Biden and the UAW Strike
Biden and UAW are currently the most talked about story in all news outlets because UAW is striking at three Detroit Auto Makers. Since his election, President Biden has sought to portray himself as a champion of unions. To have any chance to win the next election or keep his position as president, he needs the support of the unions. The Democrat Party as a group needs unions’ financial support for the next election cycle.
Biden and the Democrat Party have bet the outcome of their next election on the unions supporting them, and they have used the passage of the Inflation Reduction Act to prove that they are pro-union. This act pumps trillions of dollar in incentives to the growth of green power. The Democrats and President Biden have shown the amount of money that is being spent on incentives for electric vehicles and are using this to prove their commitment to helping unions grow. Biden and Democrats have flooded the media with messages of support for the UAW’s strike against the Detroit automakers. Unfortunately, some wrinkles could undermine this united front.
The UAW has chosen this contract to try and recoup all of the concessions they made to automakers when they were forced to declare bankruptcy. The automakers are afraid of being able compete in the EV market with demands like a 40% wage increase, restoration of pensions to all, removal of employee tiers and full healthcare for everyone. These demands may hinder the Detroit automakers’ efforts to switch to EVs by raising their costs. Tesla, which is the leader on the market for EVs, has lowered its prices while still being able to make profits. Detroit automakers are making record profits but the switch from a conventional production to EVs will require hundreds of billions in investment.
Second, there’s a problem when it comes to the results of the Inflation Reduction Act in the production and sale of EVs from the Detroit automakers. The majority of money from the Inflation Reduction Act, which is given to automakers by the government, is invested in new assembly and battery plants in non-unionized red states in the south. The UAW knows where and how these funds are spent, and is using the strike to try to minimize any financial losses that their members may have to suffer. The Democrat Party is also becoming uneasy about the outcome of this strike and who is getting the money. They are worried that they may not receive the union support in the next elections they had hoped for. To have any chance of winning the next election, they need to win Michigan.
If this strike continues for a prolonged period, it may become a liability to Biden, Democrats, and UAW. A long strike can hurt businesses like bars, restaurants and other small businesses that are not directly related to automobiles. The United States may soon be in a recession, as the Fed is trying to reduce inflation by increasing interest rates. This is already slowing the economy down. Biden and Democrats do not need an economy in recession during an electoral year.
It seems like all is not right for President Biden or the Democrats. Their best laid plans may work against them, and they could suffer a major defeat in the upcoming elections. Only time will tell what happens. The future is a bit cloudy.