TrenchNews, Verse 4


On Tuesday, we had this from Coca-Cola Corp:

Coca-Cola Enterprises said Tuesday it will cut 3,500 jobs during the next two years, including 300 in metro Atlanta.

The company also reported a $1.1 billion net loss for 2006, driven in large part by declining sales of carbonated soft drinks.

Most of the job cuts will come from operations in North America but the breakdown is still being decided, company officials said. The cuts represent about 5 percent of CCE’s 74,000-person global workforce. The cuts in Atlanta will come primarily through attrition, a CCE spokesman said.

The company expects to take a $300 million charge against earnings to cover separation expenses and other costs, which will be spread out over 2007 and 2008.

Two days later, Coke had a quite different announcement to make.

Coca-Cola on Thursday said it will boost its quarterly dividend 10 percent, from 31 cents to 34 cents a share. The move will boost the equivalent annual dividend to $1.36 a share from $1.24 for 2006. (emphasis added)

Now let me get this straight: a company that supposedly just lost over $$$1BIL$$$ announces it has to dump 3500 people and then 2 days later raises its dividend?

Am I the only one who smells a rat here?

I call your attention to the sentence in Tuesday’s third graf that allows as how the cuts will come from Coke’s North American operations. This is code. A few years ago in the book Downsize This!, Michael Moore noted that GM had made exactly the same statement in the 90’s, and that it was dutifully parroted by an American press that didn’t bother to report that at the same time GM was closing factories here, it was opening factories in Mexico and Indonesia. This in a year, mind you, that GM had made some $$$11BIL$$$ in profit. There were two reasons for GM’s move:

  1. Wages overseas were considerably lower than in the US
  2. GM’s US employees were unionized and its foreign workers were not

If Coke lost a $$$BILLION$$$, how can it raise its dividend?

First, like GM in the 90’s, the books are probably cooked. What GM did was use shady accounting to swap numbers around among its various offshore divisions to hide its profits. On paper, GM was losing money in the States, but only because the money it made here was being applied instead in low-tax countries. The $$$11BIL$$$ in profit is just what stuck its head above the radar; below the radar, GM’s profits were most likely considerably higher than what they reported. I suspect that’s what Coke is doing here – playing with the books to make it look like they’re losing money when they aren’t. When you genuinely lose money, your dividends go down, not up.

Second, Coke has one of the biggest unionized shops in the country. If they’re shifting their operations overseas, as GM did, it will be to low-tax countries without trade unions. That will weaken the unions left here and cut their bargaining power by a significant amount. Tell me that isn’t what they want. They could be raising dividends in anticipation of the extra revenue that’s going to roll in from cutting high-paid, union US employees and replacing them with low-paid, non-union foreign workers.

In this single example, we see the great benefits of globalization for employers and the investment class. We’re still waiting to see what the rest of us get out of it.


Weekly Toll: “Workers’ Memorial Scholarship deadline is March 1

We have a page of WM scholarships located at USMWF. Kevin Weeks the Public Information Officer Oregon OSHA was kind enough to send this years updated info.

Chad Brunson shot on New Year’s Eve

Kenton Neuhouser says, “Brutal killing reminds all of us about risks employees shoulder…I can’t get Chad Brunson out of my head.”

“I think about him every day. Chad was shot in the head on New Year’s Eve. He wasn’t at a party like most 23-year-olds, but at work in a pizza store where two robbers who were out to steal a few bucks from the register also murdered Brunson. He was a dedicated, longtime employee who, according to his father, loved his job. I’m sure he also loved his life outside of work and had a lot of dreams well beyond his years. I mourn for Brunson and his family. I am chilled by the senselessness of the killing and the heartlessness and evil that obviously lurks inside his killers.”


WaPo: “Loss Forces Chrysler Restructuring

Here we go again….

Chrysler, which a year ago was flush with profit, announced yesterday a yearly loss of $1.45 billion and a restructuring plan that calls for elimination of 13,000 jobs and the closing of an assembly plant in Delaware.

The automaker’s parent, the German firm DaimlerChrysler, said it would consider a range of options for Chrysler’s future and would not rule out an alliance with another big automaker. Yesterday, Chrysler — which includes the Dodge, Jeep and Chrysler brands — also reported a loss of $161 million in the fourth quarter. The carmaker earned about $2 billion for the full year in 2005.

Chrysler’s slump has brought new demands from some in Germany’s powerful investment community and from European analysts to break up the company, created in 1998 by the merger of Daimler-Benz and Chrysler. Executives are reviewing long-term options for Chrysler, apart from the restructuring plan announced yesterday.

Reuters: “SanDisk Will Trim Work Force to Counter Falling Prices

The SanDisk Corporation said Friday that it would cut 10 percent of its work force and trim executive salaries to compensate for a recent collapse in prices for memory chips, sending its shares down sharply in after-hours trading.

It was the second recent warning about oversupply in the volatile memory chip industry. Micron Technology said last week that prices for memory chips used in consumer electronics would drop 30 percent to 40 percent this quarter.

SanDisk, which competes with Micron’s Lexar division in making flash memory chips for devices like digital cameras and media players, said it expected to cut prices on many products by 30 percent to 40 percent to keep market share.

AP: “Hershey Plans to Cut Work Force by 1,500

The Hershey Co., whose name has been synonymous with U.S. candymaking for more than a century, is moving a bigger chunk of its production to Mexico.

A day after Valentine sweethearts across the country enjoyed bags of Hershey Kisses, the company on Thursday announced a restructuring plan that will scale back its work force by 1,500 jobs and force some plants to close.

Hershey said the three-year blueprint would reduce the number of production lines by more than one-third while saving the company as much as $190 million a year.

The maker of Hershey’s Kisses, Reese’s peanut butter cups and Mounds bars currently employs about 13,000 people at 20 plants in the United States, Canada, Mexico and Brazil. The planned cuts amount to 11.5 percent of that work force.

AP: “Delphi Reports $2B Third-Quarter Loss Due to Lay-Offs

DETROIT — Delphi Corp. said Tuesday it lost $2 billion in the third quarter, blaming half the loss on the cost of paying about 20,000 unionized workers to leave the struggling auto parts maker.

The net loss of $3.51 per share was worse than the $788 million, or $1.40 per share, that Delphi lost in the same period of 2005.

The Troy-based company, which is operating under Chapter 11 bankruptcy protection, said it lost about $1 billion to charges associated with shrinking its U.S. hourly work force.


Des Moines Register: “Labor, business square off over fee proposal

The fight is getting nasty.

Organized labor and business are butting heads in Iowa over a “fair share” fee proposal in the Iowa Legislature that would force some nonunion workers to pay fees to unions.

The two sides are arguing about the proposal’s fairness for thousands of Iowans, its effect on economic development in the state, and the question of whether passage of the proposal would end Iowa’s 60-year run as a “right-to-work” state.

That designation, written into Iowa law, means workers cannot be forced to join a union as a condition of getting or holding a job in this state.

Which in turn means non-union workers would no longer reap the benefits of receiving wages won by unions to whom they pay NOTHING.

Jon Richeson, who teaches in the Des Moines school district, is a member of the Iowa State Education Association, the state’s largest union, with about 32,000 members. An estimated 8,000 teachers and others covered by ISEA contracts are not members of the union.

Richeson said a fair share system makes sense because nonmembers now pay nothing, but receive benefits and services negotiated by the union.

“I think it’s unfair to the people who pay dues,” Richeson said. “I’ve felt strongly for a long time that these people are basically getting a free ride on the back of the dues-paying members.”

Businesses and the business press, are, of course, having palpitations.

The debate that is shaping up has drawn national attention. A recent Wall Street Journal editorial took Iowa Democratic leaders to task for supporting a proposal the newspaper said would “chase jobs and employers out of the state.”

The Journal’s prediction became more worrisome on Friday when a half-dozen business expansion or relocation plans in Iowa were reported to be in trouble because of concerns by business executives about the fair share proposal.

Oh, please. Unions raise the bar for everybody, including business. The shibboleth that unions break companies is historic nonsense. They blamed unions for “destroying” America’s auto industry with high wages. What busted the auto industry were shoddy materials with skin-thin tolerances, and mechanical designs that cut every corner to maximize every penny in profit. Unions didn’t buy those materials that barely lasted long enough to get past the warranty, and unions didn’t design cheap parts. Unions used what they were given to use by management, and Japan – concentrating on quality rather than the bottom line – blew them out of the water. It’s that simple.

But the WSJ is infamous for re-writing business history and ignoring inconvenient (read: not complimentary to the corporatocracy) facts.

The Hotline: “Endorsement Watch: The AFL-CIO

According to AFL-CIO spokesperson Steve Smith, they are “working out details right now” for their endorsement process for WH ’08 and are likely to announce particulars of their plan in early March, following their first Executive Council Meeting since the Nov. ’06 elections in Las Vegas, NV, March 6th – 8th.

Each of the 54 national and international labor unions within the AFL-CIO has their own respective endorsement processes and must be considered in forming the general AFL-CIO endorsement.

If there’s anything in particular you want them to consider in the way of candidates’ stances on labor issues that should be part of the decision-making process, now would be a good time to tell them. You’ll find a feedback form here.

Seattle Post-Intelligencer: “Union workers hail Westin Seattle pact

Unionized workers at the Westin Seattle, the city’s largest hotel, plan to announce today that they’ve negotiated significant pay and benefit increases — a move that they hope will thrust them into the middle class and have a profound impact on the regional service industry.

The national Hotel Workers Rising movement, which has chosen Seattle as one of its campaign cities, considers the five-year contract its first Pacific Northwest victory.

King County Executive Ron Sims called the agreement — which boosts compensation by about one-third — an “incredible success.” He was one of several elected officials who publicly supported the campaign.

WaPo: “Union Protests Gas Rate Hike to Raise Outsourcing Issue

The Office and Professional Employees International Union yesterday filed to intervene in a rate hike request by Washington Gas Light Co., saying it planned to protest the proposal out of concern that the company may hire outside contractors to replace customer service workers, which the union represents.

The company requested a rate increase of 7.7 percent in December with the District’s Public Service Commission and in September with Virginia regulators.

Of the almost 300 customer service employees who work in the Springfield and Washington call centers, more than half might lose their jobs, said Dan Dyer, OPEIU’s Local 2 president. “Our members are highly trained and experienced to take emergency calls if there’s a leak, if you want to adjust a bill, and they are all people who live and work in the community,” he said. “What ends up happening is this will be outsourced to a call center.”


AFL-CIO Blog: “Machinists Reach Tentative Agreement in Harley-Davidson Strike

The Machinists (IAM) union and Harley-Davidson Inc. have reached a tentative agreement in a contract dispute that shut down production at the motorcycle maker’s plant in York, Pa., the union announced yesterday.

Members of IAM Local 175 in York will vote next week on the tentative settlement, the union said. Nearly 2,800 IAM members have been on strike since Feb. 2 at Harley’s largest U.S. facility, which produces its most popular touring bikes.

Terms of the tentative agreement were not available. “They didn’t get everything. We didn’t get everything,” according to union representative Tom Boger.

That’s the way these things usually go.

Atlanta Journal-Constitution: “Delta unit finally gets pilot concessions deal

Pilots at Comair, a Delta Air Lines subsidiary, reached a tentative concessions agreement Tuesday, just minutes after a deadline expired that allowed the company to impose terms.

The deal, if approved, would settle a longrunning dispute that was the only major labor deal Delta or Comair had failed to complete as part of their Chapter 11 restructurings.

Comair agreed to delay implementation of wage cuts and other concessions unless the agreement is not ratified by the Air Line Pilots Association by March 4, Comair spokeswoman Kate Marx said.

Boston Globe: “Teachers win last-minute concessions, put off their strike vote

Boston teachers, who had threatened to strike today, voted yesterday to delay any action for two weeks after the school system offered two key concessions in last-minute negotiations.

Two hours before the teachers were to vote on a one-day strike, the school system rescinded its proposal to lift the cap on class size and give the superintendent, instead of a team of teachers and administrators, the authority to transfer teachers out of underperforming schools.

Also yesterday, the Appeals Court of Massachusetts upheld a lower court’s ruling that it is illegal for teachers to vote on a strike and an order that the union call off the vote.

The 8,000-member Boston Teachers Union, which has been negotiating a new contract for 13 months, had scheduled a vote yesterday afternoon on the strike. It would have been the first Boston teachers strike in 14 years.

AJC: “Goodyear Reports $358M 4Q Loss Due to Strike

Goodyear Tire & Rubber Co.’s leader is trying to put the costly effect of a nearly three-month strike behind the tiremaker and concentrate on revving up sales after Goodyear reported Friday that it lost $358 million in the fourth quarter.

“Our revenue performance will be generated by price and volume increases and continually richer product, brand and customer mix,” Robert J. Keegan, chairman and chief executive, said in a conference call with analysts.

The loss of $2.02 per share for the quarter ended Dec. 31 was due to a strike at 16 plants that dragged down sales. Sales totaled $4.98 billion for the quarter.

Akron, Ohio-based Goodyear reported a $51 million loss, or 29 cents a share, on sales of $4.94 billion in the 2005 fourth quarter.

Goodyear placed the cost of the strike at $367 million, or $2.07 per share.

Shoulda settled it before it started, shouldn’t yah? But nooooooo, you had to do it the hard way.

AJC: “Air Traffic Controllers’ Union: Stress at Hartsfield caused serious incident

A Florida-bound Delta Air Lines flight aborted a takeoff last month as it screamed down an Atlanta runway at 160 mph at the same moment incoming flights descended toward a dangerously close parallel runway.

The Boeing 757 blew out three tires in the Jan. 10 incident, but none of the 167 passengers or six crew members was injured.

Two air-traffic controllers were required to undergo retraining as a result of the incident, which one controller labeled as one of the most serious at Hartsfield-Jackson International Airport in recent years.

The incident was highlighted Tuesday by Gary Brittain, the Atlanta control tower’s representative to the National Air Traffic Controllers Association, a 14,000-member union battling with the Federal Aviation Administration over pay and staffing levels.

Brittain, speaking to reporters in a conference call, attributed the controller error to stress caused by understaffing and controllers working too many overtime shifts.

Bush’s FAA says not, but what would you expect it to say? This has been going on under the press radar for years, and it just gets worse with time. The near-misses are getting nearer and nearer as overworked controllers get more and more exhausted and burnt-out. Somebody has to stop this madness before people die.


Think Progress: “Siding With Big Business, Cheney Announces Bush Will Veto Workers’ Rights Bill

Today, the House Education and Labor Committee begins markup on the Employee Free Choice Act (EFCA), which has strong bipartisan backing in Congress. The EFCA would make it easier for workers to form a union. Under the current law, “even when a majority of workers ask for union representation, their employers can force them to undergo an election process” administered by the Bush administration’s “anti-worker” National Labor Relations Board.

Roll Call reports today, “Deep-pocketed corporate lobbying groups have joined together to defeat” the EFCA. Speaking before a business lobby group this morning, Vice President Cheney announced that Bush will veto the EFCA legislation.

The current union organization system is tilted against America’s workers. Each year, over 20,000 U.S. workers are illegally fired, demoted, laid off, suspended without pay, or denied work by their employers as a result of union activity. Under the Bush administration, American workers have seen union levels — and their wages — steadily drop….

There’s a short video of Cheney’s speech posted in which he claims he’s doing this for workers. Go watch it – if you’ve got the stomach for it.

Fort Worth Star-Telegram: “Apple CEO lambasts teacher unions

AUSTIN – Apple Inc. CEO Steve Jobs lambasted teacher unions Friday, claiming no amount of technology in the classroom would improve public schools until principals could fire bad teachers.

Jobs compared schools to businesses with principals serving as CEOs.

“What kind of person could you get to run a small business if you told them that when they came in they couldn’t get rid of people that they thought weren’t any good?” he asked to loud applause during an education reform conference.

“Not really great ones because if you’re really smart you go, ‘I can’t win.'”

In a rare joint appearance, Jobs shared the stage with competitor Michael Dell, founder and CEO of Dell Inc. Both spoke to the gathering about the potential for bringing technological advances to classrooms.

“I believe that what is wrong with our schools in this nation is that they have become unionized in the worst possible way,” Jobs said.

“This unionization and lifetime employment of K-12 teachers is off-the-charts crazy.”

There’s a real danger when CEOs start thinking govt should be run like a business. We’ve seen what that leads to, and it sucks. Jobs ought to shut up about stuff of which he is this pig-ignorant.

Stephen Barr: “Speaking Up for the Whistle-Blowers

They have job duties taken away, so they are marginalized in the office. They get stripped of their security clearances, so they can’t work. They are blacklisted, so they can’t find employment. They are reassigned to new locations, so they have to choose between moving or losing their jobs.

Those are typical forms of retaliation carried out against federal employees who blow the whistle on waste, fraud and abuse at their agencies.

Yesterday, advocates for whistle-blowers urged Congress to strengthen protections for federal employees who suffer reprisal in the workplace. The advocates were greeted with bipartisan support at a hearing held by the House Oversight and Government Reform Committee.

“Federal employees are on the inside,” Henry A. Waxman (D-Calif.), the committee chairman, said. “They see when taxpayer dollars are wasted. They are often the first to see the signals of corrupt or incompetent management. Yet without adequate protection, they cannot step forward to blow the whistle.”

AJC: “Construction workers injured in wall collapse at Lenox

Two construction workers were injured early Wednesday when a wall collapsed at a Lenox Square mall renovation project.

The 15-foot, concrete block wall fell about 3 a.m. as workers from Morley Environmental Inc. were doing demolition near the Neiman Marcus store, said company CEO John Morley.

Morley said one worker had a cut to his head and the other had a broken arm. Their names were not immediately released.

The cause of the collapse has not been determined….

OSHA’s investigating. Is that good news or bad?


NYT: “Mill Towns of Connecticut Lose Factories, and Way of Life

Victor Silva, 50, has lived in Ansonia, a town just south of here, all his life. He knew he would work in a factory, smoothing out metal or loading trucks. He never expected getting laid off three times as one struggling factory after another scaled back or shut down entirely.

Now, he can recite the trajectory as if it were gospel.

First it was Seymour Specialty, which shut down after it could not make a profit on sheet metal and brass. A sprawling supermarket has since taken its place in the center of town.

He moved to Ansonia Copper and Brass, a bustling factory that he thought would do well for decades. But four years ago Mr. Silva was one of about 100 workers let go. A few weeks ago, the company announced it would lay off 85 more employees.

Most recently, Mr. Silva came to the New Haven Copper Company, which gave him a solid job for years. But next month, New Haven Copper will shut its doors, making Mr. Silva and nearly 50 workers the latest victims of Connecticut’s declining manufacturing industry.

“I am getting too old for this,” Mr. Silva told a couple of buddies the other day, a whisper of exasperation in his voice. “I have to find something that I can stick with. I need something stable.”

The price we pay for a global economy that favors only the rich and the corporatocracy. There are other prices, too. Like workers having to pay to live crammed into motel rooms:

NYT: “Boom in the Mountains Creates a Housing Shortage

The Big Sky region, just north of an entrance to Yellowstone National Park, has boomed in recent years, attracting skiers and other outdoor enthusiasts and fueling a construction and employment boom.

But soaring land prices and building costs have put the price of housing far beyond the reach of many new resort and construction workers.

Faced with a severe housing shortage for its workers, at least two resorts, the Yellowstone Club and Big Sky Resorts, picked an unusual solution. Each bought a motel it intended to continue operating for travelers, as well as for housing workers and contractors.


Both companies said workers would receive discounts on rooms, which rent for $100 to $150 a night depending on the season. Who gets those discounts and how much they amount to depend on what a worker’s “job is and how much we need them,” Mr. Schieffer said.

Now there’s a neat bit of Social Darwinism laced with pure-D blind self-interest, and this guy thinks he’s doing his people a good turn. Jesus. Let’s see what the reality is, shall we?

Isabella Silva of Belo Horizonte, Brazil, lives in a Whitewater Inn room with three young male co-workers from Brazil. Each pays $230 a month for the crowded living space that is mostly taken up by three beds and a mattress on the floor. Ms. Silva and her roommates do most of their cooking in microwave ovens; they have wireless Internet and access to the motel pool and waterslide.

For which they pay a combined total of almost $1000/mnth. Generous, I suppose, but only against the prevailing commercial rate of around $3000/mnth. But Kyle Zimmerman is happy. He moved out of a closet in a condo to get into a motel room.

Not surprisingly, Mr. Zimmerman applauded the resorts’ buying the motels.“Every year, I hear there’s going to be new employee housing, but it never happens,” he said. “You’ve got to put them somewhere.”

Because nobody wants to build affordable housing in an area where rich people will pay top dollar, and the Bush Administration won’t lift a finger. Why aren’t we ashamed of ourselves?

Globe, Robert Kuttner: “Collision course on trade policy

GET READY FOR a four-way train wreck on trade policy. The engineers: The Bush administration, the Democratic leadership in Congress, the Democratic back-benchers, and the government of China.

The Bush administration dearly wants a renewal of the president’s authority to negotiate more trade deals. The House and Senate Democratic leadership sees an opportunity to win a long-sought Democratic goal — the addition of labor standards to trade deals.

This is NAFTA all over again.

[M]any other Democrats in Congress are not pleased. They see echoes of past trade deals such as NAFTA, whose language on labor rights turned out to be meaningless in practice.

There is widespread skepticism that the Bush administration would agree to language guaranteeing, for instance, the right of workers in countries with favorable trade deals to join or organize unions. (The administration doesn’t even enforce that right for American workers.) The issue threatens to divide the Democratic leadership from most newly elected members.

This could get ugly. Fasten your seat belt….


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