On January 2, 2014, Maria La Ganga and W.J. Hennigan write in the Los Angeles Times:
Waving angry signs and clenched fists, several hundred union members rallied Thursday afternoon for a vote against a contract that would cut their benefits but guarantee that Boeing Co. builds its latest wide-body jet in the Puget Sound area.
“This is the fight of our lives,” said local union leader Wilson Ferguson of the International Assn. of Machinists and Aerospace Workers as the raucous crowd in the union’s hall cheered. “This is the front line of the labor movement right now. Thank you for coming out and supporting us.”
This IS the fight of their worker life. But they won’t win because in a competitive global world, the competitive cost of production is critical to business success. Full employment is not an objective of businesses, nor are businesses any longer able to be loyal to long-term workers when competing globally. Companies strive to keep labor input and other costs (using machines, robotics, digital computerized operations, etc.) at a minimum in order to maximize profits for the owners. Private sector job creation in numbers that match the pool of people willing and able to work is constantly being eroded by physical productive capital’s ever increasing role. Over the past century there has been an ever-accelerating shift to productive capital––which reflects tectonic shifts in the technologies of production. The aero space industry is a perfect example of this ever-constant shift to the employment of non-human instruments to produce its products.
Labor workers are essentially demanding that they be paid more for the same or less work input, while the real gains in productivity are due to the employment of human-intelligent machines, super-automation, robotics, digital computerized automation, etc.––productive capital assets owned by the owners of the company. For Boing to develop and build a new platform for the production of the 777X it will require investment in expanded productive capital assets. What the workers should be demanding is an opportunity, via an Employee Stock Ownership Plan (ESOP) trust to finance the investment using pre-tax dollars that result in creating new employee owners in a larger company. Doing so will enable the workers to demand less wages and benefits as they gain more and more income sourced through their ownership shares in the company and assure that Boeing will manufacture the 777X in the Puget Sound area. The entire company will be able to become more competitive globally because the company will be able to invest in the most efficient employment of productive capital instruments to enhance their global competitiveness and profitability, which will benefit ALL owners, including the employee owners.
Boeing is in competition with Europe’s Airbus. Both companies operate their sales and marketing on a global basis and both are constantly seeking ways to reduce costs of production and increase efficiencies and productiveness (the rule of business).
Companies such as Boeing are constantly caught up in the never-ending march of technology and are representative of the state of tectonic shifts in the technologies of production that are destroying jobs and devaluing the worth of labor. Boeing employs a unionized labor force yet U.S. sentiment toward labor unions has deteriorated in recent years. To further reduce cost, Boeing and other manufacturing companies are electing to move production to right-to-work states, where laws allow most workers to refuse to join unions even if their workplace is unionized.
Workers are faced with the reality that they will sooner than later be threaten by replacement technologies such as human-intelligent machines, super-automation, robotics, digital computerized operations, etc. Employment as it was in a time when technology was less of a threat and manufacturing production was labor intensive is gone forever. Thus, what strength labor previously held is continually being diminished with companies constantly automating production processes.
What workers and unions should be doing is proposing a means to lower production costs by shifting emphasis to OWNERSHIP in incentivize employees rather than increased wages and pension for less and less worker input. The question should be WHO SHOULD OWN the FUTURE productive capital asset growth of Boeing and other private sector companies? The employees should be the first in line to be empowered to acquire ownership stakes in the Boeing Company using an Employee Stock Ownership Plan (ESOP) to pay for their acquisition of shares of stock with pre-tax dollars via capital credit loans which would be paid pack out of FUTURE profits to be generated by the increased production rate.
When will our elected representatives learn that they must attach stipulations when awarding corporations tax incentives to build facilities and require them to document new employee ownership creation using Employee Stock Ownership Plan (ESOP) financing? And when will labor unions transform to a producers’ ownership union movement and embrace and fight for employee ownership?
