Hoffa Jr.: The Real Record

Against the Current, No. 119, November/December 2005

Henry Phillips

MANY SAVVY LABOR movement activists and observers are understandably puzzled by Teamster President James Hoffa’s sudden and enthusiastic endorsement of the Change to Win Coalition. Within the Teamsters, it’s been the reform movement and Teamsters for a Democratic Union (TDU) who have championed the need for structural reform to free up resources to organize the union’s core industries-usually in the face of boos and catcalls from the Hoffa crowd.

Now Hoffa has apparently joined the bandwagon, partnering with Andy Stern, who has built the Service Employees International Union around this program-in the process organizing hundreds of thousands of workers. Many can’t help but wonder, “What’s up in Teamsterland?”

Facing a reelection campaign in 2006 on a weak record, Hoffa needs the PR boost that positioning himself as a labor statesman and “reformer” in the AFL-CIO split has provided. But make no mistake, as Hoffa has focused on managing the Teamsters’ decline while consolidating his power in the union officialdom — not on changing the Teamsters to win.

The front man for the Teamster old guard has no doubt delivered change in his seven years as president, but not of the winning variety. With Hoffa at the helm, Teamster membership and bargaining power have dipped, following a resurgence in the 1990s when the union’s reform movement ousted the Teamster old guard in the union’s first-ever democratic elections for top officers.

Having won office in 1998 on the campaign promise of “Restoring Teamster Power,” Hoffa failed to deliver. His diminished following in the Teamster ranks has been particularly shaken since 2003, when the union capitulated to employer demands for deep cuts in the members’ pension and retiree health benefits. With the 2006 election year on the horizon, Hoffa needs a PR boost as desperately as Stern needs political support for his Change to Win movement. An alliance was born.

Hoffa and Stern, new to holding joint press conferences after having operated for years at opposing ends of labor’s political spectrum, can be forgiven if their talking points don’t quite square.

In a recent interview in The Nation, Stern ripped the failed union strategy of “organizing any worker who is willing to pay dues in total defiance of what built the strength of that union.” In the same interview, Hoffa was equally unequivocal on the issue of general unionism-taking the polar opposite position to Stern. “Absolutely not,” Hoffa responded when asked if the Teamsters were going to stop organizing in every industry. “We will always be a general union, and we are not giving up our right.”

In fact, many Teamsters suspect that if Hoffa is “giving up” on anything it’s on the union’s core jurisdiction, trucking, where the Teamsters have historically generated their growth and power. The Teamsters have lost nearly 100,000 members during the Hoffa years and the most critical hemorrhaging of Teamster power has been in freight.

Immediately upon taking office in 1999, Hoffa fired Ron Carey’s team of organizers, who had successfully organized a majority of the terminals at Overnite Transportation-the nation’s largest nonunion trucking company. Having cut off the union’s line of communication with Overnite drivers and dock workers, Hoffa launched a nationwide strike to win union recognition — a bold strategy made ridiculous by the absence of any strategy for effectively exerting economic pressure on the corporation.

Hoffa’s organizing director bizarrely predicted that Overnite would fold in three weeks. Instead it was the Teamsters who folded, but only after destroying the union’s most promising organizing drive in freight since deregulation. During the Hoffa years the Teamsters have not organized a single national freight carrier, despite a massive $65 million annual dues increase to the International — the largest hike in Teamsters history — which the Hoffa “No Dues Increase Slate” pushed through in 2002 at a Special Convention without a membership vote.

Hoffa promised to use the dues hike to “build Teamster Power.” Instead he’s ballooned officials’ perks. A record $44.8 million in dues money is paid to the top 300+ highest paid officials in the union. The number of Teamster officials on the IBT payroll who receive multiple union salaries has skyrocketed by nearly 600%.

Had Hoffa kept his campaign promises to “Cut and Cap International Union salaries” and other IBT spending, the Teamsters would have saved more than $20 million. In light of these figures, it’s abundantly clear the $4 million dues rebate Hoffa wanted from the AFL-CIO was no more the reason for the Teamsters defection than Hoffa’s commitment to core jurisdiction organizing.

Hoffa’s partnership with a coalition that calls for unions to “make diversity a central strategic objective at all levels,” is similarly dubious. Hoffa’s own General Executive Board includes only one African American, one woman and no Latinos among its 24 voting members. (The reform slate that challenged Hoffa in the last IBT election included seven people of color and four women among its 21 candidates).

The Teamsters National Black Caucus recently launched a campaign to press Hoffa to include a minimum of four African American vice presidents on his slate as part of an effort to win enforcement of demands first made by the caucus 30 years ago.

Whatever the contradictions, Hoffa is moving full speed ahead, affiliating the Teamsters with the new labor federation. What the development will mean for the labor movement remains to be seen. Meanwhile, the Teamster reform movement is focused on another question — Changing the Teamsters to Win.

Change to Win in Trucking

The challenges and opportunities have never been greater for the Teamsters Union. In May, the largest Teamster employer, UPS, paid $1.25 billion to acquire Overnite. The move means UPS, the boss of 225,000 Teamsters will operate a huge nonunion freight division and the number one union-buster in the trucking industry, Overnite, will be financially backed by the most profitable transportation company in the world.

UPS, which acquired Overnite as part of its transformation from a parcel delivery company to an integrated shipping and logistics operation, symbolizes the new trucking industry where the distinction between parcel, freight and logistics companies are breaking down.

Employers are acquiring new operations and expanding their reach to position themselves to compete in the global market. Integrated transportation companies offer shippers a variety of services from next day air delivery to worldwide transportation of freight on the basis of one-stop shopping. Yellow-Roadway, which employs the vast majority of Teamster freight drivers, FedEx, and DHL are all built on this model.

Within a few years, the trucking industry will be dominated by this small band of integrated giants. The Teamsters represent workers at each of these companies, with the exception of FedEx, but not in the numbers necessary to defend the union’s historic gains in the industry. The ability of the union to maintain members’ wages and benefits and to reassert itself as a real force in its core jurisdiction will depend on its ability to organize the nonunion operations at these companies.

UPS-Overnite poses the threat and opportunity most immediately. UPS intends to grow the nonunion subsidiary substantially, perhaps doubling it in size. That growth threatens to come at the expense of both UPS workers — as work is shifted to Overnite — and from freight Teamsters whose company will lose business to an even more well-heeled nonunion competitor.

The merger adds additional charge to the pension crisis, the third rail of Teamster politics. Over the last two years UPS has successfully pressured the Hoffa administration to agree to benefit cuts in Teamster pension funds across the country.

UPS management’s goal when the next contract is negotiated in 2008 is to shelve pension plans altogether. That fight will be all the more challenging because the Overnite acquisition, along with UPS’s growing logistics operations, diminish the power of the strike weapon the union used so effectively in 1997.

As daunting as the challenge of taking on UPS-Overnite is, the union’s power to meet it will never be greater than it is right now. The Teamsters represents 200,000 UPS employees. Overnite has just 10,000 employees. Over time, that ratio and the balance of forces in a strike scenario will only tilt further in the direction of the employer.

To successfully organize Overnite will require more than the public relations and media work that is the Hoffa administration’s trademark. But an aggressive, all-out Teamster member mobilization against corporate power was last seen during the 1997 UPS strike. Little in the Hoffa administration’s record suggests it is up to this task.

Election 2006

TDU, which caused a stir in industry press by pushing for an organizing strategy at UPS-Overnite in the wake of the merger, is not waiting for a Hoffa change-of-heart.
The movement is gearing up for the December 2006 election for International Union officers as an opportunity to set the union on a new course. Ironically, while Hoffa’s prestige in the media may be at an all-time high in the wake of his Change to Win press maneuvers, among Teamster members, including many local officers, Hoffa’s popularity has never been lower.

For the first time, Hoffa will have a record to defend when he runs for office, and it’s not pretty. There’s the dues increase — the biggest in Teamster history — and the corruption scandal in which Hoffa’s handpicked anti-corruption czar Edwin Stier resigned, along with the entire staff, amid accusations that the General President’s office was undermining investigations into organized crime influence in Chicago, a stronghold of Hoffa support.

But the number one problem Hoffa faces among the rank and file is the pension cuts — the first in Teamster history — that have swept across the country. While particulars vary from fund to fund, members pension future accruals have been cut, minimum retirement age has been raised, as has the cost of health benefits for retirees. The stated goal of both union and employer benefit fund trustees has been to compel Teamsters to forgo early retirement benefits and to continue working longer and retiring later.

The cuts came after Hoffa promised the contracts he negotiated at UPS, freight and in carhaul would protect members’ benefits for the life of these agreements — including the unprecedented six-year contract at UPS that Hoffa bragged was the “Best Contract Ever.” What Hoffa did not disclose was that he knew the bellwether Central States Pension Fund was discussing cuts as early as November 2001, months before the contracts were bargained.

Other documents obtained as a result of TDU legal action revealed that Hoffa was briefed on the fund’s financial difficulties during the UPS negotiations. Instead of alerting members, Hoffa withheld the information and promised the contracts would protect their benefits for five and six years.

As TDU’s Convoy Dispatch has said, “The ‘Best Contract Ever’ promise wasn’t just a sales job. It was a lie.” (February/ March 2005) This betrayal as well as the cuts have gravely undermined Hoffa’s support among the union’s core constituencies, especially freight and UPS which make up about 25% of the Teamster membership but 40% of its voters.

TDU has worked to turn anger into organization — with particular success in the Midwest and South where members have formed an ongoing Central States Pension Improvement Committee whose activity also boosted TDU’s membership rolls. More recently, the New England Teamsters Pension Fund reversed some of their most draconian cuts on early retirement after a smaller membership rebellion assisted by TDU.

The Hoffa magic has also worn thin on many Teamster officials. In August, International Vice President Tom O’Donnell, and a major Hoffa fundraiser, announced that he was leaving the slate and running for General President against Hoffa.

O’Donnell has support among disgruntled officials in the Eastern Region, where officials from New Jersey and Philadelphia staged a protest by sitting silently during the obligatory standing ovation for the General President at a recent meeting of officials.

Elsewhere freight officials are lobbying for vice presidents to jump ship and launch a freight slate. None of these forces are reformers — don’t look for them to swell the ranks of TDU soon — but these developments open up opportunities for the reform movement. They indicate a shift in the political winds and threaten to siphon critical votes from the Hoffa column.

TDU in the Year Ahead

While recent years haven’t been kind to Hoffa’s political fortunes, they have not been easy times for rank-and-file organizing either. TDU doesn’t organize in a vacuum. It is affected by the prevailing political winds — the shaky economy, the decline in union membership, the absence of examples of successful labor struggles, the right-wing drift and the post 9-11 world.

TDU activists have an organization with a 30-year track record and decades of organizing experience to help stay the course in tough times. But the lack of militancy and struggle in the working class affects the political terrain in the Teamsters.

In recent years, TDU activists have carried out on local and regional level pension fights, as well as organizing with immigrant Teamsters and in other local union reform efforts — including successful election campaigns for local office in Atlanta Local 728, Seattle Local 174, Milwaukee Local 200, and New York City Local 805 among others.

A key race this fall is in Louisville Local 89 — the IBT’s third largest local — where reformers have been narrowly defeated in the last two elections. The coming election year gives a national focus to these varied grassroots efforts. The first stage — the “primaries” — are elections in each local union for convention delegates. In June 2006, the IBT will hold an International Convention where these elected delegates will vote on constitutional reforms and cast nominating ballots for the 2006 election of international officers.

TDU members and other reformers will be running in many of these local races — usually as rank-and-file insurgents — to make sure the reform slate has enough nominating votes to appear on the 2006 ballot. Reform delegates will also be pushing for reforms like accountability of benefit fund trustees to the membership.

The challenge for TDU for the rest of 2006 will be to continue to build local struggles around union reform efforts, contract fights and pension issues and to link these struggles to the 2006 election for IBT officers. It’s become common to counterpose union reform against the need to focus on organizing the unorganized. For TDU the two are part of a unified strategy for rebuilding union power.

ATC 119, November-December 2005