Boeing Workers Unite

Boeing Workers Unite

 They help themselves and the company by overruling union chiefs.

From the Wall Street Journal

By approving a new contract on Friday, 51% of Boeing BA in Your Value Your Change Short position machinists in Puget Sound protected more private union jobs than any National Labor Relations Board or White House decree. They also overrode labor chiefs who were willing to gamble rank-and-file jobs to maintain unsustainable pension benefits.

The new eight-year contract replaces traditional defined-benefit pensions in 2016 with 401(k)-style plans while maintaining accrued benefits. Machinists will also receive a $15,000 signing bonus, better dental benefits and a 4% raise over eight years on top of annual cost-of-living adjustments. Boeing warned that the contract was its best-and-final offer and critical to securing 20,000 jobs involved in the assembly of its new 777X jet.

Remarkably, two-thirds of machinists had rejected a similar offer by Boeing in November. Local labor leaders portrayed Boeing executives as Gordon Gekkos who were seeking to raid their pensions and insisted that the company's threat to move production of the 777X out of state was a bluff.

After machinists shot down its initial contract proposal, Boeing received bids from nearly two dozen other states eager for the jobs. Only then did International President of the International Association of Machinists and Aerospace Workers Tom Buffenbarger force another vote on a revised contract to prevent union jobs from flying away to right-to-work states in the South. Mr. Buffenbarger may have recalled Boeing's decision in 2009 to build its 787 Dreamliner in North Charleston, South Carolina, to avoid labor disruptions that had slowed production at its plants in Puget Sound.

One reason union membership in the U.S. has shrunk to 6.6% of private workers from 35% in the mid-1950s is that to remain competitive businesses are fleeing union workforces that refuse to change. Detroit was a casualty of this jobs flight, and Seattle may have been another had Boeing machinists insisted on preserving their traditional pensions, which no longer exist in most of the private economy and leave workers hostage to economic fate. A 401(k) lets workers build assets immediately and transport them from job to job. The Boeing vote is a victory for common sense, the U.S. economy, and especially the Boeing workforce.