Not all airlines use bankruptcy as tool to shed contracts

[WorldTraveler]

Yes, AA has done a very good job at running a business - but having the industry's highest labor CASM is not sustainable - and it is keeping AA from growing until it is settled. AA's debt will also be 50% higher than any other airline when DL and NW step out of BK. Having the highest debt and labor costs can't go on for long if AA is going to keep profitable.

US has a far worse product but I wouldn't say their labor relations are worse than AA's. US' pilots haven't refused to fly a new international route - but then US doesn't have the assets to do fly anything to Asia either.

Actually, the PBGC can indeed reinstate US' pension plans. They do not have clauses in their agreements that prohibit reinstatement as DL and UA do. And DL pilots did lose - but they did not have their pensions frozen - they were terminated. They also are getting a nice bond from DL along w/ substantial stock in the new DL. They could do quite well.

I didn't say AA was the first - it was one of the first. US has been slashing wages for decades; other than them AA was indeed the first permanent wage cuts. Interesting to mention CO but their costs are now some of the highest in the industry - my how quickly things change.

 

[eolesen]

AA's debt will also be 50% higher than any other airline when DL and NW step out of BK. Having the highest debt and labor costs can't go on for long if AA is going to keep profitable.

Keep in mind that not all of DL and NW's debt is dischargeable, and going forward, their credit will cost them more. Creditors stiffed this time 'round will be looking to get their pound of flesh and then during the coming years.

US has a far worse product but I wouldn't say their labor relations are worse than AA's.

That's only because they've been putting on a game face for the DL takeover. With that behind them, it's gonna get ugly as seniority integration talks continue between East and West.

 

[nbmcg01]

Keep in mind that not all of DL and NW's debt is dischargeable, and going forward, their credit will cost them more. Creditors stiffed this time 'round will be looking to get their pound of flesh and then during the coming years.
That's only because they've been putting on a game face for the DL takeover. With that behind them, it's gonna get ugly as seniority integration talks continue between East and West.

There are no "talks" between East and West f/as. It is cut and dried. The AFA has a national DOH policy. Done deal.

 

[Bob Owens]

Perhaps you'll think about it when you're getting your full pension checks at age 60, while guys who lost their pensions to bankruptcy will still be working into their 70's because they simply can't afford to retire on what little they'll be getting from the PBGC.

If we do get a full pension it will be based upon a salary that we could not live off of. What makes you think we will be able to retire without having to work? The fact is that when our salary was cut our pension was cut. So just as we cant live off the one source of income now its doubtful that we will then, so we will be working right alongside the guys who you claim "lost" their pensions.

 

[Bob Owens]

It means that your job won't be going to Chinese or Indian FA's(under Republicans)...but to Mexican illegal aliens once the Dems push amnesty through (for the 20-30 million here), and ENSURE that their new laws have an ENDLESS supply of cheap labor at America's door step.(that's the purpose of AMNESTY...long term path to citizenship)

There is VERY little difference between both parties. They don't give a damn about everyday Americans.

While I'm by no means for Amnesty and I agree that we should limit immigration the fact is that if these workers were made legal they would no longer work for as little as they do now.

Mexicans come here for the same reason the Irish, the Italians and every other nationality came here. All these peoples sent money out of the country, saturated the labor market, driving down wages and instilled parts of their culture into ours(have you never eaten pizza?). Mexicans will learn English if they want to succeed just as millions of people all over the world choose to learn English even when they are not planning to emigrate. They do this because English is the language of money.

The key to fixing immigration is to change things in Mexico so they dont want to come here. We should support ILO initiatives to guarantee workers rights and fair wages as a condition of free trade. If there are good jobs to be had in Mexico they wont come here.

 

[Bob Owens]

OH BOY!!!!!!!!! DOES THIS MEAN THE DEMOCRATS ARE GOING TO GET OUR CONCESSIONS BACK?????????

OH BOY, THE DEMOCRATS ARE GOING TO GET EVERYTHING BACK FOR US!!!!!!!!!!! OH WHAT A GLORIOUS DAY!

Did he say that?

Why does a negative opinion towards to the Republicans automatically translate to a plug for the Democrats?

Your reaction reveals the sad reality that you are so programed that you can not fathom politics outside of the the two party dictatorship box.

The fact is that the Republicans failed working class Conservatives just as the Democrats failed working class liberals.The fact is that working class people from both "sides" believe in fair pay for fair work, they belive in pensions and economic security.Both sides look in disgust at the abuse that they see with corporate raiding of pension funds. At the elimination of health benifits and the obscene compensation of those at the top.

I look for the day when working class people, both conservative and liberal realize that they have more in common than they realize and that neither party looks to serve their common interests but exploits their differences so they can exploit them economically.

 

[Hopeful]

Did he say that?

Why does a negative opinion towards to the Republicans automatically translate to a plug for the Democrats?

Your reaction reveals the sad reality that you are so programed that you can not fathom politics outside of the the two party dictatorship box.

The fact is that the Republicans failed working class Conservatives just as the Democrats failed working class liberals.The fact is that working class people from both "sides" believe in fair pay for fair work, they belive in pensions and economic security.Both sides look in disgust at the abuse that they see with corporate raiding of pension funds. At the elimination of health benifits and the obscene compensation of those at the top.

I look for the day when working class people, both conservative and liberal realize that they have more in common than they realize and that neither party looks to serve their common interests but exploits their differences so they can exploit them economically.

What is at issue here is that you make it sound like the Republicans screwed us AT AMERICAN AIRLINES! How their actions affect Americans is one thing, but we were screwed by AA management and the TWU. Plain and simple.

OUR CONCESSIONS WERE THE PRODUCT OF THE TWU/AA LOVE FEST.
I am not arguing the Republicans' pro corporation stance, but do you really believe our industry leading concessionary debacle would have been any different under a different congress and administration?

 

[Redbone]

"AA's debt will also be 50% higher than any other airline when DL and NW step out of BK. Having the highest debt and labor costs can't go on for long if AA is going to keep profitable."

This is what screwed AA and all the other carriers prior to filing BK. The system is broken when companies who meet their financial obligations are punished. The use of BK at NWA was for one reason only...to break the power of it's Unions. That has proved to be a more challenging fight than thought. Not because of the most powerful Union at the co.(pilots, who just rolled over with shoe prints on their faces) but by Flight Attendants who refused to settle for the greed that has emanated from Gary Wilson's control since the LBO. And, we shall NEVER forget the valiant fight our mechanics sacrificed ALL for!

Ultimately, AA will have to struggle against an unfair advantage given to legal manipulation of a broken system.

These companies are not punished as implied by the above post (higher borrowing costs) just look at Cal, and more recently US (they couldn't throw enough cheap money at US for their foray with Dal)

The system is simply broken...as it applies to free market capitalism. Bankrupt carriers should have been dissolved. (along with ALL compensation for leaders of the failed company)

 

[TWU informer]

I agree with you Redbone.

AA will someday face the same wrath that they and the TWU have created against others in the industry for 20+ years.

It will be interesting to see how AA plays when the shoe is on the other foot.

 

[Bear96]

I look for the day when working class people, both conservative and liberal realize that they have more in common than they realize and that neither party looks to serve their common interests but exploits their differences so they can exploit them economically.

I have asked this before and never gotten an answer (and I'm not accusing you of not answering, Bob, since I don't remember whose post I was responding to when I asked it before), but I'm curious, when you say "working class," how are you defining that? As in, what annual income range do you consider to be "working class" when you use the term? Serious question. I'm curious.

 

[Hackman]

I have asked this before and never gotten an answer (and I'm not accusing you of not answering, Bob, since I don't remember whose post I was responding to when I asked it before), but I'm curious, when you say "working class," how are you defining that? As in, what annual income range do you consider to be "working class" when you use the term? Serious question. I'm curious.

Not sure were to draw the monetary line, but this NWA F/A describes "working class" fairly well. Meaning people who don't live in a fantasy world like today's corporate upper management and CEO's. They seem to win the lottery even when the company fails because of their poor decisions. I'm sure you will have a different outlook, since nearly all you post is anti-worker and anti-union.
STRENGTHENING AMERICA’S MIDDLE CLASS: EVALUATING THE
ECONOMIC SQUEEZE ON AMERICA’S FAMILIES

JANUARY 31ST, 2007

BY

ROSEMARY MILLER
NWA FLIGHT ATTENDANT (SFO Base)
MEMBER, ASSOCIATION OF FLIGHT ATTENDANTS - CWA

Thank you Chairman Miller for holding this important hearing on the many challenges facing the middle class in this country – the real backbone of the American economy. I especially want to thank you for giving me the opportunity to testify today. I am honored and humbled to be a face and voice for so many women and men in this country who struggle to play and live by the rules, raise our families and hold on to the hope that the future holds a better life for us and our children. Unfortunately, that hope has grown dim for me and many others as we struggle to find a balance between working to provide for our families, spend quality time with our families, and plan for a stable future for ourselves and our children.

My name is Rosemary Miller and I have worked as a flight attendant for the past 17 years. Unfortunately, my career in the airline industry qualifies me to speak on the topic of today’s hearing. Airline industry employees have suffered greatly over the past several years and have borne the burden of returning the industry, hopefully, to profitability. We have been at the forefront of a trend that is repeating itself all across our economy as we work longer and longer hours for reduced pay. We have seen our benefits slashed simply to keep the most basic of health care. We have had our pensions frozen or terminated and our employers have used this country’s bankruptcy laws to shred union contracts and set back decades of progress we have made in turning our jobs into decent, stable careers that have allowed us to raise and support our families.

I would like to emphasize, however, that I am not really here to speak as an “Iâ€: I am here as a “weâ€. In my remarks today, you should replace “Iâ€, “me†and “my†with “weâ€, “us†and “ourâ€. In fact, please feel free to insert any one of a number of careers in place of mine. Whenever I say “weâ€, I mean the workers of the middle class, your constituents.
It could be a pilot sitting here today, or an airline mechanic, or an air traffic controller. It could be a nurse, or a firefighter, or a police officer. We are the people who install your cable TV, who drive your buses, who truck your groceries from farm to supermarket, who check you into your hotels, who teach your kids. We are the city and county civil servants who run your communities.

The reason we’re here today is to tell you what it’s really, really like in this country’s current economy, and to impress upon you that our reality is not pretty. We have all heard and read the numbers coming from some economists and bureaucrats in Washington, DC, that suggest the economy is doing well. They tell us that the economy is growing, unemployment is low and things look rosy. I am here to tell you that things do not look rosy for middle class Americans. We are seeing our professions destroyed by corporate management policies. We are watching our wages plummet, our benefit packages shrink and our pensions disappear. We are working longer hours, for less pay. We are being forced to choose between dental work and the electrical bill, between required prescription medication and groceries, between braces for our kids and new brakes for the aging car.

In my own case, I have tried to do everything right in order to balance the demands of working full time, being a single mother and raising my two wonderful daughters. I choose a career as a flight attendant because of a love for the profession and the flexibility it allowed to spend time with my daughters when they needed me to be home. But knowing that things can change, I prepared for the future in case the day would come when I might have to quit the career I love. I went back to school and have been able to obtain two bachelors degrees and a masters degree. I started saving early for my daughters’ college educations. I willingly joined a union and supported that union in order to have a voice on the job to preserve our wages and benefits. I’ve done everything within my power in to secure my job and my future.

However, upon entering bankruptcy, my employer has forced on me and my colleagues drastic wage and benefit reductions. I am now working longer and longer days as well as having to spend more and more time away from home. I have had to miss some of my daughters’ school events that I vowed I would never miss because now I have to work longer in order to keep food on the table and a roof over our heads. But not only am I working longer; I’m earning less. My pension has been frozen. My benefits have been reduced. It is harder for me now, even with three degrees, to re-enter the workforce. And it angers and saddens me that I am going to have to withdraw the small sum that I managed to carefully set aside for my children’s first semester of college in order to keep paying the mortgage and keep my house - our home - a little longer.

Again, my plight is not unique and I consider myself fortunate in many ways. Consider me the voice for just a few of the people who can’t be here today. For the woman with cancer who says, “ ... the thought of the senior executives at my company getting bonuses, gutting labor contracts and defaulting on pension obligations at the same time they are demanding a 40 % wage cut from me, while I am literally fighting for my life, makes me sicker than the cancer ever has.†Or the pilot with over 30 years of service who is outraged that when he began with his airline, there were four Senior VPs on the payroll, but at last count there were 37. The colleague of mine who, after 18 years on the job, says she has to decide some days if she’s going to buy a cup of coffee or a meal, or the woman whose husband lost his job of 28 years to outsourcing and had to start over for
$7.75 an hour. I know that we could spend hours telling these and similar stories.

Since we don’t have hours however, let me move on. What do we, the middle class, think has gone wrong? Among other things, we think executive compensation packages that are wildly disproportionate to the contribution those employees make to a company’s overall health are wrong. Why do we allow for an airline CEO to terminate all of the company employees’ pensions, while keeping his own $4.5 million pension? Why do we allow for these corporate robber barons to reward themselves compensation and management retention bonuses upon “successfully†bringing a company through bankruptcy? And I hate to use the word “successfully†because it is hard to use that term when so many employees’ lives are shattered by the process. Should these individuals that drove the company into bankruptcy in the first place be rewarded for that? The average worker in this country struggles for a modest cost of living increase today while the CEOs that made 20 times what a worker made in the 1960s, now makes 400 times as much.

Bankruptcy laws that allow companies to evade pension funding obligations, and instead sanction degrading and unlivable employment contracts are wrong. The bankruptcy laws have become a smokescreen for union busting and a tool to destroy employee contracts that were originally bargained in good faith. The abuse of these laws has eliminated employees’ access to legal self-help when confronted with gross inequities in the sacrifices they have had to make during economic hard times. In fact, my employer has used the bankruptcy laws to enforce a contract on all the flight attendants without having to negotiate one in good faith. When we democratically rejected their proposed contracts as going too far, they instead threw up their hands and with the blessing of the bankruptcy courts imposed draconian working conditions and drastic wage cuts on us. Our union rights were destroyed. Using the bankruptcy laws and courts as a means to destroy union contracts must come to an end.

As for our health care system, something has gone horribly wrong. So many workers in this country are making enormous sacrifices to just maintain basic health insurance.
Those of us with employer provided health care are finding it harder and harder to save money as our copays, premiums and other out of pocket expenses increase drastically.
And it’s increasingly harder for our employers to confer salary increases when they are paying so much more for our health care costs. Washington must act, sooner rather than later, in order to prevent the total collapse of our health care system.

Higher education for years was the path to the middle class. Now it is a necessity to simply survive in our globalized economy. The problem is that saving and paying for a college education has become harder and harder for most families today. And those that are fortunate enough to receive student loans to cover their costs find themselves in debt for many, many years. More must be done in order to make sure that American families can afford a college education for their children.

Saving for our retirement has grown harder as our wages have gone down, health costs have increased and college has become more difficult to afford. Many of us are losing, have lost or seen frozen our defined benefit pension plans. It is absolutely crucial that
Congress act to protect and secure the present Social Security system to ensure that it is there for all of us, who have worked hard our entire lives, when we reach our retirement years.

We’d also like to point out something else. We are people who live modest lifestyles.
Notice that in our remarks today we are not asking for boats, or vacation homes in Aspen, or luxury cars. We are not lamenting the lack of a 30,000 sq. ft house or cosmetic surgery. We are asking for livable wages, a home that we own, affordable health care, comfortable retirement security, and reasonable means to provide for our children’s college costs. It is obscene that in this country, among all others, it is such a struggle to simply live decently.

I know that there are many issues facing our government today. But when you, the members of Congress, walk onto an airplane, or check in to a hospital; when you send your kids to school, or go to the grocery store, or call the police, you expect us to be there to do our jobs. Now we are asking you, as legislators, as law- and policy-makers, to do yours. Which is, listen to us. Hear us. Be aware that it does not matter if we are
Democrats, or Republicans, or Independents, or Green or Rainbow or pink with purple polka dots. We are the vast majority of Americans; we are your neighbors, your friends, your own family. We are the middle class, and we are having a hard time out here.

I want to thank you again for giving me this opportunity to testify today. I will answer any questions that you may have.

 

[Bear96]

Yes, I just read that on the other thread. Not sure why you posted the entire long post again here. I agree with much of what the F/A said, but I wonder what her solution would be.

In any case, how does your post answer my question?

To refocus, the question was, "What annual income range is 'working class'?"

 

[Hackman]

Yes, I just read that on the other thread. Not sure why you posted the entire long post again here. I agree with much of what the F/A said, but I wonder what her solution would be.

In any case, how does your post answer my question?

To refocus, the question was, "What annual income range is 'working class'?"

Not everyone has the time like you to read all the other threads with the different airlines , that's why I posted it here. I think it answers the "working class" question.

I guess you want to narrow it down even further to amounts of money, so good luck with that.

 

[Redbone]

Please allow me to attempt to answer your question.:


If the Flight Attendants of the nations airlines don't survive, it is highly unlikely that passengers will survive, if the pilots don't survive it is highly unlikely that the passengers will survive, If the policemen/women don't survive it is unlikely that the community will, If the teacher, mechanic, nurse, agent booking your flight home, or our Garbage Collector...get the message?

Working class is ANYONE who does not have a million dollars in the bank. We are the folks that take care of your family and YOUR life, regardless of how much money you make, you STILL depend on US for your daily well being....don't ever forget that.

Middle Class America has been brainwashed into thinking we are "OK" If we have DEBT (beholden to the corporations that control our lives). They threaten you if you are debt free...you can't qualify for a house loan. (what does that tell you?)

 

[Bear96]

Not everyone has the time like you to read all the other threads with the different airlines , that's why I posted it here. I think it answers the "working class" question.

I guess you want to narrow it down even further to amounts of money, so good luck with that.

Why is it such a hard question?

Working class is ANYONE who does not have a million dollars in the bank.

Ah, so now we're getting somewhere.

If I have $900,000 -- or even $500,000 -- in the bank, I am "working class." Got it.

I don't understand how someone with $900,000 in the bank and a job cannot afford to send two kids to college, though.

Middle Class America has been brainwashed into thinking we are "OK" If we have DEBT (beholden to the corporations that control our lives). They threaten you if you are debt free...you can't qualify for a house loan. (what does that tell you?)

I dunno, because you're not making sense. Your facts seem to be off. I am "debt free" and can qualify for a house loan.

(Of course, just being debt-free for the moment may not erase prior poor credit history if you are seeking a large, mortgage-type loan with little collateral or earnings. But you omitted that very relevant fact, if it applies to the situation you are referring to.)

Please allow me to attempt to answer your question.:
If the Flight Attendants of the nations airlines don't survive, it is highly unlikely that passengers will survive, if the pilots don't survive it is highly unlikely that the passengers will survive, If the policemen/women don't survive it is unlikely that the community will, If the teacher, mechanic, nurse, agent booking your flight home, or our Garbage Collector...get the message?

What do you mean "survive"?

Does "survive" mean a single waitress (or garbageman, flight attendant, etc.) being entitled to a $1.5M McMansion in the suburbs and the means to put ten kids through Harvard? OK, if that is not your definition of "survive," I guess you are right, the "working class" (whatever that is) is not "surviving" (whatever that means).

If the positions you mentioned are no longer able to attract or retain sufficient numbers of qualified people for the positions, wages will go up until enough sufficiently qualified people are attracted or retained.

If you are not "surviving" on your current salary, go obtain the skills necessary to get a higher-paying job.

Such drama.