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Now, wages in the automobile industry are made up of two components, what we call base rates and the cost of living factor which is fed in by the operation of the escalator.
Leonard Woodcock
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I might say that when the settlement was made the Nixon administration issued what they called a second inflation alert in which the General Motors settlement was branded as being inflationary and bad for the country.
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At the end of 1964, wholesale prices had been relatively stable for some years.
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And so we said to General Motors that the solution had to be a first year increase, which had to be sizeable because we bad to catch up with the lost position as against the cost of living and we had to make some progress.
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