Boeing and government officials extort major concessions from angry machinists

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If anyone wasn’t already convinced that the profit system is rotten to the core, the underhanded wresting of major concessions from the International Association of Machinists and Aerospace Workers (IAM) of Washington state should do it.

The Boeing Company had the chutzpah to demand the pensions and more from its workers, and billions in tax breaks from Washington taxpayers, in exchange for a promise to build the next-generation 777 in the state.

U.S. Senator Patty Murray, Governor Jay Inslee, and other state Democrat politicians, along with the corporate media, lined up to foster Boeing’s extortion. So did IAM’s own international union officials.

The workers’ loss leaves the union greatly weakened and deeply divided. It also puts pension plans nationwide in the crosshairs. The Machinists and U.S. workers can come back from this defeat, but hammering out how to do it is vital.

A hard-fought battle. Early in 2013, IAM International officials entered into negotiations with Boeing on a so-called “extension” of a contract not due to expire until 2016. It was presented to the membership in November. In the run-up to the vote, the state legislature passed huge tax concessions in a mere three days.

District 751 union leadership bravely stood up against the International — the union brass at IAM headquarters in D.C. — and exposed the revolting concessions. Activists organized solidarity rallies and built community support. Freedom Socialist Party (FSP) members were deeply involved.

Henry Noble, former FSP National Secretary and a Boeing retiree, spoke at a large “Vote No” rally in Everett in November, at several union unit meetings and on discussion websites. FSP and Radical Women contingents went to rallies in Everett and Seattle.

The membership voted down these perfidious concessions by a resounding 2-1 vote. Then the bosses turned up the heat. The Seattle Times ran a front-page series on Boeing’s 22-state 777X “site search” along with other stories that spread fear and intimidation about “decades” of job loss. Five local mayors and county execs held a press conference urging Machinists to cave in “for the good of the community.”

Boeing made slight changes to the rejected offer and demanded a second vote. The union membership denounced it. But the International imposed it anyway, and set the date when thousands of workers would still be on vacation after the holiday break. It also erected barriers to proving eligibility that amounted to voter suppression. In the end, the new contract won by a razor-thin majority of 600 out of 23,900 votes cast.

A rotten deal. The machinists had a contract with a no-strike clause. The replacing contract is for ten long years, again with a no-strike clause. Current pensions will be frozen in 2016, then converted to a 401(k) type retirement savings system. The replacement benefits will pay two-thirds less at best — depending on the stock market and the company’s rosy projections. Healthcare premiums triple, co-pays double and health benefits can be reduced by the company without negotiation to avoid taxes imposed under Obamacare. Entry level pay will be frozen, so by the end of the contract, new hires will get the state minimum wage, which rises with inflation.

Furthermore, contract language allows Boeing to outsource jobs “in whole or in part.” No wonder the deal was originally rejected by outraged workers.

“It amounts to a corporate free ride,” emphasizes Henry Noble. Boeing, one of the most profitable airplane makers in the world, has created a new corporate model — too-big-to-pay-your-own-costs-of-doing-business. Costs will be paid by Boeing employees and tax-paying working people.

In the last ten years, Boeing paid no federal corporate taxes and got $2 billion in federal tax rebates. Now it has $8.7 billion in new state tax breaks — the biggest such subsidy in history. The state promised another $10 billion in transportation for Boeing. The stolen pension and healthcare benefits will also be added directly to company profits. Needless to say, there are no benefit losses for Boeing’s seven top executives. They made more than $75 million in 2012, a 54 percent increase in one year!

Where to from here — fight! There’s no doubt the union has been deeply wounded, not least because the membership was sold out by the national officials. As always, organizing is the only way forward.

Several IAM members have filed NLRB complaints against the misleaders and thousands signed a petition asking for a new vote. But Boeing management retaliation is sure to come, so shop floor resistance will be critical. There are lots of good reasons to strike too, even with a no-strike clause. For example, organizing against retaliation and safety violations. Another option is disaffiliating from the International and putting members’ high dues into a strike fund.

That’s for the short term. The long term strategy would be to nationalize the company that taxpayers already support — under workers control. That’s the realistic way to stop the capitalist-driven race to the bottom where workers are forced to compete globally for the lowest wages and working conditions.

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