After 40 years of government regulation, deregulation of the airlines in 1978 was supposed to lead to a flourishing of the industry. In theory, increased competition would mean more choices for consumers, lower prices, and better service. Instead, the number of airlines has declined dramatically over the past 15 years, prices remain prohibitively high for millions, and quality of service is often an afterthought. But the real goals of deregulation were successful: mega-profits for the CEOs and the wholesale destruction of tens of thousands of high-quality union jobs.
But the airline business isn’t as lucrative for the bosses as it used to be. The attacks of September 11th were a crippling blow to an industry already in trouble. The sudden drop in air travel hit the companies where it hurt most - their profits - forcing some major airlines into bankruptcy proceedings. High fuel prices and profit-eroding price wars have also cut into the airlines’ bottom line. The six big airlines expected to lose $5.5 billion this year, all of them - American, United, Delta, Continental, Northwest and US Airways - have announced plans for deep cuts in 2005: $7.5 billion in spending and at least 20,000 jobs. These cuts can only be made by attacking the wages and conditions of workers in the industry, and by reducing quality and safety of service, thereby endangering the flying public.
United Airlines, the country’s number 2 carrier, has opened an all-out offensive against its workers. It has already cut 9,000 of 20,000 jobs in Northern California alone since 2000. On top of huge “labor givebacks” of $2.5 billion in 2003, the company now demands a further cut of $725 million annually in workers’ wages and benefits – and the elimination of defined-benefit pensions. We can be sure United CEO Glenn Tilton’s wages and benefits won’t be slashed nearly that much if at all.
Gov’t Handouts and Breach of Contract
After September 11, the airlines turned to the federal government for a hefty dose of corporate welfare to keep them running. We called for the nationalization of the airlines. After all, if these companies want public money to keep running, then the public should have a say in how they are run. You see, the CEOs want the best of all worlds: no government regulation and total control over their operations when the profits are rolling in, and tax dollar handouts without public oversight when the going gets rough. This is a win-win situation for the bosses and a lose-lose situation for working people. So the case for nationalization is quite simple: if the bosses can’t run this vital sector of the economy efficiently, safely, and with quality wages, benefits and conditions for the workers that make it function, then they don’t deserve to run it at all.
After seeking the government’s help directly through a multi-billion dollar corporate bailout, they have now turned to the judicial branch in an effort to undermine the most basic rights of working people: the right to organize and bargain collectively through a union. In an ongoing case between US Airways and its machinist union, a bankruptcy judge cancelled the union’s collective bargaining agreement with the company in order to provide it with millions of dollars in annual savings. Judge Stephen Mitchell also approved the termination of the machinists’ and flight attendants’ pension plan, as well as a frozen pension plan that was still providing benefits to 28,000 retirees with potential savings to the airline of $1 billion over five years.
As reported in the Associated Press: “The termination of the contract with the International Association of Machinists would result in pay cuts for union workers ranging from 6 percent to 35 percent and the loss of thousands of union jobs. The costs savings are expected about $270 million.”
With the stroke of a pen, this single judge has undermined a basic cornerstone of the trade union movement. But there’s a catch: the machinists can prevent the judge’s decision from being implemented if they accept the company’s “best final offer” for a new contract. According to Judge Mitchell, the choice before the workers is clear: “Which is worse, that half of the mechanics lose their jobs or that all of the mechanics lose their jobs?” This is nothing short of blackmail of the union rank and file by the company, the government, and many of the union tops. Bruce Lakefield, US Airways’ CEO, said after the hearing, “The judge was very much in tune with what is going on at US Airways.”
US Airways has been able to maintain its operations only through an agreement with the federal government’s Air Transportation Stabilization Board, which lent the airline $900 million in March 2003, when the company emerged from its first trip into bankruptcy. It can only hope to get an extension on the loan if it proves it has sufficiently cut labor costs. In other words, the government will loan the company public money only if it does the dirty work of crushing the unions.
Additionally, provision of workers’ pensions will now be the responsibility of the public, not of the companies who promised to pay them in legally binding contracts. The federal Pension Benefit Guaranty Corp. will pay these workers their pensions out of public tax money. In the case of US Airways’ pilots’ union, which had its pension plan terminated in 2002-2003, the amount of the new plan was far lower than that they had earned through their years of service.
The idea that the state is an impartial arbiter between the members of society, standing above the classes is blown out of the water by the collusion of big business with the government in this and countless other cases. Together, they are working to smash the unions, and drive down wages and conditions to a level not seen in decades. It’s a case of “you scratch my back, and I’ll scratch yours.” Financially and legally, both sides lean on each other in order to weaken the position of the working class.
Cuts in pay, benefits, health care, and pensions are the norm at all major airlines, and in U.S. industry in general. This comes at a time when real wages have already been frozen or in decline for 25 years. With higher energy, housing, and food costs, it’s no wonder working families can scrape by only if they go into colossal debt.
All-Out Attack of the Bosses
Not since the 1930s have the corporate and government attacks been so blatant and open. Back then, labor’s response was a massive uprising that led to the rapid unionization of entire industries and the formation of the CIO. In society as in nature, similar conditions lead to similar results. The current offensive against the working class will eventually be met with fierce resistance on a massive scale. In the coming years, tremendous battles of the class struggle will erupt across the United States in every city and every industry. But we must start preparing now. We must first defend the positions we already hold. We cannot hope to make new gains if we cannot even keep the hard-fought rights we won in the past. This struggle can succeed only if it is the result of the concerted effort of the rank and file of the labor movement and the working class as a whole: unionized and non-unionized; employed and unemployed. In short, entire communities need to come together to fight back against the bosses. As the old labor slogan says, “An injury to one is an injury to all!”
There are numerous symptomatic indications that working people have had enough, and are ready to fight back. In response to constant attacks on their wages, conditions, benefits, and right to collective bargaining, US Airways workers unofficially struck over the holidays by calling in sick in large numbers. 300 flights were cancelled, crippling the carrier’s ability to continue service. This action was not the result of “laziness” or “spite”, but rather, came about after years of growing resentment at the actions of the company. The “straw that broke the camel’s back” came after flight attendants had already accepted a second round of cuts: a 9 percent pay cut in addition to a reduction in benefits including vacation and sick time.
On the very same day the flight attendants accepted these unfavorable terms, US Airways told them they would also have to fly 5 extra hours a month in order to make up for staffing shortages. In other words, they want to make fewer workers work harder and longer for the same pay. Because of wage and benefit cuts, some new flight attendants earn just $12,000, less than they might make at Wal-Mart or as a bank teller. To add insult to injury, US Airways CEO Bruce Lakefield has not taken a pay cut, even though a bankruptcy court judge ordered emergency 21 percent pay cuts for union members. Enough was enough.
The “sick out” of the US Airways workers is a mere glimpse of the power workers have to bring the airlines or any other industry to a halt if they are united in struggle. But this single action is just the beginning. To reverse the setbacks of recent years and make new gains will be a long and bitter battle. The trade unions must take the lead in this effort, uniting the whole of the working class behind them. However, the current leadership of the AFL-CIO cannot be trusted to fight tooth and nail in our interests. Almost without exception, they view their relationship with the bosses as a “partnership”. They act on behalf of the bosses as a police force within the unions to keep the rank and file “in line”. This “business” concept of trade unionism is responsible for the wholesale sellout and betrayal of countless union struggles and the steady decline in union membership and influence over the last 25 years. The revitalization of the union movement must begin with the rank and file and the democratization of the unions at all levels.
This struggle cannot be limited to the trade union front alone. Working people need political representation in government as well. The AFL-CIO’s historical relationship with the Democrats has been successful only in lining the pockets of the union tops, and in keeping the labor movement subservient to the bosses. Several Democratic presidencies have come and gone, and still the virulently anti-labor Taft-Hartley Act remains on the books. In the recent elections, the AFL-CIO wasted $147 million on Kerry’s failed “lesser evil” campaign against Bush. The ties between the unions, which are organizations of the working class, and the Democratic Party, which is a political party of the ruling class, must be severed immediately. There is nothing to be gained from this arrangement except more setbacks, betrayals, and defeats. Working people need our own party – a party by and for working people. The struggle for a strong, democratic labor movement is intimately tied with the need for a mass party of labor.
Making an Example of the Airlines
The smashing of the PATCO union in 1981 was the opening salvo in a decades-long assault by the bosses against the airline unions and the labor movement in general. Now the bosses and their government are trying to make an example of the flight attendants and machinists. These attacks are part and parcel of the attacks being made on all working people – union and non-union. We are all affected by these cuts. It is an attempt to turn the clock back 80 years or more. Not only are the individual workers in the industry affected, it weakens the position of the labor movement as a whole.
The quality and safety of air travel is also adversely affected. These cuts come largely out of wages and benefits packages. But corners are also cut across the board in order to maximize profits. This has meant a loss of food service, a drastic reduction in routes (over 100 cities have been removed from flight schedules), flight delays, lost baggage and other headaches. This corner cutting may well lead to more serious problems such as a major air disaster. As the experience of other countries shows, it is often only an avoidable tragedy that brings attention to the detrimental effects of privatization and deregulation.
We also think the airlines serve to illustrate an important point: that the for-profit system does not work and is detrimental to the majority of humanity. Capitalist competition is irrational and leads only to waste and inefficiency. Companies declare bankruptcy and close down their operations not because there are no planes to fly, people who want to travel, or workers skilled enough to operate and maintain them. They shut down because they cannot make a profit. After all, profit is the main aim of the capitalist class.
Without a rational plan, competing companies swing wildly between having too little capacity to meet the needs of society, and having “too much”. Not “too much” in the sense that there are not plenty of people who would like to make use of the airlines’ services, but “too much” in the sense that the companies cannot sell their services on the market for a profit. They do not produce for human need, but to make a quick buck. As a famous industrialist once said, “I’m not in the business of making cars, I’m in the business of making money.”
The airline sector is vitally important to the modern world. We rely on it for travel, shipping, and yes, also to take vacations and see the world. What we need is a rational plan for industry, run democratically in the interests all members of society. The bottom line is, if the bosses can’t safely and efficiently run their own companies without public assistance, then they have no business running them at all. If they are interested only in short term profits while an important sector of the economy goes down the drain, they don’t deserve to run it. If they can’t offer decent wages, conditions, and benefits to the tens of thousands of workers who do all the real labor, then they don’t deserve to run it.
Why should workers have to pay for the inefficiency and greed of the bosses? Why should our tax dollars be used to line the pockets of private individuals while the quality and safety of air travel continues to decline? Why should workers who have given decades to these companies, with the promise of decent wages, benefits and retirement, be stripped of this overnight because the company and the government are in cahoots?
Yet many people remain suspicious of nationalization. One reason is that they do not trust the government to act in their best interests. Mistrust of a government controlled by profit-greedy executives is healthy – but it is not a valid argument against democratic public control over essential industries. The solution is to ensure the government truly represents the working class majority. We need a government by and for working people. This is why working Americans need their own political representation. Nationalization of the airlines would be just the first step in the revolutionary transformation of the whole of society.
- Stop government attacks on behalf of the bosses. No to cuts in wages, benefits, working conditions, and quality of service.
- Unionize the entire airline industry.
- Nationalize the airlines under workers’ democratic control.
- To achieve this the working class needs its own political representation: for a mass party of labor based on the unions.