Cold Shoulder

January/February 2004 IBEW Journal

The onslaught of anti-worker initiatives that came like a wave in the summer of 2003 broke over working Americans in the winter, as some of the worst proposals became reality by the end of 2003.

On legislation ranging from Medicare to energy to overtime, the Bush Administration sold out to the corporate interests, leaving workers to pay the tab on every conceivable front.

The September 2003 issue of the Journal outlined the series of attacks on workers ("The Summer of Our Discontent"). Now, at the mid-point of the congressional session, less than a year from pivotal national elections, an update on many of the issues shows that workers were right to fear for the future.

"If this is the best this lot of lawmakers can do, frankly I don't have much hope for future legislation on any issue in this Congress," said IBEW President Edwin D. Hill. "The pattern of rewarding the powerful and punishing working families will continue as long as this crowd is in charge on Capitol Hill and in the White House."

BAD MEDICINE
Medicare Drug Bill Is Bum Deal for Seniors

Late last year, President Bush signed into law the most sweeping changes to Medicare since the retiree health program was created in 1965. Most of its changes will not occur until 2006, when many retirees are likely to be the losers.

In a country with the highest drug prices in the world, the Medicare bill does nothing to alleviate high costs for seniors. Pharmaceutical companies have successfully fought a vigorous campaign to prevent the government from using its buying power to negotiate with drug companies to get the lowest prices.

The plan pits Medicare against paid private plans for beneficiaries, turning it into a voucher program that would provide a defined contribution rather than a defined benefit. Seniors who choose to stay in traditional Medicare will see their premiums fluctuate widely and rise significantly-some by as much as 88 percent.

Retirees who benefit from union-negotiated prescription drug plans with their former employers may lose them once the new Medicare prescription drug program kicks in. The bill contains incentives for employers besieged by rising medical costs to push retirees into the new program.

Between 2.2 and 2.7 million retirees could lose their employer-sponsored drug coverage, according to estimates by the Economic Policy Institute. This will have an automatic and devastating effect on some seniors-particularly public sector employees-since retiree plans generally provide better coverage and lower out-of-pocket expenses than the new Medicare benefit.

The legislation also rewards the radical wing of the president's party that advocates privatizing Medicare, and in the process threatens the foundation of reliable health care for America's seniors.

Seniors seem to agree. In a national poll conducted after details of the deal were released, voters aged 55 years and older expressed serious concerns about the legislation and say lawmakers should work on a better deal. The poll commissioned by the AFL-CIO found only 19 percent of older voters say Congress should pass the bill while 64 percent say Congress should go back to work on it.

"The risk of benefit cuts is far too high a price to pay for the inadequate, unreliable prescription drug benefit," said AFL-CIO President John Sweeney.

Workers Win Brief Victory on Energy

Republican leaders who pushed hard for the passage of the pork-packed energy bill have vowed to take up the fight again early this year, following a November defeat. Supporters of the legislation could not overcome the strong bloc of opposition to the bill in the vote before Thanksgiving.

Written solely by House and Senate Republicans, the $31 billion bill rewards big money oil and gas interests while seeking to undo the protections of a 70-year-old law that protects customers from big utility mergers. Several Senate Republicans joined most Democrats to block the legislation.

The bill contains a repeal of the Public Utilities Holding Company Act (PUHCA), a bedrock consumer protection law that has been in place since 1932. Designed to prevent corruption by large holding companies, the end of PUHCA would result in renewed turmoil in the utility industry, said IBEW Utility Department Director James Dushaw. For more than 70 years the law's regulations and restrictions have prevented companies from controlling too large a share of the industry and manipulating prices and markets. If it is repealed, Dushaw said, companies would take advantage of the loose rules to purchase industry entities like gas and electric companies and build up the same market power that forced regulation in the 1930s.

"Every time there's a merger or an acquisition, there are job cuts, which is bad for consumers and bad for employees," Dushaw said. "PUHCA repeal would open that up tremendously."

The bill provides tax incentives for electricity transmission investment, gives loan guarantees for a gas pipeline from Alaska to Chicago and contains provisions that set guidelines for training in the utility industry, all of which could potentially create jobs for IBEW members. However, nothing in the bill requires the use of project labor agreements, so IBEW benefit from the new construction is not guaranteed, and the Bush Administration's record is to reward the major nonunion energy and construction firms, like Halliburton, with ties to the president and vice president.

The IBEW was able to persuade lawmakers to delay a plan to shift control of the electric transmission system from states to the federal government, meaning the Federal Energy Regulatory Commission in Washington, not the public utility commission in each state, will determine prices and access to the transmission systems.

The bill also does very little to address inherent flaws in the energy markets that allow the sort of system manipulations that did so much damage in California and the West Coast in recent years.

Workers Cling to Slim Hope in Overtime Fight

Months of largely successful lobbying by workers was unlikely to sway the Administration from its goal of stiffing millions of workers of their hard-earned overtime pay.

By reclassifying workers as executive or administrative, the Bush administration sought to exempt whole categories of workers who were formerly eligible for time-and-a-half pay. Majorities in the Senate and House rejected the proposal, but the president got his way by threatening to veto the entire $280 billion funding of the federal government if his new overtime rules were not included.

A member of the president's own party, Sen. Arlen Specter (R-Pennsylvania), had the overtime changes blocked until the final hours of the deadline for federal funding when he caved in to the White House. The U.S. Department of Labor has the go-ahead to make the most sweeping changes to the 40-hour work week since the Fair Labor Standards Act of 1938-and deprive millions of workers of a vital source of income.

"Against the will of the majority of the House and Senate, the president has railroaded eight million workers who depend on overtime for their economic survival," International Secretary-Treasurer Jerry O'Connor said. "His tactics show his disregard for working Americans-still another item for us to remember on election day."

Today, employers are required to pay time-and-a-half to eligible workers for more than 40 hours a week; overtime comprises a quarter of the average weekly earning of those who receive it. The rule change could result in millions of workers ceasing to be paid for the same hours on the job-all at a time when many Americans are struggling to make ends meet.

Throughout the overtime debate, right-wingers insisted 1.5 million or so low-wage workers would get overtime for the first time. But there are ways to cheat them out of their overtime and-incredibly-the Labor Department "suggested" to employers ways to do it. To keep those lowest-wage workers from actually costing you more, the Department told employers, cut their base pay so the overtime only puts them back where they were. Or, you can give workers whose base pay is near the threshold a slight increase-an amount less than their previous overtime pay-that enables you to reclassify them as ineligible and you can work them all the overtime you want without paying time-and-a-half.

Analysts have said the changes will threaten overtime pay in professional and technical fields-the employment sectors growing faster than any other major occupational group.

"Plainly, President Bush is offering tax cuts for the rich and pay cuts for hourly workers," Secretary-Treasurer O'Connor said. "His true motives are exposed in actions like these."

Bush Deals Unions Compliance Nightmare

Labor unions will be saddled with U.S. Labor Department reporting requirements that mandate burdensome compliance cost and effort, but a judge has given them a one-year reprieve.

The January 1 decision by a U.S. District Court judge said meeting the new rule's requirements would have been complicated, expensive and cause unions "irreparable harm."

The regulations require unions to collect massive amounts of minute information at considerable expense. They are expected to burden more than 5,000 labor organizations with these tasks, leaving less time for contract negotiations, grievance handling, organizing and other core union activities.

Many members of Congress agreed that the rules were punitive and did little to assure accurate disclosure. Even 30 Republican House members, in addition to Democrats, had urged the Labor Department to make the new reporting requirements less burdensome.

Asbestos Victims Hold the Line for Relief

A protracted battle over the right of victims to recover damages for asbestos exposure remains unresolved, thanks to a tough stand by Democrats holding out for a better deal for suffering workers.

Asbestos legislation would establish a fund with contributions for companies, insurers and bankruptcy trusts to pay for claims related to asbestos exposure. It would require those seeking relief to go through the fund, not the courts, and it would protect fund contributors from civil liability. Disagreement over the amount of money to be paid to claimants has divided Democrats, Republicans, private companies and labor unions.

Labor advocates contend that if Republicans have their way, private companies would have more to gain from immunity from civil proceedings than the injured workers seeking relief.

The Occupational Health and Safety Administration estimates 1.3 million workers in construction face "significant" asbestos exposure on the job. Big companies like Halliburton-the company that still pays "deferred compensation" to Vice President Dick Cheney-could save billions on pending liability claims.

Unemployment Benefits Elude Jobless

Congress left town last November without approving a federal extension of unemployment benefits, which means that 90,000 families a week (or two million over the next six months) will no longer qualify for any federal jobless aid.

"Considering the 2.4 million jobs lost in this country since President Bush took office, the least he can do is urge Congress pass an extension for those who are still out of work," President Hill said. "Last fall, unemployment reached a 20-year high and despite improvements and a better outlook for the economy, job creation still lags far behind."

May 2003 was the last time benefits were extended for the jobless. Those benefits ran out December 31, leading workers into the new year without a job or the back-up assistance provided by unemployment benefits.

Supporters are hoping for a repeat of last year, when Congress and the President let the program run out over the holidays and ended up returning early in January to fix it after a public outcry.

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