The Machinists' Last Chance

Everyone from the governor on down is worried about Boeing's biggest union.

Was there anyone of importance who didn't come to the Boeing machinists union hall last week? It didn't seem like it. In the run-up to daily contract negotiations beginning this week, none other than Gov. Gary Locke came by for a briefing from union president Mark Blondin. So did U.S. Reps. Adam Smith, Jay Inslee, and Jim McDermott, other labor leaders, bankers, food bank operators, and reporters.

The briefings followed a precedent-setting presentation the machinists (along with the engineering union, whose contract is also up this year) made to analysts on Wall Street a few weeks ago.

What they all heard, judging by the press briefing, was an impassioned account of why these negotiations are so important—the first since Boeing stunned locals by moving its headquarters to Chicago, then began laying off thousands of employees in the wake of Sept. 11.

"We feel this contract is make-or-break," says Blondin, the 42-year-old machinists head who rose through the ranks during 24 years at the union. "Our back is against the wall." Just a few years ago, he says, the union had 37,000 members. Layoffs, combined with attrition, have slashed the membership by half, he says, to "18,000 and change. Where does it stop?"

Last time around, in 1999, Blondin says the machinists got what they considered good job security language (a provision to run layoffs due to subcontracting past the union and give it a chance to come up with cost-saving alternatives), but it hasn't worked. "This time we've got to get it done and get it done right."

In fact, Blondin revealed that the union's recently presented offer to the company includes an attempt to tie the company to specific numbers of employees, in what would probably be the first contract of its kind in the nation. The union wants to set a "base level of employment," according to Blondin, which would then grow proportionally as production grows.

Boeing spokesperson Chuck Cadena says the company is willing to talk about anything. But the company has been moving in the other direction. Just a couple of weeks ago at the Farnborough Air Show in England, commercial airplane chief Alan Mulally said that Boeing has no intention of bringing back everyone who has been laid off. Indeed, he said the company would lay off even more as competition from archrival Airbus forced it to "do more with fewer resources."

What's more, there's no getting around the fact that the effects of Sept. 11, compounded by the recession, have slowed Boeing's business. As the union itself concedes, production has been cut in half—from 48 airplanes a month to 24. "We can't artificially guarantee employment," Boeing spokesperson Cadena says.

Still, the union says it's convinced that at least some of the job cuts are due to off-loading, both domestically and abroad. Cadena contests that claim, saying that the proportion of a plane's financial value made in-house has remained "stable for decades" at a surprisingly low 36 percent. The union, however, points to a chart that it says Boeing vice president and chief negotiator Jerry Calhoun has been using in presentations, which shows the proportion of in-house manufacturing declining steadily since 1916, when 75 percent of a plane was built locally. (The chart doesn't say whether that proportion is financial or based on some other measure.) As recently as 1994, according the chart, half of each plane was made in-house.

Moreover, it's no secret that Boeing sends work to other countries as a way of getting those countries to buy from Boeing instead of Airbus. "It's part of their marketing," says Rhode Island aerospace analyst Paul Nisbet, who points out that Japan buys almost nothing but Boeing because of company manufacturing done there.

Yet if such a strategy is crucial to thwarting competition from Airbus that is ever more fierce—with the French rival soon to come out with its own superjumbo model—the machinists' Blondin has a blunt response: "If the only way they can be successful is to give all the jobs away in this region, then they can fail as far as I'm concerned."

The public officials who have turned out for union events would never say that, of course. As is typical, Locke spokesperson Roger Nyhus stresses that the governor isn't taking sides but merely wants a successful resolution to contract talks.

But the cost-cutting, go-anywhere attitude of the new Boeing has clearly shaken local leaders, some of whom seemed mighty sympathetic to the machinists at a rally held last month at which members gave the union strike authorization.

From the middle of the football field at Seattle Center's Memorial Stadium, on a blazingly sunny day, King County Executive Ron Sims was practically screaming as he declared the contract to be "about whether or not to go back to basics" and "whether or not Boeing is going to honor and respect the people who made Boeing what it is today."

He finished off by saying, "We stand behind you 110 percent."

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