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March 19, 2003

Union Busting in Bankruptcy Court

Some folks wondered why Bush had billions to throw at the military, but refused to help airlines like United to avoid bankruptcy in the wake of costs imposed by 911's blow to the airline industry. Well, here's the answer:

United Airlines on Monday asked a federal Bankruptcy Court judge to void its labor contracts by May 1 if the company cannot reach agreement with its unions on wage and benefit cuts...

The Air Line Pilots Association, which represents United's highest-paid workers, issued a statement decrying the filing.

"We are extremely dismayed by the company's 1113(c) proposals," said association Chairman Paul Whiteford. "Our contract is the product of 52 years of good-faith collective bargaining conducted under federal labor law. To seek to wipe out this contract by the stroke of a judge's pen is disheartening."

But then, longtime readers of this blog knew this was coming. As I wrote back in early December on Bush's goals for the airline industry:
Destroy United, then go after the unions at rival firms.

All as the Bush White House gloats at helping send wages in the industry plummeting.

Terrorists hijacked United Flight 175 to destroy the south tower of the World Trade Center and plunge the airline industry into its downward spiral.

But remember in the future that it was the pro-wealthy fundamentalists of the White House who decided to make sure the pain would deepen and continue for years for the workers at United and throughout the industry.

Posted by Nathan at March 19, 2003 06:23 AM

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I think it's more sinister than that - it's not just going after the unions, but after everyone's pensions.

A Federal agency guarantees the pensions companies provide their workers - if the company goes bankrupt and the company's pension fund is underfunded (and pretty much all are nowadays), then the agency steps in to make up the difference (albeit with a cap on the amount to be made). This agency, funded by payments of these same companies, simply cannot pay out all the money that will be demanded of it if all the companies that look like they may go bankrupt, actually do. The result? People will just end up with no pensions at all, unless by some miracle the Federal government steps in.

Posted by: Andrew Boucher at March 20, 2003 05:14 AM

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