UAW contracts once heralded American progress. Will they in 2019?

Dec. 02--If you want to see the future of the American middle class, look no further than next year's contract talks between the UAW and U.S. automakers.

For the past 70 years, what happened to America's middle class often happened first at UAW negotiations here in Detroit.

In the 1940s, the UAW under its legendary leader Walter Reuther won concessions we now think of as middle-class entitlements. The UAW won the first paid holidays for General Motors workers (in 1947), the first employer-paid and jointly administered pension program at Ford (in 1949), and fully paid hospitalization, surgical and medical insurance for retirees (in 1964).

Those victories by the UAW helped create broad middle-class prosperity in the United States. They helped define what became known as the American Century, the dominance on the world stage of the American example.

"The UAW was a huge leader in establishing many of the worker benefits that eventually became very widespread throughout the United States," said Charles Ballard, professor of economics at Michigan State University.

That lingers even today. Although Michigan is below the national average for many economic indicators, it is way better than the national average in the percent of residents who have health insurance, Ballard said, noting that Michigan ranks seventh among the 50 states in that regard.

"We have always been better than the national average, and we have Walter Reuther to thank for that," he said.

But in more recent decades, particularly in the Great Recession years, the collapse of American manufacturing dominated UAW talks and led to union workers making deep concessions. Those concessions not only left workers and their families poorer, but they fed the discontent among American workers and fueled the populism that helped elect President Donald Trump.

What will UAW talks bring when union leaders sit down with auto executives next summer? And can whatever emerges from those contract talks translate broadly into the American scene as previous UAW gains and losses did?

Ballard said the upcoming UAW talks in 2019 will still translate to the broader community, but perhaps not to the degree they once did.

"The UAW doesn't matter in the same way today that it mattered 50 years ago, or even 20 years ago," Ballard said. "I think the UAW still makes a difference, but not to nearly the extent that it once did."

Here's an interesting thought: Perhaps, with Democrats making major gains in the U.S. House of Representatives in this year's midterm elections, the floor of Congress may once again become the place where the most influential debates on social reform take place, rather than in labor talks in Detroit.

Still, there are hints that next year's UAW contract talks will still be crucial at least regionally, if not to the same extent nationally as they once were.

GM's announcement last week of idling three major assembly plants at Detroit-Hamtramck; Lordstown, Ohio; and Oshawa, Ontario, could depress local economies in all three communities. GM said it would shed around 14,000 workers, both factory hands and white-collar workers, as it prepares for future market demands.

There is speculation that GM could be playing those communities off each other and may be willing to restore production to at least one of those plants. That could create some contentious bargaining sessions next year and some internal squabbling within the UAW.

U.S. Rep. Debbie Dingell (D-Michigan) said GM's recent announcement will impact more than 6,000 factory workers in those three locations, with some production looking like it may shift to Mexico.

"Just this week we have witnessed the real effect of unfair trade policies as GM shutters more plants and leaves over 6,200 hardworking men and women's jobs hanging in the balance," Dingell said. "Americans deserve policies that will improve job stability and fair trade and not just words, but real actions."

Bottom line: We can expect that even a round of UAW talks that isn't as revolutionary as the contracts of the 1940s and '50s will still have an impact well beyond the shop floor.

And that's why the nation will once again be paying close attention next year when UAW leaders reach across the table for the ceremonial handshake to begin the next round of bargaining.

Contact John Gallagher: 313-222-5173 or gallagher@freepress.com. Follow him on Twitter @jgallagherfreep.

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