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Monday, May 16, 2011

A Labor Strike Against Economic Reality

In 1977, Boeing was the target of a strike by the International Association of Machinists and Aerospace Workers, which represents its workers in Puget Sound, Wash. and Portland, Ore. The aircraft manufacturer had another strike in 1989. In 1995, workers went out for 69 days. In 2005, they struck again. In 2008 ... well, you see the pattern.

Strikes are an expensive luxury. The last one, which went on for nearly two months, was estimated to cost Boeing more than $2 billion. "Based on previous strike experience," reported The Seattle Times, "Boeing will not recoup that money for many years."

At some point, a light bulb went on in the heads of those running the company: If we can't avoid union walkouts, we can't make aircraft deliveries. If we can't make aircraft deliveries, we don't get paid, we alienate customers and we endanger our livelihood.

After the 2008 walkout, Virgin Atlantic founder Richard Branson voiced exasperation. "If union leaders and management can't get their act together to avoid strikes," he said, "we're not going to come back here again. We're already thinking, 'Would we ever risk putting another order with Boeing?' It's that serious."

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