King Arthur Movie Tristan

A few weeks ago I wrote about the closing of Ledco in Kitchener and the CAWs refusal to negotiate concessions, even though their members wanted the negotiation to occur. The refusal to negotiate directly resulted in Ledco closing it's doors and declaring bankruptcy. The CAW then occupied the plant, blamed Stephen Harper/globilization/the big three. Pithily, I commented:

...you have to wonder if the CAW has no shame: this closing is directly attributable to their refusal to negotiate, and now they are occupying the plant demanding the company do just that.

and

... does the CAW, today, still refuse to negotiate wage and benefit cuts? And if so, what car will GM put in Oshawa when they are done putting 16 cars in US plants?

Yesterday, Peter Shawn Taylor, a "Waterloo based Freelance writer," with quite a resume, has written a piece on Ledco, CAW Kills Jobs, Then Demands Severance, and the unions involvement. Taylor makes a few interesting comments:

The union then picketed the empty building for a while. CAW head Buzz Hargrove dropped by once to blame the factory owners and Ottawa. The CAW's most recent gambit is to demand that Ford, Chrysler and GM ante up for Ledco's missing severance. This is based on the heretofore unknown financial insight that companies have an "obligation" to cover the payrolls of firms they do business with. Of course none of this makes any practical sense.

The real point of the CAW riding off madly in all directions -- casting blame, flexing flaccid muscles and taking nonsensical actions --is to distract everyone from the fact that the demise of the Ledco workers' jobs was a strategic decision on the part of the CAW itself. In short, they were expendable.

He's right too. In order to prove to the big three that the CAW is serious about no concessions, they had to let Ledco die. Taylor then points out the CAW position on concessions

It's worth consider the wording of the CAW's no-concession statement: "We will not cut our wages, pensions, and benefits. That will never save our industry; at absolute most, it slightly defers the inevitable."

While Taylor considers this a fatalistic view, I had a different thought. If the above is true, would it not also be true for government bail outs? Especially when you consider a one time bail out of half a billion dollars would be about one years (give or take a hundred or so million) payroll at a big three assembly plant. In other words, Paul Martin's $200M to GM Oshawa would have equally been saved by now had the union gave a 30% wage concession.

The material point, however, is that an apocalyptic showdown is coming this fall, the big three vs. the CAW. The big three have US concessions from last year in their pocket that may make Canada the most expensive place in the world to build cars. The CAW has it's stubborn refusal to save Ledco as proof, that concessions are off the table. If you think the Ontario's manufacturing has been in trouble up to now, a storm is coming to the Canadian auto industry this fall that will determine the future of the industry in Canada.