Thursday, April 14, 2016

Why Politics Sucks ... The Intersection of Vote Seeking Politicians and Their Biggest Allies, the Labor Unions

Verizon's Political Strike is subtitled 'Sanders and Clinton join picket lines on behalf of the rotary-phone era' reveals a seldom told fact based but sad story about both the harm done by dinosaur labor unions and their staunch political vote seeking allies in the Democratic Party:

"As Hillary Clinton and Bernie Sanders chase each other further to the left, it was only a matter of time before somebody decided to capitalize on their competition. The Democrats have now helped inspire the largest domestic strike in years—and it’s pure political performance art.

On Wednesday, more than 36,000 workers on the East Coast walked off the job after their unions rejected the telecom’s latest contract offer in a 10-month negotiation. The Communication Workers of America and the International Brotherhood of Electrical Workers wanted a public spectacle, and did they ever get one.

Mr. Sanders joined a picket line in Brooklyn and began, “Brothers and sisters, thank you for your courage and standing up for justice against corporate greed.” He went on to accuse Verizon of “trying to destroy the lives of working Americans,” and that was the subtle part. Mrs. Clinton demanded that the company “do the right thing” and tender “a fair offer to their workers.”

The Democrats are not exactly Bobby Kennedy communing with Cesar Chavez and destitute grape pickers. How’s this for “fair”? The walk-offs enjoy an average annual pay and benefits package of $130,000. Management is offering a 6.5% cash wage increase, the same health coverage as its other domestic employees and an industry-competitive 401(k) match.

Yet Verizon and the unions have largely agreed about compensation. The unions preferred to make a political statement about expanding the ranks of the Americans lucky enough to have decent-paying jobs, which apparently means showing solidarity with an increasingly obsolete business model.

Some 99% of the strikers work for Verizon’s legacy “wireline” business, or its traditional fixed phone service plus its fiber optic Internet service. This unit generates only 7% of Verizon operating income, down from 60% in 2000—wireless is more profitable—and as more customers ditch land lines, it is only natural that these old-fashioned networks will require fewer workers to operate and maintain.

But Verizon isn’t even looking to shed jobs. It is merely seeking more flexibility to manage its workforce, such as consolidating under-used call centers and the ability to hire more outside contractors. “Nostalgia for the rotary-phone era won’t save American jobs,” Verizon CEO Lowell McAdam wrote in a LinkedIn post.

Mr. McAdam also called Mr. Sanders’s rhetoric “contemptible,” publishing a detailed rebuttal. Credit is due to the rare executive willing to defend economic reality and stand up to political intimidation."

And here's how the brave and plain spoken Verizon CEO responded to Bernie Sanders:

"From a LinkedIn post by Verizon CEO Lowell McAdam, April 13:

I read with interest Jeff Immelt’s spirited response to Sen. Bernie Sanders putting GE on his hitlist of big corporations that are “destroying the moral fabric” of America.

In fact, I feel his pain. Verizon is in Sanders’s bull’s-eye, as well. The senator’s uninformed views are, in a word, outrageous. Here’s why.

His first accusation—that Verizon doesn’t pay its fair share of taxes—is just plain wrong. As our financial statements clearly show, we’ve paid more than $15.6 billion in taxes over the last two years—that’s a 35% tax rate in 2015, for anyone who’s counting. . . . The senator has started to fudge his language—talking of taxes not paid in some unspecified “given year”—but that doesn’t make his contention any less false.

Sen. Sanders also claims that Verizon doesn’t use its profits to benefit America. Again, a look at the facts says otherwise. In the last two years, Verizon has invested some $35 billion in infrastructure—virtually all of it in the U.S.—and paid out more than $16 billion in dividends to the millions of average Americans who invest in our stock."

Summing Up

Facts are stubborn things.

Politics sucks.

It's up to each of us as individuals to get the facts.

Our politicians are only out to get our votes.

That's my take.

Thanks. Bob.

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