regularly won awards for excellence in productivity, and its workers have made GM directors very wealthy men and women. Management isn’t closing the plant because it isn’t making money, they are closing it because they think they can make more money elsewhere.

The destruction of over 2,500 direct jobs, and 20,000 indirect jobs, is particularly galling given the $10.8 billion bailout doled out to GM after the 2008 crisis. This money was sufficient to buy a majority stake in the company at the time, but instead it was gifted with no strings attached. While there were layoffs and rollbacks for the workers, management got to keep their bonuses. In 2015, the government sold off its remaining GM shares – at a loss of billions – and, earlier this year, it wrote off a further debt to the corporation of over a billion dollars. This is a classic example of socialism for the rich and capitalism for the poor. The bosses demand handouts while holding jobs hostage, but when profitability has returned they throw people on the garbage heap and say that the market determines everything. They cannot be allowed to have it both ways.

Since the 2008 crash the Canadian Auto Workers, now Unifor, have repeatedly signed concessionary deals with the supposed aim of maintaining production. The most criminal compromise of the labour bureaucracy was so-called two-tier contracts that stipulated lower pay and conditions for new hires. This cancer within the workers’ movement undermines the union from within, discriminates against the youth, and is a direct violation of the principle of equal pay for work of equal value.

The Oshawa workers showed their correct class instinct by spontaneously walking out the day of the closure announcement. But the Unifor leadership did everything in its power to get the workers back producing cars the next day. This was a missed opportunity to go on the offensive / Image: Save Oshawa GM

The rank and file were sold these miserable contracts with the understanding that the union had received a production guarantee from management. Even then, these contracts were only narrowly approved by the membership. But, as seen by the closure of the more than 100-year old Oshawa plant, concessions do not work to save jobs and any production guarantee is not worth the paper it is written on. This was pointed out by the Marxists at the time. Rather than concessions securing production, the weakness of the union emboldened the corporation that now thinks it can walk away without repercussions.

The Oshawa workers showed their correct class instinct by spontaneously walking out the day of the closure announcement. But the Unifor leadership did everything in its power to get the workers back producing cars the next day. This was a missed opportunity to go on the offensive. Historically, the best tactic to fight factory closures has been factory occupations combined with the call for nationalisation. Given the fact that all GM plants in Canada are under threat, the movement could have spread quickly to the other Canadian plants, paralyzing production and profits for the corporation.

Some may argue that this is illegal, but was it legal for GM to walk away from a signed contract that guarantees production?

Some may also argue that expropriation is unrealistic. But why is it realistic to nationalise the Kinder-Morgan oil pipeline at vastly inflated prices and not nationalise GM to save the city of Oshawa? Why is it realistic for the federal finance minister to put through $16 billion of corporate tax cuts, but not a penny to save auto jobs? In fact, expropriating GM need not cost a nickel. GM’s owners have received more than enough in years of accumulated handouts, bailouts, loan write-offs, and corporate welfare. Others connected with the union bureaucracy argued that workers couldn’t give up wages by striking now when they were going to lose their jobs next year. This defeatist line isn’t any different from Doug Ford saying that, “the ship has already left the dock,” when it comes to saving the jobs. Such pessimism was clearly rejected by the workers who are demanding action now.

Unifor president Jerry Dias is starting to feel the pressure from below. After sending his members back to the production line, he said that if he had his way he’d shut down every GM manufacturing plant until they got the message. Somebody must have pointed out the obvious fact that, as president of Unifor, he does have the power to do exactly that. At a subsequent union meeting he said, “We are going to shut down GM in this country if they they do not reverse their decision.” He also added a, “fuck you!” to Ontario Premier Doug Ford who thinks it is pointless to fight for Oshawa’s jobs.

Unfortunately, while Dias has been pushed to adopt a more militant tone, he has also flirted dangerously with economic nationalism and Trumpite trade barriers against Mexican workers. This is no solution. Economic nationalism ties the worker to “their” boss and “their” government, and allows both to set worker against worker. Rather than attacking Trudeau for inaction, Dias praised him for calling the new trade deal “CUSMA” (Canada-U.S.-Mexico Agreement) instead of “USMCA” (U.S.-Mexico-Canada Agreement)! Autoworkers, on the way to the unemployment line, are sure to be very concerned by the order of letters in the new corporate free trade pact! Protectionism leads to divide and rule, while factory occupations and nationalisation builds a movement that unites workers across borders.

The ranks need to keep up the pressure on the Unifor leadership to turn the threat to shut down GM into action. The mood is there not just to occupy GM, but to spread the movement to the entire auto sector. A mass day of action and Oshawa general strike is on the order of the day. Most importantly, the workers need to demand that the union adopt the position of nationalising GM to save the jobs and the union. There is no way to artificially make GM invest, and there is realistically no solution that maintains private ownership of GM. You cannot control what you do not own. Instead of acting all buddy-buddy with Trudeau, Dias needs to demand that the federal government take real action to save Oshawa and all the other cities with GM plants who face a similar fate. Expropriating GM is the only way out. Occupying the plants and spreading the movement is the only way to make the government do this.

The need to defy back-to-work legislation

Just as the contract guaranteeing production in Oshawa has been torn up, the right to strike also faces a similar fate. As explained above, this right was won through struggle and has since been deemed a constituent part of Canada’s Charter of Rights and Freedoms. But none of this matters to the bosses, who are setting fire to all the old contractual arrangements. The use of back to work legislation has increased to the point where it is now seen as routine. It has been used more than 90 times by federal and provincial governments over the last 35 years. Workers have the right to withdraw their labour only as long as it only inconveniences themselves. As soon as a strike begins to have an impact, the right to strike is removed by the capitalist state.

The right to bargain, the right to recognition, and the right to strike were only won by breaking the laws that prohibited such actions. The labour movement desperately needs to break the routine cycle of legislation and, short of bringing a workers’ government to power, defiance is the only way to make the capitalists think twice before they head down this road. Court challenges, even when successful, take years and change nothing. The cost of passing the legislation needs to be made higher than the cost of letting a strike play out normally.

The 2018 Canadian Union of Postal Workers strike was probably the best chance in a generation to beat back the routine imposition of back-to-work. The issues of the strike were clear and well understood. Predominantly female rural workers are significantly underpaid, relative to their mostly male urban comrades. One in four workers are injured every year due to forced overtime and overloading with packages. Sympathy for the postal workers is widespread. The union also has a left wing reputation of struggle, and every indication shows that the workers are willing to take defiant action.

Instead of defying the legislation, the union leadership appears to be accepting the process of mediation prior to binding arbitration. But the government and corporation are dragging their heels appointing a mediator, who will then work for a further 7 to 14 days. It seems likely that management will do everything in their power to push mediation past Christmas, at which point the postal workers will lose much of their leverage. Submitting to these delay tactics also risks demobilising the membership. As workers start to reluctantly accept the apparent inevitability of an undemocratically imposed contract, the window where defiance is a political possibility amongst the members gets smaller and smaller with every passing day.

Some in the union bureaucracy argued that workers couldn’t give up wages by striking now when they were going to lose their jobs next year. This defeatist line isn’t any different from Doug Ford saying that, “the ship has already left the dock,” when it comes to saving the jobs. This pessimism was clearly rejected by the workers / Image: Bruce Reeve

Since the legislation was passed there has been a heroic movement of community-led blockades popping up sporadically around the country. Fightback has solidly participated in these actions wherever we have been able to. CUPW president Mike Palecek has said “There are fifty thousand union members that have been prohibited from picketing at post offices in this country, and three million who haven’t. We are not the only ones willing to defend the right of free collective bargaining.” Activists have even been prepared to defy orders to disperse, leading to 6 arrests in Halifax and 3 in Ottawa. In addition, many unions have pledged interest-free loans of millions of dollars to support CUPW’s fight. This shows that CUPW has widespread support for any actions that may be taken to defy the legislation.

But as heroic as the community blockades are, in and of themselves they cannot defeat the legislation or force management to seriously bargain. They are a useful secondary action to show that there is no business as usual at Canada Post, and to keep up the morale of the workers. But, without escalation, there is no incentive for the boss and the government to do anything other than wait out mediation and rely upon an imposed contract. CUPE 3903 at York University recently received the results of its imposed contract after back-to-work legislation, and the administration won all the way down the line. Realistically, community pickets can only be sustained for a day in each location, and solidarity is not a bottomless well that can be called upon indefinitely.

The problem with solidarity actions by outside activists is that they leave the workers passive. Written interviews, together with conversations with workers during pickets, have shown that there is a widespread readiness to defy, combined with deep-felt gratitude for the solidarity actions, but also a layer of workers who feel defeated and do not know what to do. The lack of tactics that put the mass of the workers in the driver’s seat has been a consistent weakness in the strike. Saturday, December 1st was supposed to be a day of action, but the union did nothing to officially organise a mass protest. A Montreal protest was called off for an unspecified logistical reason. The actions that were organised were ad-hoc by small peripheral groups, none bigger than a few hundred. This had the effect of atomising the 50,000 workers in the union and not giving them a sense of their massive collective power. There should have been emergency local meetings called during the five days it took to pass the legislation so that the ranks would have a democratic forum to express their opinion on whether the legislation should be respected or defied.

Even the rotational pickets, prior to the legislation, reduced the involvement and control by the ranks. It has been argued that rotational strikes still had a massive impact on the corporation with hundreds of millions in lost revenue, without costing the workers wages or the union picket pay. This may be true, but what this tactic gained in the bank account it lost in workers’ control. Workers can learn more in a day on a picket line than in a decade on the production line. Striking frees the workers up from the daily grind and gives them the time to control the direction of the struggle. Without tactics that bring the members out, the movement will be top-down and the amazing creativity of the workers will go unrealised.

Some on the left have said that you shouldn’t give advice to the union but instead concentrate on building solidarity. This is reminiscent of the “stay in your lane” line found in identity politics. These same leftists do not hesitate to critique unions with a right wing leadership, but appear to be confused by the left tradition of CUPW. We wonder what these people would say about articles putting demands on the CUPW leadership co-written by Mike Palecek (prior to being elected CUPW president) and the author of this piece? Fightback has been literally on the front lines organising solidarity with the postal workers and it is a slander to suggest otherwise. We have supported CUPW’s fights year after year. But a good friend does not stay silent when you are making a mistake. There are also thousands of workers who wish to defy back-to-work but have no organised vehicle to achieve this aim. It is vital that we let these workers know that they are not alone and there are positive options. If we believe that an injury to one is an injury to all, then all have a right to contribute their perspective on the best way to achieve victory.

Experience of defiance

Unlike others, Fightback has earned the right to speak with authority on the question of back-to-work legislation. The author of this article was the leader of a strike that defied the undemocratic imposition of legislation. In 2003, the teaching assistants at the University of British Columbia were legislated back. This was the first time legislation had been used against university workers, but it was part of a union-busting pattern by the BC Liberal government. For the previous two years union leaders submitted to legislation saying there was nothing they could do, but we showed that to be wrong. We blockaded the campus for two days and threatened a public sector general strike. The government blinked, and we gained an 11.5 percent wage increase over three years, overturning the imposed public sector wage freeze. There were no fines or imprisonment of trade unionists. The government was afraid that by enacting such repression they would spread the movement further and turn the leaders of the strike into martyrs. But the most important victory was not the wage increases but the example that we set for the rest of the labour movement.

Subsequently, the example of UBC led to defiance by the ferry workers, in November of 2003. In May of the following year the hospital employees defied, and a general strike was only averted by the betrayal of the BC Federation of Labour leadership. In 2005, the teachers went on an illegal strike, which led to a partial general strike and spontaneous cross-picketing. Teachers’ union leader Jinny Sims, now an NDP MPP, famously said “there is a difference between breaking the law and defying a law that was written to break you”. After this, the bosses backed off. The economy had stabilised by 2006, and rather than provoke more class conflict, the government bought class peace with $3000 signing bonuses for every worker who voted for a 5 year contract. For a period, back-to-work legislation had been beaten back by defiance.

There are rumours that 6 out of 15 of the CUPW executive are in favour of defying back-to-work legislation. However these are just rumours, and from the perspective of the rank and file it appears that there is a united leadership. By functionally ruling out defiance under any circumstance the executive majority is leading the union down a blind alley. From experience, there really is no better situation than this. Occurring on the same day as the Oshawa GM closure there was an electric mood looking for an outlet. The week of 26 November could have been an historic week in the Canadian class struggle. But unfortunately, due to the lack of a lead from Unifor and CUPW, it was a huge lost opportunity.

The need for Marxist leadership and a socialist perspective in the unions

The workers of CUPW and Unifor have shown their heroism and willingness to fight. The spontaneous wildcat at GM is an example for the entire working class. But unfortunately, the union leadership has not shown the same heroism or been prepared to defy laws that are designed to break the workers. The bosses have thrown away the old social contract and do not play by its rules. It is time for the labour movement to do the same and refuse to respect capitalist legality.

The minority of the CUPW executive should be commended for wishing to defy, but without letting this be known, the ranks will not be able to delineate between them and the anti-defiance bureaucracy. Those truly in favour of defiance should be organising in the rank and file to let them know that they are not alone. Emergency meetings should have been, and need to be, called in every local. Resolutions need to be sent demanding that the executive do their duty and not submit to the legislation.There is even the possibility that a wildcat walkout will break out from below. This may be what is needed to break the impasse and force the executive to act. Every ounce of pressure needs to be put to bear on the leadership, and power has to be wielded from the bottom up. The democratic will of the 50,000 members is far more important than any so-called unity with those who do not wish to fight.

A Marxist leadership of Unifor and CUPW would have united the two struggles as two aspects of the wider crisis of capitalism. At GM, instead of sending the auto workers back to work, delegations of picketers should have been sent to every GM plant to bring them out too. At CUPW, once the legislation was announced every worker should have been legally brought out on strike to give them the time to come to emergency union meetings to plan the way forward. The slogan must be, “the workers decide!” The government should have been shown that legislation does not calm things down, but escalates the conflict. GM management must be shown that by closing the Oshawa plant, they risk losing everything to expropriation.

If capitalism cannot provide jobs for the most productive auto workers on the planet then it is capitalism that deserves to be fired, not the auto workers / Image: Save Oshawa GM

When the CUPW back-to-work legislation came into force at noon on Tuesday, 27 November, the legal pickets should have been brought to mass protests in every major city. The main issues of these protests could have been both the right to strike and the right to good union jobs in cities like Oshawa. The entire labour movement would have been brought into this struggle, pushing the CLC and other unions to do their duty to support the postal and auto workers. If mass protest proved insufficient to put pressure on the corporations and the government, then the next day genuine cross-picketing could resume. Not dozens of radicals secretly planning to blockade mail while postal workers still go to work, but thousands of postal and auto workers going to transit workers, dock workers, rail workers, steel workers, government workers, all sectors of the working class, to picket out their workplaces.

In France we are currently seeing the impressive yellow vest movement that is bringing out hundreds of thousands into the streets and forcing the government to backtrack. We cannot guarantee in advance that any movement will succeed, but it is always better to fight and lose than to never fight at all. Jean-Claude Parrot was imprisoned in 1978, but this action prepared the maternity leave victory of 1981.

The class war politics of the bosses, the crisis of capitalism, and the logic of the movement leads us to the conclusion that illegal strikes and factory occupations will be on the agenda sooner or later. The 50s and 60s will never come back, and we should stop looking to this period as if it will. It has been ten years since the 2008 crash, and we are supposedly in the midst of a recovery. But this “recovery” has not improved conditions for the workers and a new global downturn is imminent. The bosses have decided to go back to 1930s methods of struggle. The workers have no alternative but to react in kind.

On a fundamental level we need to understand that the struggles of the postal workers and the auto workers are part and parcel of the wider struggle against capitalism. If we restrict ourselves to what is “possible” in the system then workers will face defeat after defeat, concession after concession. We must not accept the logic of capitalism. We must demand that the unions adopt a socialist perspective of breaking with capitalism.

If capitalism cannot provide jobs for the most productive auto workers on the planet then it is capitalism that deserves to be fired, not the auto workers. CUPW has been proposing some innovative green solutions via the postal service, making them a hub for re-charging electric vehicles and environmentally-friendly delivery. But this could be even better if it was united with a socialist environmental plan with a nationalised auto sector that produced buses, trains, and streetcars for a free public transit system. All this is possible, all the wealth and the expertise is there, the only thing that stands in the way is capitalist production for corporate profit. The greatest advances in the labour movement have come about when our movement has adopted a revolutionary perspective. Let us cremate the post-war labour compromise as a dead letter, but also throw the capitalist system on the fire along with it.