AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 1
MICHAEL H. BOLTON, DIRECTOR
DISTRICT 2 CONTACT INFORMATION have a knack for writing, you can help start a local A Message from Michael Bolton USW District 2 Office union newsletter. Those moved to help members in 1244A Midway Road times of need may be compelled to serve on the Menasha, WI 54952 Summer is rapidly (920) 722-7630 Community Services Committee. And, the political coming to an end and Labor Northern WI & MI Sub-District Office junkies out there, Local Union PAC committees are 1244A Midway Road Day is just a few days away. Menasha, WI 54952 always looking for activists. (920) 722-7630 To celebrate the Union
Southern WI Sub-District Office Movement’s special holiday, Below is a list of local union committees that 1126 South 70th Street Suite N509A District 2 Steelworkers will each District 2 Local Union should participate in. If, West Allis, WI 53214 (414) 475-4560 take part in parades and after reading through them, you would like to
Northern MI Sub-District Office picnics being held in Michigan volunteer to serve, talk to your Local Union 503 North Euclid Avenue Suite #10 - Euclid Plaza and Wisconsin. President or Officer and they will help you get Bay City, MI 48706 (989) 667-0660 It’s a day of fellowship with our Union started. For our part, the District will be providing
Southern MI Sub-District Office brothers and sisters from other Steelworker locals various committee trainings at our quarterly Local 20600 Eureka Road, Suite 300 Taylor, MI 48180 and various AFL-CIO affiliated International Union Presidents/Officers meetings and our (734) 285-0367 Unions. With all of the positive energy created by educational sessions held throughout the year. USW District 2 our Labor Day activities, it’s a great opportunity to Council Steering Committee Also, as our Locals recruit new volunteers to recharge our “union batteries”. This year, I would The District 2 Council By-Laws established a help get members involved in Union actions and District 2 Council Steering Committee comprised of like to suggest that rather than letting those good a rank and file structure. It was set up to assist in activities, we, at the District, are going to need help the following: vibes die after we pack up the banners and flags, Development of agenda for Council Conference. to successfully carry out those activities. That ● Planning of the District Council Conference Educational let’s put them to good use by pledging to make Conferences. means calling on local union activists to work for us ● District 2 strategic planning. September local union committee volunteer ● Determining and assessing educational needs within the on a casual basis during organizing drives, Rapid District. recruitment month. Generating and leading activism and other purposes Response Actions, and other important Union consistent with the mission and directives of District 2 and the USW. Most folks who participate in Labor Day events. We will identify which Steelworker contracts The elected members of the Steering Committee are listed below by manufacturing sector. If you events are already involved, with some holding contain Union leave language and make it a priority need to contact a Steering Committee Member, please do so by using the email provided below. multiple positions within their locals. Getting more to negotiate that language into agreements where
Name LU# Sector Email Address involved just doesn’t seem like a realistic option. none currently exist. If we are going to attract Ron Fancsal 1299 Steel and Related [email protected] However, you could try easing the load on those talented members to serve as International Union Don Carlson 59 Paper [email protected] folks by inviting other members to join local union Staff Representatives, we have to give members an Robert Desmond 13702 Amalgamated [email protected] committees. I have said it before, and I really opportunity to work for our Union on an as-needed Automotive Jesse Edwards 2-232 [email protected] Related believe it, there are Steelworkers who would serve basis to determine their interest in serving. So, Chemical & Kent Holsing 12075 [email protected] Energy Related on various USW committees but don’t because there you have it. Recruiting volunteers isn’t just Jackie Anklam 9899 Health Care [email protected] they don’t know how to get involved or are John Mendyk 12934 Public [email protected] about asking members to give a little bit of their
Dave Page 1327 At Large [email protected] waiting for someone to ask them. So, rather than time. It’s about building a strong future for our
Matthew Gibbons 5965 At Large [email protected] relying on the same people to do our Union’s Locals, the District and International Union. Please
Jim Whitt 2-145 Allied Industrial [email protected] work, let’s urge others to become activists. The consider signing up for a committee today! worst that can happen is some may say no. But Grievance Committee: Members of this the reward is that you’re building your local and is published by the committee are generally called “shop stewards” and recruiting future leaders. United Steelworkers District 2 are often elected to serve in a designated AFL-CIO·CLC For those who have attended their first Labor department and/or shift as called for in the MICHAEL H. BOLTON, Director 1244A Midway Rd., Menasha, WI 54952 Day parade or picnic, and those of you who are collective bargaining agreement (CBA). The duties (920) 722-7630 interested in the Steelworkers, but have been Contributors to this issue include: of the steward are also defined in your contract.
Lori Gutekunst, Tammy Duncan, Jay McMurran, Steve Donovan, hesitant to take the first step to become active, let Stewards are our Union’s first line of defense when Robert Desmond, Patrick Temple-West, Victoria Gudia, Zachary Warmbrodt, POLITICO, Economic Policy Institute, me invite you to get involved in one of the local it comes to contract disputes and disciplinary The History Channel
Articles and photos are welcome and union committees recommended in our matters. They also initiate grievances, attend
should be sent:
Art Kroll, Editor, District 2 News Steelworkers’ Constitution and By-Laws for Local hearings and help resolve disagreements between 20600 Eureka Road, Suite 300, Taylor, MI 48180 Unions. Our founders had the foresight to create members. [email protected] • 734-285-0367
committees that both served the needs of our September 21, 2018, is the deadline for Safety, Health and Environment Committee: submissions for the next issue. members and allow activists to share their Again, the duties and areas assigned to members individual skills and talents. For example, if you — Continued on Page 2 —
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 2
Did you know? A Message from Director Bolton - continued from page 1 of this important committee are determined in your CBA. Most contracts call on The Union Difference committee members to work with their management counterparts to inspect work areas, review accident and incident reports, and to help develop and implement Union members work together to policies and practices to create a safer workplace for Steelworkers. If your labor negotiate and enforce a contract with agreement does not provide for a joint labor-management safety program, your management that guarantees the things local union establishes the role of its SH&E committee. you care about like decent raises, affordable health care, job security, and Organizing Committee: Adding new members is the life blood of every a stable schedule. organization. However, in the Labor movement, where maintaining Union density in our represented industries can impact wages, benefits and working conditions, it is even more critical. As a member of your Local’s Organizing Committee, you will be Higher Wages trained in identifying potential targets, researching those targets, initiating a drive $204 per week than their and running a successful drive from start to finish. You will also learn how to write non-union counterparts leaflets, file board charges and represent workers at National Labor Relations Board hearings. Organizing is tough, but beating a Union Buster at his own game is the Better Benefits most fulfilling accomplishment a Union activist can experience. More likely to have employer-provided Rapid Response: Rapid Response is our Union’s membership education and pensions and health insurance involvement program that encourages Steelworkers to participate in actions to influence legislative issues at the state and federal levels of government. Members Safer Workplace of the committee are assigned to discuss issues and get information to members regarding pending laws that have a profound impact on our Union and working Safe working conditions that prevent lives. Committee members work with the Local Union RR Coordinator to design and death, illness and injury. implement actions. Voice on the job Political Action Committee (PAC): Every right that we enjoy as workers and Better workplaces and working Union members has been given to us through the legislative process and those rights, as we have seen over the past ten years, can be taken away through the conditions without the fear same process. If we are going to stop the attacks on organized labor and begin rebuilding the American working class, we have to elect the right people to do it. Our PAC aims to do just that. Civil Rights Committee: Members of this committee work together to monitor dignity and rights of Steelworkers in the workplace and within our Union. Since all workers have the same basic civil rights, this committee represents all Steelworkers in civil rights matters. Workers’ Compensation Committee: A Steelworker that gets hurt on the job shouldn’t have to lose their home or dignity because they cannot work. Members of this committee monitor legislative changes in state Workers’ Compensation laws and encourage USW members to act to protect our benefits. They also review management’s treatment of injured workers and act to ensure that our members receive the benefits they are entitled to and get them on time. The Union Plus Credit Card program. Community Services Committee: Community Services is a Union referral With 3 card choices - designed to meet the needs of union members. All with competitive rates, U.S. program designed to provide assistance to members in times of need. Committee based customer service and more. Plus, exclusive hardship grants for eligible cardholders*. members are trained by the United Way to help Steelworkers find assistance from The Union Plus Credit Card Program is designed to United Way Agencies in a myriad of issues. For example, a Steelworker or a loved meet the needs of hard-working union members and their families. one may be experiencing financial problems. As a Community Services To apply by phone, call: 1-800-522-4000 representative, you’ll work with that member to find the appropriate United Way
member agency to provide financial aid and planning. Members who enjoy helping
others will find this committee fulfilling. United Steelworkers District 2 AFL-CIO·CLC
Women of Steel: Women of Steel (WOS) is the Steelworkers’ program working MICHAEL H. BOLTON, Director, 1244A Midway Road, Menasha, WI 54952 (920) 722-7630 to prepare women for leadership roles within our Union. Local WOS chapters meet HAVE YOU BEEN TO DISTRICT 2’S to discuss important issues, receive training and plan community outreach activities. PAGE ON FACEBOOK? District 2 WOS Coordinators hold regular sub-district area meetings with Local www.facebook.com/USWDistrict2 activists to provide training, group activities and to hear important information from guest speakers. — Continued on Page 4 —
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 3
20182018 DistrictDistrict 22 CalendarCalendar ofof EventsEvents
JANUARY 19 WOS Quarterly Meeting JUNE American Legion Hall, 327 W. Wisconsin Avenue • Tomahawk, WI 20 Presidents Meeting/Next Generation Meeting (9:00 a.m. – 12:00 noon) 23 WOS Quarterly Meeting USW Local 12075 Hall, 3510 James Savage Road • Midland, MI USW Local 2-21 Hall, 1201 Sheridan Road • Escanaba, MI 24 WOS Quarterly Meeting 21 Presidents Meeting/Next Generation Meeting (9:00 a.m. – 12:00 noon) USW Local 1299 Hall, 11424 W. Jefferson Avenue • River Rouge, MI USW Local 2-148 Hall, 1201 Gillingham Road • Neenah, WI 26 WOS Quarterly Meeting Milwaukee Labor Council Building, 633 S. Hawley Road • Milwaukee, WI JULY 17-20 USW National Paper Bargaining Conference FEBRUARY TBD • Pittsburgh, PA
6-7 USW Public Employee Conference Wyndham Grand Downtown Pittsburgh, 600 Commonwealth Place • Pittsburgh, PA AUGUST 27 LM Review Session 6-7 Sub-District Local Union Leadership Training (NWI) Red Lion Hotel Paper Valley, 333 W. College Avenue • Appleton, WI USW Local 12075 Hall, 3510 James Savage Road • Midland, MI 28 LM Review Session 8 WOS Quarterly Meeting Bungalow Restaurant, 1100 28th Street • Manistee, MI USW Local 2-148 Hall, 1201 Gillingham Road • Neenah, WI
MARCH 9-10 Sub-District Local Union Leadership Training (SWI) Four Points Sheraton - Milwaukee Airport, 5311 S. Howell Avenue • Milwaukee, WI 1 LM Review Session Teamsters Local 7 Hall, 3330 Miller Road • Kalamazoo, MI 17 WOS Quarterly Meeting Milwaukee Labor Council Building, 633 S. Hawley Road • Milwaukee, WI 2 LM Review Session USW Dist. 2 Southern MI, 20600 Eureka Road, Suite 300 • Taylor, MI 17 WOS Quarterly Meeting 19-20 USW District 2 WOS Meeting and Health & Safety Training American Legion Hall, 327 W. Wisconsin Avenue • Tomahawk, WI
Marriott at the Renaissance Center, 400 Renaissance Drive • Detroit, MI 17 WOS Quarterly Meeting 20 USW District 2 Next Generation Meeting 12687 Goldenrod Court • Wayland, MI Marriott at the Renaissance Center, 400 Renaissance Drive • Detroit, MI 21 USW District 2 Education Day 23 WOS Quarterly Meeting USW Local 12075 Hall, 3510 James Savage Road • Midland, MI Marriott at the Renaissance Center, 400 Renaissance Drive • Detroit, MI 22-23 USW District 2 Council Conference 20-21 Sub-District Local Union Leadership Training (SMI) Marriott at the Renaissance Center, 400 Renaissance Drive • Detroit, MI Village Conference Center, 1645 Commerce Park Drive • Chelsea, MI
26-30 USW Health, Safety, and Environment Conference 23-24 Sub-District Local Union Leadership Training (NMI) David L. Lawrence Center & Westin Hotel, 1000 Penn Avenue • Pittsburgh, PA Great Hall Banquet and Convention Center, 5121 Bay City Road • Midland, MI
26 LM Review Session 31 WOS Quarterly Meeting USW Local 2-21 Hall, 1201 Sheridan Road • Escanaba, MI USW District 2 Southern Michigan Sub-Office, 20600 Eureka Road, Suite 300 • Taylor, MI 27 LM Review Session Kronenwetter Village Hall, 1582 Kronenwetter Drive • Kronenwetter, WI SEPTEMBER 28 LM Review Session 1 WOS Quarterly Meeting Lucky Dog’z Labor Temple, 157 S. Green Bay Road • Neenah, WI Central Community Center, 413 Maple Street • Munising, MI 29 LM Review Session Milwaukee Labor Council Building, 633 S. Hawley Road • Milwaukee, WI OCTOBER APRIL 2 Presidents Meeting (9:00–12:00) & Next Generation Meeting (1:00–3:30) USW Local 2-21 Hall, 1201 Sheridan Road • Escanaba, MI 20 WOS Quarterly Meeting Milwaukee Labor Council Building, 633 S. Hawley Road • Milwaukee, WI 3 Presidents Meeting (9:00–12:00) & Next Generation Meeting (1:00–3:30) Fraternal Order of Eagles, 1104 S. Oak Avenue • Marshfield, WI 22-25 Health Care Workers Conference Four Points by Sheraton Lexington, 1938 Stanton Way • Lexington, KY 4 Presidents Meeting (9:00–12:00) & Next Generation Meeting (1:00–3:30) Green Bay Labor Temple, 1570 Elizabeth Street • Green Bay, WI
MAY 5 Presidents Meeting (9:00–12:00) & Next Generation Meeting (1:00–3:30) 9 WOS Quarterly Meeting Milwaukee Central Labor Council Building, 633 S. Hawley Road • Milwaukee, WI USW Local 2-148 Hall, 1201 Gillingham Road • Neenah, WI 9 Presidents Meeting (9:00–12:00) & Next Generation Meeting (1:00–3:30) 11 WOS Quarterly Meeting Teamsters Local 7 Hall, 3330 Miller Road • Kalamazoo, MI American Legion Hall, 327 W. Wisconsin Avenue • Tomahawk, WI 15 WOS Quarterly Meeting 10 Presidents Meeting (9:00–12:00) & Next Generation Meeting (1:00–3:30) USW Local 4950 Hall, 1206 Baldwin • Negaunee, MI USW Local 12075 Hall, 3510 James Savage Road • Midland, MI
21-23 USW Rapid Response and Legislative Conference 11 Presidents Meeting (9:00–12:00) & Next Generation Meeting (1:00–3:30) Omni Shoreham Hotel, 2500 Calvert Street NW • Washington, D.C. USW District 2 Southern Michigan Sub-Office, 20600 Eureka Road, Suite 300 • Taylor, MI
23 WOS Quarterly Meeting 14-17 USW International Women’s Conference Kent Ionia Labor Hall, 918 Benjamin Avenue NE • Grand Rapids, MI Sheraton Centre Toronto Hotel, 123 Queen Street W • Toronto, Ontario, Canada 24 WOS Quarterly Meeting Old Morton Federal Credit Union, 516 Kosciusko Street • Manistee, MI NOVEMBER 31 WOS Quarterly Meeting 26-30 Sub-District Local Union Leadership Training (MI) USW Local 12075 Hall, 3510 James Savage Road • Midland, MI Dates and Locations TBD
JUNE 1 WOS Quarterly Meeting DECEMBER USW District 2 Southern Michigan Sub-Office, 20600 Eureka Road, Suite 300 • Taylor, MI 3-7 Sub-District Local Union Leadership Training (WI) 11 Presidents Meeting/Next Generation Meeting (9:00 a.m. – 12:00 noon) Dates and Locations TBD Ronn Hall, 1206 Baldwin Avenue • Negaunee, MI 12 Presidents Meeting/Next Generation Meeting (9:00 a.m. – 12:00 noon) Fraternal Order of Eagles, 1104 S. Oak Avenue • Marshfield, WI This schedule is desidesignedgned to assist in planning this year’s events. However, 13 Presidents Meeting/Next Generation Meeting (9:00 a.m. – 12:00 noon) Lucky Dog’z, 157 S. Green Bay Road • Neenah, WI therethere isis aa possibilitypossibility datesdates and/orand/or locationslocations could change due to unforeseen 14 Presidents Meeting/Next Generation Meeting (9:00 a.m. – 12:00 noon) circumstances. Changes and corrections will be made ASAP and updated on Milwaukee Central Labor Council Building, 633 S. Hawley Road • Milwaukee, WI thethe USWUSW D2D2 Website.Website. 19 Presidents Meeting/Next Generation Meeting (9:00 a.m. – 12:00 noon) Teamsters Local 7 Hall, 3330 Miller Road • Kalamazoo, MI
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 4
A Message from Director Bolton - continued from page 2 Next Generation (Next Gen): Young workers are our Union’s future and Next Gen is working to prepare them to accept the leadership torch. Our District 2 Next Gen Coordinators work with local unions to design programs and provide training in a host of areas, which include: labor history, collective bargaining, grievance handling and arbitration, and how effective local unions function. If Union involvement is in your future, this is the committee for you. Steelworkers Organization of Active Retirees (SOAR): Just because a Steelworker retires, it doesn’t mean they cannot remain active within their Union. SOAR is the USW’s program to keep our pensioners involved and in touch with their local union and other USW retirees. Local Union SOAR Chapters meet regularly to receive important updates from their locals, gain information on programs like Social Security and Medicare, and receive tips on matters like choosing the right Medicare supplement. Local Unions also reach out to SOAR members to seek their participation in Steelworker activities. Communications Committee: This committee helps the local union get its message out to its membership through the publication of a Local Newsletter, maintaining a website or through a Twitter account. Communication is critical to educating our members and helping them get a grasp of the very important work we do each day. Every local is encouraged to implement a communication program for their members. As you can see, the Steelworkers has something for everyone. Don’t let your talents and skills go to waste. Put them to work for the brothers and sisters you work with. Join a local union committee today and let’s go build our Union together!
This Month in Labor History: 1981 : Reagan Fires 11,359 Air-Traffic Controllers - The History Channel
On August 5, 1981, President Ronald Reagan begins firing 11,359 air-traffic controllers striking in violation of his order for them to return to work. The executive action, regarded as extreme by many, significantly slowed air travel for months. Two days earlier, on August 3, almost 13,000 air-traffic controllers went on strike after negotiations with the federal government to raise their pay and shorten their workweek proved fruitless. The controllers complained of difficult working conditions and a lack of recognition of the pressures they face. Across the country, some 7,000 flights were
canceled. The same day, President Reagan called the strike illegal and threatened to fire any controller who had not returned to work within 48 hours. Robert Poli, president of the Professional Air-Traffic Controllers Association (PATCO), was found in contempt by a federal judge and ordered to pay $1,000 a day in fines. On August 5, an angry President Reagan carried out his threat, and the federal government began firing the 11,359 air-traffic controllers who had not returned to work. In addition, he declared a lifetime ban on the rehiring of the strikers by the Federal Aviation Administration (FAA). On August 17, the FAA began accepting applications for new air-traffic controllers, and on October 22 the Federal Labor Relations Authority decertified PATCO.
AUGUSTAUGUST 20172018 •• VOLUMEVOLUME 8,7, ISSUE 8, PAGE 45
Getting to Know Your District 2 Council Steering Committee
The District 2 Steering Committee has many functions as listed in the sidebar of the first page of this newsletter. But, you may be asking yourself, who are these elected members? Where do they work? What do they do? To help answer these questions, USW District 2 Director Michael Bolton has set aside a column in the D2 News to do just that starting with the May 2018 issue. We will introduce the four newly elected Council Steering Committee Members recently elected at the 2018 USW District 2 Council Conference in Detroit, MI, on March 23 to serve a four-year term — Congratulations to these newly elected council members! Let’s start with an excerpt of the District 2 By-Laws, which state:
ARTICLE XI - DUTIES OF THE DISTRICT 2 COUNCIL STEERING COMMITTEE
A. This District 2 Council Steering Committee shall assist in the following: ● Development of agenda for Council Conference ● Planning of the District Council Conference and Political/Educational Conferences ● District 2 Strategic Planning ● Determining and assessing educational needs within the District ● Generating and leading activism and other purposes consistent with the mission and directives of District 2 and the USW
B. The District 2 Council Steering Committee will normally meet biannually. C. The District 2 Council Steering Committee is expected to be present at the District 2 Council Conference. D. Once elected, the District 2 Council Steering Committee will meet to elect 2 Co-Chairs and a Secretary. The District Director or his designee shall preside over the committees as Chairperson.
This month we are featuring Robert Desmond - Amalgamated Sector Robert Desmond has been an employee of the Mt. Elliott Cemetery Association for 42 years. He is usually the first person families see the day of the service. It is his responsibility to provide the best service he can by meeting every desire, need and concern of the families and funeral directors. He is proud of the beautiful grounds and buildings in addition to the great reputation the cemetery has within the community. Robert serves as Local 13702’s Financial Secretary – a position he’s held for the past 25 years. He’s been the Chief Steward for the past 5 election turns and is also the current Chairman of the Local’s Safety Committee and Workers’ Compensation Committee. In addition to his positions at the local, he has also been a trainer with the Tony Mazzocchi Center since 2011. Robert’s favorite sports team is the Detroit Red Wings. His favorite vacations are the Caribbean side of Costa Rica and Alaska. If you wish to inquire or have any questions about this sector, please feel free
to contact Robert Desmond at: [email protected]
Not So Funny Political Cartoons?
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 6
Wisconsin & Michigan - District 2 Held its Local Union Leadership Training in August
USW District 2 held its Local Union Leadership Training in Appleton, WI, Milwaukee, WI, Chelsea, MI and Midland, MI during the week of August 6—10 in Wisconsin, and the week of August 20—24 in Michigan. This training was designed to assist newly elected local union officers and stewards, while providing the opportunity to further develop the skills and education of those who were reelected to office in 2018. Delegates who attended had the opportunity to choose one of the following classes: Financial Training This class focuses on the Financial Secretary’s duties and responsibilities, as well as extensive training on the Financial Secretary’s cashbook. There will be an overview of the Excel electronic programs that were developed to ease the officer’s recordkeeping requirements and there will also be instruction on the taxes and reporting requirement of these taxes, as well as USW policies and all reporting requirements for the International, Internal Revenue Service and Department of Labor. Steward Training & Grievance Handling This class will examine the roles and legal status of stewards and will develop the basic skills of investigating, writing and presenting grievances. Local Union Administration (New officers Training) This class examines the roles and responsibilities of local union officers, including how to hold effective meetings, record keeping, developing effective committees, organizing and working with the community. Emergency Response This safety training course provides guidance and information for basic awareness and operations level responders as required under 29 CFR 1910.120. Topics include emergency response, emergency roles, toxic myths and chemical protective clothing. This training is an awareness level course and does not qualify the participant to handle, recover or process hazardous materials.
USW District 2 - Wisconsin & Michigan Local Union Leadership Training Pictures
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 7
USW Local 2659 SOAR Chapter 29-4 Annual Picnic - By Tony Pascarella, SOAR C00rdinator
On Saturday, July 21, 2018, USW Local 2659 SOAR Chapter 29-4 held their annual picnic at Patriot’s Park in Riverview, Michigan. The weather, unfortunately, did not cooperate; however, come rain or shine, the picnic remain scheduled. In spite of the wet weather, an estimated 60-70 SOAR members and their families enjoyed the food and beverages served under the pavilion and in the attached community center. It was exciting to see a number of a new faces this year; and the conversations and camaraderie was great. As a result, we are hoping for more new members to participate in our SOAR monthly meetings. Thank you to all the volunteers that not only made this event possible, but made it successful as well.
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 8
Month in History: 1911 First Around-The-World Telegram Sent, 66 Years Before Voyager II Launch - History Channel
On August 20, 1911, a dispatcher in the New York Times office sends the first telegram around the world via commercial service. Exactly 66 years later, the National Aeronautics and Space Administration (NASA) sends a different kind of message–a phonograph record containing information about Earth for extraterrestrial beings–shooting into space aboard the unmanned spacecraft Voyager II. The Times decided to send its 1911 telegram in order to determine how fast a commercial message could be sent around the world by telegraph cable. The message, reading simply “This message sent around the world,” left the dispatch room on the 17th floor of the Times building in New York at 7 p.m. on August 20. After it traveled more than 28,000 miles, being relayed by 16 different operators, through San Francisco, the Philippines, Hong Kong, Saigon, Singapore, Bombay, Malta, Lisbon and the Azores–among other locations–the reply was received by the same operator 16.5 minutes later. It was the fastest time achieved by a commercial cablegram since the opening of the Pacific cable in 1900 by the Commercial Cable Company.
On August 20, 1977, a NASA rocket launched Voyager II, an unmanned 1,820-pound spacecraft, from Cape Canaveral, Florida. It was the first of two such crafts to be launched that year on a “Grand Tour” of the outer planets, organized to coincide with a rare alignment of Jupiter, Saturn, Uranus and Neptune. Aboard Voyager II was a 12-inch copper phonograph record called “Sounds of Earth.” Intended as a kind of introductory time capsule, the record included greetings in 60 languages and scientific information about Earth and the human race, along with classical, jazz and rock ‘n’ roll music, nature sounds like thunder and surf, and recorded messages from President Jimmy Carter and other world leaders. The brainchild of astronomer Carl Sagan, the record was sent with Voyager II and its twin craft, Voyager I – launched just two weeks later – in the faint hope that it might one day be discovered by extraterrestrial creatures. The record was sealed in an aluminum jacket that would keep it intact for 1 billion years, along with instructions on how to play the record, with a cartridge and needle provided. More importantly, the two Voyager crafts were designed to explore the outer solar system and send information and photographs of the distant planets to Earth. Over the next 12 years, the mission proved a smashing success. After both crafts flew by Jupiter and Saturn, Voyager I went flying off towards the solar system’s edge while Voyager II visited Uranus, Neptune and finally Pluto in 1990 before sailing off to join its twin in the outer solar system. Thanks to the Voyager program, NASA scientists gained a wealth of information about the outer planets, including close-up photographs of Saturn’s seven rings; evidence of active geysers and volcanoes exploding on some of the four planets’ 22 moons; winds of more than 1,500 mph on Neptune; and measurements of the magnetic fields on Uranus and Neptune. The two crafts are expected to continue sending data until 2020, or until their plutonium-based power sources run out. After that, they will continue to sail on through the galaxy for millions of years to come, barring some unexpected collision.
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 9
Eye-popping Payouts for CEOs Follow Trump’s Tax Cuts - By Patrick Temple-West & Victoria Guida, POLITICO • 07/30/2018
The insider sales feed the narrative that corporate tax cuts enrich executives in the short term while yielding less clear long-term benefits for workers.
Some of the biggest winners from President Donald Trump’s new tax law are corporate executives who have reaped gains as their companies buy back a record amount of stock, a practice that rewards shareholders by boosting the value of existing shares. A POLITICO review of data disclosed in Securities and Exchange Commission filings shows the executives, who often receive most of their compensation in stock, have been profiting handsomely by selling shares since Trump signed the law on Dec. 22 and slashed corporate tax rates to 21 percent. That trend is likely to increase, as Wall Street analysts expect buyback activity to accelerate in the coming weeks. “It is going to be a parade of eye-popping numbers,” said Pat McGurn, the head of strategic research and analysis at Institutional Shareholder Services, a shareholder advisory firm. That could undercut the political messaging value of the tax cuts in the Republican campaign to maintain control of Congress in the midterm elections. Since the tax cuts were enacted, Oracle Corp. CEO Safra Catz has sold $250 million worth of shares in her company — the largest executive payday this year. Product development head Thomas Kurian sold $85 million. The sales came after the company announced a $12 billion share repurchase. Mastercard CEO Ajay Banga sold $44.4 million of stock in May, the largest single cash-out by an executive of the company in at least 10 years, months after the company announced a $4 billion buyback of its own stock. Two days after Eastman Chemical announced it would purchase $2 billion of its own stock, CEO Mark Costa sold 55,000 shares for $5.4 million. The SEC requires company executives to disclose share purchases or sales within two business days. Companies emphasize that their executives’ share sales are often scheduled at regular intervals well in advance. In Banga’s case, he has routinely sold shares once a year, and always in May, since 2013. Yet the insider sales feed the narrative that corporate tax cuts enrich executives in the short term while yielding less clear long- term benefits for workers and the broader economy. Critics of insider sales argue that they diminish the value of paying C-suite employees in shares — a practice that’s intended to give them a greater stake in the long-term health of the company — and can even raise questions about the motivation for the buybacks themselves. Following the tax cuts, roughly 28 percent of companies in the S&P 500 mentioned plans to return some of their tax savings to shareholders, according to Morgan Stanley. Public companies announced more than $600 billion in buybacks in the first half of this year — already toppling the previous annual record. Year to date, buybacks have doubled from the same period a year ago, Merrill Lynch said in a July 24 report, citing its clients’ trading activity. “Last week we noted that buyback activity [was] poised to accelerate over the next six weeks, and indeed, corporate clients’ buybacks picked up to a two-month high and the 6th-highest level in our data history,” the company said. The correlation between corporate buybacks and insider sales is clear, according to SEC Commissioner Robert Jackson, a Democrat. He studied 385 buybacks since the beginning of 2017 and found that after half of them, at least one executive sold shares within the next month. The link between the tax cuts and big executive payouts, fueled by buybacks, is also plain, according to one institutional research firm. “Stock buyback announcements in the U.S. have swelled to the highest levels on record in the wake of last year’s corporate tax cut,” said TrimTabs Investment Research in a July 10 report. “Corporate America’s actions suggest that most of the benefits of the corporate tax cut will flow to investors in general and top corporate executives in particular.” To be sure, 44 percent of companies say they also plan to reinvest some savings in their operations through initiatives like new factories, research and development and higher wages, according to Morgan Stanley. That's the kind of uses that featured prominently in Republicans’ marketing of their tax bill. But that spending hasn’t been as immediate and could be headed off by economic headwinds. The Federal Reserve has cited anecdotal evidence of companies scaling back planned capital expenditures over fears of a trade war. And while more than two dozen companies announced one-time bonuses to employees after the tax bill, wage growth is still sitting at a lackluster 2.7 percent. “What did companies do with their cash?” said the Morgan Stanley analysis. “In short, a large increase in stock buybacks was the biggest change” in the first quarter of this year from the last quarter of 2017. Republicans and business groups point to ways that the tax cuts are helping the middle class. “Most Americans are invested [in stocks] either directly or through 401(k)s or through pension funds or through some mechanism,” said Rep. Tom MacArthur, a member of the House Financial Services Committee and a former CEO. — Continued on Page 10 —
AUGUST 2018 • VOLUME 8, ISSUE 8, PAGE 10
Eye-popping Payouts for CEOs Follow Trump’s Tax Cuts - continued from page 9
As more people are retiring and selling their shares, companies are scooping them up with buybacks, the New Jersey Republican said. “Personally, I don't think that’s usually a good way to create value for a company, to buy back its own stock. But let’s not forget who they buy their stock back from.” “Evaluating tax reform through the lens of executive compensation misses the majority of the picture,” said Chris Netram, vice president of tax and domestic economic policy at the National Association of Manufacturers, a lobbying group. “Lower [tax] rates and investment incentives have led to robust increases in hiring, equipment purchases and worker pay and benefits,” he said, adding that surveys of NAM members show businesses plan to invest their tax savings in their operations, hire employees and increase wages and benefits. Yet the lower rates have also led to robust stock sales by executives. In a speech last month, the SEC’s Jackson said, “There is clear evidence that a substantial number of corporate executives today use buybacks as a chance to cash out the shares of the company they received as executive pay. “In fact, twice as many companies have insiders selling in the eight days after a buyback announcement as sell on an ordinary day,” he said. On Feb. 28, TJX Cos., the parent company of T.J. Maxx stores, announced a new stock buyback plan as part of an earnings announcement, boosting the department store’s stock above $82. On March 1, Carol Meyrowitz, an executive and former CEO, sold $11 million in shares. In the 30 days following the buyback announcement, TJX CEO Ernie Herrman sold $2.8 million of shares. Erika Tower, a TJX spokeswoman, said executives were prohibited from trading in 2018 prior to the Feb. 28 announcement. Meyrowitz and Herrman have sold stock for years while the share price has kept going up, she said. “Meyrowitz and Herrman continue to hold very large stakes in the company,” Tower said. On Jan. 26, the North Chicago-based AbbVie announced strong profits and increased its earnings guidance for 2018. The pharmaceutical company estimated an effective tax rate of about 9 percent in 2018. AbbVie’s shares jumped to a multiyear high above $120. On Feb. 15, the company announced a new, $10 billion stock buyback plan. From Feb. 20 through March 1, eight executives sold a total of $26.8 million worth of stock. Throughout this period, the stock stayed above $114. It has since dipped to $90.56, as of July 27. Cigarette-maker Altria announced a $1 billion buyback on Feb. 1. From Feb. 8 through March 2, four executives sold a total of $1.8 million. Chief Executive Craig Johnson sold $995,734 eight days after the buyback was announced. No Altria executives sold shares prior to the buyback announcement in 2018. Representatives for Eastman Chemical and AbbVie declined to comment. Altria did not immediately respond to a request for comment. Oracle also declined to comment. Mastercard spokesman Seth Eisen said: “You’re trying to make a connection where one doesn’t exist. There’s nothing notable about this transaction,” he said of Banga's share sale. Banga’s annual financial management plan was preplanned, he said. These legal trades occur routinely regardless of a firm’s share price. Executives will often prearrange sales of their stock to avoid a perception that they are selling at the most valuable point in time for them. Charles Gabriel, president of Capital Alpha, a Washington analysis firm, said executive compensation “will unlikely prove decisive this fall, with the Trump message machine on the improving economy." Still, he said, it “will become a hardened talking point for House Democrats in their campaign messaging.”
This One Chart Shows How Obscene CEO Pay Has Become - Economic Policy Institute