George Bush Loves FedEx; Why You Shouldn't

Today George Bush had his second date in as many weeks with FedEx chairman, president and CEO Fred Smith. W used a FedEx facility in Washington, D.C., as a backdrop to promote the government's latest unemployment statistics. Well, as the saying goes, there are lies, damn lies and statistics, and from these two you can expect all of the above.

It's insulting that W would even use a FedEx facility to discuss the topic of workers in America. Not only is Bush one of the most anti-worker presidents in history, FedEx is one of the worst anti-worker companies operating in the U.S. today. Perhaps that's why Bush and Smith get along so well.

For those of you who visit Kinkos, ship or receive items via FedEx here's a news flash: When you give FedEx your business, you are helping to finance the GOP and exploit workers.

Fred Smith and the GOP
Just two weeks ago, Smith co-hosted a $2,100-a-plate fundraiser for Bob Corker, a senatorial candidate from Tennessee. W flew in on Air Force One to be the special guest.

But Smith's GOP relationship goes back much further than that.

• Smith is a lifelong Republican.


• He was a classmate and Skull and Bones member with W at Yale.


• Smith was the finance chair when Howard Baker ran for president in 1980.


• FedEx's political action committee is one of the biggest in Tennessee.


• The company has donated more than $580,000 to Republicans in this election cycle and thousands more to other conservative PACs and causes.


• Smith has given $26,700 to keep Republicans in control of the Senate.


• And FedEx has been a big contributor to the <  http://www.clubforgrowth.org/> Club for Growth.

FedEx Gets What it Pays For
Now these should be enough reasons not to ship FedEx. But wait, there's more: FedEx's lobbying machine virtually paid off the Republican-controlled Congress in 1995 to hold onto its status as an air carrier under the Railway Labor Act. Jill Fisch writes about this in depth in her paper How Do Corporations Play Politics? The FedEx Story.

Fisch writes:

The significance of this status is threefold. First, it means that FedEx labor disputes are subject to the jurisdiction of the National Mediation Board rather than the National Labor Relations Board. Second, the rules governing strikes and work stoppages under the RLA are much less favorable to labor. Third, and most important, under the RLA, unions must organize a company's employees nationally rather than locally. This requirement makes it substantially more difficult to unionize. [Emphasis added]

FedEx is the only shipper in the U.S. to be granted this special classification, even though UPS and DHL have their own air fleets.

Exploiting Drivers
FedEx also has a long history of exploiting its Home Delivery drivers by misclassifying them as "independent contractors."

This is more than a label. It means the drivers must take on costs that should be paid by FedEx - like trucks, equipment, uniforms and digital scanners.  Meanwhile, FedEx avoids paying income tax withholding, unemployment insurance premiums, worker compensation contributions and other state or federal contributions.  

Using this model, FedEx shifts its risks and costs onto drivers and onto taxpayers. It also avoids state labor laws and even federal laws like the Family Medical Leave Act or Equal Employment Opportunity laws.

Fortunately, we still have a third branch of government. A California court ruled its contractor scam to be illegal in 2005. The state later audited FedEx Ground and found the company owed nearly $8 million in back taxes. FedEx settled a similar audit charge in New Jersey.

And Massachusetts is investigating FedEx Ground too. In two decisions this year, the regional National Labor Relations Board ruled that FedEx Ground drivers are employees and have the right to unionize.  

Bush's Economy
Bush touted the latest unemployment numbers, 51,000 new jobs created and a 4.6 percent unemployment rate. But these numbers fail to tell the whole story. They ignore those who have fallen off the DOL's employment radar screen, those who have simply given up looking or work. And they count workers who have been forced to take part-time jobs because they can't find full-time employment.

The National Jobs for All Coalition estimates that total unemployment in this country is really around 10 percent. And employment, as you might expect, is not evenly distributed across racial lines. Whites had a 4.1 percent unemployment rate in August. The unemployment rate among Hispanics was more than 5 percent. The unemployment rate among blacks was nearly 9 percent - 28.8 percent for black teens.

And while Bush is quick to brag about how the Dow Jones Industrial Average is back at record levels, jobs are still catching up to their March 2001 peak. But what can you expect from an administration that believes in "ownership" and outsourcing?

What Bush fails to realize, however, is that most of America's middle class aren't feeling the benefits of his rosy economy. You could bet your bottom dollar Fred Smith is.