The United States economy is undergoing a profound transformation. As we saw in the previous chapter, rapid penetration of the domestic US market by overseas producers and concomitant unanticipated reconfiguration of product markets have left many domestic producers significantly under-capitalized, and many sectors, industries, and firms in decline. These factors have drastically affected the livelihood of many thousands of workers and their communities. Corporate restructuring programs have begun rationing the remaining jobs amongst existing facilities on the basis of labor costs, labor productivity, and union cooperativeness. Some corporations like Mack Trucks have unilaterally instituted restructuring plans. But there are others which have deliberately involved their unions in the process of job rationing.

This chapter considers an instance of cooperative job rationing, and advances three related arguments. First, it is suggested that cooperative restructuring programs can pose fundamental threats to the internal political coherence of unions. Second, it is also suggested that because of the democratic imperatives faced by unions, community loyalties may fragment union solidarity. And third, cooperative restructuring programs threaten the very future of unions as institutions. The chapter is based on a case study involving United Auto Workers Local unions 12 (Toledo), 72 (Kenosha), and 75 (Milwaukee), the UAW International, and the American Motors Corporation (AMC) and its Jeep Division located in Toledo, Ohio. The dispute concerned the implementation of an Employee Investment Plan (EIP) and Preferential Hiring and Corporate Seniority (PHCS) program involving the three UAW Locals over the period 1978 to 1986.