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- AYBE we're selfish, but
we in Oshawa figure we
are getting a hosing from

this free trade agreement in

auto,” Bill Harding, an executive
member of Local 222 of the

United Automobile ‘Workers,
told me. _

The “hosing” to which Hard-
ing refers is the cut-back in pro-
duction and the transfer of
Several models produced in
Oshawa to the General Motors

assembly plants in the United
States,

Last year GM set a production
figure of 87 cars per hour
‘n Oshawa and it produced
18 cars a day in Ste. Therese,
Quebec. This year it has an-
nounced plans to cut back to 67
Cars a shift in Oshawa and to
double its production at Ste.
Therese by adding another shift.
Overall, even assuming that the
auto market holds up as strong
as the company estimates, Gen-
eral Motors production in Can-
ada this year will decline.

This decline has meant large
Scale layoffs in Oshawa. The
Present recall date for workers
80es back now to Dec. 16, 1963,
Which means that about 3,000
Workers have not been recalled.

But the GM's decision to
transfer a portion of its produc-
tion to the USS. has wider re-
Percussions than the dramatic
layoff of “3,000 workers in
Oshawa. There is already shap-
ng up a pattern of layoffs in
feeder Plants directly connected
with GM, such as McKinnon
Industries in St. Catharines and
Windsor, with about 17,000 lay-
Offs, and other layoffs in smal-
ler feeder plants.

Aside from the stark evidence
in Oshawa or St. Catharines of
the detrimental effects of the
auto pact on the Canadian indus-
try, the very complex facets of
the industry itself, the high
Sounding and incomprehensible
arrangements of the pact as well
as the boom conditions which

ave existed, quite indepen-
dently of the pact. in the indus-
try over the past few years, all
Contribute to make the auto pact
a hard target to hit.

The difficulty of the problem
Is increased because the indus-
try was in serious trouble be-
fore the pact came into effect.

In a brief presented to the
Canadian government in 1960,
the Automotive Parts Manufac-
turers Association described the
PClitical pressures to remove or
reduce tariffs on the import of
Parts and vehicles which date
back almost to the beginnings
Of the industry. The complicated
Set of tariffs which evolved dur-
Ing the 1920’s and 1930's, as well
as the percentages of Canadian
Content required, developed out
Of the existence of the preferen-
tial tariff enjoyed by Canadian
Manufacturers in the British

LAYOFFS IN AUTO |

and the

-U.S.-CANADA PACT

By RAE MURPHY

Empire, which made it profitable
for American auto manufac-
turers to develop the industry in
Canada.

But the pressure was main-
tained for a reduction in tariffs
and for free trade between Can-
ada and the U.S. This pressure
increased after the war as the
door to Europe was flung wide
open for the American monopo-
lies and the Canadian tariff
dodge became less and less
relevant.

As the domestic market ex-
panded in the post-war period
so, to a point, did the industry
expand in Canada. This was ac-
companied by a striking increase
in the importation of both parts
and finished vehicles, mainly

from the United States..A large
share of the Canadian market ©

was also captured by European
imports. The American monopo-
lies answered this by expanding

their European ‘holdings and
marketing their products in
Canada.

Generalizing on this trend, the
brief of the auto parts associa-
tion stated: :

“The result of all these events
is that since 1936, particularly
since the end of World War
II, the market for automobiles
in Canada has steadily increased
but Canadian production of vehi-
cles has not increased propor-
tionately, and the percentage of
Canadian parts used in vehicles
made in Canada has steadily
declined.” )

The relative decline of the
Canadian auto industry is docu-
mented by the following figures:
In 1956 Canadian production
amounted to 83.5 percent of the
domestic market and imports
accounted for 16.5 _ percent.
Three years later in 1959, the
Canadian share of the domestic
market fell to 68 percent, and
imports accounted for 32 pzr-
cent of the market.

This decline in domestic pro-
duction had widespread implica-
tions for the whole economy,
besides stunting the auto indus-
try by the elimination of thou-

' nomous

>

sands of jobs. The brief antici-
pated that, given the continued
decline of the Canadian share of
the market, 25,000 jobs will have
been lost in this one industry.

The increasing importation of
auto. components and vehicles
created a drastic balance of pay-
ments deficit between Cahada
and the United States. Accord-
ing to C. M. Drury, minister of
industry, “In recent years, trade
in vehicles and components has
resulted in an annual deficit with
the U.S. of the magnitude of
$600,000,000.”

In this context the auto pact
was a political solution in 1964
to the basic question of Cana-
dian life, which is as old as the
country itself: to be or not to
be? Before the pact was de-
veloped, the Automotive Parts

Manufacturing Association

placed the question this way:

“We have in fact run the full
circle. We are back at the criti-
cal stage reached in 1926.”

By agreeing to tke auto pact,

Canada took a giant step toward
total economic integration with
the USA. In effect our govern-
ment opted for the “not to be”
side of the question.

The political significance of
the pact was summarized in tes-
timony to the House Ways and
Means Committee of the U.S.

‘Congress by the then Undersec-

retary of State Thomas Mann
who said: “Canada has laid
aside the alternative of an auto-
automotive industry,
and has joined with us to create
a rationalized and integrated
North American automotive in-
dustry.” :

This is really the guts of the
issue, and no matter how one
may rationalize, we have lost all
control over a vital aspect of ou
national economy. : ;

How well has the auto pact
worked, and in whose interests?

Any answer to this question
would have to be incomplete,
mainly because the pact came
into existence during a period of
unprecedénted boom in the eco-

nomy and there is a welter of
Statistics which can form the
basis of contradictory argu-
ments,

Appearing before the U-S.
Congressional Ways and Means
Committee in April 1965, Secre-
tary of Commerce John T. Con-
ner estimated that U.S. produc-
tion would increase over the
next three years by $3 billion
while Canadian production
would rise by . $500,000,000,
a six-to-one advantage in favor
of the United States. Conner
went on to stress that the Ame-
rican government will press
strongly in 1968, when the pact
comes up for renewal, for the
elimination of the conditions
and restrictions presently incor-
porated in the pact.

This can only mean that the
restrictions which give a degree
of protection to the parts indus-
try in Canada at present will be
eliminated and allow for the
complete consolidation of the

‘industry into the clutches of the

giants.

Conner’s estimates of the re-
sults of the pact seem to be
borne out in the balance of. pay-
ments deficits incurred by Can-
ada. Our deficit with the US.
over the first six months of 1966
was $261.8 million. This is sup-

posed to be a major reduction
due to the existence of the pact,
and the comparison figure used
$354.8 million deficit in the cor-
responding period of 1965. The
only problem with this compari-
son is that Canada had already
entered the pact in 1964. The
point is that our deficit with the
U.S. shot up dramatically during
the first period of the auto pact,
in fact it went up by $33,800,000
in the first five months of the
pact, and if one were to add the
total deficit over the whole exis-
tence of the pact and compare
it with an equal period before
the pact was. signed, the figure
would probably show a different
story. :

The Canadian government has
also released figures which show
that employment in auto in-
creased by an estimated 7,000
over the past year. If one were
to accept this figure at face
value, which is difficult in view
of the layoffs reported in the
industry, it would appear to be
a small enough growth of em-
ployment considering the record-
smashing production year.

One can easily get lost in
figures and statistics, and it is
well to remember that a compli-

_Cated deal such as the auto pact

involves not only the short-term
effects but also long-range eco-
nomic development. It may hold
up for-a year or two, but the

‘chickens will eventually come

home to roost.

The issue involved is not empty
national pride or flag-waving,
but jobs and markets — the
thousands of jobs that have been
lost because our auto industry’
was placed in the hands of
foreign monopolies, and the
thousands more that will be lost —
because we have codified this
into a permanent economic rela-
tionship with our giant neighbor.

A former French king who in
his own way was fond of short
term solutions, coined the ex-
pression “apres moi le deluge.”
If you look over Oshawa way
you'll find it raining already, '

ers’ rights:

to other jobs. _

UAW DEMANDS

In wake of the layoffs, UAW Local 222 has advanced
these demands on the Canadian

_() Improve the Transitional Assistance Benefit program,
to compensate laid-off workers fully for loss of income and
to make manpower mobility grants to assist workers moving

(2) Obtain industry’s agreement to give preferential hiring
rights to laid off workers before filing vacancies with work-
ers hired from outside the industry.

(3) Cooperation with the provincial government to set
up special training and retraining programs for laid off work:
ers and the establishment of a training centre in Oshawa.

(4) A re-examination of the auto pact.

(5) Legislation requiring companies to show cause before
a public tribunal before being permitted to lay off workers.

government to protect work-

ovember
pe

Le iy

4, 1966—PACIFIC TRIBUNE—Page .
tint & car

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