Never mind the pro hockey strike. That`s only a game.
There`s a lot more at stake-a whole lot more-in Peoria now that things have turned ugly between Caterpillar Inc. and the United Auto Workers.
Right there in River City, an Illinois town famous for being average, they`re fighting over nothing less than America`s industrial future.
This is no squabble over who gets the rights to bubble gum cards. You don`t have to be a union man or a corporate type to take an interest in the Cat strike. The outcome will affect all of us sooner or later.
The circumstances are complex, but the essential question comes down to:
What`s a national labor union to do in an industrial world gone global?
Judging by what the UAW has done so far, its answer is ”proceed as usual.” In other words, press the company for maximum wages and benefits regardless of what it does to Cat`s competitive position in the international market for heavy equipment. Whether Cat makes money is Cat`s problem, the union seems to be saying.
Judging by what Cat has done, its answer is to take advantage of today`s neo-Reagan, anti-union political climate and push the UAW to the wall. Return to work by Monday morning, Cat snarls, or your jobs will be taken by non-union workers. Stay away and you will be replaced-like the federal air traffic controllers, the bus drivers at Greyhound and the printers at the Tribune.
This is major-league hardball by both sides. It is also a self-defeating strategy for both, and more proof, if any were needed, that our country`s spit-in-your-face style of labor relations has got to go.
There must be a better way-something besides strikes, picket lines and the threat of scab labor-to get management and labor talking about some of the larger issues. There has to be a better forum-be it arbitration, mediation or a psychiatrist`s couch-for the two sides to confront the new realities of work in America.
Surely there are larger issues than whether the UAW ought to accept the 13 percent, three-year raise offered by Cat, or try for a bigger raise on the current average of $17 an hour.
The UAW hasn`t made public what it wants. But it has signaled that it won`t accept Cat`s demand for a two-tier wage scale in which newly hired warehouse and parts clerks will make less than assembly line workers. No two- tier system was allowed in the deal signed last fall with Deere & Co., and the UAW`s chieftains in Detroit want all contracts to be alike, whether the company on the other side of the table makes riding mowers or Cadillacs.
This brings us to large issue No. 1: No two industries` companies are alike. What works for Deere or General Motors might not work for Cat, and vice versa. Deere and GM sell primarily to the domestic market. But over the last 10 years Cat has turned itself into the largest provider of heavy equipment for the world, with 60 percent of its sales overseas.
Cat has been going toe-to-toe with Komatsu, Kawasaki, Fiat and Volvo. And it has been winning, which is more than can be said for GM and many other UAW employers. So many U.S. manufacturers have been losing at the export game that the autoworkers` union lost more than a third of its membership in the 1980s. The same could happen to Cat, Illinois` largest industrial employer, if the UAW squeezes too hard on the neck of the goose that lays what few golden eggs are to be found in Peoria.
Which brings us to large issue No. 2: This goose could fly away. Caterpillar already owns plants in Australia, Belgium, Brazil, France, Mexico and the United Kingdom. It has a majority interest in plants in Italy and Indonesia and production affiliates in India and Japan. More than two-thirds of the company`s 53,000 workers remain in the U.S., but the company is positioned to shift more jobs overseas if the UAW makes unreasonable demands. And that brings us to large issue No. 3: What is a reasonable demand in a global economy?
Was it reasonable for Cat`s board to pay Chairman Donald V. Fites $522,500 last year, plus stock options, though the company lost $404 million under his direction? Fites` compensation package is modest compared with the seven-figure salaries and perks commanded by the execs who run United Airlines, Time Warner and Coca-Cola. But his pay dwarfs that received by most CEOs in Japan, where Cat`s strongest competitors operate.
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Is it reasonable, on the other hand, to pay a Cat assembly worker with no advanced skill or educational degree $47,000 a year with overtime? Or not to require that worker to pay a dime toward his or her health insurance premium? Maybe it is . . . if that worker is productive enough. Cat workers, it must be pointed out, are among the most productive in the world. The problem is maintaining that wage/productivity advantage when millions of Third World laborers are willing to work longer hours at a fraction of UAW scale.
No, the growing ugliness in River City is no sports section dustup between millionaire hockey team owners and pampered pro athletes.
How the Cat strike gets resolved may determine the course of labor relations in America. And that could determine whether America has an industrial future.