The Flying News

It was a damned-if-you-do/damned-if-you-don’t contract that Boeing offered its workers last week, and its workers responded accordingly. Confronted with a contract that transformed their pensions into 401k’s, and with the company’s threat to relocate production of its new 777x to some other, lower-wage state unless its workers took the deal, the members of the International Association of Machinists Puget Sound/Boeing district approved the company’s offer by a suitably ambivalent 51-percent-to-49-percent margin.

Two months earlier, the same members had rejected management’s offer by a two-to-one margin—whereupon Boeing invited other states to offer it relocation deals. Shortly before the second vote, the company announced that 22 states had responded with proposals—promising tax abatements, free land, anti-union public policies, and Lord only knows what else. If the company took one of those states up on its offer, as many as 10,000 of the 80,000 Boeing jobs in the Greater Seattle area would move. If it didn’t move, Boeing would still make out like a bandit: the state of Washington had pledged to give it a mind-boggling $8.7 billion in tax breaks if it stayed. The union’s national leadership reluctantly recommended that the workers vote yes; the local leadership strongly recommended that they vote no. In the end, the workers’ 51-49 vote mirrored the split among their leaders. 

Boeing’s maneuvers highlight the inherent absurdity of American federalism in a time of mobile capital: The company was able to play almost half the states against one another in search of the sweetest deal it could win at the taxpayers’ expense. But the full extent of Boeing’s maneuvers in the run-up to the union vote suggest that management, no less than the union, was divided on the question of staying or going.

In December, the company announced that it would boost its dividends by 50 percent and would devote a cool $10 billion to buying back its own shares, a move that invariably bolsters share value. Such lavish expenditure on shareholders (and on top corporate executives, whose pay levels are generally linked to share value) at a time when it was asking its workers to cut their retirement incomes was guaranteed to infuriate its unionized employees and just possibly compel them to reject the company’s offer. Some Boeing executives have been reported to hate the Machinists Union so much that they were eager to relocate production, even though previous relocations to non-union states haven’t worked out all that well. The Wall Street Journal has reportedthat company’s two-year old non-union plant in South Carolina “has struggled to accelerate production,” delivering just “a small fraction” of the more than 600 new planes that Boeing had counted on it producing.


The most distressing aspect of the Boeing deal is that there is nothing exceptional about it. The immobility of labor and the mobility of capital give employers the upper hand, even when confronted, as Boeing was, with a strong union of highly skilled workers. And where capital isn’t mobile—as it’s not in the retail, transportation, hotel, restaurant and construction industries—it still has the upper hand by virtue of labor laws so weak that workers know they risk being fired if they seek to join or organize a union.

Labor law can be made weaker still when conservatives dominate the National Labor Relations Board. During George W. Bush’s presidency, the board, on which his appointments constituted the majority, reversed a previous board ruling that graduate students at private universities employed as teaching or research assistants were employees with the right to form a union. At the time, the teaching assistants at NYU had voted to become a local of the United Auto Workers and had won a contract from the university. When Bush’s NLRB members ruled that teaching assistants couldn’t form unions under the National Labor Relations Act after all, the students lost their union.

The UAW, however, didn’t abandon them. It continued to help students with job-related issues and waged a campaign to persuade the university to allow the students to seek union representation outside of the purview of the NLRB. In time, the students, abetted by some professors and local elected officials—and the prospect that the new majority of Obama appointees on the NLRB would reverse the Bush appointees’ ruling —convinced the NYU administration to permit them to vote on union representation in an election run by independent arbitrators. The administration also agreed to election procedures that were both more efficient and worker-friendly than the NLRB’s—for instance, requiring the arbitrators to rule on any procedural complaint within 48 hours of its filing. (An NLRB ruling can take months, which often not only delays but derails campaigns for union representation.)  And last month, NYU’s graduate students voted by a 620-to-10 margin to be represented again by the UAW.

The UAW has been organizing on campuses for decades—currently, 45,000 of its roughly 350,000 members are university employees. But private universities’ graduate teaching assistants have been off limits since the Bush NLRB ruling of a decade ago. With the victory at NYU, UAW regional director Julie Kushner expects that graduate students at other private universities may follow suit (as they did 15 years ago after NYU grad students won their initial campaign). Kushner is particularly excited about the “new model for organizing” outside the NLRB’s jurisdiction that was established in the NYU campaign. “For many decades, we’ve all understood that the NLRB rules and procedures can help workers or hold them back,” she told me. “At NYU, we came up with a better model. We don’t have to depend on the NLRB.”

That model may work at liberal arts colleges and universities and sundry other NGOs that are subject to popular pressure. It remains the longest of long shots, however, at for-profit employers. At those companies—at McDonald’s, Wal-Mart, Boeing and the rest—workers have fewer and fewer ways to exert any power and claim their share of the company’s revenues.


This has been reposted from The Prospect.