Detroit News

Union-made EV tax rebate could erode worker freedom

Published in The Detroit News
September 28, 2021
by F. Vincent Vernuccio
Mackinac Center for Public Policy and Institute for the American Worker
Efforts to discriminate against nonunion workers and companies is on full display in congressional Democrats’ $3.5 trillion spending package, released earlier in September.

The draft House spending package includes several handouts to labor leaders. Key among them is a proposal to reward union politics by giving union members a $250 tax deduction. By contrast, those who leave the union, but are still forced to pay in states without right-to-work protections, would not get this deduction. Other provisions could force companies to side with unions over their workers in order to keep a new financial incentive for electric vehicles.
This month, Rep. Dan Kildee, D-Flint, introduced an amendment to the spending package to give a $4,500 incentive for EVs that are assembled at a factory “under a collective bargaining agreement negotiated by” a union.

The goal of the incentive is not just to give more money to unionized worksites. It’s also to provide a carrot to those nonunion auto companies so they will let unions come in and organize their workforce. The stick, meanwhile, comes if they do not comply: Their cars would effectively be $4,500 more expensive than those made at a union facility.

The provisions will force nonunion companies to choose between protecting their employees from union coercion or being at a competitive disadvantage.

On its face, it is easy to say that the rebate for union-made electric vehicles is about rewarding companies that have union contracts and punishing companies that do not. And that is a major part of it.

In negotiating the proposal, Michigan Sen. Debbie Stabenow told The Detroit News that the automakers and UAW “were on speed dial” with members of Congress.

In addition to favoring unionized companies and rewarding electric vehicles, the incentive is also about punishing and discriminating against workers who have said no to unions.

Calling the union language “blatantly biased,” Toyota executives wrote to the Ways and Means Committee that the “draft makes the objective of accelerating the deployment of electrified vehicles secondary by discriminating against American autoworkers based on their choice not to unionize.”

Further, it is about strong-arming companies to take away certain protections from their employees and allowing unions to pressure them into having a union shop.

The United Auto Workers, which would likely be the primary beneficiary of this provision, and other unions want companies to grease the wheels for them by signing neutrality agreements.

These agreements take away employee protections and allow unions to strong-arm workers during organizing campaigns. They take away employees’ right to a secret ballot in union elections, letting unions instead organize through a process called card check, which leave workers vulnerable to intimidation.

To make the intimidation easier, companies under a neutrality agreement generally give unions personal information on their employees, including home addresses and cellphone numbers.

This is what the union EV incentive is about: It is about allowing unions to intimidate and coerce employees at home into signing a card, bypassing the secret ballot. In states without right-to-work protections, it means forcing workers to pay up.

Nonunion autoworkers have repeatedly said no to union organizers from the scandal-plagued UAW for years. The UAW has engaged in sophisticated public relations campaigns to harm employers and drive customers away from nonunion targets, as a way to get them to sign neutrality agreements. That tactic has largely failed, so union backers in Congress (who have the UAW “on speed dial”) are introducing discriminatory legislation to put these companies at a competitive disadvantage.

This is not about a “Michigan bonus,” as Stabenow has called the $4,500 credit. It is about the UAW organizing nonunion car manufacturers such as Tesla and Toyota, which make cars in the United States.

Nonunion companies have stood strong against union demands for neutrality agreements, thus protecting their employees’ right to a meaningful choice in whether to unionize. But the more that government puts its thumb on the scales, the harder it will be for companies to say no and continue protecting their workers from unions that are riddled with corruption, such as the UAW.

F. Vincent Vernuccio is a strategic adviser at the Mackinac Center for Public Policy and president of Institute for the American Worker.