STRIKE OUT.

By Peter M. DeLorenzo

Detroit. Now that the UAW has decided to call a strike against General Motors, an ugly reality is being glossed over. Yes, of course, the most immediate facts of the situation are that both sides are far apart at this juncture, with the union fighting back against more plant closures, wanting to keep their health care coverage (the average UAW worker pays only a fraction of what other U.S. workers pay for health care due to the fact that Ford and GM supplant health care benefits to the tune of more than $1 billion per year), and wanting pay increases including more profit sharing.

On the other side of the ledger GM says it is offering the UAW more than $7 billion in U.S. investments over a four-year contract, an increase in pay and improved benefits, improved profit-sharing, a ratification payment of $8,000, and 5,400 jobs with the promise of the introduction of new electric trucks and the first “union-represented battery cell manufacturing site” in the United States, which would be in, or close to, the shuttered GM Lordstown Assembly plant in Ohio.

Pretty typical stuff when it comes time for auto companies and the UAW to square off at contract time, except for the fact that the UAW concessions and get-out-of-jail-almost-free card that GM gained through its bankruptcy has rankled the union rank and file ever since. And those pissed-off feelings aren’t about to recede quietly.   

But what isn’t typical is the fact that the UAW management representatives – at least the ones assigned to speak to the media – are trying to gloss over the fact that the United Auto Workers rank and file are being represented by a fraudulent and deeply corrupt management superstructure.

How corrupt? According to the Detroit Free Press: “Multiple national UAW leaders are implicated in a public scandal involving the alleged misuse of union funds. A criminal complaint alleges that UAW officials 'hid their personal use of UAW money without any legitimate union business purpose' in an embezzlement scheme that allowed them to spend union money at swanky hotels and golf courses. UAW Region 5 Director Vance Pearson, who was arrested Thursday, is facing six charges that include embezzlement of union money and money laundering. The FBI raided UAW President Gary Jones' Michigan home last month as part of the national corruption probe. Michael Grimes, a former UAW administrative assistant and executive board member of the UAW-GM Center for Human Resources, pleaded guilty to conspiracy to commit wire fraud and money laundering last month. In total, nine people have been convicted in the investigation.”

This investigation is ongoing and could absolutely decimate the UAW management structure before all is said and done (by the way, the stacks of cash they confiscated from Jones' house totaled $30,000), and yet there was UAW spokesman Brian Rothenberg, taking umbrage when a reporter asked him late last week where Gary Jones, the UAW President, was, saying: “I’m not his scheduler. Mr. Jones has a union to run. I don’t see you asking GM where (CEO) Mary Barra is at every press conference.” 

In case you were wondering if this was the same old belligerent UAW, there’s your answer. Hey, Brian, in case you forgot, Mr. Jones doesn’t have a union to run anymore because he is too busy running scared from the Feds. In fact, the entire UAW management team is utterly devoid of credibility at this point, and to suggest otherwise is a complete joke. As for Ms. Barra, she has a company to run, and she’s doing it quite admirably, I might add.

Read between the lines, and the rank and file is royally pissed-off at its so-called management team. Here they are going into contract negotiations, and the union’s upper echelon managers have been exposed as running a major league grifting operation that has burned through millions of dollars on elaborate trips, big-dollar restaurant gorging, assorted prizes and wildly inappropriate self-gifting, and the accumulation of boatloads of cash, just because they could. There’s even a $2 million retirement party that was staged for a UAW bigwig in Las Vegas that has yet to surface, but I am sure it will in due time. 

I feel for the UAW rank and file because they’ve been taken for a ride. The fact that these UAW management grifters have squandered their union dues and freely accepted cash from the National Training Center fund funneled to them by the auto companies looking for favorable contract terms for years is simply unconscionable and inexcusable.

I was hoping the people in UAW management positions would understand that the naïve notion that they will be able to separate their contact negotiations from the Federal investigation “distractions” is simply wishful and reckless thinking. But it’s clear by their ongoing comments that they not only just don’t get it, they have their heads in the sand about the scope and seriousness of this Federal investigation.

The ugly reality for the UAW is that this ongoing investigation could very well mean the end of the UAW as a functioning entity. So UAW management can squawk and preen and talk tough all they want, but the clock is ticking on their very existence, and they refuse to acknowledge that fact.

And that’s the High-Octane Truth for this week.