Quick Hit Progress Illinois Tuesday August 7th, 2012, 5:26pm

Op-Ed: The Caterpillar Strike And The Middle Class

The following is written by Ron Kurowski of the South Suburban MoveOn Council.

It is not unusual for a company if it is in financial distress, faced with outrageous demands or is unable to compete in a tough economy to play hard-ball during contract negotiations with a union. However none of these apply to the strike by Local 851 of the International Association of Machinists at Caterpillar’s hydraulic manufacturing plant in Channahon, IL. That is what makes this work-stoppage so troubling.

Caterpillar is a very profitable company. It reported second-quarter profits of $1.7 billion, up 67 percent from a year earlier; a year in which Caterpillar earned $4.7 billion in profits. Despite its profitability and the fact that Caterpillar workers had their wages frozen during the previous six-year contract, the company is demanding the wage freeze be extended for its 780 union members for six more years, that workers pay a greater share of health care costs and that major changes be made to the seniority provision in the contract.

Caterpillar instituted a two-tier wage system in the previous six-year contract with some employees starting as low as $12 per hour. With wages frozen and with new workers replacing senior workers as they retire the Channahon plant will eventually be manned by workers whose average wage is slightly over the poverty line for a family of four.

In contrast, all the union is asking for is a cost of living increase each year of the contract.

What is happening in Caterpillar’s Channahon plant is a microcosm of what has been happening to the middle class over the last thirty years. Stagnant wages, soaring health care costs, loss of pensions and other benefits, attacks on unions and the continuing outsourcing of jobs overseas are occurring at the very same time productivity per worker has soared and company profits are at record heights. Simply put, workers no longer are sharing in the benefits of their increased productivity.

With consumer spending accounting for 60% to 70% of GDP the continuing assault on the middle class is not only devastating to the individual, but also to the economy on a national and local level. Every dollar earned but denied to a worker is one less dollar that gets back into the economy. It is one less dollar the worker has with which to buy a new car or flat screen TV, or to pay for his children’s education and more and more frequently one less dollar to feed his family. That dollar denied the worker does nothing to help the economy if it sits in the coffers of corporations who currently hold over two trillion dollars in cash.

The one constant that held for generations of middle class Americans was the unshakable belief that if you worked hard and played by the rules your life would be better than your parents and that your children would have a better life than you. And for generations this was generally true. That fundamental belief that the American Dream works for everyone is now being shredded by the reality of our national economic condition.

A food drive to support Caterpillar workers will be held on Saturday, August 11 between 10 a.m. and 3 p.m. in the parking lot of the Universalist Unitarian Church at 3401 W. Jefferson St. in Joliet, IL.

Food may also be dropped off for the duration of the strike Monday through Friday, 9:00 a.m. to 4:30 p.m. at Teamsters Local 710, 9000 W. 187th St. Mokena, Il.

The food drive is sponsored by Friends of Cat Workers, the South Suburban MoveOn Council, Universalist Unitarian Church and Teamsters Local 701.

Image: AP Photo/The Herald-News, Matthew Grotto

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