Volume 07, Issue 01

May 2007

PROMISES BROKEN

Labor Betrayed

   Iowa trade unionists were deeply disappointed and angry when the 2007 Legislative session stumbled to adjournment on April 29, without passing Fair Share, prevailing wage, improved public sector collective bargaining and employee choice of doctor in workers’ compensation.

   Although the Senate passed Fair Share—but just for the public sector— House leadership reneged on its commitment to labor.  It could not get 51 of the 53 Democrats to support any Fair Share bill (The 54th Democrat, Ray Zirkelbach, an AFSCME  member, is serving an extended tour of duty in Iraq). 

   There is thus, no official record of the House legislators’ positions.  However, House Democrats informed us, and our counts verified, which legislators did

not support Fair Share (See Box ).   Most of these had given us written and/or verbal commitments in 2006.  House Speaker Pat Murphy thanked participants at the Iowa Federation of Labor Legislative Conference in February, saying, “Frankly, we wouldn’t have gotten to 54 [seats in the Iowa House] without the people in this room.”  Yet, the House failed to pass even one of labor’s top priorities.

After forty-two years of waiting, forty-two years of supporting Democrats, in the hope of getting rid of the accursed right to work law or, short of that, at least passing Fair Share, labor was betrayed by those who led us to believe they supported us.  What they did was wrong.  In the Legislature, as in life, all you have is your word, and if your word is no good, you have nothing.

Who opposed Fair Share?

   Opposed private sector:

All Republicans, plus Dandekar (Marion), Huser (Altoona), Kelley (Waterloo), Mertz (Ottosen), Jo Oldson (Des Moines), Petersen (Des Moines), *Pettengill (Mt. Auburn), Quirk (New Hampton), Wise (Keokuk.    

   Opposed public sector: 

All Republicans, plus Mertz, Pettengill,  Quirk and McKinley Bailey (Webster City).

   Which of these signed the questionnaire for Fair Share?  Bailey, Dandekar, Kelley, Oldson, Pettengill, Quirk.

*Pettengill switched parties April 30 and became a Republican.

More Disappointments

· Prevailing Wage would require contractors on public works construction projects to pay at least the wages and benefits standard for the area, just as federal law—the Davis-Bacon Act—does on all federally-funded projects.  Prevailing wage laws prevent low-wage contractors from outside an area from coming in and undermining work standards.  Competition based on low wages and benefits spurs a race to the bottom, leading to the potential for a less-skilled, less-productive workforce, shoddy construction practices and unsafe public buildings and infrastructure. 

   What a shame Iowa could not have joined 32 other states and the District of Columbia in enacting prevailing wage this year!

· Choice of Doctor in Workers’ Compensation would correct a blatant injustice perpetrated on injured workers.  Legislation we supported would have allowed the worker rather than the employer to choose the employee’s health care provider.  Worker healing and treatment is best done by a provider who is concerned solely with the worker, not by providers who treat them like malingering liars and who care mainly about the insurance company’s bottom line. 

· Improvements in Public Sector Bargaining Law, including making discipline and discharge mandatory subjects of bargaining, would have brought more equality in bargaining power to the public labor relations arena.

Thank You, Iowa Unionists!

Union members all over the state demonstrated their deep commitment to Fair Share by lobbying, calling, sending cards, letters and e-mails, even making personal visits to legislators to support Fair Share.  The response was overwhelming and greatly appreciated.

Background to the Fair Share Struggle

What is Fair Share?

Fair Share is a label for legislation that would allow management and labor to negotiate clauses in their contracts to let unions collect a “fair share” fee from non-union members in the bargaining unit.  Currently, union members pay dues that cover the costs of negotiating and policing the contract, while non-members get all the advantages of the union contract without paying anything toward the cost. 

The legislation would not have mandated fair share payments for everyone, but would have allowed each bargaining unit to negotiate such clauses, currently

 prohibited by Iowa’s so-called “Right to Work” law. 

What is “Right to Work?”

Under the 1935 National Labor Relations Act (and the 1974 Iowa Public Employment Relations Act), a union may file for a representation election.   If a majority of those voting choose the union, the union is certified as the exclusive bargaining representative for all the workers in the bargaining unit.  This means the employer must sit down and negotiate (not necessarily agree) with the union on terms and conditions of employment. 

A 1944 Supreme Court case said unions must represent all the workers in the unit whether they are members or not.  If they don’t, they lose their certification. 

Then in 1947 the Taft Hartley Act permitted states to pass “right to work” laws, which forbid unions from bargaining over clauses which would mandate union membership for all workers in the unit.  Iowa passed it in 1947. 

Fair Share is legal in 28 states   These 28 states, including Illinois, Wisconsin, Missouri and Minnesota,  have some of the strongest economies in the country.

Responsible Tax Policy? 
The Iowa Policy Project looks at the 2007 session

Iowans need to invest in our economy and our citizens. A responsible tax system defines our capacity to make those investments that can sustain a healthy economy. Did the recent legislative session meet the basic principles of responsible tax policy?

Accountability

Tax credits need as much scrutiny as appropriations. While the 2007 session produced some steps toward transparency – requiring local governments to report more detail about use of tax-increment financing – more is needed. Identifying tax-credit recipients would allow evaluation of public benefits of such tax breaks; job-training incentives also need examination. Legislation for both failed.

Public Purpose

Tax-credit costs continue to balloon. The Department of Revenue projects that the cost of tax credits will rise to $375 million in FY2011 – an increase of 240 percent in 10 years. But legislators in 2007 kept proposing and passing tax credits as “incentives” for economic activity, with no requirement to evaluate their effectiveness.

Simplification

Hundreds of tax credits and deductions complicate our income tax system. There were no significant efforts to address this.

Revenue Adequacy and Stability

Legislators passed a $1-per-

pack cigarette tax increase, providing substantial new revenue for health care and to address shortfalls in the state budget. The tax increase is a significant shift fromtwo decades of tax-cut-dominated policy that have produced a structural budget problem. But the cigarette tax is only a short-term step; as it discourages smoking, revenue also will decline. And funds raided during the recent budget crisis still have not been paid back.

One long-term solution legislators rejected – and should reconsider – is to adopt the governor’s recommendation to close corporate tax loopholes.  Legislators have not fully addressed the long-term challenge of producing adequately funded budgets.

Fairness

In a major step to promote fairness, lawmakers made the state Earned Income Tax Credit refundable, and raised it slightly, from 6.5 percent to 7 percent of the federal credit. No other significant changes shifted tax responsibilities away from low- or middle-income working families, and toward those with the best capacity to pay. Meanwhile, tax loopholes continue to benefit wealthy individuals and multistate corporations. The cigarette tax increase compounded the regressive nature of Iowa taxes. The EITC expansion only partially mitigates that effect.

Competitiveness

The Legislature took a step in the right direction by funding a study of Iowa’s property tax system. The study should examine property taxes and the competitive standing of Iowa’s overall tax system in light of all of the above tax principles.

The 2007 legislative session ended with some positive changes for Iowa tax policy, but long-term fiscal challenges remain. Periodic recessions, increasing demand for public health insurance, and large backloaded tax cuts and spending commitments make it unrealistic to count on economic growth to cover all the costs of public services. Without more attention to long-term fiscal policies and tax reform, Iowa is likely to repeat the past budget crisis of 2001-05.

New Governor Shows his Stuff

 Chet Culver won the election for Governor of Iowa in 2006, and the progressive torch is now in his hands.  He wants to be known as “The People’s Governor,”  and his agenda for his first legislative session was a reflection of that. 

 Raising the minimum wage, raising teacher pay, increasing the cigarette tax to provide money for health care, an anti-bullying measure to protect gay students, repeal of a five-year-old ban on a type of stem cell research, and a $100 million Power Fund to give us “independence from foreign oil”  were all promises he made in January that were kept by the end of the session in April. 

Culver came out a big winner in 2007 because he got almost all of what he wanted; however, he also wanted labor unions to have the freedom to bargain Fair Share.  He publicly expressed his support for the ability of labor and management to negotiate such clauses.  He was very disappointed that his efforts to meet with and talk to wavering legislators did not result in legislation that reached his desk.

Culver told reporters on Iowa Press, “I think it’s important that we stand up and fight for workers.”  As Governor, Culver has already made great strides in moving Iowa forward.  Hopefully, Fair Share will be added to his list of progressive accomplishments

“I think it’s important that we stand up and fight for workers.”

Fair taxes and quality education: Some don’t see the connection.

 We Do!

Legislature Takes Some Positive Action

ü Minimum wage increase

ü Election day voter registration

ü Voter verified paper trail required for elections.

ü Limits on interest charged for car
title loans

ü Electrician licensing

ü Plumber licensing

ü OSHA funding for 7 new inspectors

ü Civil Rights Law expansion

ü Teacher pay increase

ü Expanded access to early childhood education

ü Health care expansion for children and parents through the state’s Medicaid program

ü Peace Officers’ Bill of Rights

ü Earned income tax credit improvements

ü Ban on private prisons

Since 1998, more than 3 million U.S. manufacturing jobs have been lost.

For the fifth straight  year in a row the U.S. trade deficit set a record. 

"For too long, the US Trade Representative has ignored the concerns of working people here in the United States and around the world," said AFL-CIO representative Thea Lee, speaking in February against the proposed US - Korean free trade agreement. 

The gap between our exports and imports reached $763 billion last year.  Under Bush, America has been better at exporting jobs and factories than products. 

Why?  Because of two great decouplings

that have occurred in recent years, says Robert Reich, Labor Secretary under Clinton.  

“First, the rest of the worlds' major economies have decoupled from the United States economy. China, India, Japan, and Europe are now such large markets they can grow briskly even as America slows.

“Second, America's largest corporations have decoupled from the United States.

Their overseas subsidiaries are booming even as their American operations stagnate.

“General Electric expects more than half its revenue this year to come from outside the United States for the first time. More than half of Boeing's new orders are from overseas.”

“Double Decoupling,”Robert B. Reich. American Prospect Web Exclusive: 05.02.07

Do we look like a developing country yet?  Outsourcing + low wages are wrecking US

Newly released data reveal just how skewed the distribution of economic growth has been over the current recovery.  Data from the Bureau of Economic Analysis through the third quarter of 2006 show that a historically high share of corporate income is going into profits and interest (i.e., capital income), rather than

employee compensation.  And a newly released Congressional Budget Office (CBO) analysis of household incomes shows that a greater share of this capital income goes to the richest households than at any time since the CBO began tracking such trends.  (Emphasis added) Economic Policy Institute. J. Bernstein, L. Mischel, J. Lin. 1/17/07 

John Sweeney on the Bush Surge in Iraq:
“...this administration has failed….”

 “No US foreign policy can be sustained without the informed consent of the American people. Last November the American people spoke loudly and clearly that the President’s course in Iraq was flawed and that he should begin bringing our troops home rapidly.

“Rather than heed the will of American citizens, or listen to military leaders speaking out against the current policy in Iraq, the President is choosing to make one last attempt to salvage his own legacy by putting in harm’s way more young American soldiers.

“These soldiers – the men and women risking their lives in Iraq – come from America’s working families. They are our sons and daughters, our sisters and brothers, our husbands and wives.

“They always answer when called to duty. For that fundamental commitment to this nation, they deserve leaders who will call them

 only when the nation’s security is at risk and there is a clear plan for victory. This administration has failed and continues to fail that basic obligation.

“As our generals on the ground in Iraq have said, there is no military solution to the civil strife that now wracks that country. Only a political solution – effected by the Iraqis themselves – can resolve what has become an internal struggle among Iraqis themselves.

“What is needed in Iraq is an expansion of political and diplomatic efforts – not an increase in United States military performing police functions.

“Moreover, sustainable social and economic development and the guarantee of fundamental labor and  trade union rights are absolutely essential. The President insists that we must succeed militarily in order to establish the conditions for a political settlement. In fact, the reverse is true. Unless

there is first the political will to stop the violence, there can be no military solution involving American troops.

“American policy in Iraq has been based on false premises and wishful thinking since the beginning. And we have tried to increase American troop presence in the most violent and dangerous areas of Iraq before without success.

“We urge the Congress of the United States to perform its constitutional responsibilities and insist that the President, and his military leaders, clearly articulate the path for withdrawal of American troops from Iraq rapidly. The dedication and patriotism of those young men and women who answer the call to service deserve no less.” 

Statement by AFL-CIO President John Sweeney On the President's Proposal to Expand American Troops in Iraq  1/11/07

We stand for getting more people to vote — and making sure their votes count!

• Allowing eligible folks who want to vote to register at the polls on election day.  (Signed into law this session!)

• Keeping polls open 14 hours.

• Allowing towns under 200 to have elections by mail ballot.

• Requiring paper trails for all electronic voting machines.  (Signed into law this session!)

• Creating a voter-owned clean election fund to keep elections out of the hands of the plutocrats.

“We face a full-fledged pension
crisis.” 

pensions.  However, it didn’t go far enough.  We face a full-fledged pension crisis.  In addition to terminations, we see daily reports of pension freezes.

Companies say they cannot afford benefits anymore.  I don’t believe them.  IBM froze its pension, but its CEO will still get a $4 million per year pension.  Similarly, Alcoa’s CEO will get $1.28 million in annual pension payments despite their freeze.

According to the authoritative, non-partisan Congressional Research Service: “Adjusted for inflation, average worker pay rose 8 percent from 1995 to 2005; median CEO pay at the 350 largest firms rose about 150 percent over the same period.”  U.S. workers aren’t sharing in the prosperity

they created.

This is happening partly because employers evade non-discrimination rules.  If a company has a qualified pension for executives, it is supposed to provide a similar plan to rank-and-file workers.  Companies get around these rules with special “non-qualified, deferred-compensation” for executives.

That’s why I am introducing legislation that says: If you are offering a special plan to executives, you must provide a pension to the rank-and-file.  If a company can afford to pad the wallets of executives, it can certainly afford a basic pension for everyone else.  I look to working Iowans to help me push for its passage.

Though it wasn’t an ideal bill, I was pleased that it included my provision to protect older workers when their companies convert to “cash balance”

Nussle

EFCA: The Employee Free Choice Act
An important way to strengthen the position of those people who brought us the weekend (Us!)

The Employee Free Choice Act (H.R. 800), supported by a bipartisan coalition in Congress, would level the playing field for workers and employers.  It would restore workers’ freedom to choose a union by:

• Establishing stronger penalties for violation of employee rights when workers seek to form a union and during first-contract negotiations.

• Providing mediation and arbitration for first-contract disputes.

• Allowing employees to form unions by signing cards authorizing union representation.

All three of Iowa’s Democratic members of the U.S. House—Bruce Braley, 1st District; Dave Loebsack, 2nd District; and Leonard Boswell, 3rd District— were co-sponsors of the EFCA, which passed the House and is up for debate in the Senate.  Senator Tom Harkin is a co-sponsor in the Senate.

Union members can send e-mails to their lawmakers here: http://www.unionvoice.org/campaign/signthe_EFCA

Why We Need EFCA:  Organize, Win, Get Fired.

Viet Nam Vet Errol Hohrein from Greeley Colorado, a boilermaker, told his story to the Senate Committee on Health, Education, Labor, and Pensions on March 27, 2007.

In 2006, Errol began working at Front Range Energy to help start up their $50 million ethanol distillery in northern Colorado.  Soon he noticed many safety risks and told management about leaks in the ammonia tanks, leaks in steam systems and the inadequate storage of overactive chemicals.  “But my requests fell on deaf ears.”  There were pay problems too.  “We were shorted on wages and to make matters worse, the company’s medical benefits were priced at over $900 a month – almost half of our paychecks.  One co-worker wrote a letter to management about having been shorted on his paycheck, and days later he was fired.”

Did you know? 
12% of American workers have unions at their workplaces, but 53% want one! (Hart research, 1/2006.)

Errol led an organizing drive at Front Range.  “Following one meeting, I was written up for insubordination. They threatened that if our campaign was successful, our paychecks may suffer.  Managers would follow me around the workplace at all times. They would not permit other workers to talk to me. They isolated me from my co-workers.” 

Despite Front Range Energy’s union-busting campaign, the union won! “But for me,” said Errol, “the victory was short-lived. The threat was real. Within days after the union election was certified, I was fired.  I’ve filed a challenge
with the NLRB, and it could be years before I get my job back.”

EFCA would have made a difference.

Democrats get a bright idea after
2006 election results

Want to Keep Track of Presidential Candidates and Where They Stand?

New “Working
Families Vote 2008”
Website 

The website is designed to be a hub for AFL-CIO unions efforts to push the concerns of working families front and center in the national political debate.

Check it out at www.workingfamiliesvote2008.org.

Features:

• The Forum: A place for union members to discuss the presidential race. Working Family Issues: Where the candidates stand on the issues important to working families, such as health care, trade and the Employee Free Choice Act.

• Candidate Videos

• Take Action Center: Rotating actions, such as, most recently, “Tell the candidates about your priorities.”

• Poll Tracking: The latest polls.

• Candidate Pages: Positions of the candidates and links to other online resources from all the presidential contenders.

• Daily Blog Roundup

Q & A:

Wal-Mart Shirks Its Taxes.  We Didn’t.

Just as our Legislature ends the session with lots of new programs to pay for (teachers’ pay increases, pre-school for all kids, for example) new research shows that Wal-Mart appears to be skipping out on its fair share of taxes. 

Most of us pay the taxes that support state governments.  Not Wal-Mart!

According to new research, Wal-Mart avoided $2.3 billion in state income taxes, cutting its payment to state governments almost in half between 1999 and 2005.  Wal-Mart uses a loophole in state law that essentially allows it to pay rent to itself and then deduct the cost as a business expense. 

See http://www.ilcaonline.org/ht/display/ArticleDetails/i/45469 for details.

Convention Notice

2007 51st Annual
Convention
Iowa Federation of
Labor, AFL-CIO