Reuther Retreats

For the first time in his twelve years as president of the United Auto Workers, Walter Reuther took a licking. With auto-industry contracts due to expire this week, Reuther last week jettisoned his key demand--for profit sharing. He issued a face-saving statement that profit sharing "was never a demand, but a mechanism for giving the stockholders, consumers, workers and managers their just equities.'' This fooled no one. Behind closed doors Reuther himself had told unionists that they must cut their demands, take "a more realistic" approach to bargaining. He decided to drive for a 10-c- hourly wage boost (v. 7-c- offered by management) plus better unemployment benefits, sliding-scale pensions pegged to cost-of-living, and other fringe benefits.

Reason for the softening of demands was that the automakers had rallied as never before to put up a united front against the U.A.W. Furthermore, Reuther himself conceded that to strike now "would be insane" because dealers have a two-month backlog of unsold new cars. Instead, Reuther wanted to stretch out the contracts week by week, hoping to stall until the 1959 models start to roll out in September, when a strike threat might be heard more clearly.

Pressure. Last week the automakers countered by putting on more pressure for an immediate two-year extension of the current contracts. They warned that some 600,000 U.A.W. members covered by the Big Three contracts will not get their annual 2 1/2% wage boost (averaging 7-c-an hour) and cost-of-living hike (averaging 2-c-), due on June 1, unless and until the union signs a contract. In the past, whenever the U.A.W. won a raise, the companies also raised nonunion and salaried employees the same amount. This week the Big Three automakers gave 2 1/2% wage boosts and cost-of-living hikes to their 173,000 nonunion and salaried employees. It was a strong hint that the U.A.W. can expect little more.

If the unionists persist in working without a contract, the companies can exert more pressure. They can stop deducting union dues from employees' paychecks, and they can refuse to pay union stewards who now work in plants and handle grievances, etc. The union let it be known that if no contract is signed, the U.A.W. will not be responsible for any scattered stoppages or slowdowns by workers. In turn, the companies let it be known that if unionists try such harassing tactics, the plants will be closed down.

Settlement? Detroit dopesters expect that the U.A.W. will settle soon for very close to what management offered originally--the extension of current contracts --plus a few face-saving fringes, such as higher and longer supplemental unemployment benefits. Auto workers would get something more than a 9-c- package v. the 35-c--to-45-c- package that Reuther originally demanded. Such a settlement would be considerable, considering the slump, but less than Reuther has signed for in the past. To date, his most modest settlement was an 11-c- boost in 1948.

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