Dockworkers Threaten East Coast Strike, Reject West Coast Deal

Bloody Thursday, San Francisco, West Cost Ports Strike, 1934

Dockworkers from Massachusetts to Texas are threatening to strike on Sunday, in what would be the first East Coast port shut down since 1977, a two-month work stoppage that cost retailers billions of dollars (see New York Times). The threat has so worried the corporate bosses that they are demanding Obama block the strike by invoking the Taft-Hartley Act, as Bush did in 2002 to end a West Coast port strike.

The anti-labor Taft-Hartley Act, which passed in 1947, banned the General Strike, solidarity or sympathy strikes, and secondary boycotts. It prohibited closed union shops and opened the door to “right-to-work” legislation. President Truman, whose veto was overridden, called it an “intrusion on free speech.” The law also permits the president to obtain a strike-breaking injunction by claiming that national security is threatened by the strike, which is what corporate leaders want Obama to do.

Many believe that Obama will resist these demands because of his supposed strong ties to the labor movement, pointing to his hands off response to the recent Chicago teachers strike as evidence. However, Obama did not need to intervene in Chicago. His crony Rahm Emanuel applied plenty of pressure on the union, including the threat of obtaining an injunction against the strike. Furthermore, the AFT has consistently served Obama votes (also see here), stymied strikes and brokered sellout contract deals (also see here) that have shoved his corporate “reform” policies down the throats of teachers. The contract that the Chicago Teachers Union finally accepted was no doubt due in part to pressure from Randi Weingarten and the AFT, which had urged the Chicago Teachers Union to avoid striking in the first place and which refused to support the teachers with strike pay.

The ports strike is substantially different than the Chicago teachers strike. Most significantly, a shutdown of the schools has very modest and tangential impacts on profits, while a port shut down is projected to cost retailers millions of dollars a day and Obama’s allegiance to capital is far stronger than his ties with labor. Retailers and other corporate leaders are further fanning the flames by claiming that a port shut down could devastate the economy, particularly in conjunction with the tax increases and spending cuts that will come with the fiscal cliff or any compromises to avert it.

The East Coast dock workers, who belong to the International Longshoremen’s Association (in contrast to their fellow workers on the West Coast, who belong to the ILWU), had been in contract negotiations for nine months, before talks fell apart on December 18. One of the main sticking points is “container royalty payments,” which the shipping companies want to freeze for current employees and eliminate for future employees. These payments averaged $15,000 per employee last year. Aside from the fact that this would lead to stagnation in take-home pay, it would also hurt long-term organizing efforts and solidarity by driving a wedge between old-timers and new members.

While long shore unions are seen by many as among the strongest in the country, they have been losing membership over the past 50 years just like most other unions. These jobs have been lost primarily because of automation. New Jersey and New York employed 35,000 longshoremen in the 1960s and today the number has dwindled to 3,500. They are also far less militant than they were in the 1930s, when the ILWU emerged on the West Coast in the wake of a bloody 83-day strike that killed several longshoremen. 

Engraved Billy Club from Battle of Smith Cove, Seattle (image from Wikipedia)

Meanwhile, on the West Coast, the ILWU voted Monday by 93.8% to reject the Pacific Northwest Grain Handlers Association “last, best and final” offer. The grain handlers association now plans to lock out the dockworkers and bring in scabs. The Oregonian reports that the owners of Portland, Vancouver and Puget Sound terminals have spent months preparing for a battle on the waterfront, “lining up troops and assets like chess pieces.”

The West Coast grain terminals implementing the lockout handle 25% of the U.S. grain and 50% of its wheat exports, according to the WSWS. Their owners are demanding the same concessions made by the ILWU in Longview, Washington to the EGT (Export Grain Terminal). The EGT contract was a pretty mediocre deal for the Longview dockworkers, particularly in light of the brutality and repression they suffered by police during their struggle. However, the recent vote indicates that the rest of the West Coast dockworkers are unwilling to accept such losses to workplace rights and working conditions.

Unions Collaborate With Obama to Squeeze American Workers

Image from Flickr, by DonkeyHotey

With the country moving ever closer to the “fiscal cliff,” the Obama Administration is doing everything it can to strike a “grand bargain” that appeases the ruling elite. The grand bargain is a euphemism for an austerity package that will maintain low taxes for the wealthy and subsidies for their business by slashing social spending and services that help keep the rest of the country from sinking further into poverty.

Union leaders met with the president on Tuesday to give their support for his plan which will include large cuts to social programs like Medicare, Medicaid, Social Security, food stamps and other welfare programs, the WSWS reported this week. Because there is broad support for most of these programs, the President is depending on the unions to help quell popular opposition and avert the kinds of protests and mass discontent seen in Greece, Spain, Portugal and the UK.

While the unions have claimed they are fighting to protect American workers from austerity, their actions indicate that their actual goal is to sell the president’s scam as a good deal for their members.  AFL-CIO President Richard Trumka, for example, said his organization was committed to making sure that the middle class and workers don’t end up “paying the tab for a party that we didn’t get to,” and he asserted that the president had the same commitment. Also present at the meeting were Mary Kay Henry, head of the Service Employees International Union (SEIU), Lee Saunders of the American Federation of State, County and Municipal Employees (AFSCME), and Dennis Van Roekel, president of the National Education Association (NEA). Mary Kay Henry said “We expect to have the president’s back on the agenda that the voters just declared support for. The president has always said he needs a movement behind his mandate.”

Unions Have President’s Back (As He Attacks the Middle and Working Classes)

In 2011 Obama proposed a deficit-reduction plan that would have raised the eligibility age for Medicare, cut Medicare benefits, reduced Social Security benefits, slashed Medicaid, and reduced tax deductions for the middle and working classes. According to the WSWS, William Daley (White House chief of staff when Obama first proposed this “grand bargain”) told Bloomberg News that this would be Obama’s starting point for the next round of negotiations with Republicans. To make matters worse, the extension on unemployment benefits will automatically expire on January 1, ending payments to over 2 million unemployed workers and Obama has said nothing about how (or if) he would avert this disaster.

The “bargain” in this Grand Bargain is Obama’s insistence that taxes must be raised on those earning more than $250,000 per year. However, he has indicated that he would be willing to consider other ways of increasing revenue from the wealthy, like maintaining current tax rates, but decreasing deductions. In either case, the rich earn most of their income through capital gains, which are taxed at the relatively low rate of 15%. Thus many, like Mitt Romney, end up paying a far lower effective rate than the majority of Americans (who earn most or all of their income through salaries) and will continue to do so even if Obama wins approval for tax increases on the wealthy.

Further evidence that Obama is planning austerity for the majority of Americans comes from a secret document leaked last week to Meet the Press. The document indicates that in 2011 Obama proposed over two dollars in cuts for every dollar in increased revenue ($2.8 trillion in cuts and $1.2 trillion in tax increases), setting the stage for raising the debt ceiling and the automatic spending cuts that comprise the “fiscal cliff.” The document revealed that Obama was willing to cut TRICARE (health insurance for the military and veterans) and to lower tax rates for business and for the wealthy. The document also suggested cutting Medicare by $250 billion between 2012 and 2021 and by $800 billion between 2022 and 2031. It proposed cutting Social Security payments by $112 billion over the next 10 years and cutting veterans’ disability payments by $24 billion. It also suggested slashing $11 billion from military retirement and $33 billion from benefits for retired federal employees, as well as $2 billion from nutrition assistance, $4 billion from flood insurance and $10 billion from higher education.

All this sounds exactly like an attempt to make American workers pay the tab for a party they didn’t attend. The Republicans have refused to sign off on any tax increases for the wealthy and Obama has indicated he would be willing to lower their tax liability. A few Republicans, like Mitch McConnell, have indicated they might accept a cap on deductions in exchange for cuts to entitlements (e.g., slashing Medicare and Social Security) and Obama has indicated he is open to this. In the end, the rich will sacrifice little or nothing toward closing the federal deficit, which will be subsidized almost entirely by reductions in services and programs that benefit the majority. Yet the deficit is almost entirely a byproduct of gifts to the wealthy, like subsidies to defense contractors, oil and coal companies, and big Agri-business; bailouts of banks; and tax breaks for the wealthy and their businesses.

Education Cuts for California Despite Prop 30 Victory

Image from Flickr, by Double-M

The California Teachers Association (CTA) lobbied heavily for passage of Proposition 30, mobilizing thousands of teachers to phone bank and canvas neighborhoods. Together with other state unions, they spent $50 million to get the initiative passed. They claimed it would save public education and restore funding to the schools. However, with more than $18 billion slashed from K-12 education since the recession began, the $6.6 billion in projected revenues from Prop 30 won’t even come close to restoring public education funding to pre-recession levels, especially considering the state budget deficit is now estimated at more than $15 billion. It will do nothing to bring back the 80,000 teaching jobs lost since the recession began nor reopen any schools that were shut down, the WSWS reports.

What Proposition 30 will do is prevent $6 billion in trigger cuts that had been built into the last state budget as a way to blackmail California voters into approving the tax hikes. Rather than restoring public education, Prop 30 simply maintains the status quo of an $18 billion hole in the state’s K-12 funding and one of the very lowest per pupil funding rates in the nation. While it does raise taxes on those making more than $250,000 per year, the increase is only a nominal 1-3% increase on their payroll taxes (i.e., the taxes withheld from their salaries) and it leaves the tax rate on their capital gains (which makes up the majority of their income) unaffected. At the same time, Prop 30 raises the state sales tax from 9.25% to 9.75%—a regressive tax increase that disproportionately affects poor and working class people.

While the California State University (CSU), University of California (UC) and state community college systems are all planning to increase course offerings and some, like CSU, are planning modest tuition refunds ($249 per semester, according to the Los Angeles Times), they are also planning other fee increases and service cuts. CSU, for example, is still planning to implement fee increases for students taking more classes than they need to graduate, and the UC system is planning on increasing fees for graduate and professional programs by 1.5% to 35%. UC, which threatened 20% tuition hikes if Prop 30 failed (and promised no new fees this year if it passed), is leaving open the possibility of raising undergraduate tuition again next year.

In response to the proposed cuts and the unwillingness of UC to go beyond a tuition freeze and actually lower tuition, UC students have been protesting at UC campuses and at meetings of the university’s regents. Students staged a sleep-out in Berkeley on Wednesday night. Hundreds of students were joined by faculty and unionized workers on Thursday to protest budget cuts that have resulted in slashed course offerings, layoffs and large tuition hikes. They blocked roads leading to the meetings and then disrupted the meeting so effectively that the regents had to call a temporary recess.

Students do not simply want a reduction in tuition—many want a completely subsidized higher education system. Last Friday, KPFA’s “Up Front” news program broadcast protesters chanting, “No cuts! No fees! Education must be free!” Until recently, California did subsidize both the UC and CSU systems to the point that neither charged tuition and both charged fees that were relatively affordable for middle income families. Back in the early- to mid-1980s, for example, it only cost $1,000-1,200 per year to attend UC. By 1995, it was over $4,000. By 2010, it has risen to more than $11,000. Last year, tuition at UC was $13,218. (Click here for more on the history of UC tuition).

With the passage of Prop 30, Los Angeles Unified (LAUSD) is planning on restoring the five school days that had been cut from the school year the Los Angeles Times reports, as well as restoring teacher pay for the 10 days which they had lost to furloughs. However, Superintendent Deasy warned of a new round of cuts (implying the furloughs and pay cuts could return) if Congress and President Obama cannot resolve the “fiscal cliff” crisis, as this would leave LAUSD with a new $60 million budget shortfall.

Of course, if this happens, many districts in the state could suddenly find themselves with large deficits, too. This is because Prop 30 is only a bandage over a gaping wound. Education at all levels, from pre-K to graduate school, has been eviscerated over the past decade and Prop 30 does nothing to restore the cuts. Prop 30 does little to close California’s current budget deficit and it does nothing to stabilize California’s revenue stream or prevent future deficits and education cuts.

There is a glimmer of hope for education funding in the future. One of the reasons California has had so much difficulty in balancing its budget for the past decade is that voters approved a law requiring a two-thirds supermajority in the legislature before any new tax increases can be approved. The most recent election, however, gave the Democrats just such a supermajority in both houses of the state legislature for the first time in nearly 80 years. This will not only allow lawmakers to pass tax increases, but it also gives them the power to override the Governor’s veto.

Whether or not they will use their power in this way remains to be seen, but seems unlikely considering that every one of them would be negatively affected by a serious tax increase on the wealthy. This is not only because they are all wealthy themselves, but because they would be biting the corporate hand that feeds them, keeps them in office, and provides them jobs when they get termed out.