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Jon Talton

Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.

November 25, 2013 at 10:11 AM

Getting inside the heads of the Machinists

Why did they do it? Many in the Puget Sound are still asking this question after the Machinists decisively rejected Boeing’s offer to build the 777X here. I’ve written about the miscalculations and misunderstandings on both sides.

But I received an email from source containing a letter that a union member sent to Boeing Commercial Airplanes chief Ray Conner in response to his open letter, which ran in newspapers, urging acceptance of the deal.

You can disagree or not, but here it is:

Dear Mr. Conner,

I am Boeing employee working under the current IAM 751 contract. I am also a third generation Boeing Employee. Growing up my (now 86 year old) grandma had a saying that has stuck with me until now. She always said, “Boeing has been good to this family.” A statement I have always believed to be true until this last contract proposal.

After World War 2, my grandfather retired from duty in the Air Force and began his career at the Boeing Company. In the 1970’s two of his sons hired on in Tooling, joining their father at Boeing until his retirement. Both sons continued on to have long careers with the company. The oldest retired a few years back and the youngest, my father, is still an active employee with 35 years at Boeing. Currently, all three of his daughters are financially supported by Boeing incomes. Along with me, my two brothers-in-law are also employed at Boeing. Two of us are IAM members and the third is an Engineer who is in fear that his job may be eliminated or moved out of state. One of my brothers-in -law has a father who is also a 30+ year IAM member. Apart from my immediate family we also have many extended family members who are current, long time Boeing employees.


As you can see, the current dilemma Boeing has placed us in effects multiple generations and facets of our family. I no longer can hold my head high and say I am proud to work at Boeing. How can anyone be proud of something that attempts to extort and blackmail them? As I see it, the tactic being used to secure the current IAM proposal are the same high pressure predatory sales tactics used in predatory sales schemes. (1) Dangle a large carrot = $10,000 lump sum bonus. (2) Divide and conquer = if we can divide the rank and file by dangling money for the newer younger employees who haven’t maxed out and retirement incentives for those who will be retiring soon. (3) Demonize the opponent before they even know what’s happening = use the Media to make Boeing look like they are helping us and our region with job security and that IAM’s lack of acceptance hurts our economy and region. (4) Create fear, panic and urgency to get them to sign on the dotted line = if we make them think we will move the new plane to another state, and they might eventually lose all their jobs they might sign. Make them think this is the last and only offer and lack of acceptance will result in Boeing moving.

In the current contract proposal you are essentially asking fathers to sell out their own children and grandchildren for a few more dollars of retirement. Not only that, but you’re are trying to scare them into taking this deal. You are essentially saying if they don’t sign, Boeing will go away and they will have unemployed children.

I see no integrity in these actions. I have told my father that would rather say NO and lose my job, than say yes under the pressure and duress of a bully. If I allow myself to be bullied now, I set precedence that it is acceptable for you to do so in the future. I personally would rather keep my integrity and be unemployed than bullied into agreeing to a contract that hurts my children in the future.

I in no way see this as a contract extension. A contract extension would be Boeing offering an extension of our current contract with minimal to no changes. This is a totally new contract proposal that benefits few and tramples on many. This isn’t even a contract offer it’s an ultimatum. Ultimatum and bargaining have two very different definitions. One declares do this or else while the other affirms let’s do this together with mutual respect and integrity.

It seems to me that Boeing leadership has discarded their own values and has adopted new less savory ones. Please do not expect me to participate in trainings on ethics, integrity, and diversity if you are not also willing to act upon those standards. Boeing says it places a high value on diversity but this contract offer tells me differently. You see diversity isn’t just about race, ethnic origin, religion or sex. At Boeing diversity can also be applied to blue collar, white collar and technical skill positions. It seems to me that there is a lack of acceptance and respect for the blue collar portion of this puzzle.

Building airplanes takes a certain level of skill. It takes several years for the average mechanic to learn and become proficient as a mechanic. Discontinuing the current step progression format tells us you do not value our skills. If you look at step progression the same way you look at the system for carpentry model. A mechanic starts at $15 as a laborer. He/she spends the first 2 years shadowing, learning and absorbing all the information and skills it takes to be a mechanic. The next 4 years are considered apprentice level. At this level mechanics refine those skills and learn more advanced ones before finally reaching journey status. Eliminating progression basically tells us our skills are not important, that this is nothing more than a job. It ceases to be a career path worthwhile for people to actively pursue. Why pursue a career when you have to go through 16 years of training before it becomes worthwhile? I chose Aerospace as my career path. I can’t say that I would make that choice again if I were a young person about to start my career. Nor can I say that I would encourage my children the way my family encouraged me. If this is the way the future of the Boeing Company is heading.

We have seen the ill effects of what happens when portions of an aircraft program are built outside the Puget Sound. Many of my fellow IAM members have worked hard to correct the issues that ensued as a result of those choices. As you can see when you look at numbers for the Performance Incentive Program we are invested in making Boeing profitable! As you increase our rates and workloads we continue to work hard for you, but I feel as if you don’t appreciate it. Your lack of appreciation shows as you try to lower our compensation and reduce our overall earning power.

If you are truly wanting to act in good faith, avert future strikes and stay competitive in the aircraft industry then show us by extending our current contract, making changes in the medical premiums only. As you witnessed in the last contract, when you make a fair honest offer we will gladly accept it! Offer a contract that is fair to the company and to its employees. Pacific Northwest Boeing employees are invested in seeing Boeing continue to flourish as a company, we want a deal that is fair to both. This recent offer is unacceptable. Like my 86 year old grandmother, I would like to tell my children and grandchildren that “Boeing has been good to this family.” This latest proposal is anything but good to middle class families.

That’s the letter. The only thing I can add is this: An analyst’s comment that stuck out in the Sunday story on the 777X by the Seattle Times Dominic Gates. “From the standpoint of economics, none of this makes sense,” said Richard Aboulafia of the Teal Group. He went on:

You could meet the union halfway and it wouldn’t have any material impact on the competitiveness of your pricing….The only thing that makes sense is that (Boeing executives) are just angry, doing this in a spirit of distaste and antipathy (toward the union). Maybe the union has brought that on themselves. I don’t know. But it’s nothing to do with rational market considerations.

I tend to agree. But to play devil’s advocate, maybe Boeing’s “rational market considerations” include a willingness to spend the money in the near and medium term — and take the risks — to shed a union workforce that it sees as intractable in a changed competitive environment.

 

Today’s Econ Haiku:

Obama’s market

Keeps hitting new record highs

Stocks that is, not jobs

 

 

 

 

Comments | More in Aerospace/Boeing | Topics: 777X, Machinists vote

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