WASHINGTON >> President Joe Biden dispatches top aides to Detroit to assist in resolving the strike by unionized autoworkers, expressing empathy for the union by suggesting that the Big 3 automakers should share their “record profits.”
“Nobody wants to go on strike,” Biden says in brief remarks at the White House. “But I respect the workers’ right to utilize their options under the collective bargaining system, and I understand their frustration.”
The United Auto Workers announced a targeted strike of 13,000 workers at three factories after failing to reach an agreement with General Motors, Ford, and Stellantis. Biden states that he is sending acting Labor Secretary Julie Su and senior aide Gene Sperling to Detroit to help negotiate a “win-win” contract for the companies and their employees.
During the start of the negotiations, Biden encouraged both sides to remain at the bargaining table for as long as possible. Only a small portion of the UAW’s 146,000 members employed by the Big 3 are participating in the strike. The UAW is seeking a 36% wage increase over four years, while GM and Ford have proposed 20% and Stellantis (formerly Fiat Chrysler) has put forward 17.5%.
“The companies have made significant offers,” Biden acknowledges. “But I believe they should go a step further to ensure that record corporate profits translate into record contracts for the UAW.”
The timing of the strike coincides with Biden’s branding of the U.S. economy as his own. As the 2024 presidential election approaches, the White House claims that its policies will support blue-collar workers, strengthen the middle class, and create factory jobs by transitioning away from fossil fuels to address climate change. However, uncertainties remain as automakers prepare to manufacture electric vehicles, and the UAW is the most notable union that has not endorsed Biden’s reelection efforts.
Biden faces economic and political difficulties due to high inflation starting in 2021. Workers’ wages have not kept up with the rising costs of groceries, gasoline, and other goods. Data from the Labor Department reveals that new car prices have increased by nearly 20% since April 2021, while higher interest rates have made auto loans more expensive.
The Democratic president supports the UAW’s demand for wage increases because the contracts can establish standards across the broader economy, resulting in higher wages and improved benefits for everyone.
The UAW strike is just one of several labor disputes taking place. Screen actors and writers are also on strike, causing a halt in Hollywood production. Business leaders blame Biden for encouraging more aggressive union tactics from the White House by repeatedly expressing support for a constituency that he believes is integral to his own identity and a key demographic in next year’s elections.
“The UAW strike, and indeed the ‘summer of strikes,’ is the natural outcome of the Biden administration’s all-encompassing approach to promoting unionization at any cost,” says Suzanne Clark, CEO of the U.S. Chamber of Commerce.
More strikes may be on the horizon, including a potential strike by 60,000 healthcare workers in California, Oregon, and Washington, according to Joe Brusuelas, chief economist at the consultancy RSM. However, the current work stoppage at three auto plants represents only a minor disturbance in the national economy.
Nevertheless, a broader UAW strike could have significant repercussions for the U.S. economy.
Oxford Economics estimates that a total strike by unionized workers at the Big 3 would result in a 30% or greater decline in motor vehicle production. This chain reaction would impact parts suppliers, as well as the stores and restaurants frequented by auto workers, potentially harming local economies in Michigan, Wisconsin, and other states that could play a decisive role in next year’s election.
The political consequences are already emerging even before the strike was formally announced.
Former President Donald Trump, the current front-runner among Republicans, claims that union jobs are at risk due to Biden’s emphasis on government incentives for the production of electric vehicles. In a recent interview with NBC News, Trump contends that consumers should still have the option to purchase gasoline-powered cars and speculates that all EVs will eventually be manufactured in China, despite the wave of domestic factory investments stimulated by Biden’s policies.
“The auto workers are being betrayed by their leadership, and their leadership should endorse Trump,” Trump declares, further predicting the disappearance of the union and the loss of those jobs within three years as a consequence of the electric vehicle shift.
In contrast, Biden views the negotiations as crucial for establishing a contract that will “lead to a ‘Made in America’ future that promotes strong, good middle-class jobs.”
AP writer Jill Colvin contributed to this report.
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