Drawing the Line at Eastern

Against the Current, No. 20, May/June 1989

The Editors

THE UNIONS AT EASTERN AIRLINES deserve maximum solidarity as they stand up to reverse U.S. labor’s desperate downward spiral. Their inspiring struggle has attracted massive labor solidarity and substantial public support for several reasons. The extreme viciousness of Frank Lorenzo and his tactics is one obvious and important factor. Another is the representative cross section of the U.S. work force embodied in the Eastern unions, from the highly paid {almost all-white) pilots to e classic blue-collar machinists and baggage handlers to the “pink collar” flight attendants, who are miserably paid {as little as $12,000 a year) and whose union, the air transport division of the Transport Workers Union {TWU), pays them no strike benefits at all. The so-called Eastern family is a group with whom a wide spectrum of working people can immediately identify.

The experiences of Eastern’s workers represent those of the entire U.S. labor movement in this decade of debacles. Concessions bargaining came to Eastern Airlines, as it did to millions of unionized U.S. workers, in the late 1970s and early 1980s. In 1983, responding to the demands of the incompetent ex-astronaut board chairman Frank Borman, the pilots and flight attendants said yes to major givebacks. Eastern’s machinists then granted the concessions in exchange for four seats on the board and a 25-percent share of the airline’s preferred stock.

Typically enough, other concessions in work rules and conditions followed, in exchange for management’s promise to restore the money the workers had given up. Members of Eastern’s “family” posed for cheery group photos in television commercials of the period, with Borman in front. And equally typical, the next time Eastern workers heard from their boss, it wasn’t to return their money but to demand more from them.

When Borman sold the family to Frank Lorenzo, fresh from his bankruptcy and union-busting triumph at Continental Airlines, the merger-and-acquisitions mania came to Eastern. Changes in bankruptcy laws now prevented Lorenzo from simply closing down and reopening with no union contracts, as he had done at Continental. However, as the owner of several airlines, Lorenzo presides over a corporate structure (Texas Air) that enables him to manipulate assets, both to boost profits and reduce union jobs. Thus he sold off Eastern’s computerized reservation system — at a huge loss to Eastern but at a great gain to Continental — and negotiated a sale of its East Coast shuttle routes to Donald Trump.

Faced with this kind of strategy, the unions’ ability to force Lorenzo into bankruptcy is at least a short-term victory. The hundreds of millions of dollars in debt burden Eastern is carrying, much of it to European banks, will enable these creditors to challenge Lorenzo’s plans to sell off assets. In fact, previous transactions such as the shuttle sale can also be called into question. Indeed, Trump wants to renege on the shuttle-route deal — or at least get it for a lower price!

The question obviously arises: what next? Unfortunately, the same debt factor casts a pall over the unions’ own preferred option. Placing a huge and understandable priority on getting rid of Lorenzo, the unions seem to want either to bring in his corporate-raider rival Carl Icahn — an equally vicious character, but without the interlocking group of airlines that Lorenzo has been using to dismantle Eastern — or to arrange a union buyout of the airline. Either way, the future for Eastern workers would be difficult. Worker ownership in a capitalist economy, a dubious proposition in the best of times, is even less promising when the workers must take over gigantic and all-but-unpayable debts run up by management.

There is a solution, although one that tragically lies far beyond the present vision of the U.S. trade-union movement. It lies in challenging the whole logic of corporate ownership. The manic deregulation of the airline industry in the Reagan years has produced a classic cycle of competition leading to the inevitable shake-out and monopolization Short-term lower fares, now going back up as a few carriers dominate the routes, were accompanied by long-term cutting of industry wages and a slashing of safety standards for the traveling public. Further concessions are taken for granted in every “practical” scheme to save the airline, Lorenzo or no Lorenzo.

The practical solution — the socialist and sensible solution — that does not damage Eastern’s workers would be nationalization of the transportation industry under democratic workers’ control. There is no genuine competitive revolutionizing of technique in the airline industry. The planes, the systems, the technologies are essentially identical. Indeed, airlines are nationalized in most countries. Why should the jobs of airline workers and the lives of passengers in the United States be subject to corporate raiders and profiteers?

Yet the airline industry’s unions in the United States don’t even have something as basic as a single hiring hall with one seniority list! Perhaps it is a sign of the times that the Airline Pilots Association is now said to be considering such a step.

The March 17 Wall Street Journal aptly headlined, “Texas Air’s Lorenzo May Be Unions’ No. 1 Foe Yet His Allies Include Some Powerful Democrats.” The roster of executives and high-powered lobbyists for Eastern, Continental and Texas Air include an impressive group of former aides to Sen. Edward Kennedy and House Speaker Jim Wright.

Needless to say, Lorenzo has great friends in the Bush administration as well, including Bush’s top legislative assistant Frank McClure, a former $132,000 Texas Air executive, who wrote to members of Congress on March 7 announcing Bush’s decision not to appoint an investigating board on the strike.

The Eastern strikers do not have much going for them in the corridors of political power. What they have is their impressive solidarity and the kind of broad public sympathy that few strikes have attracted in the 1980s. Most important is the legacy Eastern’s workers have created: for the first time in many years, even such aristocrats of labor in the air as the airline pilots realized that their own futures required joining the machinists, baggage handlers and flight attendants down here on the ground.

May-June 1989, ATC 20

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