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April 02, 2003

Bush Airline Union Busting Goals Achieved

A year and a half after 911 devastated air travel and sent the airline industry into a tailspin, Republicans in Congress are only now agreeing to financial aid for the industry.

Why the wait?

Because as I noted months ago, the Bush administration deliberately allowed the companies to plunge into bankruptcy so they could gut union contracts and demand concessions from their unions. And now that some carriers have done so, the pressure on the remaining healthy airlines to slash wages for their union workers will be unstoppable. As this story notes:

But for now, other carriers are almost certainly looking at the tentative agreements at American and weighing what they can demand of their workers.

"American is the latest airline to achieve meaningful airline concessions, though certainly not the last," said Jamie Baker, an analyst at J. P. Morgan Chase. "All major airlines are seeking some form of concession, some more aggressively than others. If American can achieve its cuts outside of bankruptcy, then there's no reason that Delta can't."

US Airways used bankruptcy to wrest big concessions from its unions, and United Airlines is trying to do the same. American could prove that such cuts can be won outside of Chapter 11 bankruptcy protection, even from hostile unions.

Now that the unions have agreed to concessionary givebacks, now the Republicans can hand the money over to the industry, knowing it will go to their rich buddies owning the airline companies, not to the workers in the industry.

As in most things, timing is everything in industry bailouts as to who wins and who loses from them.

Posted by Nathan at April 2, 2003 12:03 PM

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