Whose Strike Was That Anyway?
Contract talks were breaking down between American Telephone and Telegraph and the three major unions of their employees. As a result, workers walked off their jobs at midnight on August 7th. The AT&T strike was on!
We all remember the phone strike of 1983. It caused us to hold on directory assistance for several minutes. It gave us many unique error messages. It made it virtually impossible to make any operator-assisted calls from all around the country. For the first time in a long while, the voices at AT&T were not answering the phone.
As we all know, a strike is an organized work stoppage by the employees in order to compel the employer to meet some demand. If the workers go on strike, it stands to reason that the company should suffer. If, for example, the union of Cabbage Patch Kids producers was to strike, then none would be made, the factories would quickly be emptied, and consumers would rant and rave. If the local Cabbage Patch Kids conglomerate had anticipated a strike, they could step up production, fill several hundred warehouses with millions of the surrogate orphans and, when the strike occurred, they could sell the surplus. The workers would lose their bargaining power in this case, unless the Cabbage Patch Kids truckers; union also struck, or perhaps people stopped adopting the cretins, however unlikely that might seem.
This analogy leads us back to last summer when 675,000 telephone employees went on strike. A walk-out of this magnitude should have devastated any company. AT&T, though, is the exception to the rule.
What AT&T really depends on are phones, wires, switching systems, computers, electricity, some optical fibers, satellites, microwave towers, and other nifty 21st century things that are all designed to run without the interference of human decision. The people are really just there to remove illegal third-party phone calls from your bill, to make sure that your handwritten check matches the computer-read phone bill, or to tell you that the machine you are at cannot return your dime and that you will get a check for 10-cents in the mail.
97% of all calls made today don't use any operator assistance at all. And most of the other 3% could have been dialed without the assistance of a human.
More and more "services" of your phone company are becoming completely automated. With ESS, customers can dial overseas direct. Android information is popping up left and right. AT&T, a leader in technology, doesn't need their workers all that much.
Glenn E. Watts, president of the Communications Workers of America, said, "In 1950, for example, total labor costs amounted to about 45% of the telephone dollar while in 1980 they amounted only to 29%." John Patrick Phillips (author of Ma Bell's Millions) says that the company encourages or even "maneuvers" a strike. According to him, Ma Bell reaps huge rewards from a strike. Phillips, a disgruntled ex-employee, who at times compares the phone company to fascism, would have presented AT&Ts organized scheme last August like this:
675,000 workers strike for about 3 weeks. 3 weeks out of a year amounts to 5.8% of a worker's salary. Let's say a phone worker made at the time of the strike a modest $250 per week (operators made $373, while systems technicians, the best paid workers, made $535).
At this time AT&T provided substandard service to the people for the same prices. The 3% loss in phone usage due to lack of operators was probably easily made up by people making an extra effort to dial direct and by the fact that some of the calls were being handled by scabbing supervisory level employees. And so, the company nets pure profit: 3 week strike x $250/week x 675,000 workers = $506,250,000!
Phillips also notes that because managers and supervisors were doing the dirty work, of the phone company, these people could not work on new projects. This means that several hundred million dollars would not be invested in expenditures on new projects because there is no one to do the work. So AT&T would get interest on this money during the strike and even for some time after it was settled until work had resumed. This yields several million more dollars in profit for AT&T.
AT&T probably made out directly with over half a billion dollars from the strike. At the same time companies like New York Telephone sought to delay a $160 million rate increase so it could ask for another increase to reflect new contracts.
As part of the settlement 21 days later, top craft workers got a 5.5% increase for the first year of their 3 year contract and 1.5% for each of the next two years. They also got a $31 million training fund ($46 per employee) to help them deal with new technology and remain employable humans. All of these "gains" are subsidized by the half a billion dollars gaining lots of interest which AT&T did not have to pay to their employees. AT&T at first offered a ridiculous 3.5% increase for the first year and no increase for the next two, but after losing 5.8% of their salary by striking, workers got a 5.5% increase above the cost of living which is probably entirely subsidized by the strike itself and by rate increases.
It's certainly nifty deal for Ma Bell. Their workers blow off steam and pay for their own raises, and stockholders don't have to worry one bit.
The strike had its effect on the consumer. As we all know, many were dialing, Touch-Toning, or redialing their calls almost like usual and others were severely inconvenienced by a few managers and supervisors working as long-distance or directory assistance operators often for many hours of overtime. New installations came to a standstill and many were backlogged for several months. Any emergency repairs had to be handled by supervisory personnel. But after all this, the same fat phone bill came to people's homes the next month, without any delay.
In actuality, users cannot complain to or boycott the phone company as they could the Cabbage Patch Kids manufacturers, in our earlier scenario. They cannot make AT&T or their local company do anything because each customer is as unimportant as each employee. We, as customers, are all dependent on the phone. We have at least one in each home. We are billed if we use it or not, and are billed more to have it shut off for a month or two.
We are all so dependent on the lines that run into our homes and on the one and a half million payphones that absorb our money that the complaints of anyone or even thousands of us are quite useless. All of this utility (note the meaning of this word) was until recently controlled almost exclusively by one company, so in the name of human spirit, roll on with with the divestiture.