Would Michigan Have Been Better Off if the Sit-Down Strike had Failed?

On Feb. 11, 1937, the United Auto Workers and General Motors signed a one-page contract that recognized the UAW as the representative of those workers who had joined the union. That minimalist contract was the fruit of a titanic struggle in which UAW supporters physically occupied GM’s Fisher #1 plant in Flint, preventing the company from bringing in replacement workers and crippling the automaker. This was the famous “sit-down strike,” the turning point that made the UAW an industry-wide force.

The sit-down strike was the stuff of legend. The workers’ commitment to the union cannot be denied and the boldness of the UAW’s leadership stands in stark contrast to the sniveling posture of today’s UAW officials. It is undeniable that the union establishment in general — and the UAW in particular — have lost the confidence of most workers, which is why they must resort to card-checks and neutrality agreements with employers and quickie elections. The unions tend to lose too many fair elections.

But as union officials reminisce about the glory days when workers really believed in their movement, it should be noted that GM could have reneged on that contract the very next day. The “contract” was signed under duress. Strikers had taken over GM property. The government either could not or would not remove them, but they had no legal right to remain there. The company would have been well within its rights to tear the thing up as soon as the strikers had gone home, fire the ringleaders, and dock the rest for lost time and damage to the plant.

And Detroit might very well be better off today if GM had done just that.

It is common to attribute the prosperity of Detroit and its auto industry (of which Flint was a major satellite) during its glory days to the UAW, but we now know those glory days would come to an awful end. It didn’t have to end like that. Automobiles were, and still are, a high value-added business. A typical car has hundreds of parts and with optional items like heated seats and navigation systems a single model can have dozens of variations. The technical challenge of coordinating the production of such complex machines is enormous, but the profits to be made from mass producing vehicles are also enormous. Cars have evolved a lot since 1937 but the basic demand for them is as strong as ever. Detroit’s collapse didn’t occur because something came along that made Detroit’s products obsolete. It came because someone else figured out how to do Detroit’s business, and then they got better at it than Detroit was. And Detroit was too proud, or too stubborn — or maybe too thoroughly hamstrung by a militant union — to recognize the challenge and adapt.

It was almost inevitable that Detroit’s automobile industry would be unionized. The Wagner Act gave unions tremendous advantages that held throughout the 1940s and 50s. It’s unlikely that any of the automakers could have held out forever. But the union that stepped into Detroit’s auto plants would have been a different one. Its organizing successes would have been achieved under the rule of law, and without a massive violation of property rights. A different history might have produced a different mindset, a bit less resentful of the companies that employed their workers, and a bit more mindful of the rights of others.

That union, created under law and less prone to treat employers with contempt, would probably have better understood the true nature of the challenge presented by imported vehicles in the 1970s. With a better appreciation of property rights and the workings of a free economy, they would have reacted to the new competition from Japanese and German automakers with less hostility and more pragmatism. Rather than act offended by the presence of foreign automobiles, as if Detroit and the UAW had some sort of divine right to control the automobile trade (much like the union claimed to have a right to occupy an auto plant), they would have been more likely to allow the automakers to compete with the foreigners on design, quality and price. Work rules would have been reviewed, and wages and benefits could have held steady, until market share stabilized.

As it was, high labor costs forced Detroit’s executives, engineers and designers to cut corners on materials and design. Quality suffered, alienating customers and creating an opening for foreign automakers that hadn’t existed before. Foreign automakers concentrated on low-cost cars — with high labor costs Detroit was at an especially sharp disadvantage there — and built up their own brand loyalty among drivers. Now Nissan and Volkswagen and Honda are every bit as established here as GM, Ford and Chrysler. And a lot of UAW members lost work in the process.

Would Detroit have fared better with a less radical UAW? Very likely, yes. Admittedly, there’s a lot of speculation involved, but there is no speculation in saying that Detroit has fallen hard. The men and women who took over Fisher #1 deserve credit for their courage, but any history of the sit-down strike must acknowledge the eventual fate of Detroit’s auto industry, and the part that the union that was born in that strike played in eventually bringing Detroit down.

The UAW has not been an unalloyed blessing for autoworkers and the sit-down strike was not necessarily the great victory for working men and women that it has been proclaimed to be.

#####

Paul Kersey is director of labor policy at the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Mich. Permission to reprint in whole or in part is hereby granted, provided that the author and the Center are properly cited.