Sen. Sanders: Fix the Debt plan is “class warfare.”

Corporate leaders this week lobbied Congress to lower the nation’s debt by reducing Social Security, Medicare, and Medicaid benefits. One of those corporate executives was Lloyd Blankfein, CEO of Goldman Sachs, who told CBS that US workers need to lower their expectations about retirement security and accept cuts to Medicare and Medicaid.

US Senator Bernie Sanders, who opposes any cuts to the nation’s safety net programs, said that Blankfein’s call for cuts is another example of class warfare waged by corporate America and Wall Street against working America.

“Think about the arrogance of these guys on Wall Street who were bailed out by the middle class of this country when their greed and recklessness nearly destroyed the financial system,” said Sanders. “And now they come to Capitol Hill to lecture Congress and the American people about the need to cut programs for working people. This is what class warfare is all about.”

Blankfein and about 80 other corporate executives have signed on to a campaign called Fix the Debt, another one of Blackstone private equity group’s founder Peter G. Peterson’s debt reduction lobbying organizations.

As negotiations between President Obama and Republican congressional leaders on a debt reduction deal got underway, Blankfein and other corporate leaders who belong to Fix the Debt began lobbying members of Congress and taking their message to media outlets.

Fix the Debt has been circumspect about specific safety net cuts that it supports, saying only that benefit levels for all safety net programs should be on the table when negotiations over debt reduction take place.

Blankfein, however, was a bit more forthcoming when he told CBS’ Scott Pelley that the eligibility age for Social Security should be raised and benefits for health programs that help the elderly, the disabled, and low-income workers should be lowered. He also suggested that Social Security’s cost of living raises should be lowered.

In addition to lowering safety net benefits, Fix the Debt wants to fix the debt by reducing taxes, especially taxes on the wealthy.

It wants to preserve the Bush tax cuts that are set to expire in January. These tax cuts, enacted early during the administration of President Bush, have primarily benefited the wealthy. According to Citizens for Tax Justice, America’s richest 1 percent received on average an extra $66,384 in 2011 because of the Bush tax cuts. In the same year, the average US income was $58,506.

Blankfein and other members of Fix the Debt also want to reduce the highest marginal tax rate from 35 percent to 28 percent and to exempt corporations from paying taxes on foreign earnings that are returned to the US as profits. That exemption would mean a windfall of as much as $134 billion for 63 corporations whose CEOs have signed on to Fix the Debt campaign.

While Fix the Debt’s corporate leaders seek to reduce the federal debt by feathering their own nests with tax cuts and making retirement more precarious for the rest of us, their own retirement isn’t just secure; it’s opulent.

The Institute of Policy Studies reports that the average retirement assets of the 71 Fix the Debt CEOs whose companies are publicly held is $9.1 million.

Fifty-four of them participate in their company’s retirement program and have collective retirement assets worth $644 million, or more than $12 million per CEO, enough to generate a monthly pension payment of more than $65,000 for the rest of their lives.

The Fix the Debt CEO with the most pension assets is David Cote of Honeywell. His pension is worth $36 million and his deferred compensation $41.9 million, for a total of $77.9 million.

Blankfein doesn’t fare as well. His pension is worth only $30,000, and his deferred compensation $11.8 million, giving him a total retirement package of $11.8 million.

Meanwhile IPS reports that to generate an annual retirement income of $25,000 a year not including Social Security, a worker would need to have $500,000 worth of savings, but 34 percent of US workers have no retirement assets of any kind.

And the outlook will be bleaker in the not so distant future because more workers will have to depend on Social Security, whose average monthly benefit is only $1,237, for either their primary or only source of income during their retirement. Nearly half of all private sector workers in their fifties, 44 percent, have neither a traditional defined benefit pension nor a 401(k) type savings plan.

Only 20 percent of the private sector workforce is covered by a traditional pension, down from 83 percent in 1980. While 84 percent of public sector workers are covered by traditional pensions, 25 percent will receive no Social Security benefit because they don’t contribute to Social Security.

Since 2009, one year after the Great Recession began, 35 states have reduced pension benefits for public sector workers.

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Clerical workers strike shuts down operations at the ports of Los Angeles and Long Beach

About 70 members of the International Longshore and Warehouse Union, who work as clerks walked off the job at the APM Terminal’s Pier 400 at the Port of Los Angeles on Tuesday, November 27,  to protest outsourcing. The terminal is the largest at the Port of Los Angeles.

The mostly female workers were ordered by an arbitrator to return to work on Wednesday, but the clerks remained on strike, were joined by union clerks at other terminals, and set up pickets at nine terminals at the ports of Los Angeles and Long Beach. Longshore workers who belong to another ILWU local have refused to cross the strikers’ picket lines, effectively closing operations at picketed terminals.

The striking clerks belong to the International Longshore and Warehouse Union, Marine Clerks Association Local 63 Office Clerical Unit. Local 63 represents about 800 clerks at ports up and down the West Coast. The clerks process shipping documents and perform other clerical duties.

For more than two years they have worked under an expired contract. The clerks and the 14 shipping companies that employ them have not been able to reach agreement on a new contract.

The main sticking point has been outsourcing. “We’ve been meeting with the companies for more than two years, but they’re still concealing their outsourcing – even when they’ve been caught red-handed,” said John Fageaux, president of Local 63. “These employers seem to have an insatiable appetite for outsourcing.”

During the last five years, according to Local 63, 51 jobs performed by unionized clerical staff on the West Coast have been outsourced to Texas and overseas. The companies have announced plans to outsource another 76 in the future.

With the advances that have been made in data processing, it is now much easier for international companies like the ones who employ Local 63 members to contract out the documentation that must accompany all goods shipped to the ports.

The strikers say that thanks to the union their jobs are well paid and have good benefits. They provide a decent middle-class living for these workers. But if the outsourcing is allowed to continue, these good paying jobs will be endangered.

The employers for the last two years have failed to listen to their workers concerns.

“It just comes down to corporate greed,” said Darlene Zuvich, who has processed bills and other record-keeping tasks for Evergreen America Corporation since 1992.  “These companies have the same attitude as the ones on Wall Street – they think they’re better than the rest of us and can’t be worried about the problems that families face in this community.”

Last week Local 63 members decided to strike if the companies continue to insist on outsourcing their work.

“We’ve been patiently negotiating with these big companies for the past 30 months, but they’re refusing to respect our community and want to keep outsourcing good jobs – so we’re drawing the line and standing-up for the community,” said Trinie Thompson, a longtime clerical worker who participated in the negotiations.

On Monday, November 26, the negotiations finally broke off, and the strike began Tuesday at noon.

The workers restricted their strike on Tuesday to Pier 400 at the Port of Los Angeles, but employers were concerned that the strike would spread to other terminals and other ports.

The employers acted quickly to dampen the strike. Tuesday afternoon the employers asked an arbitrator to intervene and force the union workers back to work. On Tuesday night, the arbitrator ruled that the union was bargaining in bad faith and ordered the strikers to return to work on Wednesday morning.

On Wednesday morning, the workers stayed on strike, and pickets returned to Pier 400. Pickets also appeared at other terminals at the Port of Los Angeles and Long Beach.

According to a press statement from the Harbor Employers Association, which represents the clerks’ employers, “after picketing for approximately one hour, (Local 63 members) returned to work at some harbor employers’ off-terminal facilities, but remained on strike at the terminals, shutting down operations in the ports.”

The union and representatives of the shipping companies continued to talk on Wednesday to try to resolve the dispute. A Coast-Wide Arbitrator is set to take up the case soon. Until then, the strike will likely continue unless there is a break through in negotiations.

French government considers nationalization of steel mill

A union representing French steelworkers issued a statement on Monday calling for the nationalization of a steel plant in the Lorraine region after its owner announced that a temporary shut down of two of the plant’s blast furnaces would become permanent and eliminate 600 jobs.

After meeting with the owner of the steel plant on Tuesday, Frances’ President Francois Hollande said that nationalization of the plant remains a distinct possibility.

Lakshmi Mittal, owner of ArcelorMittal, an international steel and mining company, in October announced that two blast furnaces at its steel mill in Florange, located in the Lorraine region of  northeastern France, would be closed permanently. The blast furnaces had been shut down temporarily 14 months ago.

Since then Force Ouvriere Metaux (FO Metaux), a union representing ArcelorMittal workers, has led a campaign to keep the blast furnaces open. In October when the company announced that it was closing the blast furnaces for good, union members rallied at the plant and temporarily blockaded it.

As a result of pressure from the union, the company agreed to give the government two months to find a buyer for the blast furnaces. That deadline expires on December 1.

The blast furnaces are part of ArcelorMittal’s larger, profitable operations in Florange. The furnaces, or the hot mills as they are called,  provide the iron and coke that are turned into steel at the Florange cold mill. The steel produced by the cold mill is used to manufacture cars and other industrial consumer products.

ArcelorMittal wants to continue manufacturing steel at Florange without the hot mills.

Without the larger steel plant, there has been little interest in buying the hot mills alone.

Back in October, FO Metaux proposed that the government consider nationalizing the whole Florange plant. On Monday, it demanded action as the December 1 deadline for finding a buyer drew closer.

“With or without Mittal, the government must ensure the preservation of  blast furnaces, packaging and maintenance jobs scheduled to be eliminated,” read a statement from the union. “We urge the President and the government to temporarily nationalize the entire Florange factory, both the hot mill and cold mill. It’s the only economically viable solution.”

The Florange plant itself has been a profitable operation and Lorraine, a region with an unemployment rate of more than 10 percent can ill afford to lose more jobs. Workers at the plant blamed the company’s greed for the furnace closures.

“It’s not that we don’t make money here,” said Cyril Coplin, a ArcelorMittal worker to the Guardian as he helped blockade the factory in October. “It’s that we don’t make more money for Mr. Mittal. It’s about maximum profit, not people.”

Mittal bought Arcelor SA in 2006 in a hostile takeover. The deal included the mill at Florange. To win government approval for the takeover, Mittal promised to not cut jobs and to maintain investments at a level that would keep the country’s steel production competitive.

The decision by Mittal to shut down the furnace and eliminate jobs caused Arnaud Montebourg, France’s Industrial Recovery Minister to accuse Mittal of going back on his word. Montebourg said that the French government would not tolerate Mittal’s methods.

Mittal, a billionaire whose expertise is in finance, has loaded ArcelorMittal with more than $23 billion in debt.

The high debt load caused rating agency’s to downgrade the company’s bond rating.

The company’s announcement that it was closing the Florange blast furnaces was seen as an attempt to reassure bond holders that the company would do whatever is necessary to meet its debt obligation.

Outsourcing creates problems at American; passenger service agents prepare for union vote

The New York Times reports that outside contractors hired by American Airlines did not know how to install airline seats that subsequently came loose during flights in October. The loose seats caused unscheduled landings and dozens of planes  to be grounded for safety reasons.

American, which filed for bankruptcy last year,  has been outsourcing more of its work as part of its bankruptcy restructuring plan.

In addition to outsourcing work like the seat installation, which had been performed by unionized maintenance workers, the company has recently begun to outsource work done by passenger service agents.

The passenger service agents are currently non-union employees, but a union representation election for the agents is scheduled to take place beginning December 4.

When American filed for bankruptcy in November 2011, it had $4 billion in the bank. According to one analyst, the bankruptcy filing was an offensive strategy designed to weaken union members bargaining power.

“(American’s bankruptcy) is not a defensive move, but an offensive bankruptcy where they go after their labor groups to reduce costs,” said Avondale Partners airline analyst Bob McAdoo to the New York Times. “They have a great franchise and lots of cash.  They are not being forced into bankruptcy here.”

American used its bankruptcy filing as leverage to get unions to agree to changes to their collective bargaining agreements.  American negotiated new consensual agreements with the Transport Workers Union, which represents maintenance staff, and unions representing its pilots and flight attendants.

American originally planned to reduce its maintenance workforce by 14,000, but TWU managed to save nearly half these jobs. Still the consensual agreement that TWU members eventually ratified will result in the loss of at least 7,000 maintenance-related jobs.

To get the work done with 7,000 fewer maintenance workers, American planned to outsource more work.

One of its outsourcing projects was the re-installation of seats on planes whose seating pattern was being reconfigured, so that some seats on these planes would have more leg room, and American could charge more for them.

New York Times reporter Christine Negroni after reviewing American’s internal documents, reported that American was aware that its contractors did not know how to install the seats, and acknowledged that incorrect installation was a contributing factor when the seats came loose during flight, putting passenger safety at risk.

The loose seats caused the grounding of dozens of American’s 757s and at least one 767.

When the loose seats were first reported in October, American implied that union workers may have been engaging in sabotage; after backing away from that allegation, the company offered what Negroni calls “an evolving set of explanations,” including clamps that didn’t work, spilled soda and dirt, and “a defective part.”

Negroni also found that Timco, one of the contractors working on the seat re-installation project, used students from the National Aviation Academy in Bedford, Massachusetts to perform some of the installation work.

Larry Pike, president of TWU Local 567 told Negroni, “You can’t have just anyone doing that maintenance. You can’t pull over in the sky and fix something if you hear something go thump.”

While American was cutting corners on maintenance work, it was also outsourcing customer service work just as the busiest travel season was getting underway.

In August, about 700 agents at the company’s call center in Phoenix were laid off. Agents at airports began getting layoff notices in November. American transferred some of their work to outsourcing contractors.

“My last day was Tuesday (November 13), and they put us out on the street with nothing,” said Sylvia Solis, a former passenger service agent at Miami International Airport. “The outsourced people don’t know how to check in an infant, and they think JFK is London. They do not have the slightest airline industry background.”

According to Renee Similien, who worked the first class check-in counter at Logan Airport in Boston until she was laid off, American laid off agents like herself, who earns about $50,000 a year, and replaced them with people making $9 per hour and no benefits.

Agents who remained on the job had their pay and benefits reduced.

The agents with the help of the Communication Workers of America began organizing a union well before American commenced its bankruptcy proceedings.

Shortly after, American filed for bankruptcy, agents filed a petition with the National Mediation Service, which oversees union elections in the transportation industry, seeking recognition of CWA as the agents’ bargaining representative.

American has done everything it can to prevent the election from taking place, but in October, a federal appeals court ruled that the union election could proceed.

While the union election is scheduled to begin on December 4, American has said that it will appeal the lower court’s ruling to the Supreme Court.

CWA points out that since American filed for bankruptcy it has spent $200 million on legal fees and expenses related to the bankruptcy. It has also paid the law firm Paul Hastings LLC $19.5 million to renegotiate existing union contracts and prevent passenger service agents from unionizing.

Union supporters say that the bankruptcy has revealed American’s disdain for its workers. “The company is not on our side,” said Ted Tezino, who works at American’s Southern Reservation Office and supports the union. “It’s time to stand up for ourselves.

Bangladesh workers demand end to deathtrap labor

Tens of thousands of Bangladesh garment workers left their jobs on Monday, November 26 and marched to the center of Ashulia, the hub of the country’s garment industry, demanding an end to “deathtrap labor.” Ashulia, a suburb of the nation’s capital Dhaka, is the site of Saturday morning’s deadly fire that killed at least 124 workers at a garment factory owned by Tazreen Fashions .

“(The workers) want to see safety improvements to these deathtrap factories,” said Babul Akter, president of the Bangladesh Center for Worker Solidarity to Agence France Presse (AFP).

The workers also are demanding justice for their fallen comrades. “I demand justice, I demand the owner be arrested,” said a woman named Shadida, who gave only her first name to Reuters. Shadida said that she hadn’t been able to find her mother who worked at the Tazreen factory.

The fire at the Tazreen factory is the worst in a long series of garment factory fires that according to the International Labor Rights Forum have killed 700 Bangladesh garment workers since 2005.

The cause of the Tazreen fire is under investigation, but first reports blame a faulty electrical system. The factory was eight stories high but had no fire exits. Many of those who died either jumped to their death to escape the flames or were burned alive.

AFP reports that the fire-gutted factory was built in 2009. At the time, the owners had permission to build a three-story building, but added the extra floors without permission.

Tazreen is owned by the Tuba Group, which contracts with Li & Fung of Hong Kong to make clothes that are sold in stores throughout the US and Europe including Walmart, Carrefour, Target, Kohls, and others.

The International Labor Rights Forum says that it has evidence that the Tazreen factory produced clothing for brands such as Walmart’s Faded Glory, Ace, C&A, Dickies, Fashion Basics, Sean Combs Co.’s Enyce brand, Edinburgh Woollen Mill’s brands P.G. field and Country Rose, Hippo, Infinity Woman, Karl Rieker GMBH & Co., Kebo Raw, Kik, Piaza Italia, Soffe, and True Desire.

A Walmart spokesperson said that the company was in the process of trying to determine if any of the clothes it sells are made by Tazreen.

The lack of safety at Bangladesh garment factories has been a point of concern for years, and Western retailers have tried to address this issue by establishing contractor guidelines and conducting safety audits carried out by third-party inspectors.

The Tuba Group said that its garment factories have passed safety inspections carried out by Worldwide Responsible Accredited Production (WRAP), which the ready wear fashion industry established after it was criticized for relying on sweatshop labor to produce its clothing.

WRAP, however, denies that it has certified the Tuba Group’s factories.

Whatever the truth is, this latest deadly fire shows that the inspection system that was supposed to end sweatshop conditions has failed.

Phil Robertson, Asia deputy director of Human Rights Watch, calls the safety inspection system “a joke.”

“The only people who actually believe the labor inspection system does anything are the ministers and officials who have a vested interest in perpetuating the fiction of its effectiveness,” said Robertson to AFP.

Last May, a few Western retailers, such as PVH, which owns Tommy Hilfiger and Calvin Klein, agreed to support a program designed to improve safety standards in the Bangladesh garment shops that make its clothes.

However, “The deal has not made much headway due to non-participation by major brands like Walmart, Gap and Carrefour,” said Amirul Haque Amin, president of the National Garment Workers Federation, an independent union of garment workers, to AFP. “The problem is when it comes to workers’ safety, Western retailers mostly offer lip service.”

Amin said that the fire at the Tazreen factory and the others that preceded it are the result of willful neglect by the government and garment factory owners. The Bangladesh garment industry produces the country’s leading export.

“This disastrous fire incident was a result of continuing neglect of workers’ safety and their welfare,” said Amin to Reuters. “Whenever a fire or accident occurs, the government sets up an investigation and the authorities–including factory owners–pay out some money and hold out assurances to improve safety standards and working conditions. But they never do.”

California Walmart workers get early start on Black Friday actions

The nationwide day of actions against Walmart planned for Black Friday got off to an early start on Tuesday when Walmart associated in Pico Rivera, California walked off the job. About 120 workers and their supporters carrying signs that read, “I’m (the name of the associate) and I’m on Strike” picketed the store.

Associates walked off the job to protest the company’s retaliation against Walmart workers who speak up for change on the job. Associates on strike said that they planned to strike on Friday as well.

“Today is one strike and some of us are going to strike on Friday,” said Walmart associate Victoria Martinez to the San Gabriel Valley Tribune.

The strikers were also protesting the way that store managers schedule work for Thanksgiving and Black Friday. ” I remember when (management) used to ask you if you wanted to work overnight for the Thanksgiving rush,” said Martinez. “Now they just schedule us for however they want, and we’re always told that if we don’t show up we can be fired.”

Martinez and her fellow strikers are members of Organizing for Respect at Walmart (OUR), a nationwide movement of Walmart associates who have been working to improve conditions on the job at the world’s largest retailer.

OUR and its supporters are planning 1,000 non-violent actions at Walmart facilities on Black Friday  to call attention to Walmart’s attempt to silence workers who speak out and take collective action for better working conditions.

“We’re not trying to shut down business,” said Yesenia Yaber, a Walmart associate in Chicago, as she explained the purpose of the 1,000 protests. “We are supporting our co-workers who speak out for better working conditions. These associates have been speaking out for changes that will help all associates help our families and make Walmart stores better places for our customers to shop.  Yet, Walmart reacts by attempting to silence them. No one wants to strike, we want to work, but we can’t continue under Walmart’s threats and retaliation.”

Walmart has reacted to the growing movement for change by blaming the protests on outside agitators. It recently filed an unfair labor practices charge against United Food and Commercial Workers for illegally inciting workers to fight for a collective bargaining agreement.

OUR members say that their primary objective is to improve conditions on the job and that they have the right to take collective action to do so.

“Walmart is doing everything in its power to attempt to silence those who speak out,” said Colby Harris, a Walmart associate in Lancaster, Texas near Dallas.  “But nothing—not even this baseless unfair labor practice charge—will stop us from speaking out.

“Unfair labor is working full time and living in poverty. Unfair labor is seeing your health care premiums skyrocket year after year. Unfair labor is being denied the hours needed to support your family. Unfair labor is being punished for exercising your freedom of speech and association.

“Walmart workers know what unfair labor is—because we endure it every day. So until Walmart listens to our concerns, we will continue to speak out. We will continue to stand up when Walmart attempts to silence those who speak out. We will continue to demand respect.”

UFCW has supported OUR’s efforts to improve conditions on the job at Walmart as have a number of community and labor organizations including Color of Change, National Alliance of Latino, African and Caribbean Communities, Interfaith Worker Justice, and the National Organization of Women.

These organizations and others will be joining the Black Friday protests. Activists of the Corporate Action Network are adopting stores where they will inform shoppers about working conditions at Walmart.

The United Auto Workers also posted a message to members on its website urging them to stand with Walmart workers on Black Friday. It reads in part:

While the  Walton family (Walmart’s owners) has the same wealth as the bottom 42 percent of American families combined, they pay Walmart associates an average of $8.81 an hour.

UAW brothers and sisters , Walmart workers need your help!

This  will be the first direct action many Walmart workers take, and they  will need support in their communities and around the country to back  them up. So let’s gear up and support Walmart workers across this country by joining with them in actions on Black Friday.

Hostess, bakery workers head to mediation; liquidation on hold–for now

Federal bankruptcy judge Robert Drain on Monday urged Hostess Brands to seek the help of a mediator to resolve a strike by members of its bakery union, BCTGM. Hostess agreed, temporarily putting its planned liquidation on hold.

Negotiators from Hostess and BCTGM will meet with a mediator on Tuesday morning.

The Teamsters, Hostess largest union, which primarily represents delivery drivers and those who support the drivers, said that it would “closely monitor the mediation . . . and assist in any way we can to help the two sides reach an agreement that keeps the company’s doors open.”

BCTGM did not issue a statement about the mediation.

BCTGM did, however, submit a motion Monday in bankruptcy court that joined other unions affected by the possible liquidation in objecting to the company’s request to be allowed to begin winding down operations.

In its pleadings, BCTGM carefully laid out reasons why its members went on strike even though they knew that there was a good chance that Hostess would react to the strike by going out of business.

Foremost among their reasons was the belief that the company’s owners were not interested in meaningful restructuring that could make the company viable again.

Members of the union suspected, instead, that the private equity companies that now own Hostess–Ripplewood Holdings, Monarch Alternative Investments, and Silver Point Capital–were more interested in diverting company assets to their own pockets

The pleadings point to past experience to justify their concerns. In 2009 as part of a deal to help Hostess exit from its first bankruptcy, BCTGM members agreed to reductions in their health and welfare plans and work rule changes that achieved “significant labor cost savings.”

In return, according to BCTGM, the company agreed to invest these savings in new equipment, new technology, rebranding its products, such as Twinkies and Wonder Bread, and plant modernization–investments that could help Hostess regain its lost market share that led to its first bankruptcy.

But this reinvestment never took place. Hostess used savings generated by the workers’ concessions instead to pay private equity fees to its new owners and executive pay increases and bonuses.

The company also took on more debt. To buy the company in 2009, Hostess’ new private equity owners borrowed $713 million. Since then the company’s debt has increased to $860 million.

When the first bankruptcy ended, BCTGM warned that unless the company got serious about reinvesting in its operations, the company’s heavy debt load would soon lead to another bankruptcy. The warning proved prescient.

Instead of working with its unions to avoid a second bankruptcy, the company again blamed workers for its troubles.

After the company declared its second bankruptcy, it began bargaining with the bakery workers on a new contract. During the negotiations, Hostess demanded that the bakery workers agree to an 8 percent wage cut, 20 percent higher worker health care costs, allowing the company to freeze pension contributions until 2015, and the elimination of eight-hour work shifts.

Having been burnt once, BCTGM members were skeptical about accepting more concessions. In September when Hostess stopped negotiating and made its final offer, 92 percent of the BCTGM membership voted to reject it.

When the company decided to unilaterally implement its final offer, the union felt that it had no choice but to strike. Savings from any concessions that workers made would once again be diverted to the private equity firms instead of into meaningful investment in operations. Without new investments in operations, the firm would soon be back in bankruptcy court for the third time.