USA : United Airlines - using the courts to bankrupt workers

Mar/Apr 2003

The present article is reproduced from the quarterly published by the Trotskyist group "The Spark" in the USA (Class Strugggle #38 - Jan 2003)

On 10 January a federal bankruptcy judge imposed a 13% wage cut on those United Airlines workers who are represented by the International Association of Machinists (IAM). And as the company emphasised in court, these wage cuts were not to be the last. According to United, the "interim" 13% cuts imposed by the judge on IAM-represented workers and the "interim" cuts agreed "voluntarily" by its other unions - 29% by pilots, 13% by flight dispatchers and meteorologists, and 9% by flight attendants - were only enough to get it through the next few months.

This, United explained, was why it had also filed a second law suit, asking for the right to void all its union contracts. But United asked the court to put off hearing this issue until 15 March - giving it a chance to come to a "friendly agreement" with the unions for further concessions.

The judge gave United everything it asked for - including a reduction in IAM members' pensions, something that United had not so far asked for from the other unions. It was a warning: if you don't accept these cuts, the court will impose worse ones.

Blackmail and extortion, that is all this is! And it is directed not just at the workers at United, but at workers throughout the airline industry and behind them, at the whole working class.

Using the bankruptcy court against workers

Over the last few years, many more companies have used bankruptcy proceedings to attack workers wages, benefits and working conditions. And, increasingly, some of the biggest companies in the country have been trooping into the bankruptcy court. Of the 12 biggest bankruptcies ever filed, 9 of them have taken place 11 September. All of these companies filed under Chapter 11 provisions, which allow a company to go on functioning, while getting rid of some debts, as well as pension and other obligations towards its workforce.

Within the last few months, for example, Bethlehem Steel got permission from the bankruptcy court to completely dump all its pension obligations - current and future. Retired workers will go on drawing a pension - but paid out by the Pension Benefits Guarantee Corporation (PBGC), which in many cases pays out a lower amount. What is worse, is that there is no medical insurance whatsoever for Bethlehem retirees covered by the PBGC. National Steel had already done the same thing. But National Steel's story didn't stop there. A.K. Steel Holdings and US Steel then engaged in a bidding war to buy up National. With bids around $1bn each, they both had the nerve to insist that they could not afford to cover workers' pensions. They would take National - but only if they were allowed to avoid any responsibility for its retirees, past and future.

Behind these examples stand hundreds of other companies which are doing the same thing. The Pension Benefits Guarantee Corporation went from being $8bn in surplus at the beginning of 2002 to being almost $2bn in deficit by the end of the year, as the result of this wave of bankruptcies. And most of this decrease came before the PBGC began to pay out to retirees at some of the biggest bankrupt companies.

Of course, for years, companies have been reneging on workers' pensions, but they have also been cutting wages, chipping away at working conditions, increasing the intensity of work and cutting jobs. This use of the bankruptcy courts indicates a new turn of the screw, promising an even worse wave of attacks on the working class, not just on pensions, but right across the board.

In the current economic situation, the bankruptcy court provides companies with a convenient way to radically lower their labour costs, using the threat of a company's complete liquidation to put workers into what seems to be a dead end - thus lessening the risk that they will fight back.

If the companies think they can get away with this it is because of policies carried out by the unions for years. Leaders accepted round after round of concessions during the 1980s, which they justified with the argument that it was necessary to rescue the bosses and that the workers' future well-being depended on their company's well-being. This view gained even more currency during the 1990s, as the unions diverted workers away from fighting for their own distinct interests and pushed them instead into "partnerships" with the bosses. But such partnerships did not protect the workers, any more than the acceptance of concessions had. During the supposed "good times" of the 1990s, the workers continued to lose ground, despite enormous profits accrued by the same companies which the unions gave concessions to a few years before and were now working in partnership. Whether endorsing cuts or seeking "partnership," the unions impressed on workers the false idea that they could find common ground with the bosses. This did not protect the workers, it simply disarmed them, crushing whatever desire they might have had to fight collectively to improve their situation. And it encouraged the bosses to come back and ask for more.

What is happening at United Airlines today is particularly important because it shows to where such policies have led the working class. The biggest corporations in the country today think they can get away with junking in one blow commitments they would not have dared to renege on, even a few years ago. The unions' policies have led the working class into a dead end. To break out of it, workers are going to have to begin to fight again for their own class interests.

"Worker Ownership" - another term for concessions

Ten years ago, in 1993, United also claimed to be in a crisis, declaring losses for three years in a row. To convince the workers to agree to cuts in wages, benefits and working conditions, they offered them shares in the company, so that collectively they would own over half of United's stock. They were also promised that at the end of six years, all the concessions they had accepted would be reversed and their losses repaid. The estimate put on the value of these concessions at the time came to a total of around $4.5 bn. Then, too, the unions caved in to management's blackmail, with the IAM convincing members to accept wage cuts averaging 14% in 1994. The pilots took a 24% wage cut. Only the flight attendants, who were among the lowest paid employees, refused a wage cut.

This was the famous "employee-ownership" deal, which proved to be nothing but a con game. Just as with Enron, workers could not sell their stock for many years and, in any case, not until after they retired or quit. Neither did these shares pay any dividends to United "worker-owners" until 2000. The deal did not even allow workers representation on United's board proportionate to their stockholdings - the unions got only 2 seats out of 12.

As events were to show, "worker-ownership" gave no protection to workers. And when the six years after their acceptance of the cuts was up, their wages were at the same level as they had been in 1993. But taking inflation into account, the basic wage rates for United mechanics, for example, were about 30% less in 2001 than they had been in 1993. At the end of the six-year concession contract, United simply stonewalled union proposals to bring United workers up to wage levels then prevailing in the industry and to restore benefit cuts. At the same time, the fact that United had been able to lower its "labour costs" and keep them down during all those years also weighed on the wages of workers at other airlines.

United Airlines finally did agree to a new contract for pilots in the summer of 2000, after a much publicised campaign during which pilots refused overtime, tying United's flight system up in knots. But when the mechanics started to refuse overtime and began to "work to rule" on safety checks or took "sick-outs," the company quickly suspended workers. It then rushed to the courts to get an injunction so that mechanics who continued to take action faced jail sentences. The mechanics were stuck with their losses.

Of course, the management of a "worker-owned" company acts exactly like management in every other capitalist company. The fact that workers owned the majority of company shares gave them no control over management, any more than the relatively small amounts of money written into each of their stock accounts turned them into capitalists. Unlike the company executives, who always manage to sell off their stock before bad economic news hits, workers were stuck with these shares, which today are practically worthless. By 11 September 2001, the mechanics were still working under the old concession contract, 15 months after it had expired.

In the first weeks after September 11, airlines announced they would cut at least 140,000 jobs including 20,000 at United. Contractual job protections, seniority rules and job classifications were thrown out the window by the airlines who argued that it was the fault of the terrorists.

Congress quickly paved the way for the airlines to demand outright concessions from their workers. Taking a page out of the book that Jimmy Carter wrote for Chrysler during its drive for concessions, the Bush administration, backed up by both parties, proposed a requirement that airlines applying for loans must "provide a demonstration of concessions by the air carrier's security holders, other creditors, or employees." If they did, they could qualify for grants totalling $5bn and loan guarantees worth $10bn.

United Airlines quickly announced that it would apply for government grants. Then it suggested that it might have to apply for government loans as well, if the economic situation worsened - putting its workers on notice that it would soon come calling for more concessions from them.

Temporary pay increase, permanent concessions

The company had a problem on its hands. The workers, who had been promised in 1994 that their losses would be repaid, were still waiting - and not happy about it. So in early 2002, after having stalled for more than a year and a half, United finally agreed to wage increases which had been proposed by an arbitration board for the mechanics. Pointing to United's pay scale, which was about 30% below the standard at the other big airlines, the board had proposed an immediate increase - but only of 21%, with two more increases in 2003 and 2004, totalling 6.7% more. The board also recommended that only part of the increase be backdated to the old contract's expiry date. Thus, the workers were to get a big wage increase - but still not enough to make up for what they had lost, nor enough to make up for inflation.

But the real point of this deal was the trick attached to it, which the government's arbitration board proceeded to spell it out: "Given the aftermath of September 11th for United, the Board would be unable to recommend the industry leading wages and benefits set forth herein without agreement upon appropriate IAM participation in a financial recovery plan." To that end, union leaders signed a letter committing the union to negotiate wage and other concessions if, during the first six months of the new contract, the company "proposes to implement a financial recovery plan to address the company's severe financial condition or as a prudent alternative to a bankruptcy filing."

In other words, the union agreed to bind the workers to accept future concessions before the company had even spelled them out. In fact, the workers were being given a pay increase, most of which was going to be taken back almost immediately. Significantly, any negotiations over the concessions would take place within the framework of the contract and its no-strike commitment. The workers were being asked to put legal handcuffs on themselves in advance.

Many of the workers represented by the IAM, and especially the mechanics, were strongly opposed to the new contracts for this reason. They were also angry that they were not getting full back pay and that it would be paid in 8 installments over two years, instead of right away. The first installment was not even due until one year later, in March 2003.

Some mechanics, not for the first time, raised the idea of leaving the IAM and joining the Aircraft Mechanics Fraternal Association, a craft union restricted to mechanics.

After testing their members' reactions, IAM leaders pretended to come out against this contract a few days before the vote, supposedly because it had been imposed by the arbitration board. When the ballot took place in mid-February 2002, 68% of mechanics and utility voted against acceptance. IAM leaders headed back to the negotiating table, quickly adding a few cosmetic changes to the first offer: the back pay was to be increased - but still to only about 60% of what it should have been and the date for the first payment was moved forward to December 2002. They also added a provision that workers would have a vote on any future concessions that might be negotiated. The no-strike commitment was, of course, left in place.

This time, IAM leaders threw themselves into pushing for this contract, arguing that it was necessary to secure the wage increases before things in the airline industry got any worse. This time acceptance was carried by 59%.

The IAM then went on to negotiate similar contracts for the other United workers it represented. The last contract was ratified in April 2002. According to IAM leaders, the new contracts put the wages of the workers at "the top of the industry."

Making a mockery of the whole process, United Airlines chief executive, Jack Creighton, issued a statement calling these new IAM contracts, "a critical milestone in developing a recovery plan that meets the needs of passengers, preserves jobs, and puts the company on the road to financial stability." On the very day that negotiations for the last IAM contract were being wrapped up, the company called the unions into a meeting to discuss its need for a "recovery plan" - that is, for more concessions. IAM officials boycotted the meeting, refusing, they said, to talk about possible concessions because the pending contracts for their members had not yet been ratified! However, as they were soon to demonstrate, they would be all too ready to talk about giving back what they had just negotiated - and much more. But one thing at a time, please!

United demands $9bn - the unions offer $5.8bn

Alarming stories now appeared in the business press about United's situation. In 2001, when it had been proposing to buy out US Airways and to start up a private jet service for business executives, called Avolar, United had emphasised the strength of its financial position, underplaying its large losses in the first half of that year. Now, referring to those same losses and to September 11, it talked about its rapid "cash burn." As summer wore on, United began to list all its loans that would soon become due - loans for which it had pledged its aircraft as surety, so that if it couldn't repay them, its creditors would seize the planes, thus forcing United to shut down.

Even if United had been in as bad a shape as it claimed, this was absurd. In the spring of 2002, the industry had already estimated that over 2400 planes, about 11% of the world's civilian air fleet, were parked in the Mojave Desert, producing no income. United's creditors hardly wanted to park yet another fleet of planes out there. But union leaders not only did not point this out, they repeated these stories about loans due for repayment, adding to the sense of crisis.

In August 2002, leaders of all the unions were summoned to company headquarters where management presented them with its "recovery plan." United was now demanding concessions worth $9bn over six years.

The union leaders immediately formed the "United Airlines Union Coalition" - not to organise resistance against such an outrageous demand, but to come up with a counterproposal. They would pledge $5bn worth of "labour cost savings" over 5 years! By the following month, the Union Coalition had agreed to up this offer to $5.8bn in concessions. The proposal was conveyed in a letter which ended with the following assertion: "The coalition framework is without precedent for this or any other airline, and United has the most committed employees and strongest airline franchise in the world. We will not let it fail."

Once again, the unions were going to the rescue of the bosses - instead of preparing the workers to fight back.

Negotiations then shifted to separate tables where the workforce's concrete sacrifices would be worked out. The pilots union proposed an average 18% pay cut, among other things. The unions for flight attendants, whose wages were the lowest, offered to cut wages 3.95%. These concessions were soon ratified.

The IAM, with several contracts representing mechanics, ramp and food workers, baggage handlers, ticket agents and a few other categories had agreed inside the coalition to come up with wage cuts amounting to 7%.

But distrust was running high, particularly among the mechanics - and this was aggravated when United announced it was giving its new chief executive (the third in 2 years) a $3m signing bonus, plus almost another $1m in salary. The IAM complained that management was not contributing "its share". So United announced that its executives were still trying to "finalise" what they would "contribute" to the "recovery effort." This was nothing but another slap in the face.

It wasn't at all clear that concessions could be rammed down the throat of IAM members.

Pitting US Airways workers against UA workers

It was exactly at this point that the IAM began to discuss a second round of concessions with another airline, US Airways, which is the seventh largest in the country. The first round of wage cuts had already been agreed by the unions in the summer, with pilots taking a 26% cut and mechanics 8%. This time, US Airways wanted changes in work rules, aimed at farming out jobs of workers represented by the IAM to other companies or reducing classifications so as to pay lower wages for the workers who remained. Among its demands, was the particularly outrageous proposal to double co-pays for medical insurance for active workers and require all retirees to pay the full insurance cost, while increasing the deductibles for everyone. And, sniffing a new "opportunity," US Airways said that if the US went to war against Iraq, it would immediately implement a 5% wage "deferral" for up to 18 months!

Once again, the unions agreed to the bosses' demands. Leaders announced that after looking at the company's projections, they had to conclude that this second round was necessary, if distasteful - but the only way to prevent US Air from being liquidated by its creditors. The vote of acceptance this time round however had a much smaller majority. One contract was passed with only a 5-vote margin. IAM district 141-M president, Scotty Ford, commented: "Our members have agreed to provide US Airways with the resources to avoid liquidation and successfully emerge from bankruptcy. Their sacrifice and commitment to the survival of this carrier deserves to be commended."

What was happening at US Airways could only serve to encourage United Airlines to push harder still for concessions. The business press had already drawn attention to how much more US Air workers were giving up. The Wall Street Journal reported on November 14: "Analysts are finding fault with the size and validity of United's desired labour cuts, leading some to speculate that the Air Transportation Stabilisation Board will deny the carrier's request for aid. They say that United's planned sacrifices aren't persuasive in light of more aggressive pruning at US Airways."

Then United Airlines announced its intention to cut another 9,000 jobs. The only reaction by IAM leaders was to warn United workers that even more jobs would be lost if they did not agree to wage and benefit cuts, thus reinforcing the bosses' blackmail. The same Scotty Ford who praised US Air workers for accepting concessions now told United workers: "United Airlines is struggling to overcome the combined effects of 9-11 and an unrelenting worldwide travel recession." He then presented them with new proposals for concessions. Randy Canale, president of District 141, warned: "Too many airlines have been forced into bankruptcy, never to return. Too many good airline careers and families have been destroyed." Having brandished a stick, Canale then held out a carrot:"Despite obstacles and unprecedented economic pressures, I still believe our greatest days lie before us."

At the end of November 2002, two of the three IAM units ratified this first round of concessions - but the margin in the ramp workers' vote was not very big. And the mechanics turned down the concessions demanded of them.

They were immediately attacked by the leaders of their union. Canale, in a letter to workers, declared: "It is unfortunate that some members at United still question the need for participation in a recovery program. At this stage, the alternatives are so undeniably worse, I question the motives and judgment behind such a decision." He denounced those who opposed the first proposal for "only trying to advance their own agenda."

The heads of the other unions began to condemn what they called the "selfishness" of the mechanics, and the IAM leaders predicted that if the mechanics did not agree to cuts that this would be the end of everyone's jobs.

IAM leaders rushed back to the company to cobble together a new version of the same contract, scheduling a re-vote for 6 December 2002. But they made no attempt to pretend it was a better offer: "It has been reported in the press that United's goals and financial targets have not changed [i.e., since the rejection of the first contract]. They still need the same costs savings from the Mechanic and Related employees to avoid bankruptcy." Nor did they even pretend there would be no new job cuts. They simply argued, "the current plight is not of the employees' making, but it will certainly take a collective effort of every United employee to keep this airline out of bankruptcy."

But even before the vote could take place, the courts intervened to help United increase its demands further.

A government board helps United up the ante

On 4 December 2002, the Air Transportation Stabilisation Board (ATSB) set up to administer the airline bailout, turned down United's application for loan guarantees. It explained that United's debts required bigger labour cost savings and its underfunded pension obligation required it to provide "alternatives" to that funding.

In other words, the ATSB gave United yet another pretext to demand still more concessions from the workforce. Given the readiness of the union machineries to offer these up thus far, the ATSB and United had every reason to believe they would agree to such further extortion.

Five days later, United filed for a Chapter 11 bankruptcy, which allows a company to continue operating, in order to gain time to pay off debts, while it sheds other obligations - including labour contracts.

Three days afterwards, on the 12 December, it presented the unions with a new list of demands, asking for still deeper concessions.

And predictably, the unions rushed to "their" company's aid. The president of the Association of Flight Attendants (AFA) issued a statement condemning "the unethical collaboration between the Air Transportation Stabilisation Board and some other airlines who stand to gain if United fails." He went on: "These outside forces will not succeed in grounding United. The coming months will be difficult and painful for flight attendants as we work through the bankruptcy process. But we are committed to continuing the unprecedented cooperation between employees and management that will be necessary to turn United around and successfully shepherd it through reorganisation. This process will mean further cuts to our contract and a bigger strain on our families. But we will face these challenges head on... We will not be deterred from our goal of restoring United to the premiere airline in the world... Those who doubt us will lose. They will not be able to compete with the new United."

The president of the Air Line Pilots Association (ALPA) dredged up the spectre of September 11 once again. "The aviation industry has been dealt yet another blow today as one of this nation's greatest airlines was forced to file for Chapter 11. Pilots across the country are saddened, disappointed and angry that an airline as eminent as United, which was used symbolically by terrorists to carry out mass destruction, is now in bankruptcy. It pains me to acknowledge that terrorism scored another victory today, and this Administration let it happen."

On 15 December 2002, United announced that its lenders - some of the biggest banks in the country - were demanding that it make this latest round of cost cuts. If it did not, said United, the banks would cut off all its lines of credit.

So ALPA, the pilots union, agreed that it would now recommend a 29% wage cut (in place of 18%). And AFA, the flight attendants union, recommended a 9% cut (in place of 3.95%). But the leaders of the mechanics' union still had an angry membership on their hands - and the mechanics had refused even to give up 7%.

In the midst of all this, United filed a petition asking the bankruptcy court to grant a 1113 order, that is, an order to scrap all union contracts. A second petition asked the judge to impose a 13% pay cut on all IAM members, effective on 1 January. IAM leaders then proclaimed that they were ready to negotiate whatever concessions that United's situation required, but that these concessions need not be imposed by a court order.

Nevertheless, the petitions were heard on 10 January. The court granted the 13% wage cuts for workers represented by the IAM and approved the second round of wage cuts the other unions had offered. By rescheduling the hearing to scrap all union contracts, the court gave United the next weapon it would use to extort still more concessions.

United's appetite for concessions grows even bigger

United, armed with new hearing date, said that it must now get cuts amounting to $2.4 bn a year for 6 years - or a total of $14.4bn.

So wages, which had already been severely cut, were to be frozen for 2 years, followed by wage increases of 1.5% a year for 4 years - assuming no new concessions, of course. Among other things, workers would lose 2 holidays a year, have 5 of their vacation days "unpaid," and total vacation time reduced. They would have to use vacation days to cover any unpaid family and medical leave. The amount they could accrue in their sick leave bank would be reduced and occupational illnesses and injuries would draw out of this bank, thus reducing its availability for other illnesses or injuries. Workers would have a 20% co-pay imposed on their medical, dental, etc. insurance, and deductibles would be about doubled, depending on the plan. The payout on pensions would be decreased by 20%, with all retirement benefits before age 62 (60 for pilots) severely reduced. Retirees, once they reach Medicare age, would have to pay for all their medical insurance. The amount of severance pay for laid off workers would be capped to 8 weeks, instead of the previous 12. As for the company's promise to put some of its stock into a 401(k) plan in return, this is nothing but a sick joke, given the losses United workers had already suffered through holding United stock.

Then there are the specific cuts that apply to the different categories of workers. For mechanics and other IAM workers, United intends, among other things, to create lower wage rate classifications for a number of jobs; to outsource as much work to lower wage companies as it can; eliminate or cut back on premiums tied to skills, seniority, or shifts; eliminate job protection clauses which currently prevent some layoffs; get rid of most restrictions on use of part-time workers. As for pilots and flight attendants, the company proposed to move a lot of their work into several "low-cost" airlines it was in the process of setting up, for which they might, or might not, qualify to work - at still lower wages and with fewer benefits, of course.

How does a company like United get away with something as outrageous as this? It was the second biggest airline in the country, and had been extremely profitable for a number of years, posting earnings of $7.3bn between 1994 and 2000. And even while it claimed to be losing money in 2001, it found enough cash to propose to buy US Air for $4.3bn. The deal fell through only because the government refused to OK it, on grounds that it would have handed United a monopoly over large segments of the market. As for Avolar, United had laid out nearly $100m to it set up, and it had started to order a fleet of luxury business jets. Also in 2001, United paid out over $1.5m dollars in salary and bonus and an additional $5.7m in "severance" pay to James Goodwin, its chairman and chief executive officer, who was leaving under a cloud. In the 3 years from 1999 to 2001, its 4 top executives alone made more than $20m. And in 2002, right in the midst of this concession drive, it announced payment of $4m to its new CEO. Even if United really had lost money in the recent period, it could hardly claim it had no resources. It carries 20% of all US air traffic, with hubs in Chicago, Denver, San Francisco, Los Angeles and Washington, has important routes to Europe and to Asia, and code-sharing arrangements that link its flights with Latin America.

Where did this enormous company get the gall to demand such concessions from its work force? Where else, but from the positions taken up until now by the leaders of its unions. Each concession they agreed to was only an encouragement to the company to ask for more. This is not a question of United's financial position, it is a matter of union leaders' readiness to put the company's interests ahead of the workers' interests.

"Fair and Equal" sacrifices

This readiness to put the company's interests first was true of every one of the unions - including the IAM representing the mechanics, which was the worst of all, given that its members put up the strongest opposition to these demands. What the IAM leaders did, by initially pretending to oppose the concessions, allowed the workers no chance to seek an alternative. They were on the one hand not encouraged to try to fight, but this provided the IAM leaders with the means to make them toe the line.

Take what IAM leaders said after the bankruptcy court imposed the concessions on 10 January: "Today's action by the Court to impose wage reductions was opposed by the IAM in part due to the negative impact upon the PCE pension agreements. This in our view was an unfair and unequal burden, not being demanded of other employees in this process." But they need not have complained, since the company soon presented the same demands for pension reductions to the other unions - the sacrifices now being demanded being "fair and equal".

Having made this disgusting pretense of a "protest," IAM leaders then went on to argue that more concessions were needed: "Make no mistake. The very survival of United Airlines and our contracts is at issue in these discussions. Be assured that only the fair and equal sacrifices necessary for United's survival will be presented for your review, comment and vote when these discussions have concluded."

The company, backed up by the government, the courts and its big bankers present the workers with pure and simple extortion: either give us all the concessions we are asking for - including an end to a very significant portion of your current jobs, as well as a reduction in your standard of living and benefit protections - or we will have the courts get rid of your contracts, and then we will take what we want anyway.

When US Airways demanded its first round of concessions, the IAM offered this justification:"Should this proposal be ratified by the membership, US Airways has agreed not to seek further cost reductions from 141 members during bankruptcy court proceedings. The company has indicated, however, that if this proposal is rejected it would petition the bankruptcy court to modify or terminate your current collective bargaining agreement. If they do so, the amendments they seek will not be limited to what is contained in this proposal." As events soon showed, however, both at US Air and at United, giving in voluntarily did not stop the companies from demanding more than "what was contained in the this [first] proposal."

In fact, by accepting the cuts voluntarily along with the company's threats of extortion, not only do workers give the company everything it demands, but they prostrate themselves in front of their enemy, encouraging the company to demand still more.

The only way out of this trap is for workers to organise a fight to defend their jobs, their wages, their benefits. But this is exactly what the union leaderships have failed to propose in this situation.

From the airlines to ... the whole working class

When United announced that it was filing for bankruptcy, a spokesperson for American Airlines was quoted by the Wall Street Journal as saying, "United is our biggest competitor and if they fly with a cost structure significantly lower than ours, that may just accelerate the need to lower our costs." Underlining American Airline's intention to push for a bigger cutback in jobs and increased productivity of the remaining workers, its vice president for employee relations was quoted, "We can't be paying two guys to do the work of one." He might as well have said it directly - American wants one worker do the jobs of two! American Airlines also said it would "request" its employees to forego scheduled pay increases this year. Then on January 21, it announced it would ask its unions for concessions totalling $2bn a year - as big as those at United Airlines.

At the same time, a Delta Airlines spokesperson said that while a pay cut was not in the current cost-cutting plans of the company, "pay cuts could not be ruled out." Delta has only a small part of its work force unionised, so the form the manoeuvre takes may be different, but the end result sought by the company will be the same - a degradation of the workers' standard of living and working conditions, and even bigger cutbacks in jobs.

This attack was aimed first at workers at the airlines. After all, September 11 gave the airline bosses such a good pretext. But if these severe sacrifices continue to be made voluntarily by airline workers, they will soon be demanded from other workers. The rest of the working class is already coming under attack.

This is the same manoeuvre that all the big companies carried off in the 1980s, when concession demands started at Chrysler, under the pretext that it was about to fail, but then moved on to Ford and GM - which could not pretend to be near failure - only then to move on to the rest of the working class. The issue then, was not the economic situation of these companies, as Chrysler's quickly resurrected profitability proved. The issue was whether or not the workers could be tricked into agreeing to sacrifice themselves for the sake of the increased profits of these companies. What played a key role in this debacle in the 1980s was the willingness of most union leaders to try to convince the workers of the need for sacrifice. A few did not succeed, of course. But with the open support by most union leaders for the bosses' demands, the demand for cuts quickly spread across the whole organised working class. And everyone paid, whether or not in a union.

The working class really finds itself in a dead end today - created by the idea that the workers and the bosses have a common interest, an idea which has been openly advocated by the unions ever since the Chrysler concessions.

Workers have to break out of this trap!

Today it seems as if the bosses are holding all the cards in their hands. But they are not. It is just that workers have yet to play their cards.

A section of workers somewhere has to set the ball rolling, refuse this blackmail and call the bosses' bluff by turning a deaf ear when they cry that they are losing money.

After all, the bosses lie - and we know it. There is no reason to believe their wild claims about going broke. But even if they were, that would change nothing. The only way we are going to protect ourselves is by fighting - against the old bosses who lie to us or the new ones who will take over the company if it fails, or the banks who try to sell off the company.

Companies like US Airlines and United are backed by enormously wealthy banks and other financial interests. Those big companies and their bankers can be forced to cough up the money - but only if the workers fight. Only if the workers force them to do it.

If the workers in the airlines were to begin a fight, that could give confidence to other workers who also have many of the same problems and are coming under attack by their bosses. It is absolutely vital that the combative workers, the union militants and whoever else is ready to fight begin to resist this new round of attacks. Those who are ready to fight have to prepare the rest of the workers to resist these attacks.

The working class has accepted too much already. Enough!

27 January 2003