Tuesday, 12 May 2009

When Capital Gives A Business Away

There's a really interesting post over at orgtheory on the situation at Chrysler in the States by Sean Stafford. The firm is all but bankrupt - and part of the bailout deal leaves the United Auto Workers Union as the majority shareholder. Surely a step towards the kind of worker co-op based strategy so forcefully advocated by the likes of Boffy?

But Stafford warns that this is not unalloyed good news, and could actually leave the Union with a huge retiree health bill if the firm does tank completely. In other words, they could be stuck with a 'pig in a poke'- the capitalists, having basically decided the North American auto industry is on its uppers, have passed an unproductive asset to the workforce. (I paraphrase and crudify). He goes further:
"...worker voice today comes in multiple forms and many of these rely less on the blunt instruments of countervailing power than on the relatively softer instruments of building alliances, framing issues, participating on multiple levels (workplace, community, identity groups, local and national governments, the media, international)."
Well, perhaps, yes, sort of. But 'worker voice' must also be developed in actually deciding what can be produced to meet social need. So I'd really like to know if the lefty engineers and technologists of this world are heading Detroit-wards to help the UAW develop their very own 'Lucas Aerospace Shop Stewards Plan' on a huge scale to convert the production lines from gas guzzlers to a mixture of ecologically sound vehicles and alternative products.

Because, otherwise, I think the UAW may regret this deal.

1 comment:

  1. Putting on my capitalist fund manager hat and declaring my interest (I hold Fiat shares)...

    It is an interesting deal. Fiat seems a very good fit (small cars and ecologically better cars - remember Fiat makes a lot of ethanol cars in Brazil as well as the snazzy European hatch backs). The plan seems to be to bring together Fiat's technolofy and designs with Chrysler's production and sitribution networks.

    Let's also remember that both bond holders and equity holders of C are getting pretty much killed.

    The bigger problem for me is GM. Much harder to fix.