Two of my most indelible memories of the Black Lives Matter protests in the summer of 2020 were a CNN report characterizing the destruction of a Kenosha, Wisconsin, automotive dealership as a “mostly peaceful” protest and Chase CEO Jamie Dimon taking a knee for a photo his PR people staged in front of a suburban New York City bank branch. Reading coverage this morning of UAW strikes being staged with missile-like precision at GM, Ford, and Stellantis plants prompted a recall of my BLM protest memories.
Radical labor instigators looking to burn down the Detroit 3 automakers have infiltrated the UAW and Ford has already taken a knee.
The Detroit News last Thursday scored a monster scoop with its report on text messages sent by UAW communications director Jonah Furman on a private group chat on the X platform formerly known as Twitter. Furman said that union negotiators are using bargaining sessions to inflict “recurring reputations damage and operational chaos” on the Big 3 automakers.
“(I)f we can keep them wounded for months they don’t know what to do. The beauty is we’ve laid it all out in the public and they’re still helpless to stop it,” Furman said.
The News did its readers a disservice not disclosing Furman’s background and experience. He served as Bernie Sanders’ national labor organizer in 2020 and a political and labor organizer for Alexandria Ocasio-Cortez. He also was co-chair of Metro DC Democratic Socialists of America Labor Working Group.
According to a bio posted by the CUNY School of Labor and Urban Studies, Furman was born in Chicago and raised in Evanston, an affluent suburb. He attended Johns Hopkins University, where he majored in philosophy and literature. After graduation, Furman moved to Boston and was in a touring band for four years, which traveled the US and Europe. He later moved to New York and interned at the Street Vendor Project, a center for NYC street vendors.
Furman’s CUNY bio said he’s interested “in radical approaches (emphasis mine) to work and wages (basic income, work refusal) and the histories of those approaches.”
Underscoring how out of their depth the communications teams of GM, Ford, and Stellantis are against their counterparts at the UAW, they couldn’t capitalize on the gold the Detroit News handed them. Instead, they issued statements that didn’t force the media to note Furman’s background.
Here’s GM’s response, as reported by the Detroit Free Press:
It’s now clear that the UAW leadership has always intended to cause months-long disruption, regardless of the harm it causes to its members and their communities. The leaked information … shows a callous disregard for the seriousness of what is at stake.” GM said it put a fifth “record offer on the table” and is ready to continue to bargain in good faith.
If I was running GM’s communications, this would have been my response: “Jonah Furman’s comments speak for themselves and are consistent with his well-known radical goals and objectives. The media would do a great public service publicizing them so the public understands the political and socialist agendas some of Shawn Fain’s key advisors are pursuing.”
Fain is president of the UAW. As I noted in this recent post, his messaging and comments are closely aligned with Bernie Sanders. My recommended comment would have forced the media to include Furman’s background and his ties to Bernie Sanders and AOC, eroding some of the support and goodwill the UAW enjoys with the public. In conservative circles, Sanders and AOC are universally despised.
Longtime automotive industry experts questioned Fain’s strategy of targeting the Big 3 auto companies simultaneously with strikes at selective plants, rather than pursue customary so-called pattern bargaining where the union would strike one company and negotiate the best possible offer and then demand similar agreements from the two other automotive companies.
Fain’s strategy has proven sheer brilliance.
Playing the three companies against each other has allowed the UAW to publicly praise who is bending to the union’s will and the companies who can’t yet see the writing on the wall. On Friday, the UAW made clear that Ford has already caved.
According to the UAW, Ford has already agreed to some of the union’s key demands, including cost of living adjustments, a greater share of profits, and immediately converting to full time status employees with at least 90 days of employment. Just days ago, a Ford spokeswoman was touting Ford’s “clear path” to a permanent job, which required two years of employment and considerably lower wages than full time employees.
It comes as no surprise that Ford was the first to fold given how the company has leveraged its close ties to the Biden Administration.
Ford’s government affairs are overseen by Steven Croley, the company’s chief policy officer and general counsel, who previously served as general counsel for the U.S. Department of Energy. He spent four years in the Obama White House, first as special assistant for regulatory policy, then as deputy counsel overseeing legal policy. Chris Smith, Ford’s top lobbyist and chief government affairs officer, also worked for the DOE. In April, Smith was named an advisor to Energy Secretary Jennifer Granholm.
In May, Granholm awarded Ford a sweetheart $9.2 billion low interest loan to finance the company’s already heavily subsidized EV projects in Tennessee and Kentucky, despite Ford continuing to pay billions in dividends to its shareholders. GM long bested Ford on Good Jobs First ranking of America’s top corporate moochers, but suddenly Ford ranks higher. I can’t keep track of all the money the Biden Administration is shoveling Ford’s way.
Ford executives and affiliates made significant contributions to the Lincoln Project, a controversial organization dedicated to the political demise of Donald Trump. Given Trump’s considerable popularity, those donations benefit President Biden’s re-election chances.
Ford can legitimately claim it’s the official automaker of the Biden Administration. In Biden’s 2022 State of the Union address earlier this year, the president praised Ford for its EV projects in Tennessee and Kentucky. Months later, U.S. taxpayers are on the hook for much of the financing.
Ford is heavily indebted to the Biden Administration, but as the saying goes, “if you lie down with dogs you get up with fleas.” A prolonged strike would be a disaster for Biden, as it could cause considerable economic harm and harm his re-election efforts given that he’s already a very unpopular president. The New York Times reported that Biden has dispatched Julie Su, the acting secretary of labor, and Gene Sperling, a top White House economic adviser who was born in Ann Arbor, to seek an end to the strike.
Sperling was a senior advisor to Obama, so if he meets with Ford’s Croley it will be a homecoming of sorts.
Biden, who fashions himself as “the most union president in history,” is planning to visit Michigan next week to join a UAW picket line and “stand in solidarity with the men and women of U.A.W. as they fight for a fair share of the value they helped create.” Fain cleverly invited Biden and the president promptly took the bait.
The UAW will no doubt ensure that Biden is seen embracing Black workers. I’m in awe of this story the union’s communications organizers placed with NBC News.
That Fain would welcome Biden to walk a UAW picket line is audacious, given that the president’s green energy initiatives have caused great harm to U.S. automotive workers. The Inflation Reduction Act, which Biden championed, encourages the Detroit 3 automakers to relocate their EV manufacturing to Mexico, where Ford proudly assembles its electric Mustang and GM is assembling its electric Equinox and Blazer vehicles. Under IRA, electric vehicles assembled in Mexico, where factory workers are paid poverty wages, are eligible for lucrative tax credits when sold in the U.S.
I note that IRA was supposedly intended to reduce inflation, and Biden’s beloved Ford Motor Co. was the first to agree to a cost-of-living adjustment.
Donald Trump next week also plans to visit Michigan, feigning his support for striking autoworkers. While as president Trump paid lip service to opposing U.S. companies offshoring their manufacturing, his massive corporate tax cuts weren’t the job creation boon he promised, but rather provided funding for America’s overpaid CEOs to buy back their shares to boost their stock prices and bolster their compensations. Stock buybacks have accelerated under Biden’s rule.
Stocks buybacks were once illegal because it enables CEOs to artificially boost the value of their company’s shares. The buybacks contributed to what led to GM’s 2008 bankruptcy.
From a publication called The Lever, which was founded by Bernie Sanders operatives.
Last year, S&P 500 companies set records for stock buybacks, spending over $923 billion — far outpacing the $565 billion the top firms spent on dividends, which are profit-sharing payments made to shareholders. The U.S. government banned such stock buybacks as “market manipulation” until 1982, when President Ronald Reagan’s administration legalized them as part of his deregulatory “Reagan Revolution.” These expenditures, which artificially inflate value for shareholders, come at the cost of long-term investments that ensure a company’s ability to exist, including compensation for their workers.
For the automakers, the latest buybacks reflect an even stronger commitment to speculative payoffs for their shareholders. Ford spent $484 million on buybacks last year, its biggest outlay on the matter since 2014. GM, meanwhile, re-launched its buyback program in September 2022 after a five-year hiatus with a massive $1.5 billion expense, and has issued nearly $3.4 billion in buybacks in the past 12 months.
Stellantis — formed from the 2021 merger of Chrysler, Fiat, and Peugeot — funneled $1.6 billion in stock buybacks to its shareholders starting in February. The most recent and final tranche of buybacks — totaling $536 million — was announced Tuesday, just days before the impending strike.
The rise in stock buybacks and the decline of organized labor are linked. William Lazonick, a University of Massachusetts economics professor who has studied stock buybacks, traced GM’s reliance on this sort of market manipulation to the company’s downfall amid the 2008 financial crisis. The company filed for bankruptcy in 2009, in what was then the biggest manufacturing collapse in U.S. history.
“In the 1980s, when GM was still the biggest car company in the world, it started buying back stock,” said Lazonick in an interview with The Lever. “Between 1986 and 2002, it bought back about $20 billion worth of stock.”
In a 2015 Harvard Business Review analysis on the matter, Lazonick calculated that if GM had “saved that money and earned a modest 2.5 percent on it, the company would have had $35 billion on hand when the financial crisis and Great Recession hit and probably would not have had to file for bankruptcy protection.”
Instead, because the automotive companies were considered “too big to fail,” the U.S. spent $11 billion bailing out GM.