“Let’s be clear, no one wants a strike. Say it again. No one wants a strike,” President Biden said in his first remarks on the United Auto Workers (UAW) strike against the Big 3 auto manufacturers.
“But I respect the workers’ right,” Biden said, “to use their options on in the collective bargaining system, and I understand the workers’ frustration.”
Biden also named a large factor in that frustration — the inequality of the profit distribution — saying workers deserve a “fair share of the benefits they help create for an enterprise.”
The battle is often pitched as binary — workers versus executives — with top auto industry brass like GM CEO Mary Barra reportedly earning a 2022 salary of $34 million after earning $62 million in 2021.
But there is an important third party involved and it’s not executives but ownership. In the modern economy, ownership of large multinationals like the Big 3 resides on Wall Street. And the Street likes stock buybacks, which create greater scarcity of shares and thereby increase share value. Stock buybacks essentially redistribute cash to ownership, a role more traditionally filled by dividends.
[NOTE: GM is owned by 80.68% institutional shareholders, 13.02% General Motors Co insiders, and 6.30% retail investors according to Wall Street Zen.]
U.S. Congressman Ted Lieu (D-CA) amplified this point today, sharing a vituperative UAW post decrying Chrysler-owner Stellantis for “executing ANOTHER $500 million on stock buybacks” right before the UAW contract deadline. “I stand with @UAW,” Lieu wrote.
The $500 million buyback is an in-your-face move, as the workers portray it, but one they are trying to use to their advantage in negotiations and in winning public opinion. If the redistribution of $500 million can be easily accomplished, they claim, then the companies’ dire predictions of financial peril in the event of a too-generous worker package looks less authentic.