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April 01, 2009
The State of Big Labor on Labor Day 2005
Yesterday morning as I sat on my ass in my living room contemplating doing something moderately productive, I figured that I owed the fact that I was sitting on my ass in my living room and not sitting behind my desk contemplating working to Big Labor. Since I owed this holiday to Big Labor, what better day to contemplate the state of that big political machine that purports to look out for the "worker"? It doesn't take a hell of alot of contemplation to figure out that the state of Big Labor in 2005 sucks.
Does the state of Big Labor suck for Teamster President James Hoffa Jr. or United Auto Workers President Ron Gettelfinger? Does it suck for AFL/CIO president John Sweeney?
Actually, yes it does, but not nearly as bad as it does for the "workers" they purport to represent. For Sweeney, Hoffa and the others it sucks for this reason: In a little more than 20 years, union membership has dropped nearly in half according to the Bureau of Labor Statistics from 20.1% of workers in 1983 to a paltry 12.5% of workers in 2004. This figure shows that more workers are beginning to realize that being a member of a union is no longer an advantage and may be a disadvantage when looking for a good-paying job with long-term prospects. They are beginning to see that the unreasonable demands unions have placed on companies have cost them jobs. They are discovering that the political agenda of their union is 180 degrees out of phase with their political ideology and that they are being forced to fund a political agenda they don't agree with with their union dues. More importantly, they are beginning to realize that union leaders are more interested in preserving that liberal political agenda at all costs than they are in looking out for the "rights" of the worker.
Although the Big Labor organizations are doing poorly, Hoffa, Gettelfinger, Sweeney and the like still get their nice fat salaries and perks year in and year out. With all of the major worker welfare items unions used to fight for codified into law over the past four decades, the only thing that's left for the largely useless organizations they head to do is to try to maintain their "worker" base and political clout -- largely unsuccessfully -- while at the same time trying to convince the very "workers" they purport to represent that they aren't irrelevant. The net effect has been that Big Labor now screws "workers" even as it tries to convince them it helps them and more and more workers just aren't buying it. In order to understand the state of Big Labor on 2005, it's instructive to take a look and the companies and employees that it is screwing, because in doing so, you get a better idea of how Big Labor ended up in the mess it is today.
Fifteen miles East of where I live is a community of 25,000 people on edge. The town of Newton, Iowa, headquarters of Maytag has in the past, staked it's entire fortune on the country's third-largest appliance maker and the jobs it provided. Now Maytag is in trouble, on the auction block and the people of Newton are wondering if Maytag will even be there in a couple years. It now looks as though Whirlpool will be acquiring Maytag, giving them better than 60% of the country's appliance market provided the deal makes it past regulators. If so, Maytag's headquarters may relocate to Michigan where Whirlpool is based and the Newton appliance plant -- Maytag's highest cost plant in terms of wages and operating costs -- could very well close leaving better than 1000 "workers" looking for work.
This isn't the first time Maytag's troubles have devastated the town of Newton, but it may be the last. Throughout the 90s, Maytag's Newton production workforce was trimmed from better than 3,000 to the current levels brought about by a recent layoff of 200. Management has been hit as well -- 1100 of them were let go last year. Twenty-plus year employees -- two Maytag-earner families, many production or maintenance workers with expensive homes and three or four cars were suddenly left with no income. Real estate values plummeted as these folks, desperate for cash, unloaded real estate for pennies on the dollar just to get out from under it. Maytag came back briefly in the early 2000s with, ironically, a former Whirlpool executive, Ralph Hake, at the helm. But now they sit on the brink of bankruptcy, nearly $1 billion in debt, with the Whirlpool deal seeming like the only way the Maytag brand will survive. Company management bears the vast majority of the responsibility for the state Maytag finds itself in right now: Failure to plan ahead, failure to control costs, failure to see that things wouldn't always be as good for the company as they were in the 80s and early 90s-- failure to see the train wreck looming ahead. But a large part of this disaster came in constantly caving to the demands of the United Auto Workers, the union that "represents" Maytag's employees. And the United Auto Workers, through their incessant and unreasonable, wage, benefit and employment demands, ended up putting many of the workers they purported to represent at Maytag out of jobs. As with most big unions, the UAW isn't interested in positive solutions that might preserve jobs. They are far more interested in perpetrating the "big employer as evil bastard" mentality to its "workers" which is exactly what they did in Newton yesterday:
Gov. Tom Vilsack said he organized the event to address residents' anxiety and stress and allow them to express their concerns.And express they did. The attendees, including a number of United Auto Workers members, called on Ralph Hake, Maytag's chairman and chief executive, to resign. They railed against the Bush administration and Republicans for policies that they said hurt working Americans. They compared the fate of laid-off manufacturing workers to the victims of Hurricane Katrina, buffeted by forces they cannot control and forgotten by leaders.
By the way, thanks to Tom Vilsack, presidential wanna-be, for organizing this whine and bitch session and to other Democratic politicians like Iowa Congressman Leonard Boswell for being there. I'm sure that standing around yelling about Maytag's management, blaming Republicans for your plight and feeling sorry for yourselves is really going to help these UAW members bring about positive change in themselves by realizing that THEY are the ones in control of their lives and they are not at the mercy of the whims of the management of a company on the brink of bankruptcy. And if all that doesn't make you feel better, comparing yourselves to people living in squalor and wading around in three feet of feces-infested water is sure to help. But seriously, failing personal responsibility, blaming the CEO is always the best policy, I guess:
"If you're tired of running this company, Ralph, get the hell out. Resign," urged Chuck Gifford, retired public policy director for the state UAW.Gifford wondered whether Iowa Attorney General Tom Miller could sue to stop the Maytag/Whirlpool deal. Vilsack said he'd pass along the suggestion, but he was uncertain of what could be done.
That'll work: Sue to stop the deal so Maytag can go belly up on its own and EVERYONE can lose their jobs FOR CERTAIN. But such is the union mentality in 2005: They figure that if Maytag is a big evil bastard employer screwing employees now, they'll be even bigger, more bastardly and better able to screw even MORE employees if they become a part of Whirlpool. And this mentality, fed by the union folks and the pandering liberal politicians breeds this type of attitude in the employees:
Newton, Ia. — Kim Jackson spent Labor Day wondering how she'll keep her house, pay her utility bills and feed herself after she is laid off from Maytag Corp. today."What's going to keep me from starving?" she asked after Monday's town hall meeting of more than 100 Maytag employees and Newton residents at Maytag Park.
The union has "helped" this woman so much that she lacks the intestinal fortitude to realize that SHE can keep HERSELF from starving just like the rest of us do day after day. Losing a job sucks most of the time and we've all been there. But the last thing you need to do is stand around yelling to the air at company management, cheered on by a gaggle of like-minded losers, union thugs and liberal politicians, and wringing your hands about "what's going to keep me from starving?". Yet this is the state of Big Labor in 2005 and the dependence, despair and sense of entitlement it has wrought: Millions of little Kim Jacksons who put in their time at the union shop without ever having to think about whether or not the job actually challenges them or if they even like it -- it's a job, what the hell -- and they won't have to worry about having to find another job for the next 40 years -- they're all just a "workers" for (insert name here) evil corporation, an adversarial relationship where the little Kims pick up a check, grumble about how it is never enough, and the evil bastard CEO and the shareholders get rich. The little Kims have no more control over their collective destinies than the average snail darter -- they are all just a tiny cogs in a big wheel -the embodiment of the "worker"/slave driver mentality. Any expectation that the Kims step outside of their boxes just a tad, go the extra mile or, God forbid, shoulder any extra burden in the interest of helping the company be more profitable, which, in turn would help them, is met with shrieks of "oppression" and picket signs.
This fully-functional whine fest and pity party is the product of Big Labor -- a political organization that for decades has done a wonderful job of convincing their "workers" that their very existence is inexorably tied to the big company -- without that company they are nothing and can do nothing else for a livelihood. The truth is the fostering of this mentality by Big Labor is what screwed these "workers": An adversarial, entitlement frame of mind perpetrated by the union that pits the "worker" against the evil employer. And this festering sore of negativity and dependence among a company's employees causes the company to rot from the inside out --actively promoted by the union they "partner with". As with the destruction of any big company by the union, Maytag's demise came over a period of years.
A lot of the recent bickering in the last contract negotiation for the Newton Maytag plant -- one of the final nails in Maytag's coffin -- during the strike in June, 2004, had to do with employees having to pay more of the cost of health insurance. For some reason, unions in general and big unions in particular think that having to pay a portion of your own health insurance means the "worker" is being oppressed. Witness this lament from LaborWire USA regarding the oppression of actually having to pay a portion of the cost of your health insurance:
The contract agreed to by the California grocery workers represents a favored employer solution to the benefits cost dilemma: employee contributions. Data published by the Department of Labor’s Bureau of Labor Statistics ("Bureau") shows that the number of unionized workers in private industry who contribute to the cost of health care coverage is on an upswing. Five years ago, 54 percent of union workers had to contribute to the cost of family coverage, while in 2003, 69 percent reported making contributions to family coverage. The same holds true for employees electing single coverage. In 1999, 48 percent of union employees contributed to the cost of their medical benefits, while in 2003, 59 percent made contributions. The number of employees making such contributions will likely rise again this year. A recent BNA survey of employers indicates that approximately 40 percent of companies will attempt to introduce employee premium contributions during upcoming contract talks in 2004.
There you have it: The sinister employer, that evil bastard or collection of bastards who have nothing better to do than sit around and count the pieces of gold that seemingly fall out of their asses, are scheming against the poor worker to demand "employee contributions" as a way out of the "benefits cost dilemma" -- the implication being that the rising cost of health care is something all employers can easily afford but choose not to. As someone who has negotiated insurance renewals for an employer, and has seen better than 50% yearly increases in health insurance premiums some years, I can tell you that adversarial notion is not only wrong, it has cost jobs in union shops. There is a benefit cost above and beyond the typically good wage a union employee is paid and at some point, that cost outweighs the benefit of having that employee -- hence hiring freezes and layoffs -- exactly what happened with Maytag as they kept trying to accede to the UAW's unreasonable demands. The examples of the impact of health costs on the profitability of unionized companies, and on the well-being of their employees can be found everywhere and it's only getting worse.
In 1998, workers at the Firestone plant in Des Moines, Iowa members of the United Steel Workers union went on strike over having to pay a paltry $28 a month for family health insurance coverage. We're talking about people who came to the job as unskilled laborers, received on-the-job training courtesy of their "evil" employer and were making $40-$50,000+ a year going on strike over having to pay paying less than a percent of their annual income for their health insurance coverage. As an administrative employee of another company who was paying ten times that much for family insurance, I thought the whole situation was ridiculous. There were pickets, violence, vandalism, threats against replacement workers and dozens of arrests, to say nothing of the lost productivity and damage to the company's reputation -- all for 28 bucks a month in insurance. In the end, hundreds of Firestone employees lost decent-paying jobs because their union refused to budge on less than 1/100 of the employee's annual income, and the employees went along. The replacement workers gained somewhat lesser-paying jobs at a wage they were willing to work for and paid a portion of the cost of their own health insurance.
Firestone and Maytag aren't the only companies feeling the pinch of the unreasonable demands of Big Labor. General Motors recently reported that due to contracts negotiated with the UAW in years past, retiree’s health care costs now make up 80% of its health care costs. Having known a couple of General Motors retirees personally, I know that they not only get a generous pension and Social Security upon reaching retirement age, they also have (or had)100% paid health insurance for themselves and their families until death. One such retiree I know of has been collecting this rich benefit for the past 20 years and since he retired with 30 years in at the age of 48, he's likely to be collecting it for some time to come. Being faced with paying these benefits for hundreds of thousands of retirees, it's no wonder that General Motors bond rating, along with Ford's, was recently lowered to junk status. Maytag is in good company in its misery if two of the world's largest corporations are buckling under the burden of the employee health care "entitlement" Big Labor has negotiated for its "workers".
But there's a lot more to the problems Big Labor has screwed it's "workers" into than the mere expectation that health care is an entitlement to be paid for by the employer. They've also conditioned their "workers" into thinking that they should be entitled to more and more money for doing the same thing day after day and showing no initiative to develop themselves even further.
Take the example of the 30-year GM employee who began working for GM at age 18 and retired at 48. This guy bid through job after job, always looking for the highest-paying job that required the least amount of effort. He told tales of other employees throwing pop bottles (if you're old enough, you can remember the glass kind) inside the doors of Cadillacs before they put the door panel on out of sheer boredom and maliciousness. He whiled away his last five years as a night janitor and used to talk about how the break rooms on the second floor were the ones to sleep in because they all had steel stairs so you could hear when foremen or security guards would walk up and you could wake up and pretend you were just on break. He retired a young man better than 20 years ago with a $30,000 a year pension -- about 80% of what he was making in 1984. His only goal in life (after the first few years on the job at least) was to put in his time and make as much money as he could until retirement -- a goal actively encouraged by union work and promotion practices that emphasize seniority over skill and initiative.
Like the GM worker, workers at the Maytag plant in Newton have been conditioned to put in their time and do little else besides go along with the UAW in their demands for more and more concessions from Maytag. Maytag, for its part, met the demands easily in good times and struggled to meet them when times were tough. Although this is changing, union contracts in the past typically bred employees who are used to doing the bare minimum and thinking that they are being incredibly put out when they are expected to go above and beyond. Everyone has heard the phrase that there is no "I" in team. Well there's also no "team" in union. Many union employees in the past, through no fault of their own but through the constraints of their contracts, have been restricted from doing any part of a job that may infringe on another employee's job. A machine operator is told not to try to troubleshoot a machine, no matter how simple the adjustment may be, but to call a maintenance mechanic and sit and wait for the mechanic to come, troubleshoot and fix the machine and get it back up and running for them. While the employee is waiting, they dare not pick up a broom, for that may be infringing on the janitor's job security.
Because of this forced division of labor, stories float around Central Iowa regarding maintenance mechanics from Maytag who are now out looking for work because they are laid off. A 26-year maintenance employee advised a maintenance manager from a non-union company to not touch former Maytag maintenance mechanics with a 10-foot pole. If you need a jack of all trades as many small manufacturing companies do, or at least a maintenance mechanic who is willing to learn new skills, you're not going to find what you're looking for in a former Maytag employee according to this guy who had reason to know. They had their one job to do and that's what they did -- nothing more -- often because of what their contract said. That's not to say that a former Maytag employee wouldn't be able to step outside of that box and be a team player. But if you have the resume of someone who did a little bit of everything at a small company and the resume of Joe Maytag who spent ten years working on Machine B and that's it, who are you going to hire?
So it looks now like Maytag is going to be swallowed up by Whirlpool -- falling victim to short-sighted management and constantly giving into the UAW's demands to the eventual detriment of both Maytag and its employees. Maytag employees and the UAW may dispute the notion that Maytag is constantly caving to the union because lately, more and more Maytag employees have been laid off to try to make up for money-losing concessions made in years and decades past -- in an era when a good job at a good company came to be viewed almost as an entitlement. And since the UAW, one of the largest unions in the country, isn't interested in doing anything constructive to help, Maytag goes down while the UAW and its "workers" whine about how the evil corporation is screwing them out of their God-given right to Maytag jobs.
Such is the state of Big Labor in 2005: Unwilling to do anything to help the former high-rolling companies that employ their "workers" be competitive in a new economy; preferring instead to bitch about how the struggling companies are screwing employees and sending jobs to Mexico. And Maytag and the other companies I used as examples aren't the only companies battling to be competitive even as their unions tie their hands.
The state of Big Labor is slowly changing, a fact made evident by this summer's split between the AFL/CIO and the Teamsters and the Service Employees Union, both of which were fed up with the AFL/CIO's slavish dedication to a radical leftist/socialist agenda and decades of adhering to policies that produce the type of results for described here for its "workers". Big Labor really has no choice if it wants to remain a viable force in the workplace. If it continues to produce the kind of results cited here in the name of helping the "worker" union membership can only continue to slide as more employees reject unionization and more companies that cave to union demands continue to go belly up. Given that union thugs are a hard-headed bunch and aren't likely to see the writing on the wall, I don't anticipate that the state of Big Labor will change much in 2006. In fact, I doubt that Big Labor will change its ways until its "worker" base and political clout are virtually gone, which could only serve to benefit today's worker.
Posted by Steve at April 1, 2009 12:00 AM
Copyright © 2007 by author. May not be copied, published, or otherwise used (except for brief quotes) without express permission of author. Articles published with permission by Pardon My English.
-->Comments
One of the few things we agree on: Fuck the Unions, they're useless. They served their purpose decades ago, fighting for the American standard of better working conditions, but once their purpose was served they became a fat bloated, elitist anachronism. They went from being the standard bearer for workers rights to being the standard bearer for workers sense of entitlement. I worked in factories in Detroit for about 5 years before I thankfully escaped that shithole of a city and I can tell you that the Union never did a goddamn thing for me. Fuck the Union.
End of rant.
Posted by TRF
at September 7, 2005 10:21 AM
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