Some left-leaning commentators are celebrating the UAW’s apparent victory over GM, Ford, and Stellantis. This could be the beginning of a shift in power away from large corporations and towards working people, and the beginning of the end for the dollar store economy, right?
The pandemic should warn us that there are other possibilities, including the following:
- The companies protect their profits by jacking up prices, and consumers pay them. Increased inflation is the result.
- The companies jack up prices, but consumers refuse to pay them, and buy cars built with non-union labor. Profits fall, layoffs ensue, and the companies don’t have the funds to facilitate the change to electric vehicles. Tesla and the Japanese car companies are the big winners here.
- The companies don’t jack up prices, profits fall, and there is no money left for the conversion to electric vehicles. The pace of the conversion slows as the companies beg for relief from government timetables.
None of these is a victory for working people or the nation as a whole. History tells us that only government action, typically in a massive crisis, causes major redistributions of wealth. A few union victories aren’t going to do the trick.