THE BLOG
07/08/2008 05:12 am ET | Updated May 25, 2011

Unions Battle New Age Robber Barons

After a year in which the majority of Americans suffered the effects of recession, including tens of thousands who lost jobs because of rising unemployment, hundreds of thousands who lost homes in the subprime mortgage crisis and millions who lost their shirts because of unrelenting gas price hikes, Merrill Lynch & Co. informed us last week that, by contrast, the rich still got richer.

Merrill found that the number of dollars in millionaires' bank accounts grew faster than the number of millionaires did, a trend expected to continue. The average wealth of the world's richest was more than $4 million, the highest it has ever been, according to Merrill. They're an elite club -- one-fifth of one percent of the globe's 6.7 billion people.

That was last week. This week marks the 25th anniversary of the beginning of the strike against Phelps Dodge Corp. The Fortune 500 copper company conspired with Wharton School faculty members to devise a plan to destroy the miners' union, as well as several Arizona towns where they lived, and the middle-class way of life supported by their union paychecks. The corporation -- the guys with all the money, the guys who actually owned the homes, grocery store, hospital, even the bowling alley in the Arizona towns of Ajo and Morenci, the guys who had the power to get politicians to call out the National Guard and teargas citizens -- those guys won.

The nexus of the two -- the millionaires and Phelps Dodge -- is lessons learned by the labor movement in the quarter century since the Fortune 500 firm succeeded in withdrawing money from paychecks of middle class people who actually manufactured things and placing it instead into the hands of that tiny percentage of millionaires at the top. To succeed now, unions must be able to stand toe-to-toe with global corporations on their own turf, which means in many cases unions too must be global, must accrue substantial capital and must be intellectually nimble because strikes alone clearly won't win these contests anymore.
From the Phelps Dodge ordeal, my union, the United Steelworkers, which represented the copper miners, learned to be wary. We learned to be prepared so we would not be jumped again by the likes of Phelps Dodge, a corporation bent on a union's utter destruction.

In this quarter century, we recognized the essential power of capital. Global corporations clearly have it. And they can raise more when they want it. Goodyear is a perfect example: When the tire firm wanted to deny benefits earned by loyal retirees and to turn its back on workers whose earlier financial sacrifices had helped it return to profitability, Goodyear went to Wall Street in the fall of 2006 and got itself a $1 billion loan to try to break our strike. Unions now must have the foresight and solidarity to develop strike and defense funds well in advance that are substantial enough to respond when corporations waltz up to Wall Street or Bay Street or the equivalent financial district in any major city in the world and nab the loan they want to smash a union.

Also over these past 25 years, we realized the power of solidarity with our brother and sister union members internationally. This proved crucial in contesting global corporations such as Gerdau, the 14th largest steelmaker in the world, with 45,000 employees, more than 300 industrial and commercial facilities in 14 countries including Argentina, Brazil, Canada, the U.S., Spain and India. When Gerdau Ameristeel CEO Phil Casey decided he wanted to break our union and locked out 300 of our members in Beaumont, Texas in May of 2005, we responded by taking the fight global with the help of the Brazilian Confederation of Metalworkers, CNM/CUT, with whom we had an alliance. The Brazilian steelworkers knew exactly what sorts of protests would most annoy and embarrass the Gerdau family in their hometown in Brazil. Later the Brazilian workers joined steelworkers from the U.S. and Canada at a demonstration in the Toronto, Canada financial district just before a Gerdau annual shareholders meeting at which the president of the Beaumont USW local spoke. Ultimately, Gerdau replaced Casey as CEO and we got fair contracts.

We have similar alliances with four other unions internationally. And, this week, at our convention in Las Vegas, we will sign an agreement with the UK-based international union, Unite the Union, to create the first global union, comprised of 3 million active and retired workers from the U.S., Canada, Great Britain and Ireland, ready to meet the challenge of bargaining with global corporations.

Still, in addition to all that, we need moxie, ingenuity and brilliance to win. That one-fifth of one percent of the world's 6.7 billion people is willing to spend a lot of its wealth to hire Wharton School professors and law firms to bust unions. They pay lobbyists to get laws changed in Washington, D.C. to make it harder to unionize and more difficult for us to get fair contracts. They've succeeded in doing that during the entire two terms of the Bush administration. They're willing to spend what is really a pittance to them in order to ensure that they'll keep getting richer. And, as a result, the middle class will continue to evaporate in this country.

So we've got to use everything we've got, every ounce of our verve and wits to fight back. And we've done well, frankly, when we have. Look at two recent cases. One is the Esmark buyout by OAO Severstal and the other is the U.S. International Trade Commission's affirmative vote on sanctions for circular welded steel pipe from China.

Finally, last week Esmark announced it would sell to OAO Severstal, a decision that the Steelworkers had wrestled with Esmark for months to achieve, while fending off Esmark's attempts to deal with another company. In the typical sale of a company, the union would not be involved, but the Steelworkers had the foresight long ago to get provisions in contracts to obligate companies to include them in what are called successorship and right-to-bid clauses.
The USW's most innovative negotiators, corporate researchers and lawyers got those provisions in contracts and secured a win before the ITC. The ITC ruled in June that the U.S. industry producing circular welded pipe was injured as a result of imports from China, allowing imposition of antidumping and countervailing duties on Chinese circular welded steel pipe.
It is a new century now. We look forward to electing a Democrat to the White House. The presumptive Democratic nominee, Barack Obama, is a man of hope. And we hope that Congress will pass and he will sign the Employee Free Choice Act to ease unionization and that he will begin to turn around eight years of Bush administration persecution of labor unions.
In the meantime, as the rich get richer, we must remain vigilant. Because unions are the stewards of the middle class, we must ensure our viability. We must nurture and grow our solidarity. We must become financially formidable. We must be intellectually intimidating. We must be globally encompassing.