Now let's see if I understand this: USAIR asked the unions that have on two previous occasions released the company from its contractual wages and benefits, valued at $1 billion, to once again sacrifice, this time to the tune of $800 million [A demand more than doubled since we began writing]. These additional concessions from the workers would be necessary, they claim, to save the airlines despite a government loan-a people's loan-to the tune of $1 billion secured less than three years ago.
Now after declaring bankruptcy to avoid paying $110 million owed to union members pensions, USAIR will ask the bankruptcy court to allow management to cut wages of all employees belonging to unions representing USAIR workers.
In addition, they are preparing to dump an estimated $2.31 billion in pension fund liabilities back into the people's lap by shifting these commitments to the federal agency-Pension Benefit Guaranty Corporation which itself has a $11.2 billion deficit from accepting the pension liabilities of other criminally negligent capitalist enterprises. Even the PBGC's executive director, accustomed to corporate callousness, was shocked: Bradley Belt said The company is saying that it's irrational to keep your pension promises and to comply with federal law. Bankruptcy should not be the path of least resistance to deal with your pension obligations. There is another $1.7 billion in retiree health care benefits that have not been funded by USAIR. Are they next?
From loans, to contract concessions, to defaulted commitments, to acquired obligations all of USAIR management's costly failings have been paid for by working people. Billions of dollars in losses have been brazenly dumped onto the government or USAIR employees. If such arrogant abrogation of trust and obligation were displayed by an individual, he or she would be in jail.
To make matters worse, USAIR's biggest equity investor-the largest holder of USAIR stock-is a workers pension fund, Retirement Systems of Alabama. The Wall Street Journal (9-14-04) estimates that the state employees pension fund stands to lose half or more of its $500 million investment. The fund's director, David Bronner, demonstrated his business sense as well as his political acumen when he justified the investment by saying that the airline industry would turn around once we get through with Iraq. The Journal quotes Olivia Mitchell from the Wharton School of Business: Obviously losing this amount of money is potentially troublesome to the taxpayers of Alabama and maybe to the [pension plans] participants. Potentially troublesome?...Maybe?
But there is even more absurdity to the USAIR fiasco. Despite the fact that former executives of USAIR walked away with huge retirement packages though decidedly responsible for the airline's decline, Pennsylvania's two senators blame the bankruptcy on the USAIR unions. On September 12, Senators Rick Santorum and Arlen Specter-both from a state with two hubs and thousands of USAIR employees-left a meeting with the airline's CEO and denounced the unions' failure to give even more concessions. Rabidly right-wing, Santorum was very, very upset with the unions while moderate Specter noted that the airlines CEO was doing a good job and pledged to later also get the union's view. Despite receiving the endorsement of the Pennsylvania AFL-CIO over a Democratic challenger with a far better labor record, Specter also blamed the workers. I'm not making this up.
So what becomes of the airline's nearly $900,000,000 in assets? No doubt if the corrupted politicians and greedy managers have their way, these assets also will be pillaged, broken up and sold. None of the workers' sacrifices will be compensated. None of USAIR debt to the government will be settled.
We suggest a different option: Nationalize USAIR. Since the people-employees and taxpayers-have invested so heavily in USAIR, let's let the people run it and own it. Let's create an advisory board of retired and laid-off workers and keep the airline running without the burden of a top heavy, inefficient, greedy and demonstrably incompetent management team. The pain of cost cutting is much more bearable when workers know that it is fairly applied and success will also be shared.
We recognize that the airline industry has been badly managed and staggered by deregulation, pillaged by cost-cutters and profit-takers, so that other airlines are also bankrupt or near bankrupt. This makes for a rocky road for any enterprise, even the publicly owned. Nonetheless we think nationalizing USAIR would be a good start towards public ownership of the entire industry as well as the shamefully neglected passenger rail service in the US.
Of course this is thinking the unthinkable. In an era of neo-liberal privatization, a corrupted and co-opted two party political system, and class collaborationism, this old idea is akin to heresy. But surely the Keystone Kops capitalism exhibited by USAIR adds enormous credibility to the nationalization option. And we can keep the name!