Labor Union Blog

Economic Report:

A report titled “Preparing the Workers of Today for the Jobs of Tomorrow” found that four out of 10 industries will be responsible for 86 percent of job growth over the next seven years. Those four industries are all healthcare-related. According to the report released by the Presidents Council of Economic Advisers healthcare support jobs will likely grow the fastest increasing by 48 percent by 2016. 500,000 jobs are projected to be added by private hospitals over that same time period.

Former United Mine Workers of America International President Sam Church died on Tuesday at the age of 72. Church was the President of the union from 1979 until 1982. Church was President of the UMWA at a time when the industry was adjusting to advances in automation of work. He headed a two-month nationwide coal strike that resulted in a strong agreement with greatly improved benefits.

State workers in Pennsylvania aren’t happy that they are being asked to work with out getting paid. Jesse Russell reports:

State workers in Pennsylvania took to the streets on Tuesday to drive home a message to Governor Ed Rendell, they aren’t happy about a policy that requires state workers to stay on the job as the legislature fails to pass a budget. An estimated 500 workers rallied at the Capitol demanding pay. According to the state constitution without a budget in place the state government can’t make payments – that includes employee paychecks. Thirty-three thousand state workers will only receive a small portion of their normal pay on Friday with pay checks for all state workers shrinking until July 31 when the coffers will run dry. Once the stalemate between the Democratic governor and the Republican controlled Senate is broken and a budget is passed workers will receive any suspended back pay.

By Doug Cunningham

[Chant]: “Raise taxes now! Raise taxes now!”

Eight home caregivers and activists were arrested Tuesday at the Illinois state capitol as they protested the General Assembly’s 50 percent budget cut of home health and child care services. SEIU Health Care Illinois Indiana rallied at the capitol to protest the cuts and urge adoption of an income tax increase to maintain the services. Keith Kelleher President of SEIU Health Care Illinois and Indiana.

[Kelleher]: “There’s an estimate that if the current budget – the doomsday budget that was passed by the General Assembly, which we think was totally irresponsible – if that goes into effect 200,000 people will lose their jobs in Illinois.”

Comprehensive health care reform took a significant step forward this afternoon when House leaders unveiled the final draft of a bill that contains a public health insurance plan option and shared responsibility, including an employer “pay or play” requirement—while not taxing the health care benefits working families receive through their job. A vote could come by the end of July.

The bill closely follows the health care blueprint developed by the House Education and Labor, Energy and Commerce and Ways and Means committees and includes cost containment and insurance market reforms to help stop private insurance industry abuses. For a closer look at the House bill, click here.

Says House Speaker Nancy Pelosi (D-Calif) about the bill:

Over the coming weeks, Congress will continue working with President Obama to make health care reform work for middle-class families in America….We have a path to success: lowering costs for consumers and businesses; giving greater choice to Americans, including keeping your current doctor or plan if you like them; improving the quality of your care; putting doctors, not insurance companies, back in charge.

The money spent on providing health care coverage is tax-deductible to the employer, and the employee is not taxed on it. Some 160 million people have health care benefits tied to the workplace. But many congressional Republicans and conservative groups have pushed for a health care benefits tax.

Rather than taxing workers’ benefits provided by employers, the House bill calls for a small tax surcharge on individuals making more than $280,000 a year and married couples with annual incomes over $350,000.

The House proposal meets President Obama’s goals by controlling runaway health care costs, offering the American people real choices and expanding access to quality health care. It does not ask the American people to pay more for what they already have. In fact, this legislation offers the real promise of improving quality, increasing access and reducing costs, all at the same time.

The bill’s introduction comes at a time when the health care industry, including the private health insurance community, is spending $1.4 million a day on lobbying efforts, according to a recent report in the Washington Post.

According to disclosure records, firms spent more than $126 million in the first quarter of 2009 to pay for more than 350 former lawmakers, congressional staffers and executive branch officials to lobby Congress. Many of the firms are trying to block or weaken health care reform, especially provisions supporting a public health plan and pay or play. As the Post says:

The aim of the lobbying blitz is simple: to minimize the damage to insurers, hospitals and other major sectors while maximizing the potential of up to 46 million uninsured Americans as new customers. Although many firms have vowed to help cut costs, major players such as PhRMA [Pharmaceutical Research and Manufacturers of America], America’s Health Insurance Plans (AHIP) and others remain opposed to the public-insurance option.

At a news conference last week, President Obama said many of the groups that oppose comprehensive health care reform are deliberately sowing fear in the public. He said that while most people support fixing the nation’s broken health are system, “they’re also afraid of the unknown.”

And we have a long history in America of scaring people that they’re going to lose their doctor, they’re going to lose their health care plans, they’re going to be stuck with some bureaucratic government system that’s not responsive to their needs.

And overcoming that fear—fear that is often actively promoted by special interests who profit from the existing system—is a challenge….My biggest job is to explain to the American people why this is so important and give them confidence that we can do better than we’re doing right now.

House leaders hope to have the bill on the floor by the last week of July and a final vote before adjourning July 31 for the August recess. Congress reconvenes Sept. 8.

Henry Waxman, chairman of the Energy and Commerce Committee, said, “We cannot go home for a recess unless the House and the Senate” act on health care.

In the Senate, the Health, Education, Labor and Pensions (HELP) Committee continues to work on its version of health care reform that also includes a public health insurance option and a pay or play provision. Last week, committee Democrats defeated an attempt by Republicans to kill the public plan option.

Sen. Jeff Bingaman (D-N.M.) said a public plan would

foster competition in the health insurance industry, promote efficiency in the market, along with innovation and fair competition, and guarantee a wellness and prevention dimension that would save money.

The Finance Committee still is developing its version of health care reform legislation.

Ron Bloom

The Obama administration’s efforts to revive the auto industry will now have a union member at its helm. Ron Bloom, a senior adviser in the U.S. Treasury Department for auto industry restructuring, has been named to head the administration’s auto task force.

Bloom succeeds Steven Rattner, a former investment banker, who resigned after less than six months on the job.

Before moving to Treasury, Bloom served as an assistant to United Steelworkers (USW) President Leo Gerard. As USW’s director of corporate research, he helped revive and restructure 50 companies in bankruptcy.

Bloom began his career negotiating union contracts for low-wage workers under AFL-CIO President John Sweeney when he was president of  SEIU.

With an MBA from Harvard and experience as a vice president at the investment banking firm of Lazard Freres & Co., and his own firm Keilin and Bloom, he has extensive experience in corporate finance. While at the USW, Bloom’s restructuring plans were recognized for preserving thousands of manufacturing jobs and health care benefits for workers and retirees alike.

When Bloom was first appointed a senior adviser in February, USW President Leo Gerard said:

Ron is very passionate in his belief that manufacturing is essential to a healthy economy. The auto industry relationship to manufacturing is as important as Goldman Sachs or Citibank is to the financial community. Ron knows this.

The administration was lucky to find a person who so deeply believes in the union movement and so clearly understands corporate finance, Gerard said. 

Saving the domestic auto industry is crucial to the economic renewal of the U.S. The steel, glass, auto parts, tires and paper industries produce products for this industry and employ a quarter million of our members alone. 

Phil Feaster

Phil Feaster, a retired truck driver from Fort Washington, Md., is one of more than 24 million seniors in Medicare’s prescription drug program, the program that is supposed to cover most of the prescription drug expenses for participants.

But Feaster, a member of the Alliance for Retired Americas, like 3.4 million other Medicare Part D enrollees, falls into a very expensive “donut hole.”

For Feaster, it’s a $700 a month hole that he hopes will be closed by comprehensive health care reform legislation introduced today in the House of Representatives.

Speaking at a Capitol Hill press conference yesterday, Feaster said:

My generation likes to tell it like it is: The donut hole is a rip-off. You pay money, but get nothing in return. Can you imagine going to a restaurant where all they give you is an empty plate—but yet they still force you to pay for a full meal? Of course not.

The Medicare Part D rules on prescription drugs pushed by the Bush administration and passed by Congress in 2003 left seniors on the hook for the entire cost of their prescription medicines when they hit an annual limit and before they reach an amount considered “catastrophic.” That gap was dubbed the “donut hole.”

For example, in 2008 the donut hole was the cost between $2,510 and $5,726—a gap of more than $3,200. When Medicare Part D deductibles and co-pays are added, seniors faced $4,050 in out-of-pocket expenses

Last year, according to the Alliance for Retired Americans, an estimated 3.4 million of the 24 million Part D enrollees paid the $4,050 in out-of-pocket expenses before Medicare kicked back in and provided catastrophic care coverage, paying 95 percent of those prescription costs.

Feaster says he is struggling to stay healthy and takes eight prescription medicines a day to help control high blood pressure, diabetes and a sinus condition. He pays $85 a month in premiums, the full cost of the first $250 in prescriptions and a 25 percent co-pay, until he hits the donut hole.

For the first six months of the year, I pay $85 in monthly premiums, and in exchange I receive my Part D benefits for my eight daily medicines. But then I hit the donut hole. For the remaining six months of the year, I must pay both my $85 monthly premiums and full price for my medicines. These drugs cost me $700 per month when I am forced into the donut hole. And again, this is $700 per month on top of the $85 monthly premiums I must pay. For half of the year, I am forced to pay these premiums while receiving absolutely nothing in return.

If Feaster or other seniors in the program wanted to save the $85 a month premium and drop out of the program after they hit the donut hole, he says there’s a penalty to be paid.

Why do I keep paying these premiums? Under the Medicare Part D rules, if I stop paying my premiums, I am out of the program for next year. The donut hole sure seems like a sweetheart deal for the big drug and insurance companies.

I am hopeful that this will finally be the year we fix our health care mess….I am grateful that this legislation will start closing the Part D donut hole and finally finish it off.

University of Maryland labor historian Julie Greene will hold a book reading July 15 at the AFL-CIO in Washington, D.C., for The Canal Builders: Making America’s Empire at the Panama Canal. To RSVP, click here.

“One of the greatest engineering feats in history.” That’s how The New York Times has described the Panama Canal.

“It was our technology, our science and our leadership that had carried the day,” the Times said.

When it brought together the Atlantic and Pacific oceans, cut in half the shipping distance between New York and San Francisco, and made vast Asian markets suddenly accessible to businesses along the East Coast, the Panama Canal was considered a crown jewel of the American economic empire.

Since it started operating in 1914, the Panama Canal has been the subject of enough books to fill a small library. But until now, a key part of the story has been missing—the workers who built the canal. In The Canal Builders: Making America’s Empire at the Panama Canal, labor historian Julie Greene tells the story of these workers with great skill.

Further, she asks:

How does looking at the construction project from their perspective change our understanding of this moment in history?

Some 60,000 workers took part in the canal’s construction. As Greene writes:

Working people journeyed to the Canal Zone from all over the globe: from the United States and Canada, the Caribbean, northern and southern Europe, and India. Each group brought different strategies for responding to conditions and policies on the isthmus. Workingmen who repaired steam shovels, ran lathes, dug dirt or drilled dynamite had their own dreams and visions, as did workingwomen who washed laundry and cleaned houses.

She adds:

In the Republic of Panama, which provided critical support for the construction effort, everyone from politicians to sewer diggers, servants, prostitutes, bartenders and chauffeurs experienced the transformation of their cities as a result of the American occupation.

There was not even a pretense that these workers were treated equally in the Panama Canal Zone. At the top of the scale, U.S. white male workers did quite well. They “received pay 25 to 35 percent higher than anything at home plus free quarters, electricity, medical care and sick leave,” according to Greene. In contrast, tens of thousands of West Indians were usually paid a fraction of the wages white Americans received, and their treatment was appalling.

For example, “accidents, illness, and death, like everything else in the Zone, followed a color line,” Greene points out.

Poor sanitary conditions in West Indian communities—windows that lacked screens to bar mosquitoes, stagnant water near homes—would never have been tolerated in the white towns of the Zone.

And that wasn’t the worst of it. “West Indians also were typically the ones victimized by landslides, dynamite explosions, or other industrial accidents,” Greene writes. Government figures show that 350 U.S. whites died during canal construction—but an estimated 15,000 West Indians died. Small wonder that a song the West Indian workers regularly sang was, “Somebody Dying Every Day.”

All this is very different from the iconography of the Panama Canal when it was built. A popular lithograph of the time showed “Hercules thrusting apart a mountain range, his back pushing against one side while his arm forces away the far side. His mighty labor allows a gentle stream of water to pass by at his feet,” according to Greene. “Hercules shows no sweat; his muscles are poised but not straining.”

In fact, as The Canal Builders shows, there were tens of thousands of Herculeses. Unlike the image in the lithograph, these workers showed sweat. They lost limbs and lives. And they transformed the global economy forever.

Greene says their story is ultimately “about fortune and misfortune, about the making of America’s empire in all its idealism, enthusiasm, and tragedy.” So it is, and she honors their memory and does us a great service by telling it.

The book is available here.