Sociology Discussion Board

| November 30, 2015

CH 10 – POLITICS & THE ECONOMY

Assignment:

One of the most important (and underestimated) influence on our lives is Ch 10 – Politics and the Economy. Most students easily feel overwhelmed and uncomfortable when topics from this chapter are discussed and want to rush through it.

This is the last chapter in this course and – in some sense – the chapter that provides the larger institutional context that allows you to put the pieces together.

 

I have selected a CASE STUDY that makes it easier to see how your life is being influenced by powers, some of which you can see others which you cannot see. Understanding this environment is not easy BUT IS DO-ABLE! We, you and I, now live in a global environment where challenges are coming from near and far and we are asked to make decisions which are far from ideal.

 

The CASE STUDY which I have chosen is the case of THE BOEING MACHINIST VOTE.

This case, which just happened last year, is sure to influence ALL of us in this class. In a class this size, there are sure to be students whose direct family members are working for (or have worked for) the Boeing Corporation. Beyond that, ALL of us who live and work in Washington State are influenced by what this company will do in the future.

As such, I now place into YOUR HANDS  THE VOTE FOR THE FUTURE:  Should you, or should you not accept the new labor contract that the company offered the machinists last month? In this Discussion Board, you will get to cast your vote and state your analysis.

 

You MUST consider five separate stakeholders in your analysis of the situation:

1) The Boeing company, a private, for-profit corporation, owned by their shareholders, and led by their CEO

2) The International Association of Machinists, the union representing the manufacturing workers who would build the new plane.

3) The Political element, as represented by the WA State governor Jay Inslee and the WA State Legislature and Senator Murray.

4) The tax payers of Washington state who are directly affected by Boeing company paid taxes as well as tax-rebates granted to the company.

5) The rest of the world, that is other States inside the USA who want Boeing to produce the next airplane in their state, and the rest of the world who want to purchase the next generation aircraft, but who can purchase from Boeing or from Airbus (made in Europe).

 

It does not matter to me, if you are more democrat or more republican, lean in favor of a free market or advocate greater market regulation, consider yourself pro-capital or pro-labor. What matters to me is how well you integrate the material of the articles below into the ideas of this chapter and previous chapters (Hint: especially the chapter on Stratification). I do expect you to read ALL of the articles listed below and to do so carefully. This is not make-work, this is your understanding the forces influencing YOUR life right now and in the next few years to come.

FORMAT:

First Sentence: YOU MUST cast your vote and only have two options:

a- Accept the company proposal for lower wages/benefits in exchange for guaranteed work on the new airplane  OR

b – Reject the contract proposal for now, and hope for a better deal in a few years.

 

IF you choose to accept the deal you then must answer all of these questions:

What is GOOD about voting to cut your pension and your health insurance coverage and the pay-scale of new, incoming workers? Does accepting the deal create a better Washington State/America, that you yourself want to grow up in and raise your children in? What combination of facts and values (You must list them) leads you to argue that taking the deal offered by the company would be the wise decision for the union machinists? Project out the consequences of your choice 15 years into the future – Will Washington State be have less income equality as a result of accepting the deal or more? Make sure to look at your decision from the perspective of all five stakeholder groups.

 

If you choose to REJECT the deal then you must answer all of these questions:

What is GOOD about turning away a company offer to commit to 10-20 years worth of future employment in the aerospace manufacturing industry? Does rejecting the deal create a better Washington State/America that you yourself want to grow up in and raise your children in? What combination of facts and values (you must list them) leads you to argue that rejecting the deal offered by the company would be a wise decision for the union machinists? Project out the consequences of your choice 15 years into the future – Will Washington State be have less income equality as a result of accepting the deal or more?  Make sure to look at your decision from the perspective of all five stakeholder groups.

 

I strongly urge you to base your arguments on the facts supplied by the articles below (and by your textbook) . If you do not integrate them you will lose significant points for this last Discussion Board. Show each other how much you have learned this quarter by putting the pieces together into a strong and well reasoned stance. It is likely that doing so will require more than 600 words this week.

 

Article 0 –  Preview  (Note- This article has nothing directly to do with the Boeing decision. It DOES have to do with workers getting the short end of the stick, in order to create higher corporate profits). In that sense, it is a precursor of the debate we now face, 6 years later.)

 

“Capitalism 2007”  April 4, 2007  NY TIMES  Economix

 

One Safety Net Is Disappearing. What Will Follow?

 

By DAVID LEONHARDT

 

Over the years, American companies have built a pretty extensive social safety net for their workers. The clearest examples of it are pensions and health insurance, which became popular during the wage freeze of World War II, when employers were looking for creative ways to give raises. Today, the United States is the only major country in the world where the private sector plays such a big role in caring for the old and the sick.

 

But the corporate version of the welfare state is not just about retirement and health care. Another, much less obvious, piece of it is the steadily increasing pay that most workers receive over the course of their careers. All else equal, a typical worker in his early 60s makes about 50 percent more than a worker in his early 30s.

 

This arrangement produces some enormous benefits for society. It allows Americans to enjoy ever-rising living standards over their lives and helps them pay some big expenses, like their children’s college tuition and their parents’ elder care, that start to hit in middle age.

 

In strictly economic terms, however, paying people based on their age is a bit skewed. Sixty-year-olds are indeed more productive than 30-year-olds, studies have shown, but not 50 percent more productive. Experience isn’t quite as valuable as we might like to believe. In effect, most companies are underpaying their younger workers and overpaying their older ones.

 

This somewhat uncomfortable fact was a big part of the extraordinary layoff announcement (Links to an external site.) from Circuit City Stores (Links to an external site.) last week. On Wednesday, the company dismissed 3,400 people, or about 8 percent of its work force, not because they were doing a bad job and not because the company was eliminating their positions. Instead, executives said the workers were being paid too much and that the company would replace them with new employees who would earn less. It was the second such layoff at Circuit City in the last five years, and it offered an unusually clear window on the ruthlessness of corporate efficiency.

 

Whatever you think of the urge behind that efficiency — whether you see it as the wellspring of American competitiveness or the source of middle-class insecurity — there’s no question that it is a cause of the dismantling of the private-sector safety net that has served the country well over the last half century. What, then, is going to replace that safety net?

 

 

The laid-off Circuit City employees worked in the company’s stores and warehouses, selling electronics, unloading boxes and the like. They generally earned $10 to $20 an hour, making them typical of the broad middle of the American work force. Nationwide, the median hourly wage (Links to an external site.) of all workers is about $15.

 

“We just bought our first house about two or three months ago, and I’m afraid I’m going to lose it,” Alan Hartley, a car-stereo installer in the Charlotte, N.C., area told the local NBC affiliate after he’d been let go. “I’m not sure what I’m going to do. I’m hurt mainly because I love this company. I planned on retiring from it. I feel I’ve taken very good care of them, and I can’t believe they did this.”

 

Like a lot of companies, Circuit City sets “pay ranges” for its various jobs. Once associates reach the top of the range, they are not supposed to get further raises — beyond the basic cost-of-living increases that also push up the pay range — unless they are promoted.

 

But Circuit City’s store managers found it hard to stick to the policy. When they were divvying up the yearly pool of raise money, they would often increase the pay of all workers who had done a good job, even those at the range’s ceiling, said Bill Cimino, Circuit City’s chief spokesman. It just seemed like the decent thing to do.

 

“It’s hard to say no,” Mr. Cimino told me. “It’s only 3 or 4 percent.”

 

Eventually, though, the company’s executives decided they couldn’t afford decency for decency’s sake. In recent months, there has been a price war over flat-panel (Links to an external site.) televisions that’s an excellent case study of the benefits and drawbacks of globalization. The price cuts have made the televisions, which are manufactured in Asia and Mexico, affordable to many more families, but have also squeezed Circuit City’s margins.

 

At the same time, the company has to reckon with cut-throat competition from Wal-Mart (Links to an external site.) and Best Buy (Links to an external site.). Wal-Mart, in fact, has also been taking steps that seem aimed at pushing out more experienced workers, like setting wage caps for certain jobs and requiring people to work nights and weekends. In 2005, a top executive wrote Wal-Mart’s board a memo, which McKinsey & Company helped put together, noting that “the cost of an associate with 7 years of tenure is almost 55 percent more than the cost of an associate with 1 year of tenure, yet there is no difference in his or her productivity.”

 

There is a real question about whether these chains will hurt themselves in the long run by damaging employee morale, customer service and, ultimately, productivity. (Circuit City is forcing fired workers to wait 10 weeks to reapply for their jobs, I assume because the company executives were afraid that workers whose pay had been cut wouldn’t make effective sales associates.)

 

But there’s no question that corporate America is moving in the same direction as Circuit City. Companies are wringing out what they see as inefficiencies, like traditional pensions and health insurance coverage (Links to an external site.), and tying workers’ pay more closely (Links to an external site.) to their performance.

 

It’s probably not possible to halt these changes. It may not even be desirable. The flexibility of the American labor force seems to be one reason that recessions have become less frequent and unemployment is less of a problem here than in Europe, notes Jason Furman (Links to an external site.), a leading Democratic economist. In this country, fast-growing companies can hire new workers without worrying that they are making a 30-year commitment.

 

But it would also be foolish to pretend nothing is changing. The corporate safety net of the 20th century is going away, and a fundamentally different private sector will require a fundamentally different public sector.

 

If companies aren’t going to provide health insurance, the government will need to. It can do so directly, through a single-payer system similar to those in other countries, or indirectly, by pooling together the uninsured and helping them buy coverage, as Massachusetts is now planning. If companies aren’t going to provide pensions, the government will have to provide better incentives to save, helping people overcome their natural instinct to choose a flat-panel TV today over an adequate retirement tomorrow. And if companies aren’t automatically going to give workers raises over the course of their lives, the country will probably need a new strategy for giving older workers new skills, something considerably more ambitious than the current, meager retraining programs.

 

This is the real message of the Circuit City layoff, and it’s likely to be the great economic debate of the coming decade.

 

E-mail: leonhardt@nytimes.com

 

http://www.nytimes.com/2007/04/04/business/04leonhardt.html?_r=0 (Links to an external site.)

 

 

 

 

 

 

 

ARTICLE 1

 

 

 

Originally published November 5, 2013 at 11:05 AM | Page modified November 6, 2013 at 1:21 PM

 

Boeing machinists face hard choices to secure 777X jobs

 

Boeing is offering Machinists union members a new contract that would secure 777X manufacturing work for Washington state — if they agree to reduced long-term pension and health-benefit costs.
By Dominic Gates (Links to an external site.)   Seattle Times aerospace reporter

 

Boeing laid out Tuesday its price for assuring that the forthcoming 777X jet is manufactured in Washington state: a hardball contract offer for the Machinists and a demanding agenda for a special session of the Legislature.

 

Machinists union members face a watershed vote next week on a contract offer from Boeing. To ensure they will fabricate the 777X’s giant composite wings and assemble the airplane here, they’ll have to hold their noses and sign off on the loss of long-cherished benefits.

 

And in a weeklong special session in Olympia beginning Thursday, Gov. Jay Inslee has asked state legislators to pass a package of bills (Links to an external site.) that include granting Boeing after 2024 estimated state tax savings of $8.7 billion.

 

In a hastily arranged news conference on Election Day, Inslee said Boeing executives have guaranteed that “if these two things happen, we’re going to get the largest aerospace expansion project of my lifetime.”

 

“These jobs are ours, if we act now,” Inslee said.

 

Inslee was flanked by Boeing Commercial Airplanes chief Ray Conner and International Association of Machinists (IAM) District 751 President Tom Wroblewski, although neither spoke or took questions.

 

Just hours earlier, the union leadership agreed to take to its members a bitter pill: a tough Boeing proposal for a new eight-year contract with big cuts in future pension and health-care benefits.

 

Union members will earn a $10,000 signing bonus if it passes, payable within a month.

 

But the pension change would be a major loss for current employees: Traditional pension accruals would stop, to be replaced by an alternative company-funded retirement savings plan.

 

Clearly the terms were difficult for the Machinists leaders to accept.

 

“Only a project as significant as the 777X and the jobs it will bring to this region warrants consideration of the terms contained in Boeing’s proposal,” said Wroblewski in a union statement. “While not all will agree with the proposal’s merits, we believe this is a debate and a decision that ultimately belongs to the members themselves.”

 

If passed, the deal ensures Boeing management a full decade of labor peace. Its eight-year span begins at the end of the current contract in 2016.

 

The proposal represents a major poker play by the company to cut its long-term costs, using the future of airplane manufacturing in the Puget Sound area as the high stakes on the table.

 

“Securing the Boeing 777X for the Puget Sound means much more than job security for thousands of IAM members,” said Wroblewski. “It means decades of economic activity for the region.”

 

Boeing’s Conner, in a statement, said the union deal “when ratified, will secure and extend thousands of high-wage, high-skilled aerospace jobs and expanded economic opportunity for residents of Puget Sound and Portland for many years to come.”

 

Inslee stressed the significance of Washington’s winning the advanced manufacturing facility where the 777X’s carbon fiber-reinforced plastic composite wing will be built, saying that will create a carbon fiber manufacturing industry for future airplanes.

 

He called for swift passage of a raft of bills, including extension of Boeing’s tax incentives through 2040; a massive $10 billion 10-year transportation package; actions to streamline industrial permitting; education and training initiatives; and a compromise that will satisfy Boeing on the state’s pending water-quality rule.

 

The 777X is a planned variant of today’s 777 that will retain the same metal fuselage but utilize new engines and the new composite wings.

 

The plane is expected to be launched at this month’s Dubai Air Show and to enter service around 2020.

 

Almost 20,000 Boeing employees work directly or indirectly on the 777 program today. Inslee said that counting support and service jobs, some 56,000 people in the state depend on that jet.

 

State officials said later that the 777X project will produce fiscal benefits to the state from now through 2040 of $17.8 billion.

 

Sweeteners for union

 

To try to secure a “yes” vote by the IAM’s 31,000 members here and 1,500 more in Portland, Boeing wrapped the bitter pill of its contract proposal in lots of sugar.

 

The IAM deal includes substantial cash awards: not only the big ratification bonus but also a “golden handshake” buyout that would allow retirement with boosted pension terms of $95 per month per year of service for anyone over age 58.

 

The take-aways include significantly higher health-care premiums and, crucially, the radically changed pension plan.

 

The new pension plan would have the company contribute a fixed percentage of gross salary into a retirement savings account each year: 10 percent the first year, 8 percent the second; 6 percent the third, and 4 percent every year thereafter.

 

The IAM is the last Boeing union with a traditional pension, and the company has sought unsuccessfully in multiple contract negotiations to move away from a defined-benefit pension plan to such a defined-contributions savings plan.

 

The offer would also change the wage structure so that new hires would take 16 years to reach the top of the pay scale instead of the 6 years it takes today.

 

One machinist summed up Boeing’s strategy this way: Offer the big signing bonus to entice younger members who perhaps aren’t thinking of staying their entire working lives with the company. And use the early-retirement package to swing the votes of those planning to retire in the next few years.

 

For everyone else, this machinist said, the offer is “a losing deal.”

 

However, another machinist said the agreement is the best available. He said that layoffs could continue next year as the 787 program sheds workers no longer needed to fix earlier production problems.

 

He said the early-retirement buyout will stave off those layoffs as older workers take the offer.

 

“This is an incentive that will save younger people with families,” he said. “I think reality is, this thing will pass.”

 

A company source said that during secret negotiations over the past months, Boeing moved somewhat toward the union on the pension and health-care numbers.

 

However, among the union rank and file there is a widespread conviction that Boeing presented its offer largely on a “take-it-or-leave-it” basis.

 

One union official told members that if the offer is voted down, Boeing the next day will put the 777X work out to bid by other states.

 

Boeing declined to comment on what happens if the vote fails.

 

Sen. Patty Murray, who acted as a mediator between the IAM and Boeing over the past two months, offered an optimistic outlook.

 

“I’m encouraged and hopeful that we are close to an agreement that will make the Puget Sound home to the 777X,” Murray said. “Everyone’s goal should be a mutually agreeable solution that will provide labor peace and help rev up our state’s economic engine for the foreseeable future.”

 

The union said it will provide IAM members full details of all contract changes in the proposal when printing is completed and will communicate voting arrangements as soon as they are ready.

 

Dominic Gates: 206-464-2963 or dgates@seattletimes.com

 

http://seattletimes.com/html/businesstechnology/2022195247_boeingiam777xxml.html (Links to an external site.)

 

 

 

ARTICLE 2

 

Legislature approves tax breaks to secure Boeing 777X

 

The Legislature on Saturday approved aerospace-training programs and billions in tax incentives to help secure Boeing’s 777X jet. The union vote is next.

 

By Andrew Garber (Links to an external site.)  Seattle Times Olympia bureau

 

OLYMPIA — Now the state waits.

 

With unusual speed, the Legislature on Saturday boosted aerospace-training programs and approved $8.7 billion in tax breaks to try to secure Boeing’s 777X jet.

 

But that meets only half of Boeing’s requirements to keep production of the aircraft in Washington state. The company also wants the Machinists union to accept a new eight-year contract with big cuts in future pension and health-care benefits.

 

That’s far from a given, considering the angry reception (Links to an external site.) Boeing’s contract proposal got from the union. The union is expected to vote on the contract Wednesday.

 

Gov. Jay Inslee was asked repeatedly during a news conference Saturday if he wanted the Machinists to approve the contract. He said that’s up to union members, but sent a strong signal about Boeing’s role in the state economy.

 

“People are going to make individual decisions and I don’t think any of us should prejudge what that decision will be,” Inslee said, adding later that “the one thing I know, as a father and a working person, is it’s a great thing to bring a job home. This is bringing 54,000 jobs home to the state of Washington.”

 

That’s been the promise from the beginning, that securing the 777X means thousands of jobs for the state.

 

An independent analysis released by the governor’s office projected that keeping production in Washington would produce $21 billion in tax revenue for the state over 16 years.

 

“This is a generational opportunity,” Senate Ways and Means Chairman Andy Hill, R-Redmond, said on the Senate floor Saturday. “This is about our aerospace economy.”

 

Not everyone saw it that way.

 

Democratic Sen. Bob Hasegawa, of Renton, voted against the tax breaks.

 

“I have a philosophical issue with putting this economic development strategy on the backs of the Machinists,” he said. “We’re asking them to sacrifice the future of the next generation of Boeing workers. That is not a sustainable economic development strategy for the state.”

 

Hasegawa was far in the minority on this one. Senate Bill 5952 (Links to an external site.) passed the Senate 44-2, — Sen. Adam Kline, D-Seattle, also voted no — and in the House it passed 75-11.

 

Inslee called the three-day special session, which ended Saturday, to fulfill the state’s side of the bargain to keep the 777X.

 

The tax-incentives measure extends commercial-airplane tax breaks — due to expire in 2024 — until 2040 and expands a sales-and-use tax exemption for construction of buildings used to manufacture airplanes, among other things.

 

Lawmakers included provisions in the bill that take away the preferential tax rates for Boeing if it moves production of the 777X out of state.

 

That’s a lesson learned from 2003 when the Legislature approved big tax breaks for Boeing and other aerospace companies with the expectation that all 787 Dreamliners would be built in the state. But the legislation had enough maneuvering room for Boeing to put a second 787 Dreamliner assembly line in South Carolina in 2009.

 

The aerospace-training legislation, House Bill 2088 (Links to an external site.), passed both chambers by equally large margins.

 

The training bill, among other things, would spend $8 million to increase high-demand aerospace enrollments by the equivalent of 1,000 additional full-time students for the 2014-15 academic year.

 

“It is the intent of the Legislature that this funding be ongoing or until there is no longer a demonstrated need,” according to a bill report.

 

It also includes $2 million for grants to local governments to advance permitting for large aerospace manufacturing sites.

 

Inslee is expected to sign both bills into law as early as Monday.

 

One item on Boeing’s Olympia shopping list remains — passing a multibillion-dollar tax package to pay for transportation improvements around the state, including the highways Boeing uses to move its people and products.

 

Lawmakers said talks were progressing, but had no immediate timeline for reaching an agreement.

 

When it comes to the union, Inslee’s spokesman, David Postman, said the governor has been in contact with Machinists leaders every day.

 

Although the governor isn’t advising union members how to vote, he is saying “what’s being done here (in Olympia) supports a long-term contract if that’s where they go. And those Machinists, like every Washingtonian, should feel confident that this work is really going to be done here and we’re not going to have a second line go to South Carolina or a wing go to Japan.”

 

Andrew Garber: 360-236-8266 or agarber@seattletimes.com. On Twitter @awgarber

 

http://seattletimes.com/html/localnews/2022229051_boeinglegislaturexml.html (Links to an external site.)

 

 

 

 

 

 

 

 

 

 

 

ARTICLE 3

 

Originally published November 11, 2013 at 11:20 AM | Page modified November 12, 2013 at 10:10 PM

 

Union deeply split on Boeing’s 777X offer

 

Machinists president says members must decide for themselves how to vote, while Boeing Airplanes CEO says threat to build 777X elsewhere “is not a bluff.”

 

By Dominic Gates (Links to an external site.) Seattle Times aerospace reporter

 

Key moments for Boeing in Everett

 

1966: Construction begins on Boeing’s 747 Everett plant, which eventually becomes the company’s largest site. The facilities are expanded in 1978 and again in 1992.

 

1991: Boeing Chairman Frank Shrontz tells a business audience that rising costs in the Seattle area could make it “an aerospace rust belt in the 21st century, complete with padlocked factories, unemployment lines and urban blight.”

 

2001: After 85 years in Seattle, Boeing moves its corporate headquarters to Chicago. Gov. Gary Locke says Boeing told him “no amount of concessions would lead them to keep their headquarters here.”

 

2003: 22 states submit bids for a site to build the 7E7, later dubbed the 787 Dreamliner. The Legislature and Locke enact a $3.2 billion, 20-year tax-break package for the aerospace industry. CEO Harry Stonecipher confirms Boeing will assemble the plane in Everett.

 

2005: The Machinists’ first strike since 1995 ends after one month.

 

2008: Machinists strike for 57 days.

 

2009: Boeing says it will build a second 787 final-assembly line in North Charleston, S.C., after getting an incentive package from that state worth about $450 million, including $170 million in upfront money. The company expects to add 3,800 workers within seven years, bringing the Boeing-related complex there to more than 6,400.

 

2011: Machinists and Boeing agree on a four-year contract extension and production of the 737 MAX in Renton.

 

2013: Boeing says “detailed design” on the 777X will be done in engineering centers outside Puget Sound. Company and Machinists union leaders unveil a deal that assures the 777X will be built here if members approve an eight-year contract extension with significant changes to pension and health benefits, and a pay increase of 1 percent every other year, plus a cost-of-living adjustment. The Legislature and governor enact a package of tax breaks sought by the company.    Source: Seattle Times archives

 

 

 

Division and uncertainty within the largest union at Boeing was evident Monday as some local Machinists officials in Everett angrily denounced the company’s proposed contract while their district leader insisted the proposal will preserve aerospace jobs here.

 

Both Machinists District 751 President Tom Wroblewski and Boeing Commercial Airplanes CEO Ray Conner spoke at a morning ceremony where Gov. Jay Inslee signed into law the legislation passed hurriedly over the weekend to meet some of Boeing’s conditions for building the 777X and its carbon-fiber wing in Washington.

 

Wroblewski declined to say how he wants members to vote in the crucial 777X decision, while emphasizing , “What’s at stake here is jobs for the future, jobs to build 777X for 20 to 25 years.”

 

But in the afternoon, some 300 to 400 militant Machinists, led by local union officials, rallied outside the Everett union hall to shout out a resounding rejection of the contract offer that will be voted on Wednesday.

 

Wilson Ferguson, Local A president, twice tore up copies of the company proposal that has been presented as essential to protect the future of Boeing’s massive Everett plant.

 

Ferguson lamented the “mixed signals” coming from the union’s district leadership and told the crowd that “the majority of the (union) staff are adamantly opposed to this thing” but have been silenced.

 

“It’s not a bluff”

 

Standing near Wroblewski at the signing ceremony, Conner told reporters that if the Machinists reject the company offer, Boeing’s threat to take the work of building its new 777X jet to another state is dead serious.

 

“It’s not a bluff,” Conner said. “My sincere hope is we don’t have to even think about that. … Really, we would prefer not to do that.

 

“Hopefully we’ll get a good vote on Wednesday, then it’s easy,” Conner added. “This is our preference.”

 

Wroblewski — speaking for the first time in public since a contentious union meeting Thursday night when he was first to rip up a copy of Boeing’s offer and denounced it in vivid terms (Links to an external site.) — called the decision on the vote “very emotional.”

 

For union members, said Wroblewski, the contract “really changes the way they’ve done things, that they’ve worked hard for many years to get.

 

“They need to look at this proposal and do what’s right for them, their families and the community.”

 

“Most importantly, this is about the future,” he added. “It’s about jobs.”

 

Wroblewski refused to be definitive on how he personally will vote. He said he must make the decision “just like my members,” but then repeated, “It’s about jobs and about the future.”

 

The legislation Inslee signed provides Boeing tax incentives through 2040 (Links to an external site.), speeds regulatory approval of industrial projects, and adds funding for aerospace training.

 

With U.S. Sen. Patty Murray and many local politicians looking on, Inslee repeatedly stressed that what’s at stake are some 20,000 Boeing jobs and a total of 56,000 jobs overall, counting jobs created by ancillary services to those Boeing workers, from dry-cleaning to restaurants.

 

Conner said that with the 777X project, “working together we have the opportunity to do something really special … the ability to put in place and cement for decades to come good, high-paying jobs.”

 

He said Boeing is “under siege by our competitors from abroad” and must move quickly on the decision as it prepares a 777X manufacturing plan that will “pump a lot of capital here.”

 

Boeing has promised to build 1.5 million square feet of new buildings here to do both final assembly of the 777X and also to fabricate its advanced giant wing, made from carbon fiber-reinforced plastic composite.

 

One concern among some union members is that the wording of Boeing’s agreement with the IAM might allow the company to subcontract the wing to a supplier so that it would not be built by Machinists.

 

On Saturday, Boeing spokesman Marc Birtel said that won’t happen.

 

“If this agreement is ratified by IAM employees, 777X wing fabrication and assembly would be performed by Boeing employees at Boeing facilities in the Puget Sound region,” said Birtel.

 

Angry response

 

Such assurances were of no interest to the Machinists assembled at the union hall Monday afternoon. A half-dozen union officials came to a microphone, each claiming that the members of their unit are solid in rejecting the company offer.

 

Robley Evans, a forklift driver from the Auburn plant and a union steward and vice president in the union’s Local F unit, told the crowd Boeing’s proposed eight-year contract extension “completely stinks.”

 

“I’ve gone on strike for months over contract offers that were way better than this,” he said.

 

Evans expressed the feeling of many Machinists that Boeing is using the 777X project to force through cuts that it couldn’t negotiate in regular contract talks. He urged members to vote no now and to negotiate with strike power when the current contract runs out in three years.

 

“In 2016, we’ll have power then,” Evans shouted to the crowd. “Yeah, baby, we’ll have power then.”

 

The leader of the rally, Ferguson, attacked Inslee for supporting Boeing, saying that if the deal went through, Inslee would preside over wage and benefit cuts that would represent “the Wal-Martization of aerospace” in the state.

 

“It’s all about dividing us and killing the union,” he said.

 

Ferguson said the union needs to address leadership issues exposed by the contract talks, but that the first priority is to reject the 777X offer.

 

After a no vote Wednesday, Ferguson said, “we’ll proceed to fix whatever else is wrong with this union.”

 

His message to Boeing is that the proposal takes away too much that Machinists have fought for: “Don’t hold a gun to my head and tell me it’s a good deal.”

 

Earlier in the day, Boeing’s Conner insisted the proposal “is not about take-aways.”

 

While many Machinists are upset about the proposal to cease new contributions to their traditional pension and move to a defined-contribution savings plan, Conner said already-earned pension benefits would be protected.

 

“The reality is, we’re altering things. We’re not giving up things. Nobody is losing money here.”

 

He said the new retirement plan would still be better than that offered by many companies.

 

“We’re trying to ensure our mutual future here in Puget Sound,” Conner concluded. We would like to stay. That’s why we put a long-term deal in place.”

 

As Conner left the event, not far behind Wroblewski, a radio reporter asked Conner if he was disappointed in the union rhetoric — a reference to the union leader’s emotional dismissal of the company proposal last Thursday.

 

“I’m used to that,” Conner replied. “We’re OK.”  Dominic Gates: 206-464-2963 or dgates@seattletimes.com

 

http://seattletimes.com/html/businesstechnology/2022237073_boeingmachinistsxml.html (Links to an external site.)

 

 

 

 

 

ARTICLE 4

 

A resounding no from Machinists

 

Boeing Machinists resoundingly rejected a deal that would have cut benefits but assured that production of the 777X would take place here.

 

 

 

By Dominic Gates (Links to an external site.)

 

Seattle Times aerospace reporter MIKE SIEGEL / THE SEATTLE TIMES

 

Members of the International Association of Machinists line up Wednesday outside their union hall in Everett to vote on Boeing’s contract proposal that called for major concessions from workers in exchange for building the new 777X jetliner in the state. Members soundly rejected the offer.

 

1966: Construction begins on Boeing’s 747 Everett plant, which eventually becomes the company’s largest site. The facilities are expanded in 1978 and again in 1992.

 

1991: Boeing Chairman Frank Shrontz tells a business audience that rising costs in the Seattle area could make it “an aerospace rust belt in the 21st century, complete with padlocked factories, unemployment lines and urban blight.”

 

2001: After 85 years in Seattle, Boeing moves its corporate headquarters to Chicago. Gov. Gary Locke says Boeing told him “no amount of concessions would lead them to keep their headquarters here.”

 

2003: 22 states submit bids for a site to build the 7E7, later dubbed the 787 Dreamliner. The Legislature and Locke enact a $3.2 billion, 20-year tax-break package for the aerospace industry. CEO Harry Stonecipher confirms Boeing will assemble the plane in Everett.

 

2005: The Machinists’ first strike since 1995 ends after one month.

 

2008: Machinists strike for 57 days.

 

2009: Boeing says it will build a second 787 final-assembly line in North Charleston, S.C., after getting an incentive package from that state worth about $450 million, including $170 million in upfront money. The company expects to add 3,800 workers within seven years, bringing the Boeing-related complex there to more than 6,400.

 

2011: Machinists and Boeing agree on a four-year contract extension and production of the 737 MAX in Renton.

 

2013: Boeing says “detailed design” on the 777X will be done in engineering centers outside Puget Sound. Company and Machinists union leaders unveil a deal that assures the 777X will be built here if members approve an eight-year contract extension with significant changes to pension and health benefits, and a pay increase of 1 percent every other year, plus a cost-of-living adjustment. The Legislature and governor enact a package of tax breaks sought by the company.

 

Nov. 13, 2013: Machinists voted 2-1 against Boeing’s contract offer.

 

Source: Seattle Times archives

 

Ignoring warnings from Boeing and pleas from political leaders, members of the Machinists union Wednesday voted 2-to-1 to reject a contract offer that would have ensured the company builds the new 777X jet in Washington state.

 

Machinists threw out the proposed eight-year contract extension, unveiled barely a week earlier, because it was laced with cuts to benefits. Many members said they refused to be forced into a hasty and radical decision under a management threat that they would lose future work.

 

Blowing away the neutral public stance of International Association of Machinists (IAM) District 751 President Tom Wroblewski over the past week, his members delivered a resounding slap to Boeing.

 

But there was also anger at the union leadership for pushing the offer to a vote.

 

After Wroblewski and IAM national aerospace coordinator Mark Johnson announced the result at the Seattle union hall, the two were loudly booed by the several hundred Machinists present.

 

Wroblewswki retreated hastily to his office, trailed by loud insults as he walked briskly along. Then a message came down to waiting journalists that he would not speak to the media as had been previously arranged.

 

“Spineless,” said Todd Christensen, a union steward from Everett. “He needs to address the membership, not just give us a number and run away.”

 

JD Anderson, a 28-year veteran and quality inspector in Renton, said the union leadership “sold us down the river.”

 

“They should have never brought us that contract,” he said.

 

The vote leaves in limbo an incentive package, including $8.7 billion in new tax breaks over 16 years, that was hurriedly passed last weekend in a special session of the Legislature to comply with one of Boeing’s conditions to put the jet work here.

 

“Boeing came at us with a full frontal assault,” said veteran Machinist Jim Levitt. “We’re all outraged that Boeing is trying to pay South Carolina wages here when our workforce has saved their 787 program.”

 

“These were not minor changes to our contract,” he added. “To call this an extension of an existing contract is ridiculous.”

 

Robley Evans, a forklift driver in Auburn and IAM Local F vice president who helped lead the Vote No push, had a huge smile on his face.

 

“I couldn’t be more proud of my brothers and sisters. We stood against the wall,” said Evans. “We won. We saved our union tonight. That contract would have destroyed our union.”

 

Hazel Powers, 55, a tooling inspector in Auburn, said she voted no to defend the pension and to save new hires from a reduced wage structure.

 

“I’m not going to sell out,” said Powers.

 

What if Boeing places the 777X somewhere else? “Boeing is going to do what they are going to do,” she said.

 

Likewise, Sara Baumgardner, 23, a 787 mechanic in Everett, said, “If they move it, they move it. There’s no better place than Everett.”

 

Boeing Commercial Airplanes CEO Ray Conner said in a statement: “We are very disappointed in the outcome of the union vote. … Without the terms of this contract extension, we’re left with no choice but to open the process competitively and pursue all options for the 777X. … We had hoped for a different outcome.”

 

Boeing had repeatedly said that if the IAM vote went against it, the company would immediately seek other sites for the 777X project.

 

Sources close to Boeing said this week its analysis of alternatives focused on Long Beach, Calif.; Salt Lake City; and Huntsville, Ala.

 

Conner had emphasized Monday that this “isn’t a bluff.”

 

Dan Swank, a 17-year Boeing veteran who works on the Everett flight line and serves as a trustee in the union’s Local A unit, said he voted no although rejection could mean the plane isn’t built in Washington.

 

“It’s a very real possibility that the company could act suicidal again … and move out of state, which doesn’t make any sense financially,” said Swank. He said Boeing CEO Jim McNerney “hates unions so much, that could happen.”

 

“We’ll fight those battles as they come,” said Swank.

 

In the hallway outside the count, Larry Brown, the union’s political director, looked disconsolate.

 

He had worked hard lobbying in Olympia to get the 777X incentives passed for Boeing. As the vote came out no, he expressed regret that because of the way this process has played out, “we will look like the bad guys, for protecting our pensions, and frankly for protecting our union’s existence.”

 

Asked if he was happy at the result, he said, “Happy is not the word. There’s nothing good here.”

 

What’s next?

 

Brown shrugged. “Hopefully Boeing will recognize they went too far and will come back,” he said. “They need to build that airplane here for it to be a success.”

 

Tensions within the union flared briefly in the corridor outside the count when an IAM member accosted official Joe Crockett, loudly accusing him of telling members in Auburn that the Boeing offer was a good deal.

 

Crockett denied that but said little else. It was Crockett whom the union put forward last weekend to speak to The Seattle Times, when he gave a positive spin to the Boeing offer as ensuring job security.

 

Looking for other locations for the 777 plant doesn’t preclude further negotiation with the state and the union.

 

Yet the vote leaves the future of the aerospace industry here on uncertain ground, with an estimated 56,000 jobs at stake.

 

Gov. Jay Inslee’s spokesman, David Postman, said the governor will try to find a way forward.

 

The governor defended the incentive package that he shepherded through the special session, which takes effect only if Boeing builds the plane here.

 

“This was the right thing to do, a bipartisan decision. I stand by it,” he said at a brief news conference Wednesday night.

 

He said that though Washington would have won the 777X with a yes vote, he knew Boeing would seek other competitive bids if the vote failed.

 

Now, he added, “We’re going to go out and compete” against the other potential sites.

 

Maud Daudon, president and CEO of the Seattle Metropolitan Chamber of Commerce and vice president of the Washington Aerospace Partnership, echoed that sentiment.

 

“Now we are going to have to compete even harder,” said Daudon.

 

The no vote was decisive enough that it probably cannot be reversed by sweetening the deal a little. Unless Boeing returns to the table with a significant shift in direction, the vote could kill Washington’s chances of building the new jet.

 

The consequence of that could be devastating to the state’s manufacturing economy. The massive plant in Everett could be half-empty as early as 2021 if the 777X work is lost.

 

The jet-maker is still set to launch the airplane with a big order from Emirates at the Dubai Air Show next week.

 

With Plan A now in disarray, Boeing may move quickly to convince customers it has a fallback. The work could be offered to other states as early as Thursday.

 

New plane

 

The 777X is a new version of Boeing’s hugely popular 777 twin-engine widebody jet, which is built today in Everett.

 

The new model, slated to enter service around 2020, will feature new fuel-efficient engines, larger even than the current 777’s enormous engines.

 

And while today’s 777 is metal except for its carbon-fiber-reinforced plastic tail, the 777X will add an advanced wing, the largest ever built by Boeing, made from that same composite material.

 

The plane is designed to defend Boeing’s current dominance in the large widebody market against the rival Airbus A350, which flew for the first time in June at the Paris Air Show.

 

As Boeing learned painfully on the 787 Dreamliner program, a failed manufacturing plan can create a business disaster. This time around, Boeing has to execute 777X smoothly and deliver on time.

 

Machinists believed the Everett plant’s expertise and existing infrastructure give them leverage over Boeing. The company saw it differently.

 

Offer’s terms

 

In the offer the Machinists rejected Wednesday, Boeing tried unsuccessfully to apply the leverage of the 777X work to radically change a pay and benefits structure that the IAM has defended for years.

 

In return for building the 777X jet and fabricating its wing in Washington, Boeing sought dramatic cuts in its long-term costs — and certainty that there would be no Machinist strikes through 2024.

 

Key elements of the rejected contract proposal included:

 

• The deal would have ended contributions to the employees’ traditional pension plan in 2016, freezing the pension for current employees and eliminating it for new hires.

 

This pension was to be replaced by a company-funded, defined-contribution retirement-savings account.

 

The company would have added 10 percent of gross salary to this account for two years, 6 percent the third year and 4 percent every year thereafter.

 

• In addition, the company had offered to increase its match in the separate 401(k) account that the Machinists currently have, from up to 4 percent of the employee contribution to up to 6 percent.

 

• The proposal also would have increased employee health-care premiums and copays.

 

• New hires would have moved up the pay scale much more slowly than they would under the current wage structure.

 

• Wages would have increased just 1 percent every other year, on top of an annual cost-of-living adjustment.

 

• And all members would have gotten a $10,000 signing bonus before Christmas.

 

But the Machinists rejected that enticement in favor of protecting their longtime benefits.

 

“This contract is nothing but take-aways,” said Omar Abdul-Alim, a 23-year Boeing mechanic in Renton. “It will take away everything we negotiated for in the past.”

 

Abdul-Alim said his grandmother, Arlene Acrey, an African-American “Rosie the Riveter” during World War II and now in her 90s, told him to go fight for what he thinks is right in Wednesday’s vote.

 

He voted no.

 

Seattle Times reporters Coral Garnick, Sanjay Bhatt, Alexa Vaughn and Alisa Reznick contributed to this story.

 

Dominic Gates: 206-464-2963 or dgates@seattletimes.com

 

http://seattletimes.com/html/businesstechnology/2022253577_boeingmachinistvotexml.html (Links to an external site.)

 

 

ARTICLE 5

Originally published January 3, 2014 at 10:08 PM | Page modified January 4, 2014 at 9:58 AM

Machinists say yes, secure 777X for Everett

Machinists union members take a pivotal vote on Boeing’s contract offer, shaping the future of the aerospace industry here.

By Dominic Gates (Links to an external site.) Seattle Times aerospace reporter

 

 

 

DEAN RUTZ / The Seattle Times

Dena Bartman holds her daughter, Gabrielle Rogano, after the vote came in showing 51 percent of Machinists had accepted Boeing’s most recent offer. At left is Hazel Powers.

 

 

Mike Siegel / The Seattle Times

Machinists zigzag through the Everett union hall parking lot while waiting in line to vote.

 

 

DEAN RUTZ / The Seattle Times

The votes of Seattle Machinists are counted at union headquarters in South Park Friday.

 

 

Mike Siegel / The Seattle Times

Machinists wait in line early Friday morning to vote at the Everett union hall, across the street from the Boeing final assembly plant.

 

 

DEAN RUTZ / The Seattle Times

The votes of Seattle’s Machinists are counted at union headquarters on Friday.

 

 

DEAN RUTZ / The Seattle Times

Jim Bearden, administrative assistant of Machinists District 751, announces the result of Friday’s ballot on Boeing’s latest contract proposal.

 

 

Raw video: Machinist Union counts for Boeing 777X contract (Links to an external site.)

Play video now (Links to an external site.)

 

 

Raw video: Reaction to Boeing 777X contract approval at IAM (Links to an external site.)

Play video now (Links to an external site.)

Related

Contract’s key details

The Boeing proposal that Machinists voted on Friday has these major elements:

• Extends current contract by eight years, through 2024

• Ends pension-plan accruals in 2016, substitutes a defined-contribution savings retirement plan. Instead of pension, Boeing contributes to a current employee’s retirement account 10 percent of gross pay the first and second years, 6 percent the next year, and 4 percent a year after that. New employees get 4 percent a year.

• Retains the current 401(k) plan (distinct from savings retirement plan), and increases company match to 6 percent of base pay, from 4 percent.

• Maintains the wage progression known as “zoom,” which moves new hires to top of their grade’s pay scale after six years.

• 4 percent general wage increase over eight years, plus cost of living.

• Provides $10,000 signing bonus now, another $5,000 bonus in 2020,

Source: Boeing, Machinists

A contentious two months

Nov. 5: Boeing says it will build 777X jet and its large advanced wings in Washington if Legislature enacts an incentive package and Machinists approve a contract extension from 2016 to 2024, with significant concessions.

Nov. 9: Special session of Legislature approves $8.7 billion in tax breaks if Boeing builds 777X in state.

Nov. 13: Machinists vote by 2 to 1 to reject Boeing’s contract.

Nov. 14: Boeing begins search for other sites for 777X wing fabrication and airplane assembly, asking bidders to provide site and facilities at “no cost, or very low cost.”

Dec. 10: Company and union resume talks. States submit their 777X offers to Boeing.

Dec. 12: Boeing makes ‘best and final’ offer; District 751 leadership rejects it, says there’s no need to vote because it’s not much improved.

Dec. 21: Union’s national leaders overrule District 751 and schedule vote for Jan. 3. Later, they allow absentee ballots so members who are still on holiday break can vote.

The Seattle Times

The January vote

The hunt for alternatives

The aftermath

The November vote

The Legislature

Opinion

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Members of the Machinists union Friday accepted Boeing’s contract proposal by a slim 51 percent, sealing a cliffhanger ending to a tense chapter in the history of their union, their industry and their region.

The deal passed despite a strident Vote No campaign led by the union’s local leadership. When the result was announced inside the Seattle union hall filled with militant Machinists who opposed the contract, some men and women wiped away tears and a few cried openly.

The International Association of Machinists (IAM) did not release an official vote count, but Wilson Ferguson, president of the Local A unit of the district, said about 23,900 total votes were counted and the margin was around 600 votes. Voter turnout was lower than the earlier vote in November because many members were still on their Christmas break.

The outcome means Boeing will build the 777X jetliner in Everett and its wings will be fabricated nearby by Boeing machinists.

Approval by union members also means the company abruptly terminates its wooing of other states to compete for the work.

Boeing is assured of labor peace for the next decade, and its most experienced workers will build the widebody jet it needs to fight off a challenge from Airbus.

The region’s economy is assured of high employment at Boeing for a decade to come, and likely more.

Boeing Commercial Airplanes President and CEO Ray Conner issued a statement welcoming the result.

“Thanks to this vote by our employees, the future of Boeing in the Puget Sound region has never looked brighter,” said Conner. “We’re proud to say that together, we’ll build the world’s next great airplane — the 777X and its new wing — right here. This will put our workforce on the cutting edge of composite technology, while sustaining thousands of local jobs for years to come.”

The 32,000 members of Boeing’s blue-collar union, however, will give up some hard-won benefits, including the traditional pension.

With the vote, they qualify at once for a $10,000 bonus.

For both the Boeing employees and those at firms fueled by Boeing spending — from aerospace suppliers to restaurants and car dealerships — the bigger bonus is job security. If the vote had gone the other way, the prospect was a precipitous decline in the plane-building workforce.

Because of the advanced manufacturing technology involved in fabricating the new plane’s composite wing, Boeing employees now can look with some optimism to a future in aerospace work well beyond 2024.

Boeing’s wing mechanics will be retrained in the advanced processes used to manufacture large structures made from carbon-fiber reinforced plastic, setting up the next generation to build future jets made from this material.

Tom Wroblewski, IAM District 751 president, announced the result but did not speak to the press.

Emerging from the hall, Mark Johnson, aerospace coordinator for the national IAM headquarters, said, “It was a tough vote, a hard situation, splitting the membership.”

IAM International President Tom Buffenbarger, who forced the vote, issued a statement welcoming the result.

“The impact of this agreement extends far beyond IAM members who voted today,” Buffenbarger said. “For decades to come, the entire region will benefit from the economic activity and technological innovations that will accompany the production of the 777X and 737 MAX.”

Divided union

Yet for the local Machinists who voted, the decision was not reached easily.

Inside the union hall Friday night, the announcement of the contract’s acceptance was greeted with shock, tears and one cry of “bullshit.”

IAM spokesman Bryan Corliss said the deal was difficult to accept because the last two strikes, in 2005 and 2008, “were driven in large part by Boeing’s attempt to take away the pension from new hires.”

“To lose it this way is hard to accept,” said Corliss.

One union member in the hall at the announcement called for a union withdrawal slip. Most filed silently out of the room, consoling each other. “We’re going to be OK,” one said to another.

Wroblewski and his team this past week posted urgent messages couched in militant language on the local IAM website denouncing the “massive take-aways” in Boeing’s offer and calling for a rejection vote.

Their anti-contract stance was much more clear-cut than the opposition they’d offered to Boeing’s first contract extension proposal, which Machinists voted down by 2 to 1.

But his members ignored the very loud Vote No campaign, instead appearing to recognize the imminent risk of losing future jobs if they took that path.

Corliss said nobody was happy with the contract offer.

“But when the gun was held to their heads, our members felt compelled to vote yes,” he said.

Reassurances from Boeing’s leadership that the pensions already accrued are protected and safe may also have won over some Machinists.

Washington state political leaders, including Gov. Jay Inslee, expressed delight and relief at the result.

“Tonight, Washington state secured its future as the aerospace capital of the world,” said Inslee. “We will make sure the company keeps its commitment and that these jobs remain in Washington state for the life of the airplane.

“We have a history of innovation in our state that has gotten us to this point today and will chart our future for decades to come,” he added.

By November, Boeing plans to begin construction of a 1.1 million-square-foot facility for building the 777X wings.

Boeing projects that just this facility, at a still-unidentified site in Washington state, will require up to $4 billion in new investment and will provide nearly 3,000 jobs at peak production in 2024.

News of the Machinists’ yes vote will disappoint officials in 21 other states, including such top contenders as Texas, Utah and South Carolina, who scurried to put together incentives for Boeing as they submitted formal bids for the work.

The 777X is a new version of Boeing’s highly successful 777 twin-engine widebody jet, which is built today in Everett.

Launched at the Dubai Air Show in November with record-breaking orders and commitments worth more than $52 billion after estimated discounts, the new model is scheduled to enter service around 2020.

It will come in 400-seat and 350-seat versions and will feature new fuel-efficient engines, the largest on any airliner.

And while today’s 777 is metal except for its carbon-fiber-reinforced plastic tail, the 777X will add an advanced wing — at 114 feet, the largest ever built by Boeing — made from that same composite material.

Successfully building and selling the plane is crucial for Boeing to maintain its current dominance in the large widebody market against the rival Airbus A350, which flew for the first time in June at the Paris Air Show.

Boeing cannot afford to repeat on 777X its painful and expensive experience with the failed manufacturing plan on the 787 Dreamliner program. It needs to deliver this next airplane on time.

Machinists’ calculations

That business imperative convinced some Machinists that Boeing management could not dump their expertise and the existing infrastructure in Everett.

Voting at the Renton union hall Friday, Steve Averill, 57, called Boeing’s threat to pull out of Washington state “B.S.” He pointed to production problems at the 787 Dreamliner plant in South Carolina, where he said “they’re not fifth-generation airplane builders.”

“We build the best jets in the world,” said Averill, a 26-year Boeing veteran who works as a 737 repair mechanic. “If Boeing wants the best, they’ll stick with us.”

Driving away on his Harley, Averill shouted “Hell no!” to other sympathetic Machinists.

But other Machinists responded to Boeing’s warnings by voting Friday to accept the offer.

Avery Madden, 30, voting at the Renton union hall, said he chose to accept Boeing’s proposal in the first vote in November and then again Friday, both times hoping to secure Boeing jobs in the region.

“I don’t ever want to gamble. I’ve got a family to take care of,” said Madden, a 737 mechanic with two years at Boeing and the father of a baby girl.

Though the latest offer froze the traditional company pension, he said, Boeing still offers good pay and benefits, including college-tuition assistance.

“I just think at my age, there’s more ways to invest in my future. I’m not stuck on pensions just to say ‘no’ to Boeing and watch them leave,” Madden said. “There aren’t a lot of jobs out there I can find that match Boeing.”

Cost-cutting move

In return for its deal to build the 777X jet and fabricate its wings in Washington, Boeing has won dramatic cuts in its long-term costs. Making demands two years ahead of the current contract’s expiration date — thereby leaving the union no option to strike if the negotiations failed — Boeing secured a deal that includes radical changes to the benefits structure that the IAM has defended for years.

Nancy Stapleton, 60, voted “yes” Friday at the Machinists union hall in Renton, after voting “no” to Boeing’s initial offer in November.

Stapleton said she was encouraged that the company dropped a proposed change in the earlier offer that would have made new hires wait 16 years to reach the top of the pay scale instead of the 6 years it takes today.

And Stapleton said she took seriously Boeing’s threat to move 777X work out of Washington state.

“I call this protecting our younger generation,” said Stapleton, who was accompanied by her 11-year-old grandson Noah. “There’s a lot of jobs at stake.”

Staff reporters Amy Martinez, Coral Garnick, Sanjay Bhatt, Angel Gonzalez, Kyung M. Song and Christine Clarridge contributed to this story.

Dominic Gates: 206-464-2963 or dgates@seattletimes.com

SOURCE: http://seattletimes.com/html/businesstechnology/2022593956_machinistsunionvotexml.html (Links to an external site.)

 

 

 

 

 

 

OPINION 1

 

‘Squeeze play’ on Machinists is reality elites failed to feel

 

Business and political leaders were complicit in disrespecting workers in Boeing deal. That’s why it failed.

 

 

By Danny Westneat (Links to an external site.)  Seattle Times staff columnist

 

There was a revealing moment the other night, after the resounding “no” vote from Boeing’s Machinists, when Gov. Jay Inslee was asked if he respected the decision they’d made.

 

“I respect reality,” he said. “And the reality is we could have won tonight. Some folks made a vote, about two to one, where that vote did not come out the way that would allow us to win. That’s a reality.”

 

Who is this “us”? Because the people who build the planes didn’t feel it included them.

 

I’m not trying to be overly flip here. This answer from Inslee — his implication that he didn’t respect the workers for their decision — goes a long way to explaining why the rank-and-file Machinists were so put off by this entire exercise that it ended in a debacle.

 

After the vote I talked to or corresponded with a dozen Machinists. As might be expected, they hold widely varying opinions on the contract they were just offered (some thought it OK, some hated it), on Boeing (some love the place, some don’t trust it) and on politics (most vote Democrat, a few said they’re more conservative or don’t care).

 

All were exasperated at their dysfunctional union leadership, for “setting us up to fail,” as one said. And they were left feeling “disrespected” — not so much by Boeing as, surprisingly, Inslee, Sen. Patty Murray and the rest of the political class in the state.

 

“I never thought I’d see Jay Inslee and Patty Murray involved in a squeeze play on the middle class,” said one.

 

“It was like being kneecapped by someone you thought was your friend,” said another.

 

“I don’t know if they meant to, but they hung us out to dry,” said a third.

 

Notice I said above that this is how some Machinists “feel.” Feelings aren’t facts. Inslee and Murray have equally strong feelings that they were trying to secure jobs and economic growth for their state. Plus they may have been as misled by union leadership as the union was.

 

But here’s how this past week seemed choreographed to many Machinists:

 

Boeing, you get $9 billion. Politicians, you get a “big win” to hail at news conferences. And workers, you get to cancel your pensions.

 

Deal?

 

Last Sunday I noted how the head of Boeing, Jim McNerney, is set to draw a pension that pays a quarter-million dollars (Links to an external site.) per month. Gov. Inslee, Sen. Murray and the rest of the public officials extolling this deal also have nice, safe pensions. That’s fine, but they ought to know how grating it sounds when this same elite class finds it imperative that workers — and only the workers — should unwind their retirement security.

 

“I know change can be hard,” Boeing commercial jet president Ray Conner sympathized.

 

Especially when only one party to a deal is being asked to change!

 

People say the Machinists are blind to how good they have it. Probably so. But be honest: If your boss said to you, “Hey we’re making record profits, and paying ourselves phantasmagorical amounts, but to remain a going concern we must cut your retirement,” how would you react?

 

I would at least expect an explanation — a primer, say, on the forward-cost calculations of jetliner development. A number of Machinists told me they’d take a hit to their pensions if there was some sense of shared sacrifice from above.

 

Instead, what they got was: Take this, now, or we’re outta here. All cheered on, implicitly, by Inslee, Murray and the other lifetime pensioners we have in public office.

 

In the elite class’ defense, workers usually do cave. There’s long been resignation about the race to the bottom.

 

But who knows, maybe the winds are shifting. In the past week the Boeing Machinists said “no,” SeaTac voters appeared to be raising their minimum wage to $15 an hour and Seattle elected its first socialist to the City Council, apparently ever.

 

We could still win this airplane. But it feels like business and political leaders, rather than lecturing about their version of reality, might acknowledge there’s a new one emerging, clamoring for some respect of its own.

 

Danny Westneat’s column appears Wednesday and Sunday. Reach him at 206-464-2086 or dwestneat@seattletimes.com

 

http://www.seattletimes.nwsource.com/html/localnews/2022275588_westneat17xml.html (Links to an external site.)

 

 

 

 

 

OPINION 2

 

Anguish many of us understand

 

As Boeing tries to slash pensions for its own employees, its CEO is out arguing to cut the nation’s retirement plan, Social Security, as well. Will workers reach a breaking point?

 

 

 

 

By Danny Westneat (Links to an external site.)  Seattle Times staff columnist 

 

What we’re hearing from the Boeing Machinists right now isn’t just the usual labor-management posturing. It’s a primal scream of the middle class.

 

When a union boss the other day called Boeing’s offer to do the 777X jetliner work here a “piece of crap,” he was of course referring to the gory details of that contract: the canceled pension plan, the slashed benefits, the appalling 1 percent pay raise issued only every other year.

 

But he could just as well have been anguishing for depressed workers everywhere. He summed up, in one phrase, the state of economic security for laborers far beyond the walls of our (formerly) hometown airplane-maker.

 

Take one aspect of the Boeing showdown, the pensions. For decades Boeing has given its line workers a decent retirement benefit. It pays out about $90 a month for every year worked at the company, so that someone with 30 years of service would get $2,700 a month when they’re done at age 65.

 

Add Social Security to that and you’ve cobbled together a comfortable but hardly posh old age for sheet-metal workers, riveters and others who build the nation’s planes.

 

Boeing wants to cancel those pensions and put in much weaker 401(k) plans. There’s little doubt this will happen, sooner or later. Because if it doesn’t, Boeing can use pension-free laborers in South Carolina to do the same work.

 

It’s a race to the bottom. Or rather, a slog to an era when workers will be more reliant on Social Security than ever.

 

So what’s most galling is that Boeing’s CEO is out pushing to cut back on the nation’s retirement plan as well.

 

In recent years Boeing CEO Jim McNerney has headed the Business Roundtable, a lobbying group of top U.S. corporations. Earlier this year that group called for raising the eligibility age for Social Security (Links to an external site.) to 70 years old, as well as crimping back on the benefits (by reducing the index of inflation used to calculate payouts.)

 

“We are going to need our employees to work longer just to fill the needs that we have in the work force,” said a Roundtable suit (Links to an external site.), helpfully explaining why all Americans should willingly retire later, for less.

 

I ruefully know firsthand why a company might reconsider its pensions. Few companies have pensions anymore, and it’s true the obligations can be an anvil. Here at The Seattle Times we froze our pension a few years back. It was the toughest vote we’ve ever taken, but we did it to try to save the company and our jobs.

 

Boeing is racking up record profits, though. Its stock hit an all-time high Friday. Yet its CEO picks this moment to go for a double-whammy worker takedown — gutting the pensions of its own employees, and going after Social Security to boot.

 

If we accept that companies can’t provide for retirement anymore, wouldn’t that mean we need to expand Social Security, not shrink it?

 

Speaking of expanding, that’s what keeps happening to the pension of Boeing’s CEO. According to the company’s recent annual reports (Links to an external site.), McNerney’s pension holdings soared by $6.3 million just in the past year.

 

If McNerney retires now he will get $265,575 a month. That’s not a misprint: The man presiding over a drive to slash retirement for his own workers, and for stiffs in the rest of America, stands to glide out on a company pension that pays a quarter-million dollars per month.

 

Man, you can see why people around here are starting to vote for the socialists.

 

Seriously, I have long argued we should give Boeing mostly what it wants if it means the company will keep building planes here. Aerospace jobs are so valuable it’s one of the industries worth giving corporate welfare.

 

But there’s a breaking point. I don’t purport to know what the Machinists will do, or even what they should do. But I don’t blame them for the primal scream.

 

Danny Westneat’s column appears Wednesday and Sunday. Reach him at 206-464-2086 or dwestneat@seattletimes.com

 

http://seattletimes.com/html/localnews/2022228517_westneat10xml.html (Links to an external site.)

 

 

 

 

 

 

 

OPINION 3

 

Hard bargain for 777X way of the world today

 

Seeing the world as it is requires recognizing that Boeing provides us with an asset that has nearly disappeared from the United States: a large manufacturing workforce in one relatively compact region making good wages. Boeing is also the backbone of Washington’s export power.

 

 

 

 

By Jon Talton (Links to an external site.)

 

Special to The Seattle Times

 

Samuel Johnson said, “When a man knows he is to be hanged in a fortnight, it concentrates the mind wonderfully.”

 

It would be unnecessarily alarmist to claim that the Puget Sound aerospace cluster is facing such a lethal moment. Still, the past few years have brought some unmistakable warnings.

 

Boeing bought its suppliers’ operations in North Charleston, S.C., and established a new assembly facility there for the 787 Dreamliner in a nonunion plant. The company has made several other decisions to move important work out of the area.

 

While we won assembly of the 737 MAX, our place in the coming 777X has been in doubt.

 

That changed last week, when Gov. Jay Inslee announced a tentative deal to assemble the new airplane here, as well as to build the jet’s massive composite wings.

 

In exchange, Boeing wants members of the International Association of Machinists to accept a new eight-year contract requiring major concessions. Inslee also convened a special session of the Legislature to act on several measures, including a transportation-tax package, to secure the 777X.

 

Yes, Boeing is driving a hard bargain. Machinists would be giving up the blunt instrument of the strike, as well as agreeing to a 401(k)-style retirement plan in lieu of the traditional pension plan, and to accept higher health-care premiums and a longer wait for members to reach the highest pay grade.

 

On the other hand, if the Machinists agree to the deal, members will get a $10,000 signing bonus, early-retirement incentives and an increased company match for the retirement savings plan.

 

The deal is far from assured. This is a national union being asked, on a tight deadline, to open and extend an unexpired contract while agreeing to significant givebacks, then voting on the new contract.

 

Boeing will have overplayed its hand if it believes union contracts are top-down affairs that can be cut in backrooms. The workplace democracy of unions doesn’t work that way, especially when members see a company making record profits, rewarding top executives with lavish compensation while asking men and women on the line to risk their retirement security.

 

After all, recent years have shown how inadequate 401(k)s can be compared with traditional pensions.

 

Many members are working on programs that are stepping up production or have a big backlog of orders. The possibility of Boeing eventually leaving the region is not an immediate concern of these workers. Smaller paychecks, higher health costs and loss of pensions are real-life issues in front of their faces.

 

It’s also important to remember the Puget Sound region is one of the world’s two first-class aerospace hubs, the other being Airbus in Toulouse, France. . It offers talent, skills and institutional knowledge that can’t be replicated. When things went wrong with the 787, Boeing turned to union machinists and engineers to fix them.

 

Boeing has huge sunk costs here, while the former Vought plant in South Carolina is having trouble keeping up as a Dreamliner assembly line.

 

All this is true. But we must compete in the world as it is, not as we wish it to be.

 

Boeing has the whip hand of options, even if they are potentially expensive.

 

As the country’s only commercial airplane-maker, a huge defense contractor and the biggest exporter, Boeing enjoys tremendous power in Washington, D.C. It has capacity and talent in Southern California and St. Louis. In South Carolina, it has a state hungry for good jobs and willing to do almost anything to get them.

 

If members approve the deal, it is a potential game-changer.

 

For one thing, it assures the commanding position of the Puget Sound aerospace cluster for a generation — as much as anything can be assured in this time of disruption. In addition, building the wing here could be leveraged into a wider sector of carbon-composite manufacturing and research.

 

An agreement could represent a model of how unions can survive and thrive in the 21st century.

 

Seeing the world as it is requires recognizing that Boeing provides us with an asset that has nearly disappeared from the United States: a large manufacturing workforce in one relatively compact region making good wages. Boeing is also the backbone of Washington’s export power.

 

While the transportation package might not be the most critical element needed to land the 777X, it should have been approved in the last legislative session. It will benefit the entire state. Only a few obstructionists prevented its passage last time. Maybe now, they will see the light.

 

This is an imperfect deal. But reality is that way. It would be foolish to play chicken with reality or blow this opportunity. The destructive consequences will echo for decades.

 

You may reach Jon Talton at jtalton@seattletimes.com

 

http://seattletimes.com/html/businesstechnology/2022215319_biztaltoncol10xml.html (Links to an external site.)

 

 

 

 

 

 

 

OPINION 4  – “Shareholder Value”

 

November 14, 2013 at 10:23 AM

 

The Boeing vote: Morning-after reflections

 

Posted by Jon Talton (Links to an external site.)

 

A cynic might say that Boeing has the International Association of Machinists right where it wants them. The company came to Washington first to build the new 777X. Workers voted down the requested contract extension. So if the new airplane is built elsewhere, it is the union’s fault.

 

But last night’s vote and the circumstances surrounding it are filled with shades of gray.

 

Boeing is operating as a multinational company in a “shareholder value” environment created since the 1980s and in a competitive world. Thus, record profits and high executive compensation are not at odds with trying to drive down costs, including — especially — for labor. They go hand-in-hand. While Boeing benefits from government subsidies and other “rents,” it worries about rivals that will emerge from China and Brazil in future years.

 

Executives are not unmindful of the value of the Puget Sound aerospace cluster and the high-skilled workers that saved it from the outsourced disasters of the Dreamliner. That’s why the company would rather built the 777X here, but not at any price.

 

They also operate in a quick-step world. Everybody knew a decision on where to make the new airplane was coming. State officials and union leaders seemed to understand the need for a speedy process.

 

But this is not the culture of organized labor. A wide majority of workers saw an ultimatum, not a negotiation. In their culture, an existing contract is not suddenly reopened and members given a week to take or leave a seemingly take-it-or-leave-it offer.

 

Especially in a time of historic inequality, when 40 percent of working Americans make $20,000 a year or less, these union workers resent being asked to give back gains it took decades of collective bargaining to achieve. Especially galling was potential loss of pensions in favor of inferior 401(k)s while executive retirement packages are princely.

 

When the United Auto Workers accepted repeated givebacks, it was because the Big Three were in desperate shape. Boeing’s situation is quite the opposite. In any event, building airliners isn’t the same as making cars.

 

“Labor peace” works both ways. Union members I spoke with said the vote might have gone Boeing’s way if the company had not made what they saw as extreme demands when it is also booking record profits and a healthy stock price. To a union member, a contract is a solemn compact, not a temporary set of goals to be changed on a whim.

 

Boeing could have used some of its hefty cash holdings to reinvest in its skilled human capital. The company could have made a more nuanced offer, perhaps moving in slower steps to wean members off pensions and change seniority pay over a longer time-frame. Executives could have accepted some austerity themselves as an example. They could have given the union more time.

 

It is difficult to see that the Machinists have much leverage, however proud they are for making a stand. As hard as it is for an outsider to understand, they are also deeply proud of their work, the airplanes that lace the world in comfort and safety. For these workers, there’s no dissonance between cursing the so-and-sos in the executive suite and being profoundly attached to Boeing.   I doubt Boeing’s offer was an opening in a negotiation.

 

The deal always carried serious questions. One concerned the number of jobs that the 777X would actually ensure. Robots are already at work on the line in Everett. More automation should be expected. Another: Would Boeing feel empowered to swoop in with another sudden demand that changed the contract.

 

Now the size and scope of Washington’s aerospace and manufacturing future have become much more murky.

 

We have one of the best aerospace clusters in the world, with unparalleled strengths. In the larger economy, it saved us from the worst of the Great Recession — fixing the 787 helped — and provides a huge cohort of well-paid blue-collar jobs. It allows the state to turn in some of the best export levels in the nation.

 

Yet it is a high-skilled, high-value, relatively high cost asset in a nation, and world, with surplus labor and governments willing to do anything to attract good jobs.

 

However the vote went Wednesday, it was going to be a historic turning point.

 

The morning after, it mostly points to tragedy when the back orders and existing contracts run out.

 

http://blogs.seattletimes.com/jontalton/2013/11/14/the-boeing-vote-morning-after-reflections/ (Links to an external site.)

 

OPINION 5

 

777X vote shows bitter rift in Machinists leadership

 

How leaders at Machinists and Boeing brought forth a deal that was so soundly rejected by union members.

 

By Dominic Gates (Links to an external site.)    Seattle Times aerospace reporter    ELLEN M. BANNER / THE SEATTLE TIMES

 

Having earlier torn up Boeing’s contract offer, local Machinists President Tom Wroblewski, second from right, was back on a neutral message as officials gathered Monday for a signing of 777X incentive legislation. Seen with Wroblewski, from left, were Sen. Patty Murray; Boeing executive Ray Connerand Gov. Jay Inslee.

 

Boeing’s Machinists union went into Wednesday’s crucial 777X decision deeply divided on whether the company’s contract proposal even deserved a vote. The union’s national leaders pushed the vote through despite an emotional confrontation with local staff and officials just days earlier, according to people who were present.

 

Tens of thousands of jobs in the state building the planned 777X jetliner and its advanced wing were resting on that vote.

 

Yet after the resounding rejection of the offer, the local union leadership remains bitterly split, immensely complicating any reopening of talks with Boeing to salvage the eight-year deal.

 

On Thursday and Friday, two local units of the International Association of Machinists (IAM) passed votes of no confidence in District 751 President Tom Wroblewski and called for his resignation.

 

In addition, several petitions to decertify the union are circulating in the Boeing plants, though these are unlikely to succeed.

 

Meanwhile, Boeing pulled its offer to build the 777X jet in Washington state, which must now compete for the work against states around the country.

 

Tom Buffenbarger, the union’s Washington, D.C.-based international president, said in an interview that he doesn’t see a way forward. Only a change of heart by the rank and file in the Puget Sound area can break the impasse, he indicated.

 

“I don’t know that Boeing would entertain any overtures from us. We certainly haven’t heard anything from them,” Buffenbarger said. “The members are going to have to find their way to thinking what’s important. They’ll be able to signal to their leadership that there should be talks.”

 

Difficult talks

 

Secret talks at the union headquarters in South Park between top Boeing executives and IAM leaders began in earnest in mid-October.

 

The company side was led by Boeing Commercial Airplanes chief Ray Conner and the vice president responsible for the supply chain, Stan Deal. Tim Keating, senior vice president of government affairs, was also closely involved.

 

The union side was led by Buffenbarger’s right-hand man, Rich Michalski. Because the union has members in Canada as well as the U.S., its leadership is known as “the International.”

 

Local union president Wroblewski was also at the table and found himself the man in the middle, torn between the International and his own staff.

 

On Sunday, Nov. 3, the talks came close to falling apart.

 

In exchange for building the 777X here, Boeing had started the talks with very aggressive demands, asking more than it ever had in regular contract negotiations.

 

It wanted to dramatically cut its long-term costs. Executives were adamant they had to get rid of the traditional pension and also change the wage structure for new hires to hold back wage growth.

 

The proposal would have meant new employees, who start out with modest pay of $15 an hour, could take as long as 20 years to reach the top pay for their labor grades, currently ranging from about $33 to $43 an hour.

 

In talks leading up to that weekend, the union managed to persuade Boeing to increase the amount it would put into an alternative retirement-savings plan that would replace the pension, to offer an early retirement option, and to give a large signing bonus.

 

But on that Sunday, Boeing said it wouldn’t move further and demanded the offer be put to a vote of the membership.

 

“They gave us a last, best final offer,” Buffenbarger said.

 

That evening Michalski and Wroblewski met with about 30 of District 751’s local elected officers and paid staff, and for the first time laid out to them the terms of Boeing’s offer.

 

The local officials reacted angrily, saying the members would never vote for it.

 

Michalski argued for a vote, saying it would guarantee jobs.

 

Said Buffenbarger in the interview: “When the company says, ‘That’s it. No more,’ our role is to take the offer and present it to the members for a vote.”

 

But two-thirds of those present that evening voted against even putting the offer to the members.

 

“It blew up,” said a person who was briefed on the negotiations. “It was a very open question whether it would get to a vote.”

 

Sen. Patty Murray and Gov. Jay Inslee made calls to top company and union leaders, urging continued engagement, according to people familiar with their roles. Both had for weeks privately called for the leaders on each side to forge an agreement.

 

Next day, company representatives met one more time with the top union leaders and again insisted on a vote, saying Boeing otherwise would walk away and start a nationwide competition for the 777X work. Murray favored putting it to a vote rather than ending talks.

 

Wroblewski told Boeing he couldn’t recommend to his members that they accept the offer. But he agreed to a vote.

 

That Monday evening, Wroblewski again convened his local council, and again a 2-to-1 majority said the members shouldn’t be asked to vote on the offer.

 

“There was a lot of emotion,” said a union official who was present, and who asked for anonymity because the union threatened to dismiss any of its officers who speak about what happened.

 

He said he and his colleagues felt that the offer would badly undercut years of Machinists’ gains in creating middle-class, blue-collar jobs with good wages and benefits. They also felt certain the vote would fail.

 

Wroblewski overruled his staff.

 

A person close to both sides of the negotiations said that Wroblewski agreed to the vote even though he was against the offer.

 

“The International put a lot of pressure,” this person said. “Their thought was that … with 56,000 (direct and ancillary) jobs at stake, the concessions were not unreasonable.”

 

“Obviously, there was a miscalculation,” he added, referring to the rejection of the offer by union members.

 

A senior union official said the International “blinked.”

 

“They got the message from Boeing that they were very serious and that there would be significantly fewer workers,” the senior official said.

 

Speaking after the vote failed, Buffenbarger echoed the arguments made by Boeing executives to justify the major shift in wages and benefits that they demanded.

 

“Airbus is a true competitor now. They are coming after Boeing,” Buffenbarger said. “They have to bring a new airplane to market that won’t have the birthing problems of the 787 against the stiffest competition they’ve ever faced from Airbus. … Boeing was going to reach as aggressively as they could because they are in a new world.

 

“This was an opportunity to secure some work,” he added. “It was unusual. It was a gamble.”

 

Buffenbarger insisted that letting his members vote was the right decision. “Who is Tom Buffenbarger to tell them?” he said. “They have to decide in Seattle.”

 

However, resistance from the local union’s elected officers and staff — despite threats of termination if they publicly voiced opposition to the deal ­— had an immediate impact on the rank and file who voted.

 

Dan Swank, who works on the Everett flight line and spoke at a rally against the offer, said union officials quickly made their feelings known.

 

“Many of our local leadership were dead set against this and were out on the floor saying vote no,” Swank said.

 

Wilson Ferguson, president of the Local A unit of the union and lead speaker at that Vote No rally, said staff members spoke out “at their peril.”

 

“They put their jobs in jeopardy,” he said.

 

After the failed vote, one local staffer said, “We all feel like we have targets on our backs.”

 

Many local union officials believe that agreeing to Boeing’s terms would have revealed the union as weak, without any leverage.

 

Swank said it appeared to the rank and file that the International’s motivation in pushing the deal that would last through 2024 was to secure 10 years of dues from its members here.

 

Buffenbarger angrily rejected that suggestion, which is circulating widely among local union officials, saying that the last strike in 2008 cost the union about $50 million.

 

“Ridiculous,” Buffenbarger said. “They have never paid the kind of dues that make up a $50 million strike fund.”

 

(The 31,000 Local 751 members pay about $70 a month in dues and the union collected a total of $25.5 million in dues from them last year, according to the IAM federal filing.)

 

Leader’s stance shifts

 

Wroblewski’s position quickly became intensely difficult after the offer was laid out to the rank and file. Facing a barrage of criticism from hostile members at a union meeting on the Thursday before the vote, he revealed what he really thought when he tore up a copy of the offer and called it a “piece of crap.”

 

But by the following Monday, when he joined Conner and Inslee for the signing of the legislative incentive package for Boeing at the Museum of Flight, Wroblewski was back on a neutral message, declining to give direction on how his members should vote but adding that the deal was about jobs — which seemed to imply that accepting it might be advisable.

 

The International, one longtime local union official said, had “yanked his chain.”

 

Wroblewski has not spoken publicly since, and he declined interviews after the vote was lost and again this weekend.

 

His leadership “has been crushed,” said the person close to both sides of the secret talks. Yet Buffenbarger gave Wroblewski kudos for standing up to the abuse and dismissed the votes of no confidence last week.

 

“This union doesn’t have a provision for votes of confidence,” Buffenbarger said. He blamed the dissension on “a political faction” within the local that wants to oust Wroblewski.

 

And he pointed out that the window for any union decertification drive is narrow, and won’t open for District 751 until close to when the current contract ends in 2016.

 

Buffenbarger also raised a concern about the vote outcome. He said that the final vote tally Wednesday showed that 5,000 members hadn’t voted.

 

While he said he’s not alleging vote fraud, he said the absence of those votes leaves the outcome “questionable.”

 

“To have that big a number that didn’t vote stands out,” he said.

 

Is there a way forward for Washington to possibly still win the 777X with the union in such disarray?

 

“These are critical questions going forward,” said the person who was briefed on the negotiations. “Who’s in charge? What will the Local bear?”

 

“With all the animosity and the size of the vote, a deep breath is necessary,” he said. “But Boeing is pressing an aggressive timeline.”

 

A Boeing source said the company could decide where to locate the 777X work by year end.

 

Reuters reported Saturday from the United Arab Emirates, on the eve of the Dubai Air Show where the 777X program is set to be launched Sunday, that when asked about the union, Boeing’s Conner responded: “I would say the ball is in their court.”

 

Ferguson, the union’s Local A president, said the union must get down now to “healing and cleaning house.”

 

“There’s major damage and until something is done, the membership is not going to be satisfied,” Ferguson said.

 

Buffenbarger, in the interview, said, “I don’t know what’s going to happen” with regard to the 777X, adding that if relations with Boeing stay as they are now until the contract expires in 2016, “we’re in for a real donnybrook.”

 

The specter that Machinists might strike again in three years must certainly weigh on the minds of Boeing executives, and might spur an opening to fix what went wrong with the 777X deal.

 

But the fragile state of the union makes any move tricky.

 

“The basic level of trust between the Local and the International is gone,” said the person who was briefed on the negotiations. “It puts us in a difficult position to work with the company.”

 

Dominic Gates: 206-464-2963 or dgates@seattletimes.com

 

http://seattletimes.com/html/businesstechnology/2022276110_boeingmachinistproposalxml.html (Links to an external site.)

 

 

 

 

 

 

 

 

 

OPINION 6

 

Peter Callaghan: Why polls shouldn’t matter to Boeing’s Machinists union

 

BY PETER CALLAGHAN   Staff WriterNovember 24, 2013

 

 

 

A recent statewide poll suggests a large majority of Washington voters would have ratified the contract that Boeing presented to its Machinists union earlier this month.

 

That, and a swipe of your iPhone, can get you a cup of coffee. Because unlike Gov. Jay Inslee and the members of the Legislature, Machinists union members don’t have to care what the voters of the state think.

 

When they rejected the contract extension that would have supposedly kept all final assembly of the next generation of the 777 jetliner in Puget Sound, the Machinists cared only about what it would mean to them and to their union.

 

And that’s how it is supposed to work. Yet the rejection seems to have rekindled antipathy toward organized labor, as though the strongest private-sector union in the West, if not the nation, should accept the same pay and working conditions as those without such clout.

 

For now, these Machinists get to keep their fixed-payment pensions and the health benefits they won in previous contracts because they can. But rather than congratulating the Machinists, way too many resent them, way too many respond by describing their own circumstances: how they have a fixed contribution pension like a 401(k) — or none at all — and how they have reduced health coverage — or none at all.

 

The weakened condition of private-sector unions in Washington and the nation makes it surprising when a union has the unity to stand up and the value to force a company to pay attention.

 

One reaction by some Republicans in the Legislature is to try to change laws to tilt the collective bargaining relationship further in favor of the company. Sen. Michael Baumgartner of Spokane, returning to the comfort of his conservative roots after running for U.S. Senate last year as something of a moderate, wants Washington to become a right-to-work state.

 

That could weaken the Machinists because it could no longer require that all workers either join up or pay dues equal to the costs of representing them. But the Machinists demonstrated that a vast majority likely would stick with the union regardless of an attempt by conservatives to insert themselves into a private transaction.

 

Baumgartner’s proposal might not even pass the Senate’s mostly Republican majority, let alone get by the Democratic House or the Democratic governor. A right-to-work initiative might hurt Republican candidates in the areas they must win – moderate Western Washington suburbs. And while South Carolina is a right-to-work state, that didn’t mean it didn’t have to come up with tax breaks and other sweeteners to win a 787 Dreamliner plant.

 

The Machinists membership certainly took a risk because rejection of the contract could result in a massive loss of jobs — and economic activity — for the state. Turning down the trade of reduced pension and health benefits for supposed guarantees of 777X work might turn out to be a historic misstep. Even though Boeing can’t admit it, the company could decide to place some or all of the final assembly in another state — or even another nation — in retaliation for the union’s failure to ratify the deal.

 

But that is far from a sure thing. Assembling a jetliner is not the same as working checkout at Walmart. A highly skilled workforce, a problem-solving workforce, is needed. That workforce does not yet exist in South Carolina but it does in Puget Sound. There is a reason, after all, that Boeing was willing to give up its best bargaining ploy — the threat of leaving — in return for contract concessions from the Machinists.

 

The same poll by Stuart Elway explained why Boeing’s demands — including the most-lucrative tax exemption in the U.S., based on some estimates — are conceded with such speed in Olympia. He found that 66 percent of voters support the generous tax breaks already granted and 50 percent would support even more benefits to influence the company’s siting decisions.

 

There is little political downside, outside of a few districts with very liberal or very conservative constituencies, to voting yes when Boeing makes demands. But that polling result shouldn’t be extended to suggest that Machinists should respond to public sentiment as well.

 

Peter Callaghan: 253-597-8657 peter.callaghan@ thenewstribune.com (Links to an external site.) @CallaghanPeter

 
Read more here: http://www.thenewstribune.com/2013/11/24/2911441/why-polls-shouldnt-matter-to-boeings.html#storylink=cpy (Links to an external site.)

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