This could shape unions across America.
I’m Isaac Saul, and this is Tangle: an independent, nonpartisan, subscriber-supported politics newsletter that summarizes the best arguments from across the political spectrum on the news of the day — then “my take.”
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I'll be writing a members-only piece on the options Israel has in front of it, none of which are particularly good. I'll also be responding to one of the most common questions I've been getting since our coverage of Hamas’ attacks in Israel began: Where can I learn more? What are good resources? What are good books? I'll be sharing a list of reliable resources for readers to consult, including expert historians and their books, videos, podcasts, and articles.
- Israeli officials say they killed a senior Hamas commander who was believed to have been involved in the planning of the October 7 attack. Egypt's border remains closed, but the country says it will treat injured Palestinians. The death toll in Gaza has risen to 8,500, according to the Hamas-controlled Health Ministry. (The latest)
- The U.S. Senate confirmed Jacob Lew as the next ambassador to Israel (The confirmation). Separately, Gen. Eric Smith, the highest ranking Marine in the U.S., was hospitalized after a heart attack on Sunday. (The hospitalization)
- The White House has confirmed that President Biden is expected to meet with Chinese President Xi Jinping in San Francisco later this month. (The meeting)
- In the wake of the Israel-Hamas war, Democratic members of the House of Representatives are fracturing over several bills related to Israel and Palestine. (The fracture)
- The Supreme Court will hear two cases weighing whether public officials can block critics on social media. (The case)
The United Auto Workers deal. On Monday, General Motors and United Auto Workers struck a deal that ended the union's six-week series of strikes aimed at Detroit’s Big Three automakers. The deal with GM came after Ford reached a deal last Wednesday and Chrysler-owned Stellantis struck a deal with workers over the weekend.
The latest agreement with GM marks a major victory for the workers, who experienced stagnant wages following concessions made during the 2008 financial crisis, and brings an end to walkouts that had paralyzed the industry. It also marks another major victory for unions more broadly, whose collective power is increasing after 40 years of relative ineffectiveness.
The tentative agreements still require ratification by union members, but terms that have been announced so far include an initial 11% pay increase and a 25% pay increase over the next four and a half years (the length of the contract), as well as cost of living adjustments (COLA) to make sure the raises keep pace with inflation. Along with the pay increases, the companies will get rid of the two-tier worker structure, under which temporary workers doing the same jobs were paid less. The deal will also allow unions to strike in retaliation for plant closures.
The deal with GM came less than 48 hours after a surprise walkout at Spring Hill Assembly plant in Tennessee, a key GM plant. Negotiators had been at a standstill on questions about contracts for workers at the automakers' joint venture battery plants. The agreement will allow workers at those plants to vote on unionizing future plants and then decide whether they want to be a part of the master contract that was agreed to or seek out their own contracts.
Employees at GM facilities and the battery plant will receive an 11% increase in wages in the first year of the contract, putting their pay at $35 an hour, and by the end of the contract GM workers will be approaching $42 an hour. GM is also going to give five $500 payments to retirees, disbursing payments annually through 2027.
UAW President Shawn Fain employed a novel strategy during six weeks of strikes. Rather than full-scale walkouts at one of the Big Three, the union hit plants from all three automakers one at a time in an effort to ratchet up pressure and keep the Big Three guessing where the next strike would take place. For instance, in October, Fain ordered workers to walk out of Ford's largest and most valuable plant after meeting with Ford and learning that there was no new offer.
"We wholeheartedly believe our strike squeezed every last dime out of General Motors," Fain said in a video address. "They underestimated us. They underestimated you."
President Biden, who had shown an unprecedented level of support for the union workers, praised the news.
"This historic contract is a testament to the power of unions and collective bargaining to build strong middle-class jobs while helping our most iconic American companies thrive," Biden said.
The new contracts will significantly increase cost for the automakers, who said the deal will make it more difficult for them to compete with companies like Tesla. Two sources told Reuters the wage increases at GM alone will cost $7 billion over 4.5 years, and Ford said it would likely increase their costs by $850 to $900 per vehicle.
Karl Brauer, an executive analyst at iSeeCars.com, said in the long-term Ford, GM, and Stellantis will have to raise car prices to maintain their profit margins.
“This is going to make cars more expensive,” Brauer told The New York Times.
You can read our previous coverage of these strikes here.
Today, we're going to break down some reactions to this deal from the left and right, then my take.
What the right is saying.
- The right disapproves of the deal, arguing it will damage the U.S. auto industry in the long run.
- Some say the automakers' concessions will put them at even more of a disadvantage relative to foreign competitors.
- Others say the strikers’ demands are at odds with American values.
In The Wall Street Journal, Holman W. Jenkins, Jr. criticized the “UAW monopoly.”
“This time around, the union didn’t dispense with another of its usual fig leaves, claiming it will level the playing field by extending unionization to Tesla and the transplants, which it always says and never succeeds in doing because those companies and their workers aren’t suicidal,” Jenkins wrote. “Ford’s labor cost, to give one example, will rise to an estimated $88 per hour, compared with $55 or less for nonunion car makers. This would have no competitive effect if UAW workers were 60% more productive, but they aren’t.”
“Ignore gooey liberals. The 1960s aren’t coming back as a result of this week’s successful strike conclusion, with union members insulated from nonunion competition. Nor will the government ban gasoline-powered cars or tax them out of existence to stem EV losses. What will be the policy options then?”
In Fox Business, Sean Duffy said the agreement could hurt “the U.S. economy and workforce for generations.”
“The UAW has made demands that could damage the competitiveness of U.S. auto manufacturers. They’ve asked for significant wage increases and a shorter work week, making it tough for U.S. manufacturers to compete globally and potentially weakening a core and beloved American industry,” Duffy wrote. “However, it's the UAW's third demand that is most troubling: the elimination of the two-tiered wage system, which would result in everyone in a given role receiving the same compensation, regardless of their experience or time in their position. This demand is fundamentally un-American and would have severe unintended consequences.
“Recently, UPS eliminated their two-tiered wage system. If the UAW secures this concession, the auto industry would be the next domino to fall, putting American industry on the perilous path of self-imposed decline. Negotiators need look no further than Communist Mao Zedong’s China in the 1950s and 1960s to see the disastrous economic effects of this policy… When everyone is paid the same regardless of their performance or skills, the motivation to excel dissipates.”
The Detroit News editorial board called the deal “a risk” for the auto industry.
“The historic pact merits celebration by those on the factory floor, who have seen their real wages slip while company profits and executive pay soared. It does, however, place the jobs of those workers in greater jeopardy. In an intensely competitive industry, the cost of this contract will make the low-wage manufacturing plants in Mexico and Asia much more tempting,” the board said.
“Fain took a hostile stance in this strike, to the point of declaring as over the union's collaborative relationships with the automakers and causing them operational chaos as his strategy. That will be a red flag to global manufacturers seeking to locate in the U.S. should this contract trigger a renaissance of union organizing.”
What the left is saying.
- The left celebrates the deal as a major victory for organized labor in the U.S.
- Some suggest the concessions won by the UAW could catalyze more ambitious union efforts across the country.
- Others say Biden should also get credit for this outcome thanks to his strong show of support for the unions.
In MSNBC, Hamilton Nolan said “the UAW’s victory is just the beginning of a much, much bigger battle.”
“The new contracts secure major wins, including 25% wage gains, the elimination of divisive wage tiers, the right to strike over future plant closures, and a path to unionize the companies’ electric vehicle plants. These victories amount to a comprehensive reset of the balance of power in the auto industry, where workers have been struggling to participate in the industry’s resurgence since the 2008 recession. The contracts are models of solidarity, legal embraces of the idea that the labor movement’s collective power exists to help everyone.
“In all cases, the biggest beneficiaries of the union’s leverage were the workers with the greatest needs: lower earners, new hires, temps, and all of the auto industry’s employees who are not unionized — yet,” Nolan wrote. “The UAW’s victory in this strike was inspiring on its own, but more thrilling is the conviction it carries with it: that this strike is just the beginning of a much, much bigger battle.”
In The Hill, Harley Shaiken called the deal “a home run for the US workforce.”
“This agreement is great news for UAW members, but the gains could resonate across the economy in two ways. First, auto talks historically have served as a benchmark for other unions, and non-union employers have improved wages and benefits to avoid unions,” Shaiken said. “Second, Walter Reuther, the union’s legendary early president, famously said that UAW gains create ‘high-velocity purchasing power’ which fuels economic growth.”
“When workers feel they are well treated and valued, productivity rises, absenteeism and turnover decline, and workers improve the production process. Ford seems to agree. As part of this contract, it announced a commitment of $8.1 billion in new U.S. investments over the life of the agreement; a strong vote of confidence. Ford said it expects to find efficiencies to offset the higher labor costs. GM and Stellantis will likely do the same. This is hardly utopian thinking but reflects the history of the industry.”
In The New Republic, Michael Tomasky argued it’s time for liberals to “start giving Biden some damn credit.”
“Could the UAW have won these deals without Joe Biden? I’m sure it could have—it came to the picket line with a great case to make,” Tomasky said. “But the automakers also had the president of the United States walking the picket line and declaring himself more unambiguously on the side of the workers than any president has done in my lifetime. Biden’s public display of allegiance to their union was surely reinforced by private signals the administration sent out to both sides.
“This was the most dramatic presidential intervention in a private-sector strike since… well, if there was a precedent for it, I can’t recall it,” Tomasky wrote. “[Biden] deserves way more credit for this than he’s been getting. The UAW has not endorsed Biden yet, and Trump of course will campaign heavily in the Rust Belt states claiming to be the working-class’s warrior chief. But it’s Biden who has been delivering.”
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- The numbers here are pretty stunning.
- Fain proved his strategy can work, and I expect union membership to grow after this.
- The political landscape for unions could be changing under our feet.
It is a breathtaking deal. Even without the fine print, which will be important, I honestly struggle to remember a union win where a pay raise as large as 25% was dished out in one fell swoop.
UAW President Shawn Fain hasn't just proven the efficacy of his strategy, which worked better than I imagined, he has proven it so effective that I suspect we are going to see a wave of new union membership in the wake of this deal. Imagine being a worker at a foreign-owned company like Toyota and watching union workers land what for many of them could end up being six-figure salaries in a town like Flint, Michigan. All it took from union members was six weeks of pain and some courage. How would membership in a union like that, led by someone who just pulled off what Fain did, not be alluring?
I think one of the biggest stories of post-Covid America is the unbelievable power shift toward workers that we are witnessing, as I've written about several times this year. Loads of think pieces have been written about "quiet quitting" and remote work, but the meatiest story of all is that workers — unionized or otherwise — are simply ratcheting up their demands and either getting what they want or walking out if they don't. Wages continue to rise, benefits are improving, and already positive union sentiment continues to increase.
Politically, the implications are fascinating. I live in Philadelphia, and a few weeks ago I visited my parents in Bucks County, just outside the city. On my way home I saw a group of striking auto workers sitting around a bonfire right off the I-95 interstate outside a factory. People were honking and cheering as they drove by. In Bucks County, PA — a bellwether county in a bellwether state. This story has created a tectonic amount of national coverage, and on the ground, its tremors are reverberating. I think the strike’s outcome is going to be impactful in the next few elections — but I think it’s too early to say exactly how.
The framework we’re familiar with is that Democrats like unions and Republicans don't. That was somewhat reinforced when President Biden took the unprecedented step of joining the picket line with UAW, while former President Trump spoke to non-union auto workers and issued a warning that the union negotiations wouldn't make any difference and the industry was going to collapse because of electric vehicles and Biden's environmental agenda. But even Trump's appearance in Detroit was a new tack for the party, an explicit kind of outreach to auto workers during their battle with big business.
Now, I suspect the workers who just scored this pay increase would argue the negotiations did, actually, matter a great deal, and we'll see if Trump's approach does any damage to him politically. Though Trump could certainly be right about a future where the Big Three struggle to fend off emerging rivals like Tesla, and right that workers at the Big Three just won a single battle in a losing war.
Still, the ground is shifting. Trump-friendly Senators like J.D. Vance (R-OH) and Josh Hawley (R-MO) backed the auto unions on strike, something that was unthinkable just 15 years ago (Mitt Romney published an op-ed titled "Let Detroit Go Bankrupt" in 2008). Republicans have gained much of the blue-collar vote in the midwest, and Democrats are seizing this opportunity to claw some of it back. Politicians like Hawley and Vance either recognize that danger or genuinely represent a new era of union loyalty from Republicans seeking out those voters. We'll know more about that landscape when we see how consistent their support actually is.
I'm not someone who supports unions wholesale (many of my conservative readers loathe unions because of the teachers’ unions, while many liberal readers feel similarly about police unions), but in the case of UAW, I thought their argument was legitimate and their cause was just. The Big Three are pulling record profits, auto workers sacrificed a lot after the 2008 recession, and the rationale to compensate them fairly now was straightforward. As Fain has argued: CEOs of the Big Three automakers earn millions in annual compensation, and UAW estimates that executive pay has increased by 40.1% since 2019. His opening position was 36% raises on a shortened work week and he looks happy to walk away with 25% and cost of living adjustments.
But everything I wrote in September is also still true: A short-term win for workers could set these companies up for long-term downturns. I hope Fain and the unionized workers know what they’re doing, and I hope the leaders of these automakers are prepared to fit these new pay increases into a future where they can remain profitable, sound businesses.
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Q: What's it like to get an exclusive like this? I'm sure Mr. Phillips went to you for a reason, and I'm sure leading up to it you had a bunch of thoughts in your brain about what kinds of questions you wanted to ask, what you thought he would answer, and what kind of access you'd have to him or people like him in the future based on how this interview goes. How did you navigate all of that? And, knowing that "esprit de l'escalier" is a thing, how many more questions did you think of the moment you hung up?
— Brendan, Pittsburgh, PA
Tangle: This is a nice tee-up for a shameless plug. If you still haven't watched our interview with Dean Phillips, the Democrat now challenging President Biden in the primary, you can do that below:
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As for the questions: I don’t typically worry about access. If a politician doesn’t want to talk to me because I asked them a tough question, that is a story on its own. And I don't have any regrets about what I asked — mostly because we only had 15 minutes, most voters don't know who Phillips is, and the main goal was to allow him to introduce himself to the public. To that end, the important stuff to cover was a brief bio on him, why he was running, and how he thought he could win. We hit all those notes, which I was happy about.
Still, you’re right, I had a million other questions I would have asked him if we had more time. Questions like:
- What policies did President Trump enact that you support?
- Why didn't you push or vote for a moderate Republican for speaker?
- How do you plan to win over black voters, who disproportionately seem to support Biden over other Democrats?
- What specific policies do you think could get the border under control?
- How do you square your concerns about deaths of despair, like addiction and depression, with your career running a major distillery?
- What policy issues have you supported that ended up not panning out the way you thought? What have you been wrong about?
And so on. I’m grateful for the time we got with him and proud of how the interview turned out, but unfortunately 15 minutes only goes so far! I do hope to speak to him again soon.
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Under new House Speaker Mike Johnson (R-LA), Republicans are rolling out a plan to fund aid to Israel that relies on $14.5 billion in cuts to the Internal Revenue Service (IRS). Johnson is proposing a bill that would send $14.3 billion to Israel, decoupling it from aid to Ukraine and Taiwan, while also making the cuts to the IRS to pay for it. "We're going to have pays-for in [the bill]," Johnson told Fox News on Monday. "We're not just going to print money and send it overseas." Republicans will hold a vote on the bill Thursday. CBS News has the story.
- One year ago today we wrote about Elon Musk's purchase of Twitter.
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- 45,000. The number of workers who had walked off the job at the height of the UAW strike, representing nine assembly plants and 38 parts distribution facilities.
- 6.6%. The average first-year raise secured by union contracts across all U.S. industries in 2023, the biggest bump in over three decades.
- $34. The average hourly wage for union workers, as of June 2023.
- $29. The average hourly wage for non-union workers, as of June 2023.
- 67%. The percentage of Americans who say they approve of labor unions, according to an August poll by Gallup.
- 48%. The percentage of Americans who said they approved of labor unions in 2009, during the Great Recession.
- 11 million. The number of workdays lost due to labor disputes in the U.S. in 2023, more than the total in any full year since 2000.
Have a nice day.
Soon after giving birth two months prematurely, middle school teacher and single mother Terri Logan received a bill from the hospital. The total was eye-popping, and it saddled her with medical debt that she’s been working to pay off for 13 years. Then, a few months ago, Logan received a different kind of letter — this time from a nonprofit telling her that her debt was paid. That nonprofit is RIP Medical Debt, which pays off medical debt for thousands of people at a time. They buy debts like any other debt collector, but instead of collecting payments they send out notices to consumers saying their debt has been cleared. To date, they have paid off $6.7 billion in medical bills, relieving the debts of 3.6 million people. “Call us! We want to talk to every hospital that’s interested in retiring debt,” says RIP Medical Debt’s CEO Allison Sesso. Good Good Good has the story.
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