Airline unions need workers' control, not bankruptcy
By Milt Neidenberg
The crisis in the airline industry has
reached gigantic proportions, threatening the livelihoods of about half a
million workers. Captains of the industry, tied to various factions on Wall
Street, are gung-ho to cut wages, pensions and health care to protect their
obscene corporate benefits.
The airlines have been cash cows for the big
banks and other financial institutions on Wall Street. A number of airlines have
been driven into bankruptcy by mismanagement--United Air Lines, the second
biggest airline in the country, US Airways and a number of smaller
companies.
Citigroup and JP Morgan Chase--recently merged with credit-card
giant Bank One--and General Electric dug their financial hooks into the bankrupt
airlines by lending them huge amounts of money to buy and/or lease additional
aircraft. Now the industry is in crisis because of overcapacity and thousands of
the planes bought on loans sit idle, warehoused in the Mojave
Desert.
Continental Airlines has warned that it could face bankruptcy if
it doesn't win $500 million in wage and benefit concessions by February. Delta,
the third biggest airline, is cutting flight attendant crews and eliminating
7,000 jobs.
It is part of a restructuring plan that follows a decision to
reduce Delta's most expensive fares by 50 percent to compete with the
anti-union, cheap-labor regional carriers like Jet Blue and
Southwest.
Delta is on the verge of declaring bankruptcy in this ongoing
crisis of brutal capitalist competition and downsizing. It is a replay of the
self-destruct syndrome in the steel industry that wiped out tens of thousands of
good-paying jobs and benefits in the 1980s.
To make matters worse, the
Bush admin istration, the Air Transportation Stabilization Board, and the
Pension Benefit Guarantee Corporation are players in the anti-union mix. The
secretary of labor has announced a series of changes in how the pensions are
funded.
The PBGC, a government-owned insurance corporation, is in
financial trouble, deep in debt, and under-funded. It has posted a deficit of
$23.3 billion, which is double the previous year.
Information about how
many workers have lost their pensions or seen them shrunk hasn't been made
available. Wall Street and the White House are demanding the Wal-Martization of
the airline industry workforce.
The objective is to tear up union
contracts, cut wages, and slash pensions and health benefits. Working conditions
have become more barbaric for the crews who service the planes on the ground as
well as in the air. This is especially true for those workers who are trapped by
an airline bankruptcy.
Since December 2002, United Air Lines has been in
bankruptcy. It has received con cessions from the unions, approved by the
bankruptcy judge, totaling over $2.5 billion. Retirees have lost their health
benefits.
Now UAL is seeking another $725 million in cuts from the
workers. The Flight Attendants/Communications Workers union is about to vote on
a pact that would cost these workers another $138 million annually.
UAL
also seeks $100 million in concessions from the mechanics. And the bosses have
threatened to cancel the pensions of all workers in the four UAL
unions.
Recently, UAL made a deal with the Pilots' union that involved a
14-percent wage cut and restructuring pensions for a future stake in the
company. Judge Eugene Wedoff, the bankruptcy judge, rejected the deal, in part,
because it required that all UAL union pension plans be restructured as well.
That would mean that the PBGC would have to pick up the pension
payments.
The other reason for the judge's ruling was that the future
stake for the Pilots' union included $550 million in notes convertible to stock
once the carrier emerges from bankruptcy. Were they afraid that this deal would
open the door for the Pilots' union to own a piece of UAL? It wasn't too long
ago that all the UAL unions owned over 50 percent of the airline through an
Employee Stock Ownership Plan. They lost their investments in bankruptcy
court.
It wouldn't have had to end that way if the unions had exerted
their rights to legitimate ownership. ESOPs create an illusion, enticing workers
to believe they have a stake in the operations of a corporation. In fact, ESOPs
are a stock manipulation fraud.
Who should control the airlines?
How can the hemorrhaging of jobs, wages and benefits at UAL be
stopped? The airline's rank and file workers are beginning to fight
back.
Recently, the UALFlight Attendants union organized a march on
Washington. Big con tingents of flight attendants from other airlines were also
well represented. In addition, other workers present included members of the
International Longshore and Warehouse Union and other marine trade and seafarer
unions.
At the conclusion of the rally, they marched in front of the White
House on the way to Freedom Plaza. They chanted, "CHAOS! CHAOS!" The acronym
stands for "Create Havoc Around Our System."
Flight attendants are
discussing whether to call a one-day strike, a shorter one, or delay a scheduled
UAL flight.
During the December holidays when passenger travel was at its
peak, a wave of rank-and-file absenteeism shook up a few of the airlines,
particularly US Airways and Delta. Sick-out calls and other absenteeism forced
the airlines to cancel many flights and left thousands of passengers huddled in
airport lounges.
The airlines have created such tensions and work loads
for the workers that inconvenience to passengers is the inevitable consequence.
The public must be educated about who is responsible.
A campaign for
worker control of the airlines could be a start in building this
perspective.
The airline unions need to initiate the campaign with
agitation and street activity. The key to the struggle is for the labor movement
to get behind the campaign to take ownership out of the hands of the bankrupt
airlines.
Ownership for the airline workers, particularly those who are
being victimized by bankruptcy court, is a valid demand. UAL and US Airways are
no longer the owners of the property. Legally, they are a debtor that has been
granted possession by a trustee appointed by the bankruptcy court.
The
banks and other financial institutions, in collusion with the court, claim that
they have provided lines of credit and cash that enable the airlines to operate,
and are therefore first in line as the principal creditors. Not true.
The
UAL and the US Airways unions are the principal creditors. They keep the
airlines flying with their labor power and skills. Pensions owed to them alone
amount to billions of dollars, far outstripping any investments by the banks and
vendors.
Saving pensions and restoring other wages and benefits can be
accomplished if the unions assert their right as the principal creditor, declare
themselves to be the trustees and run the airlines. This is a tall order but it
is possible if a plan of action is forthcoming.
Flight attendants have
overwhelmingly authorized a strike. Whether they strike or not, they should
raise the slogan "workers' control, not bankruptcy" and begin agitation to take
over the bankrupt airlines for as long as necessary to protect their assets and
restore their losses.
Workers' control was a significant development in
some European countries after World War II. (See High Tech, Low Pay, by Sam
Marcy, p. 171.)
The AFL-CIO is now debating how to strengthen and
reorganize the labor movement. The Service Employees union has put forward a
10-point program in this spirit. The Communications Workers, the parent union of
the UAL flight attendants, has brought forth other proposals to achieve the same
objectives.
What is needed is not a wordy debate that can only stir up
tensions among the affiliates, but bold action. The airline workers,
particularly those in bankruptcy court, are sending a message: They are ready to
struggle. The right of ownership should be on the front burner.
Reprinted from the Jan. 20, 2005, issue of Workers World newspaper
This article is copyright under a Creative Commons License.
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