WASHINGTON -- "The president was totally screwed," an airline official told colleagues Monday. At 7 p.m. the previous evening, a presidential emergency board recommended a massive pay increase for machinists at United Airlines. That was an unexpected outcome, especially for the pleasantly surprised union, the International Association of Machinists (IAM).
It was not what President Bush had in mind a month earlier when he selected the emergency board to prevent an IAM strike against United. All sides had expected the president's selected board members to consider the parlous state of an airline lurching toward bankruptcy. Instead, it recommended nearly all the union asked for, including a 37 percent wage increase raising the hourly rate to $37.54 (plus an unrequested dropping of the retirement age from 62 to 60).
United and other airlines, reeling from the Sept. 11 terrorist attacks, are not complaining publicly. But in private, they are anguished about a decision impacting the whole industry. How could Bush's handpicked board do this? Because instead of selecting conservative labor experts, the White House picked three professional arbitrators. The board then ruled the machinists deserve a pay increase even though United cannot afford it.
On Dec. 21, Bush tried to avert a deadly United strike by naming the emergency board. Much of organized labor had not bought into a less divisive national mood after Sept. 11, as shown by its reaction in this case. IAM President Tom Buffenbarger claimed that Bush's creation of the emergency board, forcing at least a 30-day delay in any strike, "will go down in history as the defining moment in this administration's war against American workers' collective bargaining rights."
The labor leader's worst fears were not realized because Bush's aides treated this key labor negotiation like a petty grievance dispute. They could have called the conservative
Heritage Foundation for the names of labor lawyers who live in the real world to serve on an emergency board whose members do not require Senate confirmation. That kind of board probably would have recommended no pay increase under present conditions. Instead, the White House dipped into the roster of career arbitrators who make a living settling disputes as self-described neutrals.
Named as chairman was Helen Mercer Witt, a Pittsburgh attorney/arbitrator in over 250 cases who served on emergency boards under President Bill Clinton as well as the current administration. The others selected by Bush for the three-member board were Ira Jaffe, a full-time arbitrator in the Washington area who has handled over 200 cases, and David Twomey, a Boston College professor who was selected for emergency boards under the first President Bush and Clinton.
These neutrals, after three days of closed hearings, reached a decision not worthy of Solomon. Noting the devastating decline after Sept. 11 in airline use by business and international travelers depended on by United, the board predicted "continuing adverse impact for the foreseeable future" that makes a "compelling case" to defer pay increases. Nevertheless, it ruled, facts "fall short" of supporting United's position.
If a shaky airline cannot afford big pay hikes, why would arbitrators recommend them? "There is simply no justification," they explained, "for the company's initial proposal which would perpetuate the Machinists' position significantly below the compensation paid at major carriers and would single out the Machinists at United for such treatment even within the contest that saw the pilots, flight attendants, and other employees become industry leaders in terms of compensation." Beyond that, the recommended lowering of the retirement age was a gratuitous insult to Bush.
That is arbitrator-think, dismissing reality. United now faces a no-win situation. If the airline gets back to the bargaining table to prevent a ruinous strike after the 30-day pause, it confronts a 37 percent pay hike as the new base-line minimum. The board's recommendation also exerts pressure on other distressed airlines, which have been privately harangued by the administration to hold down ticket prices.
This episode has generated improbable nostalgia for the Clinton White House among steadfast Republicans. Clinton's personal aide, Bruce Lindsey, maintained close control over emergency boards. While President Bush's national security team is justifiably applauded, his domestic advisers are far less experienced, and it shows.