Contract talks between the Machinists Union (IAM) and Boeing were in a state of limbo as of press time. Although the existing contract expired at midnight on Sept. 1, the IAM agreed to extend the contract for 30 days at the request of the Federal Mediation and Conciliation Service (FMCS).

The service asked for the extension on Aug. 29, the day IAM members were voting to accept or reject Boeing’s “last, best and final” contract offer. They were also voting on whether or not to authorize a strike. Both ballots have been sealed pending the outcome of meetings with the FMCS.

Dick Schneider, who heads up the IAM negotiating team, said the union hoped that further talks would result in a “fair, and acceptable” contract offer.

Boeing, on the other hand, said although it would meet with FMCS Director Peter Hurtgen, “there is nothing left to negotiate.”

Given cutbacks in air travel and financial difficulties at several major airlines, many observers have concluded that Boeing has been “negotiating” toward a strike, a view shared by Schneider. “We believe Boeing is trying to incite a strike. We say that based on Boeing’s demands for deep takeaways in job security and health care and the blatant scare tactics they’ve used at the bargaining table and against our members and the public,” Schneider said in announcing the union’s agreement to meet with FMCS officials.

The three main issues in this year’s contract talks are job security, affordable quality health care and decent pensions.

The union says Boeing has eliminated half of all IAM jobs since 1990, with 47 percent of those cuts coming since 1999. In 1990 Boeing delivered 284 airplanes and employed 146 IAM members per plane. In 2001 the number of airplanes nearly doubled to 476 while the number of IAM members per-plane dropped by more than 50 percent to 63.

Boeing has also demanded that IAM members pay a larger portion of health care insurance that union sources say will increase those costs by as much as $318 per month. Boeing has also refused to budge from its offer to increase the minimum monthly pension benefit from $50 to $56.

The IAM said Boeing’s offer would do little to increase the pension of the average retiree with 30 years service, whose pension is now about one-third of his/her previous pay – and this in a situation where pensions of top Boeing executives are much more than the salaries they received when working.

The union says it would take an average IAM member 2,316 years to earn a pension equal to that of Alan Mulally, CEO of Boeing’s commercial aircraft division, who has accrued pension benefits worth $1,389,566 annually.

While top dogs at Boeing may not be as creative as Ken Lay and other corporate crooks when it comes to finding ways to use company money as their private piggy bank, they certainly don’t need any coaching. Their way is simple and straightforward. They use company money – $10 billion at last count – to buy back Boeing stock. And the beauty of the scheme is that it’s perfectly legal and, as is said these days, “Other people are doing it, so why not us?”

Matt Bates, an IAM spokesperson, accused Boeing executives of “hollowing out” the company for years. “They spent $10 billion in the last five years buying back their own stock and plan to buy back another $3 billion worth in 2002. This does nothing to build the company, nothing to develop new products and nothing for the workforce or the community. It simply inflates the value of Boeing stock and executive stock options.”

And Boeing executives have their share of stock options, beginning with Vice-Chairman Harry Stonecipher, who has options with a current value of more than $29 million and accrued annual pension benefits of $2,299,983. According to Boeing’s 2002 proxy statement, Stonecipher “will receive credit for twice as many years as he actually works for the Company.” Phil Condit, Boeing CEO, will receive an annual pension of at least three million dollars, more than twice his present salary of $1,479,200

Bates told the World in a phone interview that he was sitting in the lobby of the FCMS building, surrounded by reporters. “Boeing has been there all morning and we are waiting our turn,” he said.

Boeing, number 16 on the Fortune 500 list, and the nation’s second largest military contractor ($13.3 billion in 2001), had profits of $2.8 billion in 2001, up 152 percent since 1998.

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Fred Gaboury
Fred Gaboury

Fred Gaboury was a member of the Editorial Board of the print edition of  People’s Weekly World/Nuestro Mundo and wrote frequently on economic, labor and political issues. Gaboury died in 2004. Here is a small selection of Fred’s significant writings: Eight days in May Birmingham and the struggle for civil rights; Remembering the Rev. James Orange; Memphis 1968: We remember; June 19, 1953: The murder of the Rosenbergs; World Bank and International Monetary Fund strangle economies of Third World countries