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April 15, 2005
By Marty Mulcahy
Union investment money is doing the talking - and in some cases, the walking - as organized labor is moving into a renewed strategy of using pension dollars to win work for members, improve their standing, and further union political goals.
The union campaign has moved into numerous arenas. Significantly, unions are putting their own houses in order, seeking to consolidate financial and insurance services offered to members (see related article). Labor is also moving to influence or get friendly directors nominated to corporate boards. And brokerage houses that openly support privatization of Social Security assets are being put on notice that unions will pull their money if such support continues.
Labor's financial clout is considerable. According to Business Week, there is $2.6 trillion in U.S. public employees' pension funds, and there are another $400 billion-plus in multi-employer pension funds, which cover groups like building trades unions.
The renewed activism by union pension fund managers is drawing howls of protest from the business community and the editorial page of the Wall Street Journal.
On March 31, under the headline "Pension Fund Blackmail," the Journal wrote in its lead editorial, "The result is what one observer has termed 'the new politics of capital' in which liberal activists attempt to turn entire corporations into lobbyists for their social and political goals, their campaigns all neatly disguised as 'shareholder activism.'"
For example, the Journal noted that the pension fund manager for California state union workers, directing some $180 billion in assets, used its investment in Safeway to demand that the company soften its stance against union workers on strike against the grocer.
Another example: last year, a New York state pension fund manager wrote a letter to the Sinclair Broadcasting Group, suggesting that airing a controversial documentary on John Kerry's Vietnam war record could hurt shareholder value. The pension fund held shares of Sinclair - which ultimately agreed not to air the show.
On March 31, unionists picketed corporate offices - notably those of stockbroker Charles Schwab & Co. - targeting those firms that joined Bush's pro-privatization for Social Security coalition.
Labor's protests over the conflicts of interest inherent in brokers' support for Social Security privatization, sent two financial services companies, Edward Jones & Co. and Waddell & Reed, "scurrying out of a coalition supporting reform," said the Journal.
Schwab is targeted, the AFL-CIO said, because its officials have been outspoken in speaking and financing the pro-Bush coalition. The federation also launched a new website, www.wallstreetgreed.org, spotlighting 28 financial firms and their ties to the pro-Bush privatization coalition. The conservative University of Chicago Business School calculates brokers would earn $934 billion from privatization.
"Working families are putting financial firms on notice: They will not allow firms that handle their savings to promote a scheme that will put their hard-earned money at risk," AFL-CIO President John J. Sweeney said.
According to a University of Notre Dame Higgins Labor Research Center study, "unions may only represent 9% of the private sector labor force, but they submitted 28% of all shareholder resolutions in the 2002 proxy season and 18% in 2003 - far more than any other institutional investor. Through their pension funds, unions influence nearly one quarter of all equities and one half of bonds in the U.S. economy." The study said the success of a union-backed mutual fund is coincident with classical trade union strategies to improve the working lives of their members."
Through proxy votes and other pressure, unions are seeking lower executive salaries, are acting as watchdogs on foreign investments and have managed to pull investments from companies that have been accused of fiscal fraud. By applying pressure to corporate boards, unions argue that their pension funds can bring balance to an out-of-whack power structure in a world that's dominated by corporations.
Corporate America is not taking the fight sitting down. A few years after taking a low profile after the highly publicized corporate malfeasance at Enron and WorldCom, companies are now coming out of their shell. Among their arguments against this type of union activism: pension fund administrators become more adverse to taking risks and are doing their investors a disservice by chasing pro-union causes, instead of chasing higher investment returns. No doubt corporate pressure will be brought on the Republican Congress to find a way to outlaw such union activism.
'It's just clearly a pendulum that has swung too far," said David Hirschmann, senior vice president of the U.S. Chamber of Commerce.
The pendulum has started to swing. Late last year, the Securities and Exchange Commission reversed course and ruled that Walt Disney Co. could bar from its proxy ballot a union-backed initiative that would make it easier for shareholders to nominate corporate board members.
Richard Ferlauto, director of pension and benefit policy for
the public union group AFSCME, told the AP that he expects state
pension funds will eventually win the right to nominate corporate
board members. "That's an issue that corporate America doesn't
want to see happen and the push back is around that," he
Organized labor seems ready to start thinning out the herd of financial and insurance services that are offered to members.
A proposal by Laborers International Union President Terrence O'Sullivan would consolidate a number of labor-backed organizations under a single roof for the benefit of members. The proposal was heard last month at the AFL-CIO Executive Council meeting.
The stakes are huge for the potential money shift on Wall Street, where antennas were raised last month after AFL-CIO leaders reached a consensus on consolidating and expanding labor's financial services businesses.
It's an idea "so obvious," said Business Week, "that it's a wonder no one proposed it sooner: vastly expanding labor's lucrative financial-services businesses. After all, labor-owned companies already sell union members everything from life insurance to credit cards. But the companies don't work together and have never even tried to reach all of the country's 16 million union households."
A unified financial services organization under the AFL-CIO would combine the Union Labor Life Insurance Co., the AFL-CIO Building Investment Trust, Union Privilege (which currently offers a credit card, life insurance and mortgages) and possibly Amalgamated Life Insurance.
Less than 10 percent of union members currently take advantage of those services, said O'Sullivan, a chief proponent for the consolidation. Instead, members' insurance needs are provided by corporations, "most of whose interests are not the same as those in the labor movement and working people," O'Sullivan told the Construction Labor Report.
Combining those services, he said, the profits from the unified
network could "grow the labor movement, rather than go to
As a comparison, AARP earns $300 million a year by offering services such as health insurance and travel by using its brand in partnership with for-profit companies.
"What's more," Business Week said, "managing hundreds of billions of union pension-fund assets - a key part of the plan - would magnify union efforts to influence proxy votes on CEO pay and other corporate governance issues."
ANN ARBOR - Cardiovascular disease kills more Americans than the next five leading causes of death combined - claiming the lives of 35,000 Michiganians every year - which is the nation's 8th worst coronary death rate.
The University of Michigan plans to do something about lowering that fatality rate with the construction of its new $199 million Cardiovascular Center (CVC). The 350,000 square-foot building is being constructed on six floors as well as two basement levels.
The CVC will include three ambulatory care clinics, non-invasive diagnostic and testing suites, five cardiac catheterization labs, five electrophysiology labs, eight operating rooms specializing in cardiac, vascular and radiology procedures, 20 intensive care beds and office space for clinical faculty and support staff.
Barton-Malow is leading the three-year construction project, which is expected to be complete in the fall of 2006.
"This facility will be a wonderful addition to our research and our services at the Medical Center," said U-M President Mary Sue Coleman. "Academic medical centers around the country are turning their focus to cardiovascular work in a new and intensive way, and this building will allow us to be at the leading edge of all that activity."
The building will be located just south of the Cancer & Geriatrics Center and the University Hospital, on the site of the "Old Main" hospital.
According to architect Shepley Bulfinch Richardson and Abbott, the new clinical building will enable more patients to receive coordinated care at a one-stop location by bringing together specialized services and facilities that are now located throughout the existing medical center.
Space and programs for patient and physician education are also included in the building. The facility was flexibly designed to accommodate changes in technology and procedures to ensure patients will receive the most up-to-date care.
The design will maximize the use of natural light and include a garden atrium and healing garden to create a place of tranquility for patients, families and visitors. The project also includes a 465-space parking deck.
LANSING - Striking back at critics blaming her for the state's unemployment rate - which leads the nation - Gov. Jennifer Granhom on March 28 unveiled the "Jobs Today Initiative," a plan to jumpstart Michigan's economy.
And it appears as if the state's lagging construction industry will be the prime beneficiary of the boost.
First announced in the governor's State of the State address, the Job Today Initiative is a three-year program designed to accelerate the pace of state and local infrastructure projects that were scheduled to begin over the next decade. The initiative will also create new tools and incentives to encourage local and private investment.
"Every year in Michigan, we invest thousands of hours and millions of dollars to fix roads, improve schools and build community resources that citizens share," said Granholm. "This work is critical and necessary - and it requires scores of Michigan women and men working in a variety of jobs from the skilled trades to service and sales. This is a plan to create new opportunities for economic development around the state that will put shovels in the ground and paychecks in workers' pockets this construction season."
Granholm's plan will:
As part of the 2005 budget agreement, legislative approval was given to $220 million in projects to upgrade universities and $38 million worth of pollution clean-up projects. In addition, Granholm said $400 million in accelerated road projects will also begin this year.
Granholm said she will ask the state legislature to approve two key changes in the law to create incentives for local governments to accelerate their own infrastructure improvements. The first is a change in the state's School Bond Loan Fund to make it easier for Michigan school districts to renovate aging school buildings without raising taxes. The second is a new provision to allow cities to expand the boundaries of their downtown development zones in order to spur new job creation and development projects.
Granholm also outlined new incentive programs her administration has created to encourage pollution clean-up, housing construction and long-term care facility improvement projects. She said her administration is taking on increased outreach to ensure that developers are taking advantage of the new incentives to start construction now.
The governor said the Jobs Today Initiative will create jobs in seven key areas, and building trades workers are the prime beneficiaries: affordable housing construction and renovation; school improvement and repair; pollution cleanup; road improvements; long-term care facility construction and renovation; downtown development; and university campus improvements.
"Jobs must be the first order of business for everyone
in Michigan today," Granholm said. "Contractors, engineers,
architects and construction personnel across Michigan are eager
to get to work."
By Marty Mulcahy
LANSING - When it comes to designing and building bridges, the Ambassador, Blue Water, International and Mackinac are all proof that our state has done a great job on the big ones.
It's another story for the thousands of Michigan's nameless, mundane overpasses, which have usually been built with monochrome concrete and an eye toward economy rather than beauty. But ever so slowly, as old overpasses are repaired or new ones are built, fresh designs are adding a little variety to highway-scapes and the driving experience.
Mark Van Port Fleet, the Michigan Department of Transportation's engineer of design, acknowledged that until five years ago, MDOT usually chose "function over aesthetics." Now, he said MDOT and other state transportation departments are looking at their own and each other's work, "trying to determine what would look good here or be appropriate there."
In 2000, MDOT joined other states that took a critical look at their stock of bridges and highway overpasses, and made a formal commitment to "aesthetically pleasing design" for bridge construction and renovation. The concept is part of the "context-sensitive solutions" outlined in the article nearby.
Perhaps the ultimate example of this philosophy can be found at the ongoing revamp of the I-94 - Telegraph Road interchange, where MDOT has authorized construction of a steel-arched dual "Gateway" bridge. The $14 million span is designed as a showy "entrance" for Metro Airport travelers traveling to Detroit.
MDOT was able to specify an upgraded bridge because local communities and quasi-public agencies like Detroit Renaissance chose to pick up part of the tab for the unique span.
Building a better-looking bridge can be more expensive, but it doesn't have to cost too much more - especially as the industry adapts to the new philosophy. As manufacturers of bridge materials get more accustomed to building unique designs and use new techniques, their prices should come down.
More experience with slip-forms will allow contractors and tradespeople to do work with different designs and textures. Colored pre-cast materials are currently only nominally more expensive. And some colored coatings on bridge surfaces act as a sealant and lengthen their life-span. In some cases, just installing unique railings can make a big difference in appearance.
Van Port Fleet said there is no cookie-cutter for new or renovated bridge designs - MDOT has individual plans for each. "Obviously beauty is in the eye of the beholder, but in the transportation community, we have slowly come to realize that everything doesn't have to be dull and drab," he said.
A few Michigan bridge projects that have been worked on over the years that have broken the traditional mold include the West Grand Boulevard bridge over I-75 in Detroit, the new Beck Road-I-96 overpass in Novi and the M-22 overpass in Glen Arbor.
Utah was one of the first states to implement context-sensitive design. In the beginning of the interstate era, said Tom Warne, executive director of the Utah Department of Transportation, "we built the greatest freeway system in the world; but aesthetics and preserving the environment weren't part of that mission. Now we need another transformation. We're here to define a new vision, to change how we do business."
By Barbara Hicks
Context sensitive solutions (CSS) is an abstract term for a very down-to-earth approach to designing transportation projects. This approach relies on early and continuous dialogue with members of the community to identify common interests and build consensus, so that bridges, interchanges, bikepaths and other transportation projects are built to "fit" their physical settings.
"When you design a transportation project that is meant to last 20 to 30 years, you want to avoid a cookie-cutter approach," said Mark Van Port Fleet, MDOT engineer of design. "Everyone benefits when extra care is taken to ensure that the completed project does what it is intended to do, looks good and reflects the community's values and objectives."
The Michigan Department of Transportation (MDOT) believes that incorporating CSS principles into transportation project design enables the department to arrive at transportation solutions that keep a community mobile and safe, while respecting its scenic, historic, economic, cultural and environmental resources.
In 2003, Gov. Granholm issued an Executive Directive that requires MDOT to incorporate context sensitive solutions into transportation projects whenever possible. To date, the department has held two CSS workshops that were attended by several hundred representatives of local government, road commissions, industry groups, land use advocates, and state agencies, to further this partnership.
MDOT has recently completed a number of projects that meet planning and engineering objectives while satisfying specific needs identified by the communities involved.
A recent CSS project involved the M-69 bridge over the Paint River in Iron County. MDOT needed to preserve the historic bridge, built in 1924, and maintain a safe traffic flow. After talking with the city of Crystal Falls and the State Historic Preservation Office, MDOT held a public meeting and learned that residents were concerned about safeguarding the bridge's historic spans.
The only one of its kind in Michigan, the concrete bridge consists of two primary arch ribs.
The construction of the old bridge made collapse highly possible if either rib were compromised. There were other challenges, including protecting the river and its natural setting, and creating driving conditions on the bridge that would reassure local motorists who reported feeling crowded when sharing a curve with large trucks such as logging trucks and manufactured home haulers.
Another challenge involved working with the city, which wanted to keep traffic moving on the main street during construction. The MDOT design preserved the historic aspects of the bridge, including the spandrel columns, superstructure, railing, lighted columns, standards and lamps with some critical modifications. To accommodate wider travel lanes, the superstructure was widened by six inches and each sidewalk was reduced by six inches. Drainage problems were addressed and new lighting, based on the original design, was installed, adding to both the safety and ambiance of the rehabilitated bridge.
Realizing that it was not feasible to keep traffic on the main street during construction as the city preferred, MDOT ended up investing nearly $350,000 to upgrade the city streets that would serve as detour routes. In order to minimize disruption to local businesses, MDOT placed signs at strategic locations along the detour route to let motorists know that the downtown district was open for business. Additionally, small businesses were encouraged to place their own "open for business as usual" signs along the detour route.
Finally, MDOT paid for dedicated law enforcement in the construction work zone to keep speeds down on the part of the detour that went through a residential area. There were no accidents during the five months the detour was in effect.
Returned to service in 2002, the bridge now serves as both a gateway into Crystal Falls and a focal point for the non-motorized path along the Paint River. The project was completed in just one construction season at a final cost of $1,130,545. A traditional bridge replacement that followed 2005 design standards would have cost approximately 25 percent more.
Even more important, such a design would have had greater environmental impacts, not blended as harmoniously with the surroundings and would not have been as visually respectful of the bridge's history with the community.
"We even were able to accommodate snowmobile traffic
on the bridge," said Mike Premo, the MDOT Crystal Falls
Transportation Service Center manager responsible for the project.
"Paint River is a good example of how working closely with
the community can result in a win-win solution to a transportation
problem. The residents of Crystal Falls were happy with the final
result and with how we kept them in the loop throughout planning
and construction, and the department was satisfied that the rehabilitated
bridge will continue to serve the community for a long time to
*Brighton Area Board of Education - Endorsed is Joe Carney, a 35-year member if IBEW Local 58.
*Warren Consolidated School District - Endorsed are
Warren Consolidated Board of Education candidates Elaine Jankowski-Arnold
and Chris Arnold. Chris is a member of Roofers Local 149 and
Elaine is his mother. Both have pledged to support prevailing
wage in the community, prevent outsourcing, and support the labor
Hunter safety program scheduled
Two classroom lessons will be held, on Monday, May 9 and Wednesday, May 11, from 6-9:30 p.m. at Grand Blanc High School (auditorium), 12500 Holly Rd.
A shooting range lesson will take place from 8:30 a.m. to noon on Saturday, May 21 at the Grand Blanc Huntsman's Club, 9046 Irish Rd. in Grand Blanc. Free refreshments follow.
This is a free Michigan DNR-certified program, and all supplies and safety equipment will be provided. Gifts will be provided to all program graduates.
To register, go online to www.senate.mi.gov/cherry and click
on "hunter safety program," or call (866) 305-2126.
636's Wiechert picked for boiler board
"I know Frank will represent the building trades industry with distinction because of his hard work, knowledge and dedication," said Local 636 Business Manager Tom Devlin.
Wiechert has been a member of Local 636 since 1972 and has
been a business agent since 1996.
Retirement party set for three Local 80 BAs
Retiring this year are Bill Bradfield, Tony Caleca and Mike
Stumpf. Their retirement party will be held on Friday, May 13
at 6 p.m. at the Hyatt Regency in Dearborn. Tickets are $75 each
and they are available at the Local 80 union hall, 17100 W. 12
Mile Rd in Southfield. (248) 557-7575.