December 21, 2008
Inside a Gritty Brooklyn Factory, Potomac Fever
By CAROLINE H. DWORIN
ON Thursday, Dec. 11, Jim Donnelly got the call at his office on Jay Street in Dumbo for the biggest job he had ever had. Emmett Beliveau, the executive director of the Presidential Inaugural Committee, told him that Precise Continental, Mr. Donnelly’s 26-year-old printing company, had won the bid to produce one million gold-and-black engraved invitations for the inauguration of President-elect Barack Obama.
Mr. Donnelly gathered his staff for the announcement, and a cheer went up. “They were ecstatic,” he said. “They wanted to be a part of history.”
To meet the Jan. 2 deadline, Mr. Donnelly’s 65 employees have to work around the clock. But no one was complaining, Mr. Donnelly said, and he put out dozens of calls for rush orders of paper, ink and the like.
According to Mr. Donnelly, Precise Continental was selected over rival printers because it is a union company, it uses recycled paper and it is certified by the Forest Stewardship Council, which promotes responsible forest management. Although Clark Stevens, a spokesman for the inaugural committee, would not confirm that those factors were decisive, he did say, “These are issues that President-elect Obama campaigned on and that have concerned him throughout his career.”
Several days after the phone call, the snow fell heavily on the cobblestones in Dumbo, and trains rattled over the Manhattan Bridge. Inside Precise Continental, there was an almost poetic combination of mechanical repetition and human industry, all on an enormous ink-stained wooden floor. It could have been the 1800s.
The first order arrived by truck on Monday, from Neenah Paper, a Wisconsin company. Ink came on Tuesday from BuzzInk, in Chicago.
With clean hands, the workers inspected each invitation at each step in the process, and fed great machines moving back and forth. “This gentleman here can feed by hand as good as the automatic press can,” said Mr. Donnelly of a man he called Bobby, who was seated in front of a massive instrument moving sheets of paper from his left hand to his right.
Precise Continental prints stationery and specialty items, like certificates for Fordham’s million-dollar donors and invitations to an Emmy after-party sponsored by TV Guide. As for the inaugural invitations, they are being printed on recycled paper called Classic Crest (“It’s a distinguished cream color,” said Bernie Hennessy, area sales director at Neenah Paper), with an inaugural seal at the top in gold. The curling black script, modified versions of Shelley Allegro and Kuenstler typefaces, begins, “The Presidential Inaugural Committee requests the honor of your presence. ...”
Mr. Donnelly’s plant will hum 20 hours a day, with the workers in two shifts, to complete the project. “Our goal is to get as much done before Christmas Eve,” Mr. Donnelly said, “so they don’t have to work the day after Christmas.” He would not say how much the invitation project will cost.
A small, dark-haired, steady-handed man named Augusto Lovato, who speaks more Spanish than English, hunched over a drawing board in a quieter room off the main floor, a dusty lamp nearby. Peering though an old magnifying glass at a copper plate, he expertly cleaned the serifs and curls.
“This is a real economy,” Mr. Donnelly said of the printing business. “This is not that bogus economy of Wall Street. This country used to manufacture things.”
Mr. Donnelly does not believe he will be asked to attend the inauguration. Of course, he has not finished printing the invitations.
Sunday, December 21, 2008
Saturday, December 20, 2008
Keeping Up With Xanthe Hilton
A wonderful follow-up on Greencastle Antrim college member Xanthe Hilton's experiences as an Obama volunteer. Reprinted from the Colby Sawyer Current:
Changing the World through Political Activism
By Amber Cronin '11
It's the day before the New Hampshire Primary, and people are clapping, screaming and cheering as if anticipating the arrival of a rock star. In the midst of the excitement, a college student makes her way through the crowd, pushing toward the rail. When she makes it, she can finally see what everyone is searching for: a tall, thin African-American man running for president of the United States. Sophomore Xanthe Hilton squirms as she waits for Barack Obama to make his way down the line to shake her hand.
“How's it going, nice to see you again,” he says when he finally reaches her.
“I'm voting for you tomorrow,” Hilton responds. It is her third meeting with the future president.
Hilton, a native of south central Pennsylvania, became involved with politics during her high school years. “I took a government class senior year,” she said. “When I told my professor I was going to college in New Hampshire, he said, 'You should get involved with the political scene because their primaries are first, and next year is an election year.'” Hilton took those words to heart and became a full-time volunteer for the Obama campaign.
“When I got here the only name that really caught my attention was Barack Obama's, and instantly the campaign hopped on me and asked if I wanted to get involved,” said Hilton. She told the campaign that she would volunteer, but on a limited basis. Her plan did not exactly work out the way she expected. After meeting Obama two or three times--she has now met the future resident five times total--she found herself wanting more involvement with his campaign.
A Key Player in Pivotal States
During primary season, along with her schoolwork and responsibilities on campus that include her role as a resident assistant (RA), a Student Government Association (SGA) senator, student representative to three different committees, and involvement in several clubs, Hilton served as a full-time volunteer doing outreach programs. After the primary season ended in the Northeast, she became a sort of cheerleader on campus for the Obama campaign. Over the summer, however, it was a different story.
Hilton moved to Toledo, Ohio, to work as a fellow, organizing campaign fundamentals and activities to engage the community and build the movement. The city where Hilton worked and the county that surrounds it ultimately voted Democrat after 40 years of voting Republican.
The Obama campaign office in Toledo, Ohio, where Xanthe Hilton worked in the summer of 2008.
“On a personal level the program allowed for me to understand what a small difference I, one person, can make, she said. “Working as an Obama fellow gave me the confidence that I can change the world. I already have.”
Once the fellows training was completed, she moved on to other duties. “We had to register voters; it was critical to get people registered to vote and then track those people, and call them on Election Day to make sure they could vote,” she said.
“I found that people were a little nervous about going out and asking other people how they are planning to vote, but what people were interested in was opening up their homes to a staffer and having someone live with them or bring in lasagna once a week until Election Day,” she said. “We had one woman who catered our office every week for the entire time I was in Ohio, which was amazing.”
Ramping Up for the Final Stretch
After completing her volunteer work in Ohio, Hilton made the long trip back to New London. “I know a lot of people who joined on as paid staff for the election, but because of commitments here at school I couldn't do that,” she said. “But I made it a month-long journey to drive back to school. I stopped at home for a bit, I volunteered in Virginia, Pennsylvania, and volunteered in New Hampshire for two weeks before school started.”
Her work in politics was far from over upon her return, however. Back in New Hampshire, Hilton began working as an organizer on campus and as unpaid staff for the New Hampshire Democratic Party. Hilton, along with several other Colby-Sawyer students, spent the evening of Nov. 4 in Wheeler Hall anxiously awaiting the declaration of the next president. When the announcement came in, she breathed a sigh of relief.
“It was kind of euphoric for me. It really felt like I had worked for the past 14 months to get this man elected and it finally happened,” she said.
Hilton spent her summer volunteering for a cause she really believes in. What will she remember the most? Not how all the work she did paid off in the end, but the people she met along the way. “A major part of [the Obama campaign] was telling your story, and telling his or her story. I listened to all those stories and carried them with me with everything that I did.”
One thing Hilton will always remember is the work that people did to get people involved in the campaign, gathering supporters and registering voters. She recalls that while they were registering people to vote, one of her friends called a woman and asked her if she was interested in registering. It was the last day to register, and she wanted to vote, but she had just had a baby and was still in the hospital. Within half an hour, the new mother was registered to vote.
“That shaped this woman's life; she had a role in choosing who was going to run her country and who was going to shape her new baby's life,” said Hilton. “That's what I think is great about politics, that such a small act, like giving up your life for six weeks, can change the world.”
With her busy schedule as an RA in Burpee Hall, an SGA senator, a campus organizer and a laundry list of other activities, Hilton harbors her own political ambitions and seems to be well on her way to playing an important role in the future of this country. “I plan on, if circumstances need be, fulfilling that position and running for office.”
Changing the World through Political Activism
By Amber Cronin '11
It's the day before the New Hampshire Primary, and people are clapping, screaming and cheering as if anticipating the arrival of a rock star. In the midst of the excitement, a college student makes her way through the crowd, pushing toward the rail. When she makes it, she can finally see what everyone is searching for: a tall, thin African-American man running for president of the United States. Sophomore Xanthe Hilton squirms as she waits for Barack Obama to make his way down the line to shake her hand.
“How's it going, nice to see you again,” he says when he finally reaches her.
“I'm voting for you tomorrow,” Hilton responds. It is her third meeting with the future president.
Hilton, a native of south central Pennsylvania, became involved with politics during her high school years. “I took a government class senior year,” she said. “When I told my professor I was going to college in New Hampshire, he said, 'You should get involved with the political scene because their primaries are first, and next year is an election year.'” Hilton took those words to heart and became a full-time volunteer for the Obama campaign.
“When I got here the only name that really caught my attention was Barack Obama's, and instantly the campaign hopped on me and asked if I wanted to get involved,” said Hilton. She told the campaign that she would volunteer, but on a limited basis. Her plan did not exactly work out the way she expected. After meeting Obama two or three times--she has now met the future resident five times total--she found herself wanting more involvement with his campaign.
A Key Player in Pivotal States
During primary season, along with her schoolwork and responsibilities on campus that include her role as a resident assistant (RA), a Student Government Association (SGA) senator, student representative to three different committees, and involvement in several clubs, Hilton served as a full-time volunteer doing outreach programs. After the primary season ended in the Northeast, she became a sort of cheerleader on campus for the Obama campaign. Over the summer, however, it was a different story.
Hilton moved to Toledo, Ohio, to work as a fellow, organizing campaign fundamentals and activities to engage the community and build the movement. The city where Hilton worked and the county that surrounds it ultimately voted Democrat after 40 years of voting Republican.
The Obama campaign office in Toledo, Ohio, where Xanthe Hilton worked in the summer of 2008.
“On a personal level the program allowed for me to understand what a small difference I, one person, can make, she said. “Working as an Obama fellow gave me the confidence that I can change the world. I already have.”
Once the fellows training was completed, she moved on to other duties. “We had to register voters; it was critical to get people registered to vote and then track those people, and call them on Election Day to make sure they could vote,” she said.
“I found that people were a little nervous about going out and asking other people how they are planning to vote, but what people were interested in was opening up their homes to a staffer and having someone live with them or bring in lasagna once a week until Election Day,” she said. “We had one woman who catered our office every week for the entire time I was in Ohio, which was amazing.”
Ramping Up for the Final Stretch
After completing her volunteer work in Ohio, Hilton made the long trip back to New London. “I know a lot of people who joined on as paid staff for the election, but because of commitments here at school I couldn't do that,” she said. “But I made it a month-long journey to drive back to school. I stopped at home for a bit, I volunteered in Virginia, Pennsylvania, and volunteered in New Hampshire for two weeks before school started.”
Her work in politics was far from over upon her return, however. Back in New Hampshire, Hilton began working as an organizer on campus and as unpaid staff for the New Hampshire Democratic Party. Hilton, along with several other Colby-Sawyer students, spent the evening of Nov. 4 in Wheeler Hall anxiously awaiting the declaration of the next president. When the announcement came in, she breathed a sigh of relief.
“It was kind of euphoric for me. It really felt like I had worked for the past 14 months to get this man elected and it finally happened,” she said.
Hilton spent her summer volunteering for a cause she really believes in. What will she remember the most? Not how all the work she did paid off in the end, but the people she met along the way. “A major part of [the Obama campaign] was telling your story, and telling his or her story. I listened to all those stories and carried them with me with everything that I did.”
One thing Hilton will always remember is the work that people did to get people involved in the campaign, gathering supporters and registering voters. She recalls that while they were registering people to vote, one of her friends called a woman and asked her if she was interested in registering. It was the last day to register, and she wanted to vote, but she had just had a baby and was still in the hospital. Within half an hour, the new mother was registered to vote.
“That shaped this woman's life; she had a role in choosing who was going to run her country and who was going to shape her new baby's life,” said Hilton. “That's what I think is great about politics, that such a small act, like giving up your life for six weeks, can change the world.”
With her busy schedule as an RA in Burpee Hall, an SGA senator, a campus organizer and a laundry list of other activities, Hilton harbors her own political ambitions and seems to be well on her way to playing an important role in the future of this country. “I plan on, if circumstances need be, fulfilling that position and running for office.”
Tuesday, December 2, 2008
Debunking The Myth of the $70 per hour autoworker
by Johnathan Cohn
If you've been following the auto industry's crisis, then you've probably read or heard a lot about overpaid American autoworkers -- in particular, the fact that the average hourly employee of the Big Three makes $70 per hour.
That's an awful lot of money. Seventy dollars an hour in wages works out to almost $150,000 a year in gross income, if you assume a 40-hour work week. Is it any wonder the Big Three are in trouble? And with auto workers making so much, why should taxpayers--many of whom make far less -- finance a plan to bail them out?
Well, here's one reason: The figure is wildly misleading.
Let's start with the fact that it's not $70 per hour in wages. According to Kristin Dziczek of the Center for Automative Research -- who was my primary source for the figures you are about to read -- average wages for workers at Chrysler, Ford, and General Motors were just $28 per hour as of 2007. That works out to a little less than $60,000 a year in gross income -- hardly outrageous, particularly when you consider the physical demands of automobile assembly work and the skills most workers must acquire over the course of their careers.
More important, and contrary to what you may have heard, the wages aren't that much bigger than what Honda, Toyota, and other foreign manufacturers pay employees in their U.S. factories. While we can't be sure precisely how much those workers make, because the companies don't make the information public, the best estimates suggests the corresponding 2007 figure for these "transplants" -- as the foreign-owned factories are known -- was somewhere between $20 and $26 per hour, and most likely around $24 or $25. That would put average worker's annual salary at $52,000 a year.
So the "wage gap," per se, has been a lot smaller than you've heard. And this is no accident. If the transplants paid their employees far less than what the Big Three pay their unionized workers, the United Auto Workers would have a much better shot of organizing the transplants' factories. Those factories remain non-unionized and management very much wants to keep it that way.
But then what's the source of that $70 hourly figure? It didn't come out of thin air. Analysts came up with it by including the cost of all employer-provided benefits -- namely, health insurance and pensions -- and then dividing by the number of workers. The result, they found, was that benefits for Big Three cost about $42 per hour, per employee. Add that to the wages -- again, $28 per hour -- and you get the $70 figure. Voila.
Except ... notice something weird about this calculation? It's not as if each active worker is getting health benefits and pensions worth $42 per hour. That would come to nearly twice his or her wages. (Talk about gold-plated coverage!) Instead, each active worker is getting benefits equal only to a fraction of that -- probably around $10 per hour, according to estimates from the International Motor Vehicle Program. The number only gets to $70 an hour if you include the cost of benefits for retirees -- in other words, the cost of benefits for other people. One of the few people to grasp this was Portfolio.com's Felix Salmon. As he noted recently, the claim that workers are getting $70 an hour in compensation is just "not true."
Of course, the cost of benefits for those retirees -- you may have heard people refer to them as "legacy costs" -- do represent an extra cost burden that only the Big Three shoulder. And, yes, it makes it difficult for the Big Three to compete with foreign-owned automakers that don't have to pay the same costs. But don't forget why those costs are so high. While the transplants don't offer the same kind of benefits that the Big Three do, the main reason for their present cost advantage is that they just don't have many retirees.
The first foreign-owned plants didn't start up here until the 1980s; many of the existing ones came well after that. As of a year ago, Toyota's entire U.S. operation had less than 1,000 retirees. Compare that to a company like General Motors, which has been around for more than a century and which supports literally hundreds of thousands of former workers and spouses. As you might expect, many of these have the sorts of advanced medical problems you expect from people to develop in old age. And, it should go without saying, those conditions cost a ton of money to treat. To be sure, we've known about these demographics for a while. Management and labor in Detroit should have figured out a solution it long ago. But while the Big Three were late in addressing this problem, they did address it eventually.
Notice how, in this article, I've constantly referred to 2007 figures? There's a good reason. In 2007, the Big Three signed a breakthrough contract with the UAW designed, once and for all, to eliminate the compensation gap between domestic and foreign automakers in the U.S.
The agreement sought to do so, first, by creating a private trust for financing future retiree benefits -- effectively removing that burden from the companies' books. The auto companies agreed to deposit start-up money in the fund; after that, however, it would be up to the unions to manage the money. And it was widely understood that, given the realities of investment returns and health care economics, over time retiree health benefits would likely become less generous.
In addition, management and labor agreed to change health benefits for all workers, active or retired, so that the coverage looked more like the policies most people have today, complete with co-payments and deductibles. The new UAW agreement also changed the salary structure, by creating a two-tiered wage system. Under this new arrangement, the salary scale for newly hired workers would be lower than the salary scale for existing workers.
One can debate the propriety and wisdom of these steps; two-tiered wage structures, in particular, raise various ethical concerns. But one thing is certain: It was a radical change that promised to make Detroit far more competitive. If carried out as planned, by 2010 -- the final year of this existing contract -- total compensation for the average UAW worker would actually be less than total compensation for the average non-unionized worker at a transplant factory. The only problem is that it will be several years before these gains show up on the bottom line -- years the industry probably won't have if it doesn't get financial assistance from the government.
Make no mistake: The argument over a proposed rescue package is complicated, in no small part because over the years both management and labor made some truly awful decisions while postponing the inevitable reckoning with economic reality. And even if the government does provide money, it's a tough call whether restructuring should proceed with or without a formal bankruptcy filing. Either way, yet more downsizing is inevitable.
But the next time you hear somebody say the unions have to make serious salary and benefit concessions, keep in mind that they already have -- enough to keep the companies competitive, if only they can survive this crisis.
Jonathan Cohn is a senior editor at The New Republic, where this article first appeared on Nov. 21, 2008. Used with permission.
© 2008 The New Republic.
If you've been following the auto industry's crisis, then you've probably read or heard a lot about overpaid American autoworkers -- in particular, the fact that the average hourly employee of the Big Three makes $70 per hour.
That's an awful lot of money. Seventy dollars an hour in wages works out to almost $150,000 a year in gross income, if you assume a 40-hour work week. Is it any wonder the Big Three are in trouble? And with auto workers making so much, why should taxpayers--many of whom make far less -- finance a plan to bail them out?
Well, here's one reason: The figure is wildly misleading.
Let's start with the fact that it's not $70 per hour in wages. According to Kristin Dziczek of the Center for Automative Research -- who was my primary source for the figures you are about to read -- average wages for workers at Chrysler, Ford, and General Motors were just $28 per hour as of 2007. That works out to a little less than $60,000 a year in gross income -- hardly outrageous, particularly when you consider the physical demands of automobile assembly work and the skills most workers must acquire over the course of their careers.
More important, and contrary to what you may have heard, the wages aren't that much bigger than what Honda, Toyota, and other foreign manufacturers pay employees in their U.S. factories. While we can't be sure precisely how much those workers make, because the companies don't make the information public, the best estimates suggests the corresponding 2007 figure for these "transplants" -- as the foreign-owned factories are known -- was somewhere between $20 and $26 per hour, and most likely around $24 or $25. That would put average worker's annual salary at $52,000 a year.
So the "wage gap," per se, has been a lot smaller than you've heard. And this is no accident. If the transplants paid their employees far less than what the Big Three pay their unionized workers, the United Auto Workers would have a much better shot of organizing the transplants' factories. Those factories remain non-unionized and management very much wants to keep it that way.
But then what's the source of that $70 hourly figure? It didn't come out of thin air. Analysts came up with it by including the cost of all employer-provided benefits -- namely, health insurance and pensions -- and then dividing by the number of workers. The result, they found, was that benefits for Big Three cost about $42 per hour, per employee. Add that to the wages -- again, $28 per hour -- and you get the $70 figure. Voila.
Except ... notice something weird about this calculation? It's not as if each active worker is getting health benefits and pensions worth $42 per hour. That would come to nearly twice his or her wages. (Talk about gold-plated coverage!) Instead, each active worker is getting benefits equal only to a fraction of that -- probably around $10 per hour, according to estimates from the International Motor Vehicle Program. The number only gets to $70 an hour if you include the cost of benefits for retirees -- in other words, the cost of benefits for other people. One of the few people to grasp this was Portfolio.com's Felix Salmon. As he noted recently, the claim that workers are getting $70 an hour in compensation is just "not true."
Of course, the cost of benefits for those retirees -- you may have heard people refer to them as "legacy costs" -- do represent an extra cost burden that only the Big Three shoulder. And, yes, it makes it difficult for the Big Three to compete with foreign-owned automakers that don't have to pay the same costs. But don't forget why those costs are so high. While the transplants don't offer the same kind of benefits that the Big Three do, the main reason for their present cost advantage is that they just don't have many retirees.
The first foreign-owned plants didn't start up here until the 1980s; many of the existing ones came well after that. As of a year ago, Toyota's entire U.S. operation had less than 1,000 retirees. Compare that to a company like General Motors, which has been around for more than a century and which supports literally hundreds of thousands of former workers and spouses. As you might expect, many of these have the sorts of advanced medical problems you expect from people to develop in old age. And, it should go without saying, those conditions cost a ton of money to treat. To be sure, we've known about these demographics for a while. Management and labor in Detroit should have figured out a solution it long ago. But while the Big Three were late in addressing this problem, they did address it eventually.
Notice how, in this article, I've constantly referred to 2007 figures? There's a good reason. In 2007, the Big Three signed a breakthrough contract with the UAW designed, once and for all, to eliminate the compensation gap between domestic and foreign automakers in the U.S.
The agreement sought to do so, first, by creating a private trust for financing future retiree benefits -- effectively removing that burden from the companies' books. The auto companies agreed to deposit start-up money in the fund; after that, however, it would be up to the unions to manage the money. And it was widely understood that, given the realities of investment returns and health care economics, over time retiree health benefits would likely become less generous.
In addition, management and labor agreed to change health benefits for all workers, active or retired, so that the coverage looked more like the policies most people have today, complete with co-payments and deductibles. The new UAW agreement also changed the salary structure, by creating a two-tiered wage system. Under this new arrangement, the salary scale for newly hired workers would be lower than the salary scale for existing workers.
One can debate the propriety and wisdom of these steps; two-tiered wage structures, in particular, raise various ethical concerns. But one thing is certain: It was a radical change that promised to make Detroit far more competitive. If carried out as planned, by 2010 -- the final year of this existing contract -- total compensation for the average UAW worker would actually be less than total compensation for the average non-unionized worker at a transplant factory. The only problem is that it will be several years before these gains show up on the bottom line -- years the industry probably won't have if it doesn't get financial assistance from the government.
Make no mistake: The argument over a proposed rescue package is complicated, in no small part because over the years both management and labor made some truly awful decisions while postponing the inevitable reckoning with economic reality. And even if the government does provide money, it's a tough call whether restructuring should proceed with or without a formal bankruptcy filing. Either way, yet more downsizing is inevitable.
But the next time you hear somebody say the unions have to make serious salary and benefit concessions, keep in mind that they already have -- enough to keep the companies competitive, if only they can survive this crisis.
Jonathan Cohn is a senior editor at The New Republic, where this article first appeared on Nov. 21, 2008. Used with permission.
© 2008 The New Republic.
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