We now own a major stake in the largest auto company in the world.
With the General Motors Corporation filing the second-largest industrial bankruptcy in world history, the US government has stepped in to take a 60% stake in the company and the autoworkers’ healthcare fund taking ownership of 17.5%. In a reversal of Aesop’s tale “The Lion’s Share,” where the lion steps in to consume an entire stag that the other animals have captured and painstakenly prepared for eating, those who have purchased and built GM cars (consumers and workers) now own a lion's share of the company. Is US democracy up to the task?
In the early years of GM in 1946, the late labor leader Walter Reuther threw one of the most boldest demands across the table to the General Motors chief Harry Coen—“higher wages for workers without an increase in car prices for consumers.” When Coen declared GM did not have the money, Reuther told him to prove it and “open the books.” Reuther distrusted GM and large monopolies who he believed had the power to endanger the safety and stability of the nation. Reuther stated,
“The grim fact is that if free enterprise in America is to survive, it has got to work…it must demonstrate more than an ability to create earnings for providing full employment at a high standard of living, rising year by year to keep pace with the annual increase in technological efficiency…The fight of the General Motors workers is a fight to save truly free enterprise from death at the hands of its self-appointed champions.”
He believed “increased production must be supported by increased consumption, and increased consumption will be possible only through increased wages.”
GM refused Reuther’s demand to “open the books” and told Reuther to stop “fighting the fight of the whole world” and “let the labor statesmanship go to hell for a while.” For GM, meeting Reuther’s request would have opened the company to more public scrutiny and potentially would have held them more accountable to the people of the US. The autoworkers succeeded in getting higher wages with the first “cost-of-living” allowances in US history but lost the bigger fight for corporate responsibility. With this loss, the fight to “open the books” was forever abandoned and became a historical footnote.
This same company who turned away from Reuther and his demands would continue displaying their backside when various local autoworker leaders, over the decades, would repeatedly warn GM that their greed would lead to disaster for this country—“people want small economically efficient cars, not big rich luxury cars,” “ if you move our jobs overseas, you won’t have the middle-class families to buy your cars,” “we have to stop this policy of making cars that fall apart after a few years so that people would have to buy a new one” and “you have a responsibility to the local communities you have used for their labor and tossed away.”
At one point in our history, GM, like the young soldier inspired to serve his or her country, halted car production to build the weapons needed to win World War II while providing some of the first jobs for African Americans and women in the nation. Over half a century later, GM, once the largest company in the world and leader in the global economy, has fallen into the arms of the US people. For the longest time, we have measured the success of our democracy by how much we can consume. Now, the viability of US democracy will be measured by how much we can lead. Will we carry GM along the path of service or will we repeat history and return it prepared for the lion to consume as whole?
John Delloro is the Executive Director of the Dolores Huerta Labor Institute, LACCD and currently sits on the Legal Advisory Board of the Koreatown Immigrant Workers Alliance (KIWA) and the Board of Directors of the PWC. He was one of the co-founders of the Pilipino Workers Center of Southern California (PWC) and served as the president of the Los Angeles Chapter of the Asian Pacific American Labor Alliance (APALA). For the past decade, he also worked as a regional manager/organizer for SEIU 1000, Union of California State Workers, a staff director/organizer for SEIU 399, the Healthcare Workers Union, and an organizer for AFSCME International and HERE 226, the hotel workers union in Las Vegas.