USW

A Job Creation Saga

Leo Gerard — Tue, 10 Jul 2012 08:03:30 -0400

The United Steelworkers would not take “shut” for an answer.

Steelworkers demonstrated, petitioned, held press conferences, conducted candlelight vigils, demanded studies, pestered lawmakers, organized meetings and ultimately helped save about 1,200 good-paying refinery jobs, create 1,000 construction jobs and produce 200 new permanent jobs.

Those jobs are at two of three Philadelphia refineries given death sentences last fall. The Steelworkers sought reprieves for all three. The score so far: two preserved, one more to save.

In a conference call last week to announce that a joint venture between Sunoco and The Carlyle Group would preserve and expand the largest of the three refineries, officials acknowledged the Steelworkers’ efforts as crucial to the deal. It’s hard for Fox-News-watching-Tea-Party-saluting-rabid-right-wingers to hear that a union is a job creator. Especially when those words come from the mouths of CEOs and private equity partners. But that’s what they said. And that’s what actually happened.

This saga started sadly last fall. ConocoPhillips and Sunoco announced they would close their three Eastern Pennsylvania refineries – Marcus Hook, Philadelphia and Trainer. Processing expensive light, sweet crude oil, the three were losing money.

ConocoPhillips closed Trainer in September. Sunoco closed Marcus Hook in December. And Sunoco said it would shut the Philadelphia refinery if a buyer weren’t found by July. That would be a total of 2,200 workers out of jobs at the three plants, 1,200 of them represented by the USW. The Steelworkers refused to accept that as inevitable.

The union launched what would become a massive campaign to save the three refineries. Steelworkers enlisted support from lawmakers who initially weren’t paying attention. This included Pennsylvania Gov. Tom Corbett, whose mansion was the site of a USW candlelight vigil; congressional representatives, subjected to relentless USW phone calls, and the White House, whose top economic advisor heard Steelworker pleas.

The USW contention that loss of the refineries was too economically devastating to ignore got empirical support from the Pennsylvania Center for Workforce Information and Analysis. It calculated that if the three refineries closed, job losses could reach 36,000 and cities, school districts and the state could lose $560 million in tax revenues. The U.S. Department of Energy warned that the closures could cause gasoline and fuel oil shortfalls and price spikes.

Steelworkers posted yard signs, secured a Congressional hearing, organized massive rallies at Marcus Hook and in Washington, D.C., and searched for potential buyers.

The first breakthrough occurred in March. That’s when Sunoco replaced Lynn Laverty Elsenhans, who had spent her time as CEO selling off Sunoco assets. The new CEO is Brian P. MacDonald, the son of a coal miner whose hometown was devastated by deindustrialization. He proved much more amenable to working a deal to sustain the Philadelphia refinery.

The second big breakthrough came at the end of April when ConocoPhillips announced it would sell the Trainer refinery to a company controlled by Delta Airlines. By mid-June, Delta and ConocoPhillips successor company Phillips 66 finalized the sale that would give the airline a secure domestic jet fuel source. Steelworkers began returning to their jobs at Trainer shortly afterward.

In early July, the next big breakthrough was announced. Sunoco and The Carlyle Group agreed to a joint venture called Philadelphia Energy Solutions that would continue operating the Philadelphia refinery and expand it as well. Gov. Corbett provided $25 million in state aid to support the deal. And Steelworkers overwhelmingly approved a labor agreement with the new owners that gave them the flexibility that Carlyle said they needed.

In a conference call with reporters, David M. Marchick, managing director of The Carlyle Group, praised everyone, from Republican Corbett to officials in President Obama’s office, for their help. He said the White House was relentless in making the deal work, including resolving environmental issues.

Marchick acknowledged the effort the Steelworkers put into redeeming the refinery, saying that without the USW:

“This refinery would be closing and 850 people would be out of work.”

The Steelworkers, he said:

“called and wrote and pushed and prodded about the importance of this facility to the region.”

Later, in an interview on Fox News, Jim Savage, president of the USW local at the Philadelphia refinery, noted that the Steelworkers and Carlyle have had a long, productive relationship. He said part of the reason is that Carlyle treats Steelworkers with respect and doesn’t try to gouge them at the bargaining table.

Another important reason, he said, is that Carlyle is a serious investor in U.S. manufacturing:

“Carlyle has a history of investing in businesses and growing them. They don’t come in and load you up with a bunch of debt and leave with a pocket full of money and leave devastation in their wake, which some people do. If they had come to us with something like that, we would have had a different past couple of weeks or months. They came to us with a true vision to build and grow this refinery.”

This saga has a happy ending. It defies stereotypes:

Industry can survive in the U.S.A. Unions can thrive in the U.S.A. Government can work. And private equity can do good things.

Marchick put it this way:

“What we saw in this transaction is what made this country great – cooperation among business, government and labor, Democrats and Republicans.”

Now let’s revive Marcus Hook.

Workers of the World Unite — with Shareholders

Leo Gerard — Tue, 22 May 2012 09:49:44 -0400

At Citigroup, shareholders had their say on CEO pay -- and they yelled, "No damn way!"

Concerted action by shareholders, workers and public interest groups compelled corporate change in several other cases this spring as well.

At least three CEOs resigned. Executives truncated one shareholder meeting to 12 minutes. And across America and Europe, CEOs lamented the end of automatic approval for excessive executive compensation.

A wave of corporate change is rising because the rabble and the stockholders share an interest: decent corporate governance. To shareholders, decent means more long-term corporate vision providing reasonable returns and fewer risky, quick-profit schemes benefiting only executives. To workers, the unemployed, community and environmental groups, decent means operating corporations in the best interest of the nation, including treating workers with dignity and refraining from polluting. Together, the rabble and the shareholders wield power.

They'll be exercising it inside and outside the ExxonMobil shareholder meeting next week. Some activist stockholders will seek approval of resolutions calling for the corporation to form a task force on climate change and to reduce greenhouse emissions.

Other activist shareholders, including my union, the United Steelworkers, will seek approval of a resolution calling for Rex Tillerson to give up either his CEO title or his chairmanship of the board of directors. Because corporate boards oversee executives, many experts believe holding both positions is a conflict of interest. The board, for example, determines executive pay. The ExxonMobil board gave its chairman, who also happens to the CEO, a big fat pay increase last year -- a jump from $29 million to $34.9 million.

Corporate governance and pay and the environment are important issues as well to those who will be demonstrating outside the shareholder meeting May 30 in Dallas. They are from the 99% Power coalition that includes workers, retirees, job seekers, families fighting foreclosure, students burdened by debt, immigrants and environmentalists. The coalition's goal is to demonstrate at more shareholder meetings than ever in American history to make corporations more accountable to their communities, workers and shareholders.

Steelworkers and Occupy Dallas activists worked with the 99% Power coalition to organize the protest outside the ExxonMobil meeting. USW-represented refinery and clerical workers will protest ExxonMobil's greedy and dangerous corporate behavior. This corporation, which last year gave its CEO a 20 percent pay increase, has refused for two years to approve much smaller raises for its all-female clerical staff at Baytown.

In addition, ExxonMobil, among the most profitable corporations in the world, is denying safety measures to workers the Baton Rouge refinery -- measures that it has agreed to implement at four other facilities. This refusal comes just two years after an explosion at a Tesoro refinery killed seven workers and seven years after a massive blast at BP's Texas City refinery killed 15 and injured 170.

Steelworkers have joined the 99% Power coalition in demonstrating at the Wells Fargo, Tesoro and Compass Minerals shareholder meetings and will be at Chevron next week too.

The protesters don't always get what they want. But they've succeeded in rattling some CEOs. At Tesoro, when executives realized workers who are also shareholders were in the audience, they broke tradition and refused to take questions. Then they ended the meeting in record time, just 12 minutes.

In Britain this spring, shareholder revolts against outrageous executive pay prompted the resignations of the CEOs at insurer Aviva, pharmaceutical maker AstraZeneca and publisher Trinity Mirror. At Aviva, a proposed pay raise for the CEO angered shareholders of the poorly performing company.

That's what happened at Citigroup, too. Shareholders balked when the board of directors recommended a pay increase for the CEO despite Citi racking up the worst stock price performance among large banks over a decade.

The Dodd-Frank Wall Street Reform and Consumer Protection Act, passed two years ago, provided shareholders and the 99% Power coalition with new tools. One is say-on-pay, which gives shareholders the right to vote on executive compensation packages every three years. The other is the pay gap ratio requirement, which the Securities and Exchange Commission (SEC) has failed to enforce. When the SEC does, corporations will have to determine the pay gap between an average worker and the CEO.

Neither of these protections is binding. The Citi board of directors can disregard the shareholder vote against the CEO pay package. But it probably won't because that would be ignoring the sentiments of the majority of the company's owners.

Last year, the first year for the say-on-pay votes under the new law, shareholders at three dozen companies opposed executive pay packages. That's about 2 percent of the 2,300 votes taken, but it was higher than in other countries and higher than expected. This year, with shareholders and community activists organized, more "no" votes are expected.

The pay ratio will give shareholders and workers important information. Overall, in 1980, CEO compensation averaged 42 times typical worker pay. Workers at that time received a larger share of the benefits from the companies that their labor helped to succeed. Now, CEOs make 325 times what workers do, meaning the amount workers share in success is much smaller.

Apparently, that's the kind of information CEOs don't want workers and shareholders to have since they've lobbied furiously -- and successfully -- to prevent individual corporations from having to report their pay ratios.

In the wake of Wall Street recklessness that caused economic collapse in 2008, Congress gave shareholders and citizens Dodd-Frank to help them constrain self-dealing corporate executives. The 99% Coalition and shareholders are working with those tools even as Republicans vow to take them away by repealing Dodd-Frank.

End the Delays Deadly to Workers

Leo Gerard — Tue, 24 Apr 2012 09:02:28 -0400

Wear black on Saturday. It is Workers’ Memorial Day, a time devoted to commemorating those killed on the job.

A month later, on soldiers' Memorial Day, the nation will recognize those who sacrificed their lives for American ideals, for a nation’s freedom. That ultimate gift is given in most cases valiantly and voluntarily. No one, however, volunteers to sacrifice their life for corporate profit. Every day in workplaces across this country, the lives of 12 workers are taken, not given.

The shield Congress erected in 1970 to protect workers – the Occupational Safety and Health Administration (OSHA) – is mutilated from relentless attacks by corporations and their battering ram -- the U.S. Chamber of Commerce. The delays in OSHA rule-making that corporate carping achieves cost workers their lives. Congress must intervene to restore OSHA’s power to act swiftly.

The Government Accountability Office (GAO) detailed the delays in a report issued last week titled, “Multiple Challenges Lengthen OSHA’s Standard Setting.” The GAO found it takes OSHA longer than seven years to issue a new standard. In one case, it was 19 years. And it’s getting worse. It took 70 percent longer to finalize standards in the 1990s than it did in the 1980s, and another 30 percent longer in the 2000s.

The GAO determined that this was a result of increasing demands on OSHA. These occurred as corporations sued to stop enforcement and new mandates for review of proposed rules were stacked on top of existing ones. The GAO said defenders of the delays argue that the layers of obligations balance worker protections with employer costs.

So the very corporations and Chamber of Commerce that constantly deride government red tape demand it for this special case -- to delay implementation of rules to protect workers. And this is their justification: Corporate profits trump worker lives.

There’s no doubt that the rules OSHA implements actually save lives. Members of my union, the United Steelworkers (USW), are alive today because of OSHA’s lockout/tagout rule. The GAO noted this in its report.

The lockout/tagout standard, established in 1989, requires corporations to install devices and adopt procedures that prevent workers from accidently switching on big machines while co-workers are cleaning or repairing them. The GAO wrote about this rule:

“In a 2000 review, OSHA attributed a 55 percent reduction in machinery-related fatalities at 10 steel-producing companies between 1990 and 1997 to the provisions in this standard.”

The quicker such a regulation is implemented, the more worker lives saved. But now, for OSHA, “quick” is anything less than seven years and nine months. For standards limiting exposure to some highly-toxic substances, including silica and beryllium, exposed workers have waited much longer than seven years. OSHA has been working on a silica standard for 15 years and a new beryllium standard for 12.

Beryllium is so dangerous that no safe level has ever been established. It causes a devastating lung disorder called chronic beryllium disease (CBD). It is so hazardous that office workers in factories where it’s used and family members of workers who handle it can be struck down by tiny particles carried on shoes or pant cuffs. This year, my union and Materion Brush, the only U.S. producer of pure beryllium metal, recommended a new standard that is 90 percent lower than the current limit.

That, however, followed years of obstruction by industry officials. This is typical of corporations fighting standards that will save lives but cost money. They strangle proposed standards by suing and by entangling them in red tape. The lawsuits, the GAO report says, mean OSHA must provide extraordinary levels of proof. And the suits have restrained OSHA from using its full powers to protect workers.

For example, theoretically, OSHA has authority to issue emergency temporary standards. OSHA hasn’t done that in 29 years, despite 23 requests from workers or health officials. That’s because of industry lawsuits. In the 13 years from the agency’s creation until 1984, OSHA used the authority nine times, but five of those orders were invalidated or frozen by industry lawsuits.

One of the nine was for asbestos. In 1983, OSHA issued an emergency temporary standard lowering the exposure limit for this cancer-causing material. Using mathematical projections from long-term epidemiological studies, OSHA estimated that the six-month-long emergency rule would prevent at least 80 eventual asbestos-related deaths.

The industry sued to stop implementation of the emergency standard, and a judge killed the OSHA effort. The court contended the agency’s projection was inadequate to establish grave risk. And it said if OSHA intended to use such estimates, then a new standard based on them should not be enforced until after public notice and comment.

That would delay implementation of a lower exposure standard, which, when dealing with toxic substances like asbestos and beryllium, costs lives. But industry won. And who knows how many workers suffered early deaths across the country.

Last Workers’ Memorial Day, Robert Stubblefield, 66, a member of my union, was killed on the job at Republic Special Metals in Ohio.

Over the next 12 months, 34 more Steelworkers died, one every 10 days. They made glass, tires, cement, aluminum and steel. They refined oil and mined potash, platinum and palladium. They logged forests and constructed earthmovers.

They produced the products that build North America. They should not die for that. No worker should die for a job.

Traditionally, Memorial Day is the first day of the season when women wear white -- white shoes, white purses, white hats.

On Workers Memorial Day, Saturday, April 28, wear black for the workers who perished on the job last year. Hold loved ones close and hope that the delays imposed on OSHA won’t cause for another worker’s family the suffering endured by Robert Stubblefield’s widow, five children and nine grandchildren.

American Workers: The Best Bet

Leo Gerard — Tue, 06 Mar 2012 09:35:05 -0500

Remember the fear in 2008? Think of the collapse of Bear Stearns and Lehman Brothers. Wall Street melting down. Pension savings disappearing. Housing values plunging and foreclosures skyrocketing. Three million workers losing their jobs.

It had all the makings of another Great Depression. As Barack Obama took office on Jan. 20, 2009, he faced a dilemma. In this crisis he could play it safe and hold steady on his predecessor’s path of pampering the rich and pandering to corporations, pretending that possibly, eventually, some benefit would trickle down to workers. Or President Obama could keep candidate Obama’s promises of change.

He went with change. He focused on workers, believing restoration of the nation’s great middle would drive economic recovery for all. He secured an economic stimulus package and rescued the American auto industry. Both measures worked to halt, and eventually reverse, the previous year’s relentless economic decline. Both, as well as other changes President Obama has proposed, emphasize creating and securing jobs for everyday workers. He wagered on American workers. And it paid off.

As unemployment slowly eases, as the Big Three automakers report huge profits and hire workers, as the stock market slowly climbs and foreclosures slowly drop, Republicans, particularly the GOP presidential candidates, refute it all. They simply deny that the stimulus created the 1.2 to 3.3 million jobs that the non-partisan Congressional Budget Office reports it did. They continue to insist that America should have let Detroit go bankrupt. Instead of betting on American workers, they would double down on Bush’s tax breaks for the rich, subsidies for fabulously profitable corporations and deregulation of Wall Street.

GOP front runner Mitt Romney supported the government bailout for Wall Street but opposed rescuing GM and Chrysler. Like so many Republicans, he’s all for preserving the jobs and institutions and million dollar bonuses for executives. But Republicans offer nothing but cutbacks and pain for workers.

They want to cut back food stamps, raise the retirement age, slash funds for education and Pell Grants for college, slice Medicaid and repeal the health care reform law that will lower the deficit while enabling 32 million uninsured American to get coverage. At the same time, all four GOP presidential contenders would lower or eliminate corporate taxes and further cut levies on the wealthiest so much that their budget plans would increase the national deficit that they’re so keen to criticize.

They’re betting that more tax cuts for the rich will prompt reinvestment and economic resurgence. That’s the gamble former President Bush took when he twice cut taxes on the wealthiest. After seven years, here’s how Bush’s bet on the rich paid off: the economy and jobs were contracting at an alarming rate. Remember the fear in 2008?

Now, three years later, after President Obama placed his faith in workers, the nation’s economic outlook is brighter. As is that of GM and Chrysler.

Both companies suffered managed bankruptcies. Tens of thousands of workers lost jobs. Retirees took health care benefit cuts. Remaining workers accepted pay reductions. Plants and dealerships closed. It was pain all around.

Now, GM is back as the world’s number one automaker, making the highest profits in its history. Chrysler is growing faster than any other American car company. Ford is investing $16 billion in its American operations and plans to bring thousands of jobs back from overseas. Altogether, the industry added 200,000 jobs. In addition, rescuing the industry meant preserving hundreds of thousands of jobs in auto parts factories across America, and all the service jobs they support.

Here’s what President Obama told the 2012 United Auto Workers convention about his wager on them:

“I placed my bet on American workers. And I’d make that same bet again any day of the week. Because three years later, that bet is paying off for America. Three years later, the American auto industry is back.”

In the past few weeks, President Obama has doubled down on his wager on working Americans. He has called for a tax break reversal – ending the deal corporations get for shipping jobs overseas and instead giving it to those who move jobs back on shore. And, just last week, he demanded an end to the $4 billion in subsidies that taxpayers give massively-profitable oil and gas companies, explaining:

“You can either stand up for oil companies, or you can stand up for the American people.”

Republicans immediately attacked the President for the proposal. They criticized him for talking to the auto workers as well. While Republicans regard workers in general as second class citizens, not to be given the deference they reserve for the rich, members of the GOP particularly despise auto workers because they’re members of a labor union. Republican lawmakers hate unions – maybe even more than they loathe President Obama. They can’t tolerate any organization of workers that succeeded in bargaining with fat cat factory owners for weekends off, paid sick days, good pensions and middle class wages, even though the GOP lawmakers themselves benefit from decades of union activism by receiving weekends off, paid sick days, good pensions and very decent wages.

Obama, by contrast, told the auto workers he was honored to be with them, to bet on them:

“It’s unions like yours that fought for jobs and opportunity for generations of American workers. It’s unions like yours that helped build an arsenal of democracy that defeated fascism. It is unions like yours that forged the American middle class – the greatest engine of prosperity the world has ever known.”

It’s a sure bet: Wagering on workers is a winner.

Republicans: Against It Before They Were For It

Leo Gerard — Tue, 21 Feb 2012 09:44:17 -0500

First, Republicans opposed extending the payroll tax cut that put an extra $20 a week in the pockets of 160 million working Americans.

Next, they supported it. If the cost were offset the way they wanted. Even though Republicans previously had said that tax cuts never need be offset.

After that, they opposed a stopgap measure extending the break by two months. Even though the cost was offset.

Ultimately, they approved the 60-day extension.

Then, they opposed extending the tax cut another 10 months. Unless the cost were offset.

Finally, however, they supported that. Even though the cost was not, in fact, offset.

What’s that sound? It’s the frantic flailing of a grounded GOP fish: flip flop, flip flop, flip flop.

Republicans revel in casting themselves as the principled party. They claim they’re the moral majority. Their values, they contend, are unshakable. So their serial waffling on this issue is confusing. Against it; for it; against it; for it. Isn’t that what they ridiculed a Democratic Presidential candidate for?

There’s a simple explanation, however. Throughout this entire episode, Republicans never wavered or vacillated or faltered in any way in performing their most vital, their most basic function as a political party: pandering to the rich.

The thread running through this drama, from beginning to end, is Republican opposition to equitably taxing the rich. The GOP did whatever it took to prevent the nation’s millionaires and billionaires from parting with another cent. In the end, the party’s public image took a beating. But Congressional Republicans triumphed in shielding the nation’s richest from paying their fair share.

So focused are Republicans on providing welfare for the rich in the form of special tax breaks and perks that initially the party didn’t support extending the payroll tax cut for the middle class at all. Late last November, party leaders, including U.S. Sen. Jon Kyl of Arizona, announced they opposed a one-year expansion. Republicans said they’d allow a temporary tax cut for the middle class to expire, no problem, even though they’d previously contended they couldn’t end the supposedly temporary income tax cut Bush gave the rich because that would be a “tax increase,” and they could never support a tax increase. Not ever.

For Republicans, who are so true-blue to blue bloods, the real problem with extending the payroll tax cut for the middle class was that Democrats proposed paying for it with a small surtax on the nation’s wealthiest.

That confronted the GOP with a choice: side with the rich or go with the middle class. This was hardly a Sophie’s Choice, however. It was no difficult decision for the average American, say one of the 160 million for whom the extra $1,000 a year from the payroll tax break is meaningful.

Despite that, the GOP sided with 350,000 millionaires and billionaires. Republicans worked to ensure those millionaires and billionaires would not have to pay an additional amount insignificant to the 1 percent individually, but collectively substantial to the federal budget.

Within days of Kyl’s assertion that the GOP opposed adding a year to the payroll tax cut, Republicans changed their minds. They would go for the extension, they said, if the cost were offset not by taxing the rich but instead by freezing the wages of federal workers for a third year in a row and eliminating the jobs of 210,000 of them.

Their logic was straightforward – if the middle class were to get a break, then the middle class would pay for it.

Democrats, and the vast majority of Americans, disagreed.

Stymied on a year-long deal, the two parties arranged a two-month reduction, the cost of which was offset. Even so, House Republicans rejected it. Before they accepted it.

At the time, Republican U.S. House Speaker John Boehner said Americans could “take to the bank the fact that” a payroll tax cut extension for 10 additional months “will be paid for.”

Seventy-eight days later, Boehner and his Republican crew agreed to extend the tax break without an offset.

Never mind, then.

In a presidential election year, Boehner & Co. surrendered to a simple calculus: the 99 percent has something that the 1 percent doesn’t – more votes. Way more. And polls show American opinion is just the opposite of Republican position on these issues. Americans strongly support raising taxes on the rich, while they strongly oppose ending the payroll tax cut for the 99 percent.

The GOP was cornered. If it wanted to win elections, it must appease the 99 percent. If it wanted to remain true to its core values – pandering to the rich – it must refuse a surtax on the 1 percent.

So Republicans flip flopped on the easier issue – appeasing the unwashed masses. Have your payroll tax break extension, damn it.

Unfortunately for the GOP, the masses may be unwashed, but they’re not unwise. This time last year, 63 percent disapproved of Congressional Republicans; by January, 75 percent disapproved of the GOP.

There’s just something so unappealing about a flip flopper. But as U.S. Sen. John Kerry can tell you, Republicans know that.

Kicking Underdogs When They’re Down

Leo Gerard — Tue, 14 Feb 2012 09:26:00 -0500

Americans love an underdog. Maybe it’s an artifact of the American Revolution, when a rag-tag rabble of farmers and frontiersmen defeated the disciplined and well-provisioned military of the most powerful nation on earth.

Even though the United States has usurped most powerful status, Americans still ally with Davids in contests with Goliaths. They love to see a top dog taken down a notch. They rooted for the perennial loser Red Sox in the 2004 World Series and reveled in the win by America’s unseasoned ice hockey team in the 1980 Winter Olympics.

That’s why the sudden surge of right-to-work (for less) legislation is so confounding. Right-to-work (for less) laws are perks for the wealthy, for the top dogs. These laws facilitate destruction of unions. The concerted action of a labor union is a tool that workers use to win fair wages, benefits and conditions from the powerful, from the likes of massive multi-national corporations. At a time of dwindling union membership, at a time when labor union participation is so small as to be nearly negligible, state legislatures across the country are taking up right-to-work (for less) laws that will further decimate union ranks. They’re kicking the underdog when it’s down.

Despite the derisive “big union boss” label that right wingers throw at labor leaders, unions are not the big dogs. Union representation in the United States has declined steadily since the 1950s, following federal legislation in 1947 impeding unionization. Just after World War II, about 35 percent of workers belonged to unions. And those who didn’t benefitted from the higher wages and good benefits that union workers negotiated because non-union employers felt compelled to provide competitive compensation. Last year, the percentage of U.S. workers in unions fell to 11.9, the lowest in more than 70 years.

As unions atrophied and the recession raged, the median income of working Americans declined. Meanwhile, at the top, the big dogs who run corporations continued awarding themselves colossal compensation and bonus packages. Median compensation for executives quadrupled over the past four decades. Last year, most executives got big bumps, whether their companies did well or not. Now, income inequality is greater than at any time since the robber baron days of the 1920s.

Still, somehow, legislatures across the country are rooting for CEOs, the top dogs, and bashing unions. Lawmakers in Ohio, Wisconsin, Arizona, Oklahoma, Idaho, New Hampshire, Tennessee, and South Dakota have attacked public sector unions. Politicians in South Carolina, Minnesota, New Hampshire, even Michigan and West Virginia are pushing right-to-work (for less) legislation.

Republican-controlled Indiana actually passed it this year. The law forbids companies and unions from negotiating terms that require every worker benefitting from the contract to pay his or her share of the cost of bargaining it. In other words, these laws allow workers to refuse to pay union dues and simply freeload on those who do.

Right-to-work (for less) is great for CEOs. It enables them to pocket more of the profits because such laws weaken unions, ultimately resulting in lower pay and benefits for workers, both those who are in unions and those who are not. Oklahoma’s experience illustrates the sad fact that right-to-work (for less) guarantees lower pay for workers, while not ensuring them more jobs.

Oklahoma adopted right-to-work (for less) a decade ago, the last state to favor the big dogs before Indiana. It joined other right-to-work (for less) states where wages are 3.2 percent lower; the likelihood of employers providing health coverage is 2.6 percent lower, and the rate of employer-sponsored pensions is 4.8 percent lower. These tragic statistics are detailed in the Economic Policy Institute (EPI) report, “The Compensation Penalty of ‘Right-to-Work Laws.”

Oklahoma workers didn’t get additional jobs out of the deal either. That’s documented in a study titled, “Does Right-to-Work Create Jobs?” Its authors, a labor expert and an economist at EPI, determined the law had no effect on jobs.

But CEOs, the 1 percent, do benefit. A 2009 study by Hofstra University Business Research Institute Director Lonnie K. Stevans shows that right-to-work (for less) is exactly that for employees but the opposite for CEOs. Stevans writes:

“Wages and personal income are both lower in right-to-work states, yet proprietors’ income is higher.”

The “proprietors,” the top dogs, win. The workers, the underdogs, lose. And they’re defeated by a special advantage that lawmakers give to top dogs with right-to-work (for less) legislation.

It doesn’t make sense in a society enamored of underdogs. It doesn’t make sense to give additional perks to the already-advantaged. It doesn’t make sense to turn workers into beggars, but that’s what right-to-work (for less) laws do. They eviscerate unions, so that each worker is on his or her own to seek just compensation, benefits, job security and safe working conditions from massive multi-national corporations.

It is Oliver Twist, his gruel bowl upheld, begging of the workhouse overlord, “Please, sir, I want some more.” Oliver didn’t get it. And workers who are thwarted from collective action by this legislation won’t either.

To win fair wages, the underdogs must band together as a team.

America’s Failed Mole-by-Mole Trade Policy

Leo Gerard — Tue, 07 Feb 2012 10:11:20 -0500

Last week several groups, including the United Steelworkers, petitioned the federal government to whack the latest trade mole – illegally traded auto parts from China.

With President Obama announcing creation of a new trade enforcement unit in his State of the Union Address, the feds probably will investigate. But even if they whack down the auto parts mole, experience has shown a new mole will pop up.

Mole-by-mole trade enforcement isn’t the solution to America’s massive trade deficit. Although conservative candidates revel in ridiculing Western Europe, America could learn crucial economic lessons from Germany, which doesn’t rely on Whack-a-Mole and maintains trade surpluses, including one with China in auto parts.

The Steelworkers – along with the United Auto Workers, the Alliance for American Manufacturing and Campaign for America’s Future – explained why the federal government must smack down the latest trade problem that has raised its ugly head.

China and several other countries promote their auto parts manufacturers by providing subsidies and engaging in additional practices banned by the World Trade Organization (WTO). As a result, the United States imports more auto parts than it produces, a situation that kills manufacturers and manufacturing jobs here. For example, over the past 11 years, as the U.S. auto parts trade deficit increased by 867 percent, the Unites States lost 45 percent of its auto parts jobs – a total of 419,000.

The reason the groups sought action against China specifically is that its exports of auto parts to the United States have increased faster in the past three years than any other country’s and China supports its auto parts industry in ways that violate its commitments to the WTO.

For example, China provided $27.5 billion in subsidies to its auto parts industry between 2001 and 2010. It’s fine with the WTO if countries subsidize industries that sell their products domestically. But it forbids subsidies for exported products because that distorts the free market, wrongly destroying jobs and industries in the countries that buy those artificially low priced goods.

Beijing also aggressively limited import of American-made auto parts. This is hardly startling. In December, China imposed steep tariffs on imported American-made sports utility vehicles and other large cars. And the WTO affirmed last week that China violated its trade commitments by restricting export of key raw materials. Earlier, the WTO supported President Obama’s imposition of tariffs on tires imported from China because Beijing had violated international trade rules.

China has prospered by breaking the rules. Electronics manufacturing is a good example. In a story about Apple’s experience, The New York Times described how America lost these jobs to China. Worker wages, while achingly low in China, were not the lure. And they were not the issue for Apple, a company that makes $400,000 in profit for every worker. It was a combination of other factors including the Asian supply chain and Chinese subsidies.

An example is the Chinese company that bid on supplying glass for the iPhone. When Apple executives visited, they found the company already constructing a wing where the iPhone glass would be cut. The company built it with subsidies from Beijing, subsidies that never would be provided by the United States to American companies, subsidies that are of questionable legality under WTO rules because they were for exported goods. Apple gave the contract to the Chinese firm, of course. Here’s how the Times described it:

“The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory. It had a warehouse filled with glass samples available to Apple, free of charge. The owners made engineers available at almost no cost. They had built on-site dormitories so employees would be available 24 hours a day.”

Beijing is a serial trade rule violator. The USW has won trade cases against China for violations involving paper, steel pipe, tires and other products. The Steelworkers filed for protection of the U.S. green energy sector against Chinese encroachment abetted by WTO violations and already has won negotiated settlement of several aspects of that case.

The USW and others that file trade cases often win. But this is Whack-a-Mole trade enforcement. A union or industry wins a case, whacks down that individual annoyance, but immediately another surfaces. America is losing, and far more is at stake than in an arcade game.

America can win. But it’s got to deal with trade differently. It needs a game changer, like Germany’s manufacturing policies.

Germany accounts for nearly 17 percent of America’s auto parts trade deficit. Germany sells more auto parts to China than it imports from China. German auto parts manufacturers accomplish this while paying higher wages and benefits than their American counterparts.

An analysis by the Economic Policy Institute notes that Germany actively enforces its industrial policy. This, EPI noted, stands in stark contrast to the United States, which doesn’t even have an industrial policy.

Germany encourages a sector of banks that is devoted to financing small and medium firms – the size that auto parts manufacturers are likely to be. In addition, Germany favors stakeholder capitalism, and corporate boards of directors there are populated by equal numbers of managers and workers. This changes the focus from profits benefitting only the 1 percent to company operation in the interest of the community, the country and the workers, as well as the executives and stockholders.

Republicans and Americans of the World War II generation might choke on the idea of learning something from Germany. But, frankly, this Western European country has prospered in manufacturing and trade with sophisticated state and corporate planning – not with the arcade-economics of Whack-a-Mole.

Retirees Occupy Century Aluminum

Leo Gerard — Tue, 31 Jan 2012 09:48:55 -0500

On Dec. 18, a dozen retirees, men and women in their 60s, 70s, even 80s, began occupying a median strip along Route 33 in front of the closed Century Aluminum smelter in Ravenswood, W.Va. In tents and under tarps, a small group stays overnight, despite hypertension, arthritis and other old age ailments. One has suffered a stroke.

These vulnerable people expose themselves to weather extremes although some have no health insurance at all. Century cancelled it. That’s why they’re occupying Century.

The retirees labored their entire lives for wages and pensions comparably lower than those of other aluminum workers. They did it believing they made those sacrifices in exchange for good, lifelong health coverage. Over the past two years, however, Century evicted them, about 540 retirees altogether, from the insurance plan.

The betrayal burns. Executives at Century, corporate 1 percenters, committed the same sort of treachery that is being condemned by Occupy Wall Street demonstrators representing the victimized 99 percent across the country. Thus the retirees adopted the grandchildren’s protest tactic of encampment.

Century shuttered the 50-year-old Ravenswood smelter in February of 2009, throwing 651 workers out of jobs. Century, headquartered in Monterey, Calif., didn’t go bankrupt though. It still operates aluminum plants in Kentucky, South Carolina and Iceland. And it didn’t immediately cancel promised insurance for retirees.

Nine months after the shutdown, it announced it would terminate as of June 1, 2010 health benefits for retirees eligible for Medicare. Then on Nov. 1, 2010, Century told its retirees who weren’t yet eligible for Medicare that it would stop paying for their coverage as of Jan. 1, 2011.

This revoking of earned benefits isn’t an isolated incident or a fluke. It is part of a pattern documented by Wall Street Journal investigative reporter Ellen E. Schultz in her new book “Retirement Heist.” The subtitle is, “How companies plunder and profit from the nest eggs of American workers.

She describes in gory detail how corporations raided worker pension accounts, siphoning off surpluses that would be needed later to prop up plans damaged by the Wall Street collapse. She provides detailed accounts of executives gouging the funds to pay for their own exorbitant retirement packages. She tells of corporate executives ending retiree health insurance and freezing pensions but deceptively calling the changes improvements, so that CEOs could pump up company profits with money that had been pledged to workers.

While breaking promises to workers and violating contracts, these CEO 1 percenters falsely portrayed themselves as beleaguered champions of workers, valiantly attempting to preserve underfunded pensions. Like Costa Concordia Captain Francesco Schettino saving himself while abandoning passengers on his sinking cruise ship, the captains of industry padded their own pockets with pension and health care funds intended for retirees, then deserted the workers. Schultz describes the CEO scams this way in the book:

“In reality, they’re the silent pirates who looted the ships and left them to sink, along with the retirees, as they sailed away safely in their lifeboats.”

Most of the Costa Concordia passengers survived, but more than a dozen drowned. In West Virginia, most of the retirees are still kicking. A leader among the Century occupiers, Karen Gorrell, explained:

“We may have one foot in the grave, but we are kicking like hell with the other.”

But some have succumbed. Gorrell, wife of a 33-year veteran aluminum worker, says Century has retiree blood on its hands.

She tells of two tragedies. There’s Bryce Earl Turner who Karen encountered after her first meeting with Century retirees in Ravenswood. He was scared and sick. Both alternatives he faced -- buying private insurance or paying for his leukemia treatments out of pocket -- were way beyond his means. Losing his insurance was a death sentence. The retirees worked desperately to get him more time.

With the help of West Virginia’s U.S. senators, Jay Rockefeller and Joe Manchin, and a provision in Obama’s health care reform law, the retirees managed to get coverage extended to Sept. 1, 2011. Bryce Earl Turner, 59, who worked 37 years at the aluminum plant, died the next day.

The other tragedy is Sam McKinney. He attended a meeting of the retirees on Feb. 14, 2011. He said he feared losing the insurance because his wife was ill. Karen recounts:

“He was very emotional because he had taken his wife to Charleston to try to get some assistance with her health care costs and had been turned down.”

He said, she recalled, that it was hard to believe that in America after a person expended his usefulness to industry, a corporation could coldly cast him aside as if his life had no value.

After the meeting, Sam McKinney took his wife to Outback Steakhouse in Parkersburg for Valentine’s Day. As they left, he collapsed and died in the parking lot. Karen is sure the stress killed him. Wrongful stress. Stress he’d not have experienced if Century was good for its word.

Karen says of Turner and McKinney:

“It was murder without a gun.”

Though Century failed to fulfill its obligation to pay for retiree health care, it handed its last CEO, Logan W. Kruger, $4.9 million in 2010. That’s twelve times more than Americans pay their president, the leader of the free world. Century gave Kruger another $6.2 million to leave last November. Still, he’s suing for $20 million on top of that. Century also is defending against a lawsuit filed for the retirees by the United Steelworkers (USW) union, which represented most of the Century workers.

The USW hopes, however, to resolve the dispute outside the courtroom, with the help of the retirees and West Virginia lawmakers. The elderly agitators managed to win the support of the state’s U.S. senators, its governor and its legislature. So last year when Century went begging to the state for $20 million it claimed it needed to re-open the Ravenswood smelter, the lawmakers sent Century away empty handed with a directive to settle with the retirees before seeking reconsideration.

Not long afterward, Century booted Kruger, and the new management team is negotiating with the USW and the retirees.

The protesters don’t have what they want yet, and they’re not leaving their tents until they do.

Century gave the retiree occupiers port-o-potties and installed concrete barriers to prevent cars careening on an icy Route 33 from plowing through the encampment.

Very nice gesture. But resuming payment for promised health insurance would be a whole lot better.

Emblematic of 1 Percenters, Cooper Tire Punk’d Workers

Leo Gerard — Tue, 24 Jan 2012 10:44:39 -0500

Four years ago, Cooper Tire told its workers they’d have to sacrifice to save the company. With a straight face, Cooper executives said it was essential for the corporation’s survival that workers take tens of millions in pay and benefit cuts.

The workers understood the link between their livelihoods long term and Cooper’s success. Dedicated and loyal, they accepted the cutbacks. Soon afterward, city and state officials granted Cooper millions in subsidies.

Management didn’t share in the workers’ and taxpayers’ pain, though. The top dogs rewarded themselves with millions in pay increases and a shiny new corporate jet.

Cooper punk'd the workers and taxpayers.

This isn’t an aberration. It’s a pattern. Corporate executives, the 1 percenters, slash workers’ wages, then give themselves big bonuses. CEOs tell mayors and governors their businesses are in such dire shape that they may close or move offshore. Government officials dutifully shovel truckloads of taxpayer cash into CEO hands, then the CEOs grant themselves more perks. The television show Punk’d, in which actor Ashton Kutcher humiliates famous people, took a five-year hiatus. The 1 percenters gave workers and taxpayers no such break. Punking the 99 percent for profit has only escalated.

At Cooper, 1,050 members of the United Steelworkers union in Findlay, Ohio agreed in 2008 to give the company $30 million in concessions when executives cried destitute at the negotiation table. The next year, after witnessing the same sad song and dance, Ohio officials began transferring $2.5 million from taxpayer pockets to corporate coffers.

Between 2008 and 2011, though, Cooper awarded its executives two pay hikes and double bonuses. The year after Cooper told workers they had to suffer for the company, Cooper CEO Roy Armes got a 50 percent pay increase. The next year, in the middle of the recession, his bump was 19 percent, giving him a package worth $4.7 million in 2010.

Cooper 1 percenters also bought themselves a corporate jet and, for $17 million, a Serbian tire company. Since January of 2009, Cooper posted $360 million in income before taxes.

The workers who took the cutbacks and taxpayers who subsidized the company got punk’d.

Then, this year, Cooper top dogs went back to the bargaining table with Steelworkers. Despite the big profits, they demanded more concessions. They planned to punk those workers again.

When workers in Findlay rejected a vague proposal from the company but offered to continue working under the terms of the old contract while talks continued, Cooper locked them out.

This would be disturbing if Cooper were a rogue company. But what’s more alarming is that it’s not. Profitable companies routinely blackmail workers and townspeople. They threaten to close or move to Mexico or China if workers won’t take cuts and if politicians won’t grant tax breaks. After the demands are met, the corporate executives shower themselves with cash.

Think of hugely-profitable Wal-Mart. The largest retailer in the world told its workers in October that it would substantially cut health care coverage for part-timers and significantly increase premiums full-timers must pay. By contrast, Wal-Mart’s CEO Mike Duke made sure he wouldn’t suffer. He had the board of directors change the way his pay is calculated when it looked like declines in sales at some stores would mean less compensation for him.

No matter his performance, the CEO is richly rewarded. No matter their performance, workers get cut. Punk’d.

This holds true on Wall Street too, where bank performance this year was lackluster. After declines in bank stock value, mid-level workers learned in recent weeks their bonuses would shrink. But not so for CEOs. Shares in Citigroup, for example, fell 44 percent, but its CEO, Vakram S. Pandit, was awarded a $16.7 million retention bonus as well as $3.7 million in stock while many Citigroup workers were told last week they would receive no bonus or a small one.

Mitt Romney’s Bain Capital is another example. It operates just like other vulture capital firms. They buy struggling companies, borrow against the assets, fire workers, cut the pay and benefits of the remaining ones, and take a huge chunk of that money and give it to vulture capital executives. Often the purchased companies, struggling under the excessive debt, go bankrupt, killing all the workers’ jobs.

The Wall Street Journal evaluated 77 deals Bain made while Romney was there. Of those companies, 22 percent closed or went bankrupt within eight years of the Bain investment. Even so, Bain executives made millions for themselves off those deals.

At the same time, Bain took handouts from taxpayers. Phil Mattera of Dirt Diggers Digest provides a list of tens of millions in taxpayer-financed subsidies Bain companies collected.

Workers and taxpayers got punk’d.

This isn’t a criticism of free enterprise or capitalism. It’s about civic duty and patriotism. A corporation has obligations to more than just its executives and shareholders – especially when the Supreme Court contends it’s a person. Every person is beholden to the community and country that provide nurture, protection and support. A corporation is accountable to its workers, its customers, its community, its country.

The executives who run American corporations have forgotten that. Or they reject it. These are the same CEOs who rail against regulation ensuring public safety and laws ensuring worker rights. They don’t want to be told they can’t pollute or let explosive methane collect in mines. And they don’t want to be told they can’t fire workers just for trying to form unions.

A little more regulation and a little less taxpayer subsidy might remind corporations of their obligations.

Workers and communities aren’t asking for the power to punk employers. They’re just asking not to be punk’d.

***

Tell Cooper to end the lockout!

Traditional Voting Fails; Alternative Works

Leo Gerard — Tue, 08 Nov 2011 08:16:45 -0500

Voting doesn’t work anymore. If it did, Americans would get what they want -- or at least some of it -- from Washington.

But they don’t.

Instead of the people’s priority, which is jobs, country club conservatives in Congress stubbornly fixate on deficits. Instead of ensuring millionaires and corporations pay their fair share, House Republicans passed a budget that would destroy Medicare and Medicaid.

Corporate and clandestine campaign contributions have undermined the power of traditional voting, the kind done at polls on election day. Rather than voters, politicians now serve donors -- billionaires and banksters -- who invest untold millions and demand returns in the form of self-serving policy.

This is demoralizing to those who cherish democracy and the sanctity of one person, one vote.

Hope, however, arrived with the debit card fee victory. The 99 percent forced Bank of America to back off its proposed fee. Average Americans accomplished this by voting differently, not at the ballot box but at the twitter account, the Occupy march and the teller window, where 1 million depositors went to move $4.5 billion from the big Wall Street banks to community banks and credit unions. They found another way to exercise their franchise and force the powerful to respond.

The 99 percent must exploit the method of this triumph to get what they need. Because politicians sure as hell aren’t giving them what they want.

The numbers don’t lie. Coin-operated conservatives in Congress have rejected President Obama’s jobs plan, parts of the jobs plan and Obama’s pitch to raise taxes on the rich to pay for it.

And yet, the electorate strongly supports both surtaxing millionaires and the elements of the jobs plan. In a CNN poll in October, 75 percent favored sending federal money to the states to hire teachers and first responders and 72 percent favored infrastructure investments.

A whopping 76 percent wanted millionaires to pay higher taxes.

In that same CNN poll, there’s another compelling statistic. Sixty-one percent said reducing unemployment was the most important issue. Reducing the deficit didn’t even come close at 35 percent.

The numbers aren’t flukes. Another survey, taken a week later by CBS found the same thing.

At a time when companies are hoarding $2 trillion in reserves, failing to create jobs and demanding tax cuts, the CBS poll provided a snapshot of public opinion on corporate responsibility. It found 67 percent opposed shrinking big business tax obligations.

That is a result of the public knowing intuitively what a report released last week proved: corporations aren’t paying their fair share. Citizens for Tax Justice conducted a comprehensive study that showed 280 of the nation’s largest publically-traded corporations paid only 18.5 percent of their profits in taxes over the past three years. That is little more than half the official rate of 35 percent, and it is lower than the rate paid by their competitors in other industrialized nations.

Thirty of the companies paid nothing. For three years.

Numerous polls over time found Americans, including Tea Partiers by a two-to-one margin, strongly oppose cutting Social Security, Medicaid and Medicare benefits. Yet, what is the Congressional super-committee talking about? Cutting Social Security, Medicaid and Medicare.

If only the public could get their elected representatives to listen. If only they could walk into those plush Congressional offices -- the way corporate lobbyists do -- grab those lawmakers and get them to understand the sentiment of all those polls, the feeling of the vast majority of the electorate: Tax the rich; don’t cut the social safety net; create jobs now; worry about the deficit when the economy improves.

Traditional balloting has failed to get country club conservatives to listen to the public. To the majority. To the people who a democratically-elected government is supposed to serve.

The Bank of America debit card fee reversal suggests, however, that the majority can win with non-traditional balloting. In this case, a big bank that had been bailed out by the public after it engaged in excessively-risky betting, a bank that gave its CEO a $9 million bonus after he lost billions, announced that it had “the right to make a profit” off the backs of poor people by charging them a new $5-a-month fee to use their own money with their debit cards.

Other Wall Street banks indicated they would do the same.

Fed up, depositors said they wouldn’t take it anymore. They began transferring their money out of the Wall Street banks, participating in the “Move Your Money” campaign that urged citizens to deposit their savings in community banks and credit unions. YouTube began featuring outrageous videos of Wall Street bank branches denying depositors access to their accounts when they tried to withdraw their money to move it.

The effort was tweeted and blogged. It was cheered by Occupy Wall Street protesters who marched to bank headquarters buildings in New York City carrying thousands of letters of complaint.

Wall Street banks began backing off their new fee plans. One by one they abandoned Bank of America. Finally, it too cancelled the fee, meanwhile refusing to disclose just how much businesses it lost.

Last Saturday was the big, official “move your money” day. Of course, the Wall Street banks won’t tell how many more customers they lost. But depositors, more than 78,000 of whom pledged to make the move, made their point.

They voted differently. They voted with their feet and their wallets. And they won. They cast ballots in the only way coin-operated politicians and big banks respond to.