With a Little Help From Their Friends, Boeing Forces Union Workers to Sacrifice Pensions for Profit's Sake

February 25, 2014
Keyan Bliss, Move to Amend
In January, the Boeing Corporation bullied the members of the International Association of Machinists and Aerospace Workers (IAM) to accept a new contract forcing them to give up hard-won pensions, dismantle their health care, and reduce their wages. The effort to take away essential benefits from Washington workers was a well-calculated scheme by the world's largest airplane manufacturer. By exploiting bad economic conditions, it manipulated opportunistic politicians and even the union's own leadership in order to pressure workers to accept these concessions.

(image by Laura Bonham)

Boeing demanded the cuts to retirement and healthcare benefits in its initial offer to extend its current contract with organized labor in the Puget Sound region. This new contract will keep IAM workers' current pensions frozen while ending their defined-benefit plan and replacing it with a 401k plan, a trend among Fortune 100 companies looking to reduce benefit costs. The contract would allow the corporation to gut and/or replace health plans previously negotiated before they are taxed under the Affordable Care Act in 2018. It would also limit wage increases to one percent every other year with annual cost-of-living adjustments. If this were not enough, IAM workers would be barred from striking until the new contract expires in 2024.

There is no financial imperative for the aerospace-defense corporation to demand such sacrifices from their workers. In fact, Boeing is expected to exceed $4.7 billion in profits in 2013, and that's after increasing its dividends by $2 billion and repurchasing $10 billion in from shareholders. Local labor unions refused to sacrifice hard-won pensions during such times and rejected the contract in November by a margin of 2-to-1. 
Rather than renegotiate its offer, Boeing threatened to leave its home in the Puget Sound all together and immediately solicited bids from 22 states desperate to secure thousands of quality manufacturing jobs. Not satisfied with this leverage, Boeing initiated a relentless public-relations campaign targeting Boeing workers in Seattle newspapers, radio advertisements, and even flyers distributed at local factories  telling workers they would lose their jobs for refusing the corporate offer. 
Local and national politicians, including Washington Governor Jay Inslee and US Representative Rick Larsen, publicly pressured their constituent workers to accept Boeing's contract. It makes sense given more than $15 million in lobbying and over $1 million in direct contributions the corporation has spent influencing politicians in 2013. In fact, it likely helped convince Washington state lawmakers to award nearly $9 billion dollars in tax incentives exclusively to Boeing, the largest state-based tax subsidy in American history
Local union leaders were able to withstand the enormous pressure, but could not predict their national union leadership would sabotage their efforts. IAM President Tom Buffenbargeroverruled the objections from local union leaders and hastily ordered a second vote during their members' holiday season. This resulted in more than 8000 of its 31,000 eligible members not participating in the second vote, which passed by narrow margin of 600 votes. Despite exposing a deep rift among its members, the national leadership has refused to allow a recount or a new vote on a contract approved by the smallest majority in the union's history.
When a profitable corporation like Boeing can win major benefit concessions from organized labor, it sets a dangerous precedent that corporations no longer need to be in financial trouble to justify them. There is no limit to the amount of leverage our corporate plutocrats will use to squeeze the working class of essential benefits for the sake of a little extra profit. Now more than ever, the We the People Amendment is needed to establish that money is not protected speech and that constitutional liberties belong exclusively to real people, and not the corporate entities we create. As we add another sad chapter to the history of the labor movement, we need to stand together with our fellow laborers to demand a real democracy, free of the strings corporations have pulled for more than a century.
Keyan Bliss is a graduate of Indiana University, where he majored in political science. He is currently a field organizer and communications intern for the Move to Amend Coalition.