Sunday :: Jan 2, 2005

Bracero Bu$h

by pessimist

George Wiseacre Bu$h wants to be president - not of the United States of America, but of Mexico. This has been a goal of his since he ran for the Texas Governorship, and is still an unrealized ambition.

In his effort to achieve this lofty status, he's using his position as the pResident of the US to promote the passage of legislation which would effectively erase the border between the two nations:

Bush Faces GOP Fight Over Guest Workers

As a presidential candidate, both in 2000 and 2004, Bush eagerly courted Hispanics, the fastest-growing ethnic group in the electorate. "We will keep working to make this nation a welcoming place for Hispanic people, a land of opportunity para todos (for all) who live here in America," Bush told the League of United Latin American Citizens last summer. An estimated 10 million immigrants live in the United States illegally; the vast majority are from Mexico, with an additional million arriving every year. As governor of Texas, Bush was committed to immigration changes. As president, he came close to making a deal with Mexican President Vicente Fox in the days before the attacks of Sept. 11, 2001. Those plans were put on hold as tighter borders took on a higher priority for the United States. The president's plan would grant temporary-worker status, for three years to six years, to millions of undocumented workers.

It also would it easier for those workers to get permanent U.S. citizenship.

Why is this so important to Bu$h?

Bush claimed 35 percent of Hispanic voters in 2000 and at least 40 percent last Nov. 2, according to exit polls. That compares with the 21 percent won by Bob Dole in 1996 and the 25 percent that Bush's father got in 1992.

Thus, he could offset any losses from the Miami Cubans or other traditionally GOP voter groups. But just what is George W. Bu$h doing for those who already are citizens - including those who voted for him?

Not a damn thing!

Average-Wage Earners Fall Behind
New Job Market Makes More Demands but Fewer Promises

Teresa Geerling is living the future of life in the middle of the American workforce. After years cleaning the insides of airplanes and polishing their outsides, Geerling was laid off from American Airlines last year. The job was physically taxing for Geerling, 50, but the nearly $32,000 annual pay and health-care coverage helped provide a typical middle-class life in this small midwestern community.

Now, she works the overnight shift at a local hospital as a nurse's aide while completing course work to be certified as a medical assistant. That would seem to be a smart move, because unlike airlines, which are contracting, health care is one of the industries that many economists believe could generate millions more jobs in the decades to come.

This canard requires exposure. Few people today can afford to pay for medical care themselves, thus the need for medical coverage plans from their employers. Employers are regularly terminating their plans, citing the increased costs of maintaining those plans. Thus, more people than ever are without both coveage and the ability to pay, reducing the need for medical services. As the facilities for medical services are essentially fixed, cost-cutting must come from staffing, which means that there will be fewer jobs for those now seeking them, like Mrs. Geerling. The author tends to agree:

Yet rarely has Geerling's work life been so precarious. If she can't stay on her husband's health plan, her costs for health insurance offered by the hospital will be $200 a month, more than five times as much as at the airline. There are no pension benefits beyond the option for a 401(k) savings plan and few job protections. She makes $2 an hour less than before; to have a chance at higher pay, she will need to continually train herself in new areas.

This is also not such a simple solution, with college costs increasing at an exponential rate while governmental educational support is dwindling - if not disappearing. With reduced options for educational advancement, eventually Mrs. Geerling will fall behind, unable to maintain the level of training necessary to hold on to one of the disappearing good-paying jobs left in America:

Geerling is at the leading edge of changes that herald a new era for millions of people earning around the national average, $17 an hour. This new era requires that workers shoulder more responsibility and risk on the way to financial security, economists say. It also demands that they be nimble in an increasingly fluid job market. Those who don't obtain some combination of specialized skills, higher education and professional status that can be constantly adapted will be in danger of sliding down the economic ladder to low-paying service jobs, usually without benefits. Meanwhile, those who secure the middle-class jobs of the 21st century will have to make $17 an hour stretch further than ever as they pay more for health care or risk doing without insurance and assume much or all of the burden for their retirement.

Which brings up another situation that has not yet been factored in: with reduced wages and icnreased fixed costs, there isn't much left over for discretionary spending. Those caught in this situation fall out of the consumerist society we have become. Did the latest holiday season spending patterns not reveal the truth of this? The Toppers spent more while the Ninety-niners spent much less, resulting in a retail sector that didn't do as well as anticipated. All of the increased spending by the Toppers was offset by reduced spending by the rest of us.

But the 'experts' are trying to tell us that while it hurts now, this situation is going to get so much better!

Blue Sky Pie

In the lively debate about the future of U.S. jobs, many economists and scholars acknowledge that the changes wrought by technology and global economic forces will be painful at first. But they say the new structure ultimately will create many kinds of jobs as yet unimagined, in fields such as education, health care and science. "You have to take the leap of faith that the economy will evolve and there will be this innovation economy that comes," said John C. McCarthy, a Forrester Research analyst who wrote a report on U.S. jobs going overseas.

Let's look at these fields. Education is being surrendered to the likes of Chris Whittle and his 'Channel One' style of education. I've already looked at health care above, and science continues to flee the United States for friendlier climes (think stem cell research, for example). Just where are these new and improved jobs supposed to come from if there's no investment will to fund such activities? Some are already on to this idea:

Yet many observers also say that the present economic restructuring may be more rocky than similar transitions in the past and that society should take additional measures to ease the struggles of those caught in the middle, especially the three-quarters of Americans who lack a college degree. Analysts say retraining will be key because tomorrow's middle-class jobs are likely to be enhanced variations of today's lower-wage jobs.

Shrinking Benefits

Most workplace experts are skeptical that the jobs of the future are likely to come with the same kinds of benefits as the jobs of the past. Over the past two decades, companies have moved en masse away from traditional pensions in which employers pay the cost and employees get a set amount after retiring. Employer-based health care coverage has fallen as well, not just for workers in low-wage jobs, but increasingly for those in middle-class jobs.

One analysis estimates that there were 5 million fewer jobs providing health insurance in 2004 than there were just three years earlier. Overall, nearly 1 in 5 full-time workers today goes without health insurance; among part-time workers, it's 1 in 4. Those who manage to keep their benefits often must pick up their share of the higher cost. Employee contributions for family coverage were 49 percent higher in 2004 than they were in 2001, and contributions for individual coverage were 57 percent higher, according to the Kaiser Family Foundation.

Jobs that provide both a middle-class wage and benefits, even for workers without advanced degrees, still exist, often in union environments. But they're getting harder to find. "It's not helping employers to not be able to offer benefits," said Jennifer Schramm, manager of workplace trends and forecasting at the Society for Human Resource Management. But cutting back on benefits "is something they feel they have to do for economic reasons." In firms with 1,000 or more employees, just 1 in 10 workers lacks insurance. In companies with fewer than 10 employees, nearly one-third lack coverage.

Reworking America

As displaced workers fail to make the transition into new jobs that afford them the same kind of lifestyle as their old ones, economists say that politicians ignore the issue at their own peril. Some contend that such ideas only touch the edges of a looming crisis. While they may help individual workers in the short term, they don't address the larger difficulties faced by the workforce in adapting to the demands of 21st century jobs. For that, these labor market experts say, the educational system will have to continue to raise its quality and reach a broader population.

Thomas Bradtke, a manager at Boston Consulting Group, said that for the United States to retain its technological leadership and create new job-producing industries, it will have to keep coming up with a large share of the world's innovative ideas. At a time when other countries' students are routinely testing higher than American children in science and math, that's not a given. "Education systems compete against each other in the long run," he said. "Right now the U.S. is still at the leading edge of innovation, but what if five or 10 years down the road, India has built up world-class universities?"

Anthony Carnevale, senior fellow at the National Center on Education and the Economy, a member of the White House advisory committee on technology and adult education in the Clinton administration, argues that the country needs the equivalent of an industrial policy focused both on getting more people through college and on retraining them for new jobs. Otherwise, "we could have a permanent working poor," he said. "They don't live in America; they kind of live under it."

Kissing That Retirement Goodbye

The Geerlings are determined to avoid that fate. Teresa Geerling said she plans to work "as long as I have two arms and two legs." Life for the couple has recently become more complicated, however. Until now, she could do without the health insurance at her new job because she was included in her husband's plan, which covers them both for $37 per month. But Bernie Geerling, who still works at American Airlines as a baggage-handling supervisor, just got notice that he is scheduled to be laid off next month. He is hoping he can transfer to another slot at the airline somewhere else in the country, but union and company rules for such moves are complex. If her husband does not get a transfer, Teresa said, they will probably stay in the area but sell their well-tended house in a quiet residential neighborhood and move to something smaller. "Scary's not the word for it," she said, reflecting on the growing number of workers she knows facing similar predicaments.

Within the Geerlings' own industry, many others are now facing that same predicament:

Dire times for United pilots' pensions
Federal agency petitions to take over $1.4 billion in costs

The U.S. pension insurance agency on Thursday asked a federal judge to let it assume responsibility for an underfunded pension plan for pilots at bankrupt United Airlines, arguing that it could help bolster the health of pensions for former and current workers in four unions all told, including thousands in the Bay Area. The federal pension corporation said its pension plan court filing was prompted by United's dire financial condition. "Ideally, the company would maintain all four of its pension plans and honor fully the promises it has made to employees," Belt said. "However, in conjunction with the company's bankruptcy proceeding, PBGC's financial advisers have come to the conclusion that United Airlines can afford at most only three of its pension plans."

United, the dominant carrier at SFO with about half of all passengers and flights, employs 11,000 people in Northern California. Before the high-tech implosion and the terrorist attacks of Sept. 11, 2001, the company employed 20,000 people locally. Furloughs of 11,000 workers over the last four years, plus large numbers of earlier retirees at United, which has operated in the Bay Area since the 1930s, have generated thousands of retirees in many walks of life. Retirees believed their defined-benefit pensions were locked in for life, but United earlier this year said it wants to terminate all its pension plans and replace them with 401(k)-type programs to cut its operating costs.

The Pension Benefit Guaranty Corp., subject to bankruptcy court approval, will assume $1.4 billion in pension payments, the third-largest obligation in its 30-year history, according to Executive Director Bradley D. Belt. This means the taxpayers will be picking up roughly half the cost of the pilots' plan. The other half, comprising an additional $1.5 billion shortfall in funding, would be absorbed by the pilots themselves in the form of reduced pension benefits. Belt said retired pilots would continue to draw pensions up to the $44,386 a year maximum permitted by Congress, and that other United retirees such as mechanics, baggage handlers, flight attendants and reservations agents, who belong to other unions, would not be affected. If it takes over the United pilots' plan, the new claim will add to the pension agency's own deficit, which presently stands at $23 billion.

The agency has taken over airline pension plans before. Indeed, claims by airlines account for 20 percent of the federal pension corporation's total claims, according to the agency, and five of the 10 largest claims have come from struggling airlines.

This doesn't sound like such a bad deal for United, right? Motley Fool begs to differ:

Turbulence Ahead for United

When is what appears to be good news really bad news? When UAL Corp's United Airlines is involved.

Yesterday, the Pension Benefit Guaranty Corp. (PBGC), the government arm that insures traditional pension plans, said it has petitioned a court to assume responsibility for $1.4 billion in retirement funds for United's pilots. The problem is that, in making the filing, the PBGC intimated that UAL could fund its obligations for its other three pension plans.


That's a problem because United's pilots have worked out a tentative agreement whereby they would not contest a transfer to the PBGC in exchange for, among other things, $550 million in convertible notes. But a key condition of that deal was that the other three plans would also have to be canceled, ensuring pilots weren't left alone to the Feds. That's what UAL wants, too. In a statement, the airline said the PBGC's decision doesn't have an impact on its need to cancel all of its pension plans and still secure $725 million in labor cost savings from its unions in order to emerge from bankruptcy.

But it gets worse.

The PBGC said it needs to take over the pilots' plan now in order to prevent more than $140 million more in payouts. And that's supposedly important because the agency already operates at a $23 billion deficit.

The pilots' reaction to the move was predictable and nasty. In a statement, the leader of the Air Line Pilots Association called PBGC's move "duplicitous" and a "December Surprise."

What's next? CHAOS could ensue. That's the name the flight attendants' union has given to a strike its members have authorized in the event that the company abrogates its union contract through bankruptcy court. (The airline is asking to have all of its union contracts cancelled to fundamentally alter its cost structure.) The strike would come without warning and could take any form, with the intent to, as the acronym says, "create havoc around our system."

Hopefully, both management and the flight attendants have learned enough from the circus at US Airways to keep this from happening. Because if it does, I see no way around liquidation for the nation's No. 2 airline.

Management screws up, and then expects labor to pay for those screw-ups with their incomes, pensions, benefits, and livelihoods.

Where is the justice? Not here!

U.S. Asks Bankruptcy Court to Deny United Pension Plan

In a motion filed in federal bankruptcy court in Chicago, the Pension Benefit Guaranty Corporation accused United of attempting to circumvent the federal pension law with the agreement, and of offering its active pilots relief "at the expense of the federal government, its other employees and creditors."

It was the second time in two days that the federal government has gone to court to try to stop the airline, a unit of the UAL Corporation, and its pilots' union from terminating the insolvent pension plan according to their own terms. Earlier on Thursday, the pension agency filed a complaint in the United States District Court in Chicago, asking the court to terminate the plan immediately and make it the sole trustee.

The government moved in bankruptcy court late Thursday to oppose an agreement that United Airlines recently struck with its pilots' union on the looming termination of the pilots' pension plan. When any company defaults on its pension obligations, the assets and liabilities of the defunct plan go to the pension agency, which pays the retirees their benefits within certain limits. The agency argued in its motion that Congress had created a legal framework for this process because it "foresaw the possibility of abuse of the pension insurance program," and that United's agreement with its pilots constituted such abuse and should be rejected by the court. If United is able to delay the termination until next May - one provision of the agreement - the active pilots would qualify for a higher level of insurance coverage.

An airline trying to pull a fast one involving money? I'M SHOCKED! What's an oppressed labor staff to do? Their choices are few:

Attendants for United threaten to stage strikes

United Airlines flight attendants are threatening to stage intermittent strikes if the company ends their contract and imposes additional salary and benefit cuts. The labor strife and taxpayer burden come as United enters its third year of Chapter 11 bankruptcy protection. The two sides remain in talks over a new contract, and no action would be taken until the matter is resolved in Bankruptcy Court. Hearings on United's motion to terminate the existing contract are scheduled to begin Friday if no agreement has been reached. Talks also continue between United and unions representing mechanics, baggage handlers and public-contact workers.

"United flight attendants have spoken loudly and clearly," Greg Davidowitch, leader of the Association of Flight Attendants, said in announcing that 88 percent of members had approved taking unauthorized strike actions. "They will not allow their employer to exploit the bankruptcy process and strip them of their rights. They are ready to fight."

United said the actions contemplated by the union are prohibited by the Railway Labor Act and U.S. bankruptcy law. "We regret that the AFA continues to take actions which are simply not helpful to United, its tens of thousands of employees or its customers," spokeswoman Jean Medina said. "We remain committed to considering all workable options and alternatives that will still provide the long-lasting savings United needs to exit Chapter 11 successfully."

That means breaking the unions and lowering wages while eliminating benefits. Management doesn't like it when labor isn't supinely compliant:

The United pilots union expressed outrage at a move by the federal pension agency to begin assuming responsibility for their pensions, an action that occurred Thursday. The pension agency will be taking over the pensions of more than 14,000 active and retired pilots, many of whose benefits will be sharply reduced from what they were promised from the airline, which is a unit of Elk Grove Village, Ill.-based UAL Corp. The pilots union deplored what it called an "ill-timed attempt to retaliate" against it, and suggested that it might be a ploy designed to undermine the contract ratification vote under way among its members. "ALPA will vigorously oppose any effort by the PBGC (pension agency) to take over the plan before May 1, 2005, or to single out the pilot group for punitive and vindictive treatment in the United bankruptcy," said a statement by the leadership group of the Air Line Pilots Association's United branch.

What Money Says When It Talks:

Facing $4.1 billion in required pension contributions by the end of 2008, United said last year that it would terminate all its employee pensions and replace them with less-expensive defined-contribution funds, similar to 401(k) plans. The Pension Benefit Guaranty Corp. was facing the required takeover of United pension plans in 2005. The agency estimated it will be responsible for $1.4 billion of the plan's $2.9 billion in underfunded assets, making it the third-largest claim in the history of the insurance program. By acting at year's end instead of in May, when the pilots' pensions were to have been terminated, the agency said it can avoid an annual rise in mandated benefit payments and save $140 million in payouts.

It Ain't Over 'Til It's Over

The action follows a tentative contract agreement between United and its pilots union last month, part of United's effort to slash labor costs for the second time in its bankruptcy restructuring. United issued a statement saying the decision by the Pension Benefit Guaranty Corp. "changes nothing with respect to our need to terminate and replace all four of our defined-benefit pension plans." The company says it requires an extra $725 million in labor-cost savings to emerge from bankruptcy "as a sustainable, profitable enterprise."

The pension agency had objected to the tentative deal with pilots, who dropped their opposition to the pensions' elimination in exchange for financial considerations. But it might have little recourse if the deal is approved in court. "The decision to take over a pension plan is never made lightly, especially in situations where participants won't get everything the company promised but failed to fund," executive director Bradley Belt said. "I hope the plight of participants in airline pension plans puts an exclamation point on the need for Congress to strengthen the funding rules for defined benefit plans."

The pension agency planned to file an objection to United's pilots plan, a spokesman said.

If anyone was awake at the White House, they would note that the following story stands ready to disrupt these plans to make Americans' jobs the reward for cooperating with American multinational corporatism:

U.S. Businesses Overseas Threatened by Rising Anti-Americanism

The Bush administration's foreign policy may be costing U.S. corporations business overseas according to a new survey of 8,000 international consumers released this week by the Seattle-based Global Market Insite (GMI) Inc. Brands closely identified with the U.S., such as Marlboro cigarettes, America Online (AOL), McDonald's, American Airlines, and Exxon-Mobil are particularly at risk. GMI, an independent market research company, conducted the survey in eight countries December 10-12 with consumers over the internet. "Unfortunately, current American foreign policy is viewed by international consumers as a significant negative, when it used to be a positive," according to Dr. Mitchell Eggers, GMI's chief operating officer and chief pollster. "Some American brands become closely connected to their country of origin and are quintessentially American," he added. "They represent the American lifestyle, innovation, power, leadership, and foreign policy."

One third of all consumers in Canada, China, France, Germany, Japan, Russia, and the United Kingdom said that U.S. foreign policy, particularly the "war on terror" and the occupation of Iraq, constituted their strongest impression of the United States. Twenty percent of respondents in Europe and Canada said they consciously avoided buying U.S. products as a protest against those policies. That finding was consistent with a similar poll carried out by GMI three weeks after Bush's November election victory. Last month, Kevin Roberts, chief executive of advertising giant Saatchi & Saatchi, told the Financial Times that he believed consumers in Europe and Asia were becoming increasingly resistant to having "brand America rammed down their throats."

Simon Anholt, author of Brand America has also predicted a consumer backlash against U.S. foreign policy. He recently told the British trade magazine Marketing Week that four more years of Bush's foreign policy could have grave consequences for U.S. companies' international market share.
"There have already been casual protest brands, such as Mecca Cola, which are primarily political," he told the weekly. "But things are now moving beyond that. For instance, German restaurants are beginning to refuse American Express cards. This is new territory."

The new survey, as well as the one taken by GMI last month, suggests that the unpopularity of U.S. foreign policy may indeed be playing a role, at least for companies that are either strongly identified with the United States or that are perceived as having similar characteristics as its foreign policy.
"American companies are accused of aggressiveness and arrogance because they insist on imposing the American way of doing things on their international markets; they are inflexible," according to Allyson Stewart-Allen, co-author of Working With Americans, a business best-seller published by Prentice Hall in 2002.

The latest poll found that more than two thirds of European and Canadian consumers have had a negative change in their view of the United States as a result of U.S. foreign policy over the last three years.

* Nearly half believe that the war in Iraq was motivated by a desire to control oil supplies, while only 15 percent believed it was related to terrorism.

* Nearly two thirds of European and Canadian consumers also said they believe U.S. foreign policy is guided primarily by self-interest and empire-building, while only 17 percent believe that the defense of freedom and democracy is its guiding principle.

* Half of the entire sample said they distrusted U.S. companies, at least in part because of the U.S. foreign policy.

* Seventy-nine percent said they distrusted the U.S. government for the same reason, while 39 percent said they distrusted the American public.

* Fully 87 percent of German, 84 percent of French, and 71 percent of British respondents have negative feelings toward Bush himself.

Moreover, British, French and German consumers all felt that the cultural values of the other two countries were closer to their own than "American values."

If foreign consumers feel this way about American firms, why would foreign workers not feel the same? Somehow, this fact seems to be escaping Bu$hCo notice. What they do seem to notice, however, is that American troops need to know how to fight in American cities:

Marines will stay close to home for urban training
Unit to use downtown Toledo

The Marines will take over parts of downtown Toledo as sounds of gunfire will echo off buildings when training exercises are conducted next weekend. A Marine Corps unit based in Perrysburg will stage the exercises from 9 p.m. Jan. 7 to about noon Jan. 9, Maj. Gregory Cramer said. Major Cramer said most of the 130-member unit - Weapons Company, 1st Battalion, 24th Marines - will take part in the exercises. "We're looking for an urban environment to do our training," he said. "Urban training is one of the proficiencies we're required to maintain."

Why? Is Bu$hCo afraid that Americans will be angry and upset when the last job goes to a foreigner?

The sad part is: this is just what it might take to awaken awareness to this crisis - when it's too late to do anything else.

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pessimist :: 12:08 PM :: Comments (7) :: Digg It!