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An Appeal for Sanity: Boeing's Impending Strike

by: Steven Hansen September 05, 2008 | about stocks: BA    

Steven Hansen

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Workers do not strike every day, they cannot do that the way they function in the capitalist economy. The way they have to live by selling their labor power makes that impossible. – Ernest Mandel

According to Bloomberg, Boeing (BA) and the International Association of Machinists and Aerospace Workers have less than 48 hours to agree on a new three year collective bargaining agreement. The rank and file appear motivated to strike.

Wonderful news! The short term effect of a strike is a further delay in the delivery of Boeing’s 787 Dreamliner, but the long term effect is permanent displacement of Boeing as the leading commercial airplane manufacturer to its archrival Airbus [EAD.PA]. This leads to losses of jobs and loss of revenue base for the USA.

(click to enlarge)

Deliveries so far in 2008 appear equal between the rivals. However, bookings, which should have been helped by the weakness of the dollar, shows Airbus with 754 bookings through July 31, while Boeing has only 586 bookings through September 2.

If Bear Stearns was too big to fail, is Boeing and the International Association of Machinists and Aerospace Workers too big to strike? Without going into the reasons, we now have one airplane manufacturer and one union which holds the country’s economy hostage.

A strike will have three losers – Boeing, the International Association of Machinists and Aerospace Workers, and the US economy. I would make the case for forced arbitration.

Disclosure: None.

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This article has 16 comments:

  •  
    Sep 05 12:49 PM
    One word; Outsourcing...........
    Reply
  •  
    Sep 05 01:38 PM
    GREED, by the Boeing company ! 13 BILLION in profits and all they do is hire knight to try and bust the union. They jacked around the medical and other benefits so the "pay increase" meant nothing ! There was only take aways in this contract while Beoing has all time high profits ! But, everyone is believing the lies that Boeing paid the press to print and put out. check out for the real story 751iam.org SHAME ON BOEING !! To: Carson, McNerney and Kight you morons would save money if you gave a good contract and we all got back to building airplanes !! Boeing has had it their way for the last decade its time for union members to have theirs !
    Reply
  •  
    Sep 05 05:34 PM
    Do you really want to know the truth? I guess not by the way the authors of these articles publish opinions that mean really nothing. The details of the contract are rarely ever mentioned and all you get is the wage increase they tout as the best in the industry. You simply can not take things away and add them back in a different spot and say, "See we did so much better, so go ratify this contract."

    The best description I've heard is as follows:
    Take a sheet of paper and write 'Contract' on it. This is the now the current contract Boeing union employees are working under. Ok now go into negotiations for a new contract, Rotate that sheet of paper 90 degrees. See now its different,....No not good enough ok well do better...rotate that sheet of paper another 90 degrees. See we changed things up, the word 'Contract' is now upside down....isn't that better? No?, ok we hear you loud and clear and well fix this right with our BEST and FINAL offer. Rotate that sheet a paper another 90 degrees.....there you go, the BESTin the industry!

    Its no wonder 87% decided to go on strike, why? Because they can do the real undistorted math!
    It is truly simple: Record profit not shared with the employees who created it!!
    Reply
  •  
    Sep 05 10:23 PM
    Well, I think they should be prepared for a long strike. I think the contract was a fair one. Certainly many times better than their brothers in Detroit or working for any airline. The IAM although it talks a good story is trying to bleed the company now but I believe it will be disastrous in the long term.

    Boeing has a new 737 and 777 coming in the next 20 years. The members of the IAM are going to price themselves out of the opportunity to build those planes. In fact, they nearly lost out on the 787.

    So get your money now and hope you retire in the next 10-15 years. Your jobs will be in another state after then.

    Ridiculous and very short sighted.
    Reply
  •  
    Sep 06 12:31 AM
    i am proud of my union brothers and sisters. i've done this at eastern airlines, i'm doing it now. uncle boeing would like us to work for free if possible, this latest proposal is just a tiny bit better than volunteering. does anyone notice the % rise of gas, food, property tax, tuition? we produce the BEST transport category aircraft in the world, we should be appropriately compensated.
    honk as you drive by our picket lines, we're doing this for the american worker, not the multi-million dollar corporate executive.
    Reply
  •  
    Sep 06 10:40 AM
    A company takes the risks and provides the jobs, the greedy ones are the unions and they are forcing more outsourcing and less jobs.
    Reply
  •  
    Sep 06 12:05 PM
    Fire them all, ban them from the ever being employed by BA again in the future, hire new employees, and move on. All this talk about "sharing the profits that the employees created" is BS! You "created" nothing. You are simply doing a job that BA hired and trained you to do. If you don't like the wage and benefits package, QUIT. If you could find something better, you'd already be gone.
    Reply
  •  
    Sep 06 12:11 PM
    the printers union in nyc had the same attitude.they commited suicide.if someone doesnt like the job or working conditions they can quit.will any machinist quit?no might they lose their jobs if the work goes elsewhere?yes.they better be very careful in this new world of globalization.
    Reply
  •  
    Sep 06 04:32 PM
    a lot of workers forget they have no investment in the original business.unless they own stock privately or in the retirement acct.they take no loss other than the job.
    Reply
  •  
    Sep 06 10:50 PM
    I work my but off for Boeing and I am very thankful to have the benefits and pay that they offer....I sell my labor to them for what is a resonable transfer of wealth....if Lockheed Martin offered me a better deal I would take it...that is how a healthy economy works....unions distort the healthy economy in two ways...they jack up the cost of labor not because there is a shortage of workers (believe me Boeing can get as many monkey wrench turners as it needs with the benefits package it offers...some thing you fools in Seattle do not understand)...but because enough idiots get together and say if you do not give us more than we are worth than we will try to shut down your business and we do not care if we have jobs in the future.. and secondly the unions protect lazy workers that do not want to compete in a global competitive market place like the rest of us do...I am very disapointed with the attitude and foolishness of my fellow Boeing employees....I am concerned with the strong competition that faces our company...27000 greedy fools will willingly and boldly picket their possible doom.....by the way there are bunch of us that helped with Boeings record "profits"...... act like you union members deserve it all....you are dividing this company at a time when companies need to be extremely competitive....if I could fire you all myself I would and hire up employees with better attitudes that would be thankful to have a steady job with good benefits....there is something like 600,000 out there right now looking for jobs....in a way it is very sad that they cannot compete for your jobs....some poor family is without its source of primary income while you willingly go lazily sit on your butt and take an extended vacation waiting for the company to come and offer you more than you already deserve....econ 101 should be taught in Seattle....better go...I need my sleep because I need to get up and be a worker bee in the morning...something you lazy union people would never understand...America will loose its competitiveness with workers liek you....sad really....
    Reply
  •  
    Sep 07 05:00 PM
    The Dreamliner was supposed to begin production in May of this year. Then it became 2009, now it's late 2009, and who knows what effect this strike will have.

    It screws not only Boeing but all the aerospace/defense stocks who sell to Boeing. Great job, McNerney.
    Reply
  •  
    Sep 16 08:39 PM
    I work my but off for Boeing and I am very thankful to have the benefits and pay that they offer....I sell my labor to them for what is a reasonable transfer of wealth....if Lockheed Martin offered me a better deal I would take it...that is how a healthy economy works....unions distort the healthy economy in two ways...they jack up the cost of labor not because there is a shortage of workers (believe me Boeing can get as many monkey wrench turners as it needs with the benefits package it offers...some thing you fools in Seattle do not understand)...but because enough idiots get together and say “if you do not give us more than we are worth than we will try to shut down your business and we do not care if we have jobs in the future because we are idiots and the one thing we are good at is being idiots and holding picketing signs, we had some good practice 3 years ago”.. and secondly the unions protect lazy workers that do not want to compete in a global competitive market place like the rest of us do...I am very disappointed with the attitude and foolishness of my fellow Boeing employees....I am rightly concerned with the strong competition that faces our company...27,000 greedy fools will willingly and boldly picket their possible doom...by the way there are bunch of us that helped with Boeings record "profits"...... you act like you union members deserve it all....you are dividing this company at a time when companies need to be extremely competitive....if I could fire you all myself I would and hire up employees with better attitudes that would be thankful to have a steady job with good benefits....there is something like 600,000 out there right now looking for jobs....in a way it is very sad that they cannot compete for your jobs....some poor family is without its source of primary income while you willingly go lazily sit on your butt and take an extended vacation waiting for the company to come and offer you more than you already deserve....econ 101 should be taught in Seattle....better go...I need my sleep because I need to get up and be a hard worker in the morning…you know that physical labor you union p*ssies whine about…America will loose its competitiveness with workers like you....sad really

    One last note…I am working on my MBA which “evil” corporate Boeing is paying 100%...you have no idea how many workers in America wished that their “evil” company provided this benefit…I have worked for Raytheon and Lockheed Martin and neither one had a pension…Raytheon wanted $11,000 a year for family medical...unionites live in a world of their own and do not get the real world and how good they have it...I love quotes from 20 and 25 year union veterans that show their clear lack of knowledge of real world economics and business...saving American jobs my ass…you are part of the problem.
    Reply
  •  
    Oct 01 08:17 PM
    You would'nt want them to lose their job would you? This is the first time that the IAM has stood up to the company about outsourcing their work. I know the company saves lots of money on outsourcing of it's work. Enough is enough. I use to work for Boeing Manufacturing in Tulsa,Ok and they contracted out the majority of are maintenace department,so alot of people were dimissed for good. I didn't think that was to great myself on what the company did. They want to keep their pockets lined well. So more power to the IAM standing up for their rights.
    On Sep 06 12:05 PM User 256787 wrote:

    > Fire them all, ban them from the ever being employed by BA again
    > in the future, hire new employees, and move on. All this talk about
    > "sharing the profits that the employees created" is BS! You "created"
    > nothing. You are simply doing a job that BA hired and trained you
    > to do. If you don't like the wage and benefits package, QUIT. If
    > you could find something better, you'd already be gone.
    Reply
  •  
    Oct 01 08:33 PM
    Great timing for IAM to go on strike. Now I can afford to buy alot of boeing stock.


    On Sep 07 05:00 PM User 137633 wrote:

    > The Dreamliner was supposed to begin production in May of this year.
    > Then it became 2009, now it's late 2009, and who knows what effect
    > this strike will have.
    >
    > It screws not only Boeing but all the aerospace/defense stocks who
    > sell to Boeing. Great job, McNerney.
    Reply
  •  
    Oct 01 09:03 PM
    What do you mean? The work is going elsewhere. Eventually they will bring foreign people to the states and let them take are jobs away.Then they won't have to ship the product overseas to be built. This would really line the companys pockets. The 747-8 take for instance, 70% is being built overseas. Do you think this is right? NO. Even if IAM union turned down 11,500 per year of the contract making boeing being that much later on deleivery dates. The union workers will be able to make up most of there lost strike money and contract offer money in OTand DT for the offer of the three year contract, plus they will have put a feather in their hats when they have proper language in their contract stating that they have control on outsourcing of their work. More power to the IAM.


    On Sep 06 12:11 PM notsosmart wrote:

    > the printers union in nyc had the same attitude.they commited suicide.if
    > someone doesnt like the job or working conditions they can quit.will
    > any machinist quit?no might they lose their jobs if the work goes
    > elsewhere?yes.they better be very careful in this new world of globalization.
    Reply
  •  
    Oct 01 10:34 PM
    I agree on that.


    On Sep 06 12:31 AM boeing princess wrote:

    > i am proud of my union brothers and sisters. i've done this at eastern
    > airlines, i'm doing it now. uncle boeing would like us to work for
    > free if possible, this latest proposal is just a tiny bit better
    > than volunteering. does anyone notice the % rise of gas, food, property
    > tax, tuition? we produce the BEST transport category aircraft in
    > the world, we should be appropriately compensated.
    > honk as you drive by our picket lines, we're doing this for the american
    > worker, not the multi-million dollar corporate executive.
    Reply
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