Oh, look, a highly profitable company that made record setting profits with a management team so greedy and self-serving that they are attempting to squeeze their employees for concessions:
When it comes to dealing with labor unions, Caterpillar has long taken a stance as tough as the bulldozers and backhoes that have burnished its global reputation. Be it two-tier wage scales or higher worker contributions for health insurance, the company has been a leader in devising new ways to cut labor costs, with other manufacturers often imitating its strategies.
Now, in what has become a test case in American labor relations, Caterpillar is trying to pioneer new territory, seeking steep concessions from its workers even when business is booming.
Despite earning a record $4.9 billion profit last year and projecting even better results for 2012, the company is insisting on a six-year wage freeze and a pension freeze for most of the 780 production workers at its factory here. Caterpillar says it needs to keep its labor costs down to ensure its future competitiveness.
The company’s stance has angered the workers, who went on strike 12 weeks ago. “Considering the offer they gave us, it’s a strike we had to have,” said Albert Williams, a 19-year Caterpillar employee, as he picketed in 99-degree heat outside the plant, which makes hydraulic parts and systems essential for much of the company’s earth-moving machinery.
Caterpillar, which has significantly raised its executives’ compensation because of its strong profits, defended its demands, saying many unionized workers were paid well above market rates. To run the factory during the strike, the company is using replacement workers, managers and a few union members who have crossed the picket line.
This is the future.
And let’s not forget that the Caterpillar CEO is a total right-wing tool.
muddy
Of course he’s a right-wing tool, else he would not act like that.
Matthew Reid Krell
I have an ironic story about this plant that I can’t tell. Dammit, attorney-client privilege!
Sorry, that is a really obnoxious thing for me to say, I know.
Comrade Javamanphil
Logic Error 101. Does not compute.
I wonder how far below market value its executives are paid.
reflectionephemeral
Makers vs. Takers.
Tom Levenson
This is how countries fail. There is no possibility of common cause in a culture that permits such behavior. The appropriate response to CAT’s management is shunning in every social setting as unAmerican, unethical. That this response won’t occur is an illustration of what it means to have the social divides we have now (see the post below). The net result will be a country incapable of responding to any collective challenge. We are just about there, and it will not end happily, I fear.
I got a twelve year old. I do not like what I see of the world I will be bequeathing him.
Greed Is God
It’s not like they need to pay them enough so that the employees can afford to buy Caterpillar bulldozers.
“You can have it any color you like… as long as it’s yellow!”
Trentrunner
Because Americans know neither the history of labor nor the concept of management vs. workers (i.e., management will ALWAYS err on the side of profits at the expense of workers’ safety and compensation), it looks like we’ll have to fight these battles all over again.
Yay! IWW for all!
cathyx
Unfortunately, greed is the new black. It’s slimming.
Ben Franklin
I just want to know how many of these employees are right-wingers.
SC won’t turn Blue on this, of course. But, I would be curious.
MikeJ
If all the workers were armed this wouldn’t happen.
Rosalita
A friend of mine works for a regional bank. They have been acquiring smaller banks and other leasing businesses steadily. One would think that means they are doing well (they are) and make the balance sheet look better (it does). However, they decided they would eliminate the bonus program for everyone except the sales execs–that is everyone who does all the detail work that actually gets the sales closed just took a cut in pay.
Mnemosyne
@cathyx:
That’s what former Exxon CEO Lee Raymond used to tell himself.
Greed Is God
You know what would make Caterpillar even more profitable?
Freezing the compensation and payouts to the executives and shareholders.
Funny how they never try that business model.
PopeRatzo
I detect a new corporate meme. They need to “insure their competitiveness”.
It’s the reason that a Corning executive recently testified to Congress that their tax bill is too high, even though, they paid a negative tax rate (they got money from the government and paid not a penny in taxes).
They’re going to take this to a whole ‘nother level now. I thought paid internships where the intern paid the company to work for them was the height of corporate cupidity and hubris, but this is really too much.
beltane
American workers have sacrificed a great deal to provide the means to fatten up the 1%ers for market. When do they get to enjoy the ham and bacon they have earned for their efforts?
Ben Franklin
My error. They are moving some operations to SC. They are in Illinois.
Same question for the workers.
Northern Observer
Selfish bastards.
Yutsano
You can’t expect the job creators to give up THEIR money now can you? How else are they supposed to create all those jobs?
...now I try to be amused
@Trentrunner:
For years I’ve felt like America flunked the final exam on the Twentieth Century and now we have to repeat it, hopefully with less live ammunition this time.
jrg
@Ben Franklin: Yep. How’s Obama polling with white working class voters, again?
A significant number of people in this country deserve to take it in the ass. Hard. At least this time, they’re the ones bending over… Unlike the “keep the government out of my Medicare” crowd, who expect me to pay for their healthcare while calling me a soc1alist for supporting reform.
Lacking the sense to get out of the damn rain means you get wet. Shocker.
japa21
@Ben Franklin: My son’s f-i-l retired from Caterpillar a few years ago. He was at a different plant in Illinois. From everything he has told me, very few of his co-workers will ever vote for a Republican.
mechwarrior online
@MikeJ:
I don’t know if you’re joking or not but at one point the unions were armed, they had to be. Let’s not forget that labor rights were won with blood and there were actual fights that happened to make the gains we made. Unions had their own enforcers.
We seem to gloss over a lot of that now. Civil rights may have been won non violently but worker rights were not and almost are never won without violence.
jwb
@…now I try to be amused: I often wonder if the NRA’s uncompromising interpretation of the the second amendment won’t eventually end up having some massive unintended consequences for the corporate overlords who have long been paying the bills for the organization. I imagine that if it comes to pass they expect they can just flee the country and live off the nut they have squirreled away in the Swiss bank account.
MikeJ
@mechwarrior online: It would be interesting to see the reaction of Republicans if they walked a picket line with legally purchased AR-15s.
Butch
@Rosalita: My company did the same – only the “seller-doers” can get bonuses. I want to barf every time I hear the phrase.
NCSteve
I’ve said before that I keep hoping I’ll wake up and find out I only dreamed I was living in a Dickens novel. But increasingly, I’m finding the novel I can’t wake up from looks less and less like Oliver Twist and more and more like a Tale of Two Cities.
satby
I have a brother-in-law on this picket line. Since scabs and management are still running the plant negotiations have broken off for all practical purposes.
And yeah, a lot of these jokers were totally OK with Republican values until those values came back to bite them in the ass.
Interrobang
I wish I could say I was shocked, but these scumsuckers just did nearly the same thing to my hometown a few months ago. Caterpillar wanted to slash wages by more than half, and the union refused, so Caterpillar closed the plant. I hope if there are any Juicers in Muncie, you Muncieans are enjoying it while it lasts.
Check it out, also, too: Electro-Motive received $5 million in federal tax breaks announced on the factory floor by Prime Minister Stephen Harper in 2008. That was before the plant was sold to its current owners in 2010, prompting questions from the union as to whether there were any strings attached to the money. …
In Ottawa, Liberal MP and human resources critic Rodger Cuzner criticized the government for allowing the plant to shut down and poked fun at Prime Minister Stephen Harper for personally handing out the tax incentives, which went to buyers of the company’s locomotives.
“I am looking at a picture of the Prime Minister in a locomotive down in London, Ont., and he is waving. He must be waving to the 450 employees that they just let go when they shut down the plant there,” Cuzner said in the Commons during question period.
Allan
@MikeJ: In for the win at #10.
runt
Don’t be silly. These people don’t want there to be any such thing as a minimum wage.
Greed Is God
@MikeJ:
Or they could show up at Caterpillar HQ like this:
http://www.youtube.com/watch?v=PZbG9i1oGPA
Citizen Alan
@Tom Levenson:
Every day, I thank God for the fact that I don’t have children. I don’t think I could live with the despair I’d feel about their future.
Culture of Truth
can those white collar guys build a tractor? Cause I bet those blue collar guys could give themselves fat bonuses for doing nothing if they switched places.
Dennis SGMM
It would be too much of a leap, wouldn’t it, to suppose that there’s a correlation between squeezing worker wages and the non-recovery recoveries that seem to be the norm.
It would be un-American to suggest that the party which brays that you know better than the gov how to spend your money is also the party that is doing everything it can to ensure that your income is subsistence level or even a bit below that.
GxB
@Tom Levenson: Summed up my thoughts nicely. Problem being countless hordes of the “grunts” thinking they are or will soon be in the elite class with the life rafts. Another piece of evil genius was tying our retirements to feeding the beast – so now we have skin in the game. Thus the status quo will be defended to the death.
Won’t change until those grunt hordes wake up to a few fragments of their world remaining and they ask themselves for the first time “Now what are we going to do?”
rootless_e
Caterpillar is also using Ex-Im bank to finance their late payment to small business suppliers.
they really do suck.
Rosalita
@Butch:
and the “seller-doers” turn in crappy paperwork that underwriting and legal have to fix in order for them to go through. whatta system.
mechwarrior online
@MikeJ:
Yeah I’m waiting for the left to collectively wake the fuck up and realize that cutting deals with Goldman Sachs and Wall Street to get human rights and social issues through doesn’t require tough work now but workers rights still will. Corporations are only to happy to throw a bone on issues such as gay marriage if it makes them look good and doesn’t cost them a dime. Raising wages, hell no. They’ll require blood on all sides before that happens.
Bill Murray
If companies can have negative income tax rates, they should be able to pay negative salaries.
runt
@NCSteve:
Actually, you may find that the Dickens novel you’re living in is Little Dorrit. Soon, with a bit more Republican government, you can all experience the blessed state of an inmate of the debtor’s prison:
FREEEEEEDOM!
gene108
@Greed Is God:
Payments to shareholders is done from equity, i.e. after the net income is calculated.
All dividend payments do is (1) affect the stock price/valuation and (2) affect cash flow.
AHH onna Droid
@MikeJ: +1
Cassidy
@MikeJ: I think that is an outstanding idea.
Citizen_X
–The IWW.
Way to prove them right, greedheads.
Nicole
Because the Baby Jesus forbid your “top-tier” workers make a middle-income.
Belafon (formerly anonevent)
But the company was built entirely by the executives.
/snark
Roy G.
Those profits are due to Galtian innovation in the opening of new markets:
Shareholders to Caterpillar: ‘our product has become Israel’s weapon of choice for ethnic cleansing and potentially even war crimes’
http://mondoweiss.net/2011/06/shareholders-to-caterpillar-our-product-has-become-israel’s-weapon-of-choice-for-ethnic-cleansing-and-potentially-even-war-crimes.html
muddy
@runt: I never understand the notion of debtor’s prison. The state is then paying to support the people. Surely, in a disgusting low manner, but still.
For what it costs to keep someone in prison, you could just give them the half of that money and they could just live on their own. I think only violent people should be put away. For what prison costs, I’d be happy to keep a couple in the cellar, and they’d get really nice food and no raping.
Greed Is God
@gene108:
Transferring economic value from a company to shareholders reduces the company’s ability to invest in profitable opportunities.
Njorl
@Comrade Javamanphil: You don’t understand. Workers are interchangeable. Paying more for better workers is a waste. Executives, though, always produce exponentially more when you pay them more. It’s the breeding, you know.
IrishGirl
My only beef, John, is this–It’s not the future, it’s now.
Kesov
My personal favourite story for Caterpilliar… I used to work for them. Not for very long, mind you.
I started work for Bucyrus(Which had bought Terex, which had bought O&K(which is another company I worked for years ago)) last year. Good, steady work. Well, as it turns out, Cat bought out Bucyrus. On the day I started, it was finalized. Yay! Or so we thought.
We had new banners, and new product stuff come in to put around the shop. But no new HR stuff. Curious… Then we get told that we’re getting transferred over to a different division (Finning, which is a Cat Dealership in my neck of the woods).
We had the COO, Director of Mining Operations(Western Canada), and the head of the local operations up here in our boardroom to tell us how things were going to be. One of our engineers said ‘So, now that you’ve said all that (Beautiful presentation, btw), Are there going to be Layoffs?’
We were told, emphatically, that ‘We Need Everyone. Everyone Has A Home Here.’
Hour later? I was handed a pink slip by Cat(Not Finning, as they hadn’t taken us over yet), along with several others who were under their 90-days.
Linnaeus
They really do see themselves as the new lords of the manor.
Nancy Cadet
Activists are pressuring the retirement fund TIAA CREF to divest all Caterpillar stock.
El Cid
So many times I had to be the objecting loudmouth whenever some professor or speaker or researcher mouthed the platitude “when productivity rises, pay and benefits rise.”
No, no, I had to point out, this was an empirical generalization as the result of worker power being able to get those things.
BAH HAH HAH, DUMB PERSON, WE HAVE MANY YEARS OF THIS TREND AND IT FITS WITH SO AND SO’S POLITICAL AND ECONOMIC SCIENCE THEORY SO SHUT UP AND LET ME CONTINUE.
trollhattan
@Rosalita:
“Coffee’s for closers!”
Funnily enough, I thought Mamet was being ironic with “Glenngarry Glen Ross” but turns out he was writing of a utopian dream.
trollhattan
@Nicole:
Fortunately for Caterpillar, there’s no need to worry about whether their workers can afford one, so they’re freed of any pesky Henry Ford-type pay raises.
...now I try to be amused
@Kesov:
Corporate management never admits there will be layoffs. So naturally workers suspect there will be layoffs even when none are planned, and morale is always low.
Ash Can
We need to bring back the laws that levied tax penalties on profits beyond a certain amount that weren’t reinvested into the business. And I’m sure they will be back — on the heels of a renewed assault weapons ban. Sigh…
gene108
The minimum wage strangles job creation, by reducing the supply of jobs. Employers do not want to pay for the work load they need done, because the minimum wage is higher than what the rate would be otherwise.
The headline should read: The Only Should Be the Freedom Wage*
*Freedom Wage = the wage you freely negotiate with your employer, without artificial constraints like the minimum wage or union (thug) contracts.
greenergood
@Roy G.: Thank you for bringing up Caterpillar’s Israeli connection. US citizen and peacemaker Rachel Corrie was killed by a Caterpillar bulldozer that was in the process of illegally flattening a Palestinian home, which she was trying to protect. From her wiki entry:
“Corrie was part of a group of seven ISM activists (three British and four US) attempting to disrupt the actions of Israeli bulldozers. Corrie, who had positioned herself in the path of a Caterpillar D9R armored bulldozer, was fatally injured. She was transported to a Palestinian hospital. Accounts vary as to whether she died at the scene, in the ambulance on the way to the hospital, or at the hospital.”
Amir Khalid
I’m kind of embarrassed to admit that early this year, I got a pair of Caterpillar work boots (design outsourced to Wolverine, made by a contract manufacturer in China).
El Cid
@Amir Khalid: Now he’s making boots? Guess the cuts are easy, but the stitching too?
El Cid
@greenergood: Not that questions of business practices shouldn’t arise with Caterpillar in this case, but the actual armoring is mainly done by the IDF and its engineering subgroups.
mainmati
@Tom Levenson: I completely agree. The corporate world is actually waging war on American workers to drive them down into Third World poverty. That will, of course, guarantee a hollowed out population of extremely wealthy and a majority poor population. This was the world of Jim Crow South. It will also mean a stuttering low growth or stagnant US economy. This will hurt small businesses but the globalized corporations and financial giants will still have world markets to prop them up, at least for a time. Ultimately, this is a suicidal economic path.
mainmati
@Roy G.: That may be so but Caterpillar tractors are also used over the Arab world too. Capitalism is non-sectarian.
mainmati
@gene108: Needless to say, your “Freedom wage” would inevitably be whatever the company chose to pay, which would nearly always be starvation level. Unions came about not by some socialist government fiat but because of sheer desperation and the most grotesque kinds of exploitation (child labor, horrible working conditions, high mortality rates, etc.)all of which corporations would bring back in an instant if they could. You may be totally fine with that kind of shit but the vast majority of the population is not. Yes, they have forgotten or never known what it’s like to be a worker in China or Pakistan but that’s what your “freedom wage” would lead to. And so we would end up having war on the streets and re-create the late 19th early 20th century all over again.
Amir Khalid
@El Cid:
No, no. The bad-tempered Canadian runt just designs the boots. The factory where people make them is in China.
slightly_peeved
@muddy:
I see it as the equivalent of the pre-obamacare American health system, but for bankruptcy. The government wastes money by only handling the catastrophic case, rather than the general case.
freemark
@mainmati: tractors don’t bulldoze homes, people do
El Cid
@freemark: When armored heavy bulldozers are outlawed, only outlaws will have armored heavy bulldozers.
Narcissus
They’ve gone beyond simply socializing the risk and privatizing the profits. Now they see the public sphere and the body politic as another resourced to be squeezed dry.
Taibbi’s vampire squid has never seemed more accurate.
El Cid
@Narcissus: Anyone who paid close attention to what happened in politics and economics in Latin America in the 1970s and 1980s watches today’s developments as depressingly familiar.
Those were the role models for what the elites would be doing domestically in the big money West a couple decades later.
Literally.
(It was odd to see Naomi Klein’s Shock Doctrine seen by so many as a new view, when for so many I knew, it was great to see a recap of what had happened for those not there or not aware of it the first time.)
celticdragonchick
@mechwarrior online:
This. Pinkertons with machine guns and National Guard troops have fired on striking workers (and their families) more than once. Quite a bit more, actually.
It only becomes “violent” when the workers start shooting back.
celticdragonchick
@MikeJ:
They would be screaming for the BATF to stomp all over the union. The 2nd Amendment is only for GOP loyalists dontchaknow.
As a practical matter, I do think it would be counter productive, since the company is very unlikely to engage in really violent strike breaking the way they used to a hundred years ago. That stuff really doesn’t fly anymore in the age of YouTube.
daverave
@Citizen Alan:
Me, too, also… I’d be despondent and very, very angry.
David in NY
@gene108: Well, except that people who’ve studied it have found that’s not so.
bcinaz
Time to start googling ‘French Revolution’ several times a day. Drive it to the number 1 search term in the world.
Mnemosyne
@mainmati:
Your snark meter may require a slight adjustment.
El Cid
@gene108: Wait — we’re talking about negotiated methods of theoretical exchanges of human effort for imaginary goods such as invisible currencies, and we need to take care not to be “artificial”?
What part of the wage economy lies outside artifice?
Isn’t “artificial” the same root as the words which underlie “labor” or “work” itself? Artifice?