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In its never ending mission to hoard profits, Caterpillar is asking for steep concessions from its union workers even as the company witnesses a 31 percent sales increase in North America alone.  Caterpillar expects 2012 to be a record year and sports a current backlog of $28.2 billion.

Last year, Caterpillar earned a record $4.9 billion.  Executives were compensated for their economic accomplishments while the workers who did the hard work of producing the product are having difficulty getting a fair deal at the negotiating table.

In Joliet, Illinois (which has been the site of labor-management tension for months), hydraulic parts and systems plant workers represented by the International Association of Machinists are being asked to accept a six-year wage and pension freeze.

Rather than accept ice-cold austerity, workers chose to strike in May and have been on the picket lines for the past 13 weeks.  Rising healthcare costs have been already created a $1,900 bump in worker contributions.  A six-year pay freeze would turn these traditionally good jobs into underpaying jobs by the end of that term:

Ever since negotiations began in March, Caterpillar has insisted on a wage freeze for its top-tier workers, those employed seven years or more; they average $26 an hour, or $55,000 a year before overtime. For the junior third of the workers who typically earn $12 to $19 an hour, Caterpillar has made no promises but has suggested it might raise their wages based on local market conditions.

Timothy O’Brien, president of Machinists Local Lodge 851, does not accept Caterpillar’s decision to press on with lowering labor costs at a time of financial success.
“A company that earned a record $4.9 billion in 2011 and $1.586 billion in the first quarter of this year should be willing to help the workers who made those profits for them. Caterpillar believes in helping the very rich, but what they’re doing would help eliminate the middle class.”
The delusion surrounding this topic is apparent.  Forbes contributor Bob Lutz in an anti-union piece yesterday, opines for a future where globalization has rendered the value of work microscopic:
The workers in question receive $26 per hour, $50,000 per year, plus substantial overtime which, I am assuming, takes many of them to sums of $75,000 or more. These numbers, reminiscent of the heady days when workers at the Detroit Three were called “the aristocracy of American labor,” simply won’t fly in to today’s globally competitive environment.
Wait a second there, Bob.  $50,000 "won't fly" ?!?  As in, workers don't deserve $50,000 to safely and accurately building the massive equipment that is central to rebuilding the country and sustaining business?

$50,000 won't fly alright.  If you want to put one (1) kid through college.  Or if your wife gets in a car accident.  You're damn right $50,000 won't fly.

Thankfully, the workers in Joliet have some leverage in their situation as the hydraulic parts made in the factory are essential to a majority of the brand's products.  Caterpillar has pressed on with a contingent workforce and maintained that the factory is processing orders on time.  Timothy O’Brien told the State-Journal Register, however, that he doubts the production numbers.

"We know that Caterpillar was having trouble finding experienced people before the strike. They don't have the skill level in the plant right now. It takes years of experience to run quality parts and do the tooling necessary for precision work."
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Comment Preferences

  •  WPP - thanks for keeping us informed (1+ / 0-)
    Recommended by:
    FarWestGirl

    You answered my key question at the end of your diary, how has the strike impacted production. My guess is that CAT will bring in workers from all over the world to break the strike.

    "let's talk about that"

    by VClib on Fri Jul 27, 2012 at 11:17:10 AM PDT

  •  Wish this was getting more attention. n/t (0+ / 0-)

    Information is abundant, wisdom is scarce. The Druid

    by FarWestGirl on Fri Jul 27, 2012 at 04:20:41 PM PDT

  •  "The Aristocracy of American Labor" (0+ / 0-)

    I felt such raw anger when I read that comment about the danger of approaching a new time where factory workers were making over $55,000/yr.

    As the diarist pointed out, 55K is perfect if you have one child who chooses to go to college and no unexpected major issues - if you do, it will be little better than minimum wage.

    Now, here is what makes me really really angry, the company is pumping out unbelievable profits at a rate of near, what?, 15% of its market capitalization during any given year?  Just whom do you propose to reward such wonderful perfomance?

    The Executive Officers?  Back when the big 3 represented the Aristocracy of American Labor, the average CEO earned roughly 10x what his average worker made.  Caterpillars CEO would make $550,000/yr - a very very nice salary, better than the Presidents and yet if you gave it to the CEO of Caterpillar right now he would jump out of a fucking building.

    That is b/c Executive pay is the ONLY pay that has shot up in the last 30 years.  Workers make essentially the same they made 25 years ago.  Only directors make more.  As a multiple of average worker pay, we probably need to get out 3 or maybe 4 figures.  The figures given would lead a "normal" person to think that the Cat. CEO has a base salary of around a million or so, stock options worth 5-10 million each year and bonuses that can be anywere from 3-30 times the base salary.  

    That is executive pay in America.  Its the suits that believe they can make a better big yellow hauler.  If it is the suits that get more when there is record pay, does that mean that they lose money when the company goes through hard years.

    "How can the United States be the Greatest Nation ever if it is the only modern nation where citizens hold bake sales to pay for life saving medical care?" Single payer is coming but how many people will die before it becomes the only solution?

    by 4CasandChlo on Sun Jul 29, 2012 at 05:56:15 PM PDT

  •   (0+ / 0-)

    I felt such raw anger when I read that comment about the danger of approaching a new time where factory workers were making over $55,000/yr.

    As the diarist pointed out, 55K is perfect if you have one child who chooses to go to college and no unexpected major issues - if you do, it will be little better than minimum wage.

    Now, here is what makes me really really angry, the company is pumping out unbelievable profits at a rate of near, what?, 15% of its market capitalization during any given year?  Just whom do you propose to reward such wonderful perfomance?

    The Executive Officers?  Back when the big 3 represented the Aristocracy of American Labor, the average CEO earned roughly 10x what his average worker made.  Caterpillars CEO would make $550,000/yr - a very very nice salary, better than the Presidents and yet if you gave it to the CEO of Caterpillar right now he would jump out of a fucking building.

    That is b/c Executive pay is the ONLY pay that has shot up in the last 30 years.  Workers make essentially the same they made 25 years ago.  Only directors make more.  As a multiple of average worker pay, we probably need to get out 3 or maybe 4 figures.  The figures given would lead a "normal" person to think that the Cat. CEO has a base salary of around a million or so, stock options worth 5-10 million each year and bonuses that can be anywere from 3-30 times the base salary.  

    That is executive pay in America.  Its the suits that believe they can make a better big yellow hauler.  If it is the suits that get more when there is record pay, does that mean that they lose money when the company goes through hard years.

    "How can the United States be the Greatest Nation ever if it is the only modern nation where citizens hold bake sales to pay for life saving medical care?" Single payer is coming but how many people will die before it becomes the only solution?

    by 4CasandChlo on Sun Jul 29, 2012 at 05:56:28 PM PDT

  •  Labor Arisctocracy (0+ / 0-)

    I felt such raw anger when I read that comment about the danger of approaching a new time where factory workers were making over $55,000/yr.

    As the diarist pointed out, 55K is perfect if you have one child who chooses to go to college and no unexpected major issues - if you do, it will be little better than minimum wage.

    Now, here is what makes me really really angry, the company is pumping out unbelievable profits at a rate of near, what?, 15% of its market capitalization during any given year?  Just whom do you propose to reward such wonderful perfomance?

    The Executive Officers?  Back when the big 3 represented the Aristocracy of American Labor, the average CEO earned roughly 10x what his average worker made.  Caterpillars CEO would make $550,000/yr - a very very nice salary, better than the Presidents and yet if you gave it to the CEO of Caterpillar right now he would jump out of a fucking building.

    That is b/c Executive pay is the ONLY pay that has shot up in the last 30 years.  Workers make essentially the same they made 25 years ago.  Only directors make more.  As a multiple of average worker pay, we probably need to get out 3 or maybe 4 figures.  The figures given would lead a "normal" person to think that the Cat. CEO has a base salary of around a million or so, stock options worth 5-10 million each year and bonuses that can be anywere from 3-30 times the base salary.  

    That is executive pay in America.  Its the suits that believe they can make a better big yellow hauler.  If it is the suits that get more when there is record pay, does that mean that they lose money when the company goes through hard years.

    "How can the United States be the Greatest Nation ever if it is the only modern nation where citizens hold bake sales to pay for life saving medical care?" Single payer is coming but how many people will die before it becomes the only solution?

    by 4CasandChlo on Sun Jul 29, 2012 at 05:57:09 PM PDT

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