Auto workers decry "attack on middle class"

WARREN, Michigan (Reuters) - About 200 workers and a few local politicians gathered in this Detroit suburb on Tuesday to protest wage cuts and other concessions demanded by the Bush administration's bailout for the struggling U.S. auto industry.

"The call for wage cuts is an attack on the middle class," said Rex Lux, a truck driver at Chrysler LLC who had come to the rally to show his support for organized labor. "The middle class send their kids to college, they buy cars and they keep the American economy going.

"Why break the middle class?" he asked.

The $17.4 billion federal bailout for U.S. automakers announced in December included required labor concessions.

General Motors Corp M and Chrysler -- controlled by private equity firm Cerberus Capital Management LP -- have received $4 billion each from the U.S. Treasury and GM has been promised another $9.4 billion.

Under the loans' terms, for example, GM has until the end of 2009 to get the United Auto Workers union to accept hourly wage costs and work rules competitive with the non-union plants in the United States run by Toyota, Honda and Nissan.

The UAW must also take half of the $21 billion that has been pledged by GM for retiree health care in stock in the restructured automaker, not cash. Further job cuts and plant closures are also expected.

Warren Mayor James Fouts told the protesters gathered in the City Hall's atrium that GM and Chrysler are the city's top taxpayers and account for 15 percent of his budget.

"If anything happens to their operations here, that will put public safety at risk," he said. "We cannot afford to have that happen."

Workers held hand-painted signs reading: 'Proud to be Union' and 'Cutting wages won't solve Detroit 3's crisis' as they cheered the mayor.

Many said the imposed conditions on the auto bailout were unfair especially compared with the $700 billion bailout deal the financial sector received.

"The auto companies got a raw deal," said Robert Pittman, a retired unionized city worker. "There were no questions about wage cuts or stipulations when Congress gave the banks money."

There was also fear over how many jobs will be lost as the Detroit Big 3 restructure their operations.

"A lot of people here are afraid they won't have a job a month from now or a year from now," Steve Waskul, a worker at the Dodge Truck plant in Warren, said.

But most of all there was anger in the crowd over the required wage cuts.

"I'm here to support a living wage for a good day's work," said Matthew Krol, who lost his job at Chrysler's Detroit axle plant on December 16. "The cost of necessities like that is not going down, but they want us to take wage cuts? How is that right?"

Some in the crowd said their best hope now lies in President-elect Barack Obama, who takes office Jan 20.

"I think Obama will take a look at Detroit and he'll help us," said Lux, the truck driver at Chrysler. "But he's going to have his work cut out for him."

(Editing by Peter Bohan and Leslie Gevirtz)