cross the picket line--or not?

Great Debates
61

I’ll leave the retort courteous to Bricker.

It’s really hard to know where to start. Why don’t the supermarket owners hire some bully boys to kneecap picketers and bash a few heads in? After all, why should the supermarket owners be concerned about obeying laws if those same laws can be used against them?

You will, no doubt, observe that some business owners have resorted to these tactics in the past – but that didn’t make it right. Of course, it is the very application of the law you so despise that prevents these things from happening to strikers today.

Contrary to your Marxist worldview, not everything is politics. Your suggestion that supermarket employees “should take over the store and run it by and for themselves” is utterly abhorent – and stupid. So stupid, in fact, that I can’t believe you actually seriously suggested it.

Apart from the practical problems – specifically that the strikers would get chewed up and spit out if they tried anything so utterly daft, the only thing that protects ordinary people from the depredations of the powerful is widespread respect for law. Do you really want to live in a world where whoever has enough raw power can do whatever they want to whomever they want? Not me. One of the main features of law is that it constrains the powerful – to the obvious benefit of the weak.

Respect for law is package deal. You can’t simply follow the laws that benefit you and ignore the rest.

62

The purpose of the cite was to counter claims made previously. I’d be willing to agree that a unionized cashier likely makes more than a non-union cashier. By the same token, a unionized electrician likely makes more than a non-union one.

Hence, I still find the numbers to be perfectly valid as a tool of comparison.

63

Nowhere have I said that I support strikers physically attacking scabs or vandalizing property. I do, however, support strikers keeping scabs off company property in order to make the strike that much more effective. Like the sit-in strikes in Detroit 1936, or the Teamsters strike in Minneapolis 1934. Both of which, I might add, were around actually having unions in the workplace.

If you really can’t tell the difference between personal property and private property, on your own head be it when I shoot you in self-defense for breaking into my apartment, you knucklehead.

They did it in Petrograd in 1917, they did it in Seattle in 1919, they did it in Minneapolis in 1934, they did it in Detroit in 1936, they did it in Chile in 1973, they did it in Portugal in 1975, they did it in Iran in 1979 (before Khomeini stepped in), they did it in Poland in 1980. They’ve done it before and they can and will do it again. If a strike at Von’s and Kroger’s and Albertson’s got to the point where the places were shut down by the corporations and people in the communities couldn’t get food, by all means the people who work in the stores should open them up again and run things themselves.

Now, to the figures debate.

Have you looked at Albertson’s sales for 1997? (See page 3). The figure there is a paltry $14.6 billion in sales. 14.6*2.23=32.56, which is actually less than the $35.6 billion posted for FY02. Now the merger with ASC hadn’t been anywhere near completed by then, so it seems to me that the statement that Albertson’s enjoyed a 123% increase in sales is quite valid. My guess, therefore, is that the website I linked to is comparing the 2001 reports to the 1997 reports for Albertson’s, Kroger’s, and Safeway and making their statements based on those.

In other words, the website I used should really only be faulted for not providing its sources and nothing more. Their figures are accurate.

64

Then the website you linked to is staffed by financial idiots.

Remember where I noted above that the American Stores merger was accounted for by the pooling of interests accounting method? That’s critical to looking at these figures. In the pooling of interests accounting method, past year numbers are revised on an “as if” basis to reflect what the financial statements would have looked like if both entities had been one enterprise from the beginning of history.

Thus, you need to turn to the 1999 Annual Report, the first annual report after the merger. It will restate the prior three year’s data, including 1997 data, on an “as if” basis to show what the financial statements would look like had Albertson’s and American Stores been running as one company for each of those years.

And what is the revised figure for FY 1997? $33.82 B, only modestly less than the $35.62 B in sales reported for FY 2002.

Long story short: the 123% increase is fiction. The increase in raw numbers is almost wholly attributable to the merger with American Stores. **

That website should be faulted for almost criminal stupidity in performing financial analysis. You can’t just throw out numbers without understanding what those numbers relate to in real life. Your cite gamed the numbers to inflate their case.

65

Just to add some further resources:

The FASB started disallowing the use of the pooling method in June 2001 with the issuance of FASB Statement 141. All acquisitions initiated after that time must be accounted for via the purchase method of accounting.

Here is a good comparison of the differences between the pooling and purchase methods.

66

It’s incorrect to paint those numbers as though every employee would have to cough up those final numbers out of their paychecks every year under the proposed plan – they won’t. In fact, most of them won’t even come close.

They seem to have intentionally inflated some of those figures in an effort to make the end numbers look bigger. For instance, currently, employees with a family HMO plan pay $84/year for generic prescription medication and the new plan increases that to $280.00. Sure, a nearly $200 increase looks big – until you note that that’s for 28 prescriptions over that time. That’s a whopping $10 copay per scrip they’re being asked to pay. I’m currently paying $15/scrip copay. My heart does NOT break for them under that scenario. And that’s only if they fill 28 prescriptions for the year.

Same “high-end” scenario (your “Family, catastrophe: $144/yr to $4,745/yr.” from above), that $4,745 includes $880 for office visits to see a specialist… 22 times!. It’s also inflated to include 5 emergency room visits at $300 and 3 hospital stays at $750. So, for the family that doesn’t go to any specialists, manages to avoid the emergency room and no one is hospitalized, that supposed out-of-pocket figure drops by $1,930.

Sure, I guess it’s possible, but how many employees under that plan will see a regular doctor 10 times a year and see specialists 22 times a year and go to the emergency room 5 times and have 3 hospital stays? Those numbers are so over-inflated I’m surprised you didn’t notice that before you quoted them.

At the moment these people contribute absolute ZERO toward their healthcare premiums, and they also pay nearly nothing at all if they see a doctor, visit an emergency room or need a prescription. While I can certainly empathize that they’d like to keep those cush bennies (I know I was disheartened when the company I worked for 5 years ago started making employees contribute to their healthcare costs), I don’t agree that they deserve to, or that I’m morally obligated to honor their strike so they can retain benefits that have basically been done away with almost universally in the US workforce. Cite: 90% of the total US workforce makes contributions for family healthcare costs.

“A journeyman clerk now earns $17.90 an hour with fully paid family health insurance and a guaranteed pension.”

67

OK, Dewey, I’m a little confused. You use the pooling method to show how the strike website is “gaming” the numbers, yet you also indicate that the FASB disallows the use of the pooling method in financial statements. So, as I understand it, the strike website is looking at the numbers the way the FASB wants people to look at the numbers, yet you say they shouldn’t be doing that?

RickJay, I did not say that Safeway made $131 million in profit in 2002 - nor did the website. The statement was that Safeway’s operating profit (apparently a different creature, since it’s listed separately in the financial reports) is up $131 million in comparison with the operating profit of four years previously. That’s a whole different ballgame.

Shayna, as I understand it the medical plans the website shows reflect the employer’s proposal, so there’s no inflation about it. It’s what Von’s wants its employees to pay. The number of visits you cite don’t change from the present plan - a family is allowed either 10 or 22 visits to a specialist, depending on what HMO plan they get - but the costs differ. Sure, $10 per generic script doesn’t sound like much, but if you look at what employees are paying now, which is $3 a generic script, it becomes rather obvious why employees are angry about it. (You may be looking at Family Scenario 1 as what’s allowed now and Family Scenario 2 as what’s being proposed, but that’s incorrect. Both scenarios show current and proposed out-of-pocket costs. For instance, under Family Scenario 2, families are allowed 22 visits to a specialist at no cost under the current plan, but would be expected to pay $40 a visit under the proposed plan. ER visits under the new plan would cost the employee $100, whereas they’re completely covered by the company under the current plan.)

Let me ask you a related question. You noted that you felt “disheartened” when the company you worked for started requiring employee contributions to their healthcare plans. Did you feel then that you didn’t deserve to have all your healthcare costs covered by the company?

68

Olent, I completely acknowledge that under the new plan the employee will have to make a contribution to the plan premium and accept a higher co-pay on many services they either get free or at a lower cost right now. However, that still doesn’t make the over-blown numbers they cited on their website “real” numbers – especially not when comparing bottom-line figures. They’re disingenuous enough to present those figures as though that’s what they’ll have to actually pay out-of-pocket under the new plan. That’s not true. Those numbers reflect arbitrary “catastrophic” situations that are likely to never come to pass, and, frankly, appear completely unrealistic, to boot.

Seriously, if you knew a family who had to have 28 prescriptions filled AND had to see regular doctors 10 times AND see specialists 22 times AND had 5 emergency room visits AND was hospitalized 3 times in a given year, wouldn’t you be posting in MPSIMS asking for prayers for this family who’d been hit by such amazing tragedy in such a short time?

Also, you infer from that website that the company is making those changes to the healthcare plans. (“ER visits under the new plan would cost the employee $100, whereas they’re completely covered by the company under the current plan.”) “The company” was never picking up that $100 for emergency room visits – they were covered under the policy. And it’s the insurance carriers who are changing the terms of those policies. Those fully covered packages aren’t even available anymore, whether the company is willing to pay 100% of the premiums or not. So even if the employees don’t have to come up with their measely $5-20/week, they’re still going to have to pay a larger portion of their healthcare costs in co-pays and deductibles because the policy they’ve been covered under is being discontinued by the carrier.

Yet they’re still “blaming” management, as if they had any cotrol over what the insurance company is willing to cover. I guarantee you they’ve shopped for the best group plans that are out there, and hon, those are IT. I just did a comparison at https://www.ehealthinsurance.com. I made up a family of 4 with a 13 year old child and a 3 year old child. The cheapest (as far as monthly premiums) family policy available is a Blue Cross PPO plan that costs $177/month with a $1,000/year deductible, a 20% co-pay and office visits are not covered. If I want $0 co-insurance and a $40 co-pay for doctor’s visits, it’ll cost me $235/month and I’ll have a $4,000/year deductible! So even the new policy coverages that these employees are being offered are outstanding, given what’s available out there.

And to answer your question, no, I absolutely did not then, nor do I now, feel that I “deserve” to have all my healthcare costs covered. I always had to pay out-of-pocket deductibles and co-pays for doctor’s visits and scrips anyway. And as an individual, the contribution they were asking me to kick in (at the time, which was 5 years ago) was just under $5.00. The company was still paying hundreds of dollars towards my premium. So they were still picking up a hugely disproportionate amount of my healthcare benefits.

And every year that my healthcare costs went up and the company absorbed that increase, in essence, I was getting a “raise” in the form of an increased value to my overall benefits package. I was damn grateful. $4 and change was a small price to pay to ensure I was able to remain covered in case I became ill, or simply to cover routine doctor’s visits.

And when I accepted my current position, I was only offered 50% coverage if I wanted to get health insurance. I couldn’t afford it (or, in reality, wasn’t willing to sacrifice anything I was currently spending my money on), so I went uninsured for over 3 years until I got married and could get covered under my husband’s policy through his employer!

I’m thrilled to have the job I have, making the money I do, doing something I absolutely love, working for a man who pays me well and gives me lots of other perks in addition. How greedy would I have to be to say I “deserve” to have him pay 100% of my healthcare premiums, too?

I’m sorry, but I don’t think these people have a legitimate grievance. Particularly not with management. Now, if you want to debate what highway robbers the healthcare providers are, that’s a whole other ball of wax. The whole system is fucked up. And that’s not grocery store management’s fault.

69

The FASB disallowed the use of the pooling method in June 2001. The Albertson’s-American Stores merger took place in 1999. The use of the pooling method was still allowed back then.

And there is a legitimate argument to using the pooling method – it does reflect the fact that the two entities are now one, and clears up confusion about to what degree their past operations are simply the result of the merger adding stores versus the degree to which it is attributable to actual improvements in sales and whatnot. The FASB disallowed the pooling method not because it was per se bad, but because it made it difficult to compare different firms that had engaged in mergers but elected to use different methods for accounting for that merger and also because of certain balance sheet effects. Read the links I posted earlier to learn more.

In this case, it’s just a happy coincidence that the merger took place before the mandatory use of the purchase method went into effect, since the use of that method lays bare the bankruptcy of your argument.

Had the merger been accounted for by the purchase method, you would see a dramatic increase in sales in the year immediately following the merger. Most smart people – a population to which the maintainers of your cited website do not belong – would recognize that uptick as being largely the result of the merger, since radical increases in sales over a one-year period, particularly in a mature industry like grocery sales, are highly unlikely.

The pooling method makes that point clear – by restating prior year numbers, we can see that quite clearly that there was no dramatic uptick in sales at Albertson’s. Albertson’s just added a bunch of stores; it didn’t start selling a lot more stuff at all its stores.

70

It’s also a stupid number to cite. Albertson’s has overhead and other fixed expenses that can’t be attributed directly to sales, after all. One wonders: why is your website not looking at changes in net income – the proverbial “bottom line” – when that figure is what actually represents the amount of funds left over after all expenses that could be applied to increasing benefits?

71

Shayna - You bring up some valid points. Both sides of the argument, however, beg the question of who’s actually carrying the insurance. And neither of us have the answer. I’m trying to find that out now, and I hope to get results sometime today.

While it’s true that very few employees are likely to max out the allowed number of items on the plan (and I believe at this point that those numbers are set by the insurance plan itself and not pulled out of thin air by the unions), any usage of the proposed plan represents a dramatic increase in out-of-pocket costs for an individual employee.

I’m very glad that you didn’t suffer any catastrophic medical situations during those 3 years you went uninsured. There are, however, some 43 million people in the US who are in the same situation today, and it’s almost certain many of them won’t be so fortunate. That in and of itself sickens me, and I therefore feel very strongly that working people certainly do deserve to have their entire medical expenses covered, whether at corporate or federal expense. And I think the employees of Von’s have a legitimate grievance. Even if it’s an outside carrier, it shows how little Von’s management cares for the people it hires, and how much it cares about the money it can make, to simply accept this new arrangement and expect its employees to accept it as well.

I had a very strong feeling you’d come back with something like that. The standard’s changed, Dewey. If the corporations themselves can’t use the pooling method in their financial statements, then other people making statements about those documents shouldn’t be expected to use the pooling method either. Were we having this discussion in October 2000, you’ve have a point worth debating. As it is now, however, it’s really only so much hot air.

72

Did you bother to read the rest of my post? Y’know, where I explain how the merger would have been accounted for under the purchase method, why a reasonable reader would recognize that the increase in sales was attributable to the merger, and why the use of pooling in this case is just a happy conicidence because it allows us to clearly see the bankruptcy of your argument?

My overall point is still correct and you haven’t addressed it in the slightest: there was nowhere near a 123% increase in sales over four years; the larger numbers are wholly attributable to the increase in stores related to the merger. The people who put together your cited website are, in essence, publishing a lie.

73

There was indeed a 123% increase in sales. After the merger in 1999, ASC became a wholly-owned subsidiary of Albertson’s, therefore their sales should be counted as part of Albertson’s total sales. It’s becoming increasingly clear that you’re looking at things backwards: you want to lump Albertson’s and ASC together before the merger and separate them after the merger in order to bolster your argument, when financial accounting regulations you yourself cite specifically reject that approach.

74

Thank you, hon. (I’ve missed interacting with you!). However, I’m pretty damn confident that I do, indeed, have the answer to who’s actually carrying the insurance and it’s not the stores, but 3rd party insurers. Grocery stores aren’t in the business of administering healthcare. I promise you, these employees have coverage through someplace like United Healthcare or Pacificare or Kaiser, etc.

I don’t dispute that those numbers are set by the insurance carrier, but it’s still extremely misleading and disingenuous to use the absolute max outlay numbers as a basis of claiming that’s what the employees are going to have to pay. And this is purely a matter of differing opinions, but I don’t agree that their out-of-pocket costs are increasing “dramatically.” I don’t really see an increase from $7 to $10 for prescriptions to be that big of a deal. Same for office visits at $10. I wish I had that policy!

I’m very glad, too. However, make no mistake, I certainly saw doctors and had medical procedures performed during that period. I just went to the state-funded Family Clinic and paid a $25 or $35 copay for paps and routine medical care. And when they found I needed a procedure, they referred me to Harbor/UCLA and my copay was also only $35 no matter the procedure or total cost. And I got free mammograms when UCLA sent their mobile unit to the clinic. And I didn’t have any kind of special Medi-Cal coverage or anything like that. So decent healthcare at a reasonable cost is available to people who don’t have private insurance (at least where I live, anyway).

I do agree with you in that I think it’s a crime that every person in this country doesn’t have access to covered medical care, either through an employer or through the government. But where we part ways, apparently, is that I don’t agree that the consumer shouldn’t have to shoulder a fair portion of that expense. And I feel that based on current market prices for healthcare premiums and co-pays, the store employees are still being offered a great plan at a fair price.

I’m curious how you know this. What makes you so sure that store management didn’t shop those plans thoroughly and present their employees with the best options they could find at the lowest premium cost? How do you know they’re not just as disgusted with the rising costs of healthcare and the reduced coverage offered by the carriers as the rest of the employees are? Do you believe that the management are getting better plans for themselves and not also having to suck up the increases out of their pockets for their families? Has the union, to your knowledge, shopped insurance plans, found a better one as far as coverage and employee co-pays while maintaining similar premium costs to the company and presented it as an option but management has turned it down?

75

Goddammit, pay attention.

The 123% increase is not the result of Albertson’s performing better in the marketplace. It is the result of adding a bunch of stores. It is unsuprising that adding a bunch of stores would increase sales – but it also increases your expenses. Obviously, the architects of the merger hope that the synergies and efficiencies created by a larger organization will produce a net gain, but no one with a whit of financial saavy would point to the raw numerical increase in sales attributable to the merger standing alone as an actual improvement in Albertson’s economic position.

And that’s the problem with just citing to the 123% increase. It tells us nothing about Albertson’s actual performance. Indeed, when you look at the actual facts it becomes abundantly clear that the raw numbers that yield that 123% increase are meaningless – they are wholly the product of a merger, and not of an actual increase in sales at individual Albertson’s stores. Those numbers don’t tell us anything useful about the business performance of Albertson’s.

But you, and your cite, are clearly using the figure as a measure of financial performance – you’re saying “look how good Albertson’s is doing, and yet they’re stiffing their poor workers.” That shows either incompetence or dishonesty. Take your pick.

76

I have a quick aside, question, why aren’t the truckers for these stores supporting the strike (by which I mean, I still see them delivering goods to the stores)? Are they not unionized?

77

Some of them are supporting it, Gangser. The “drivers” you see at the stores might very well be the store managers, as many of the union drivers won’t take the trucks any closer than within a block of the stores.

78

I’m not ruling out that possibility, for sure. But I don’t have any evidence either way. You find anything?

I agree, the language above the charts is vague.

Check your math again - generic scripts are jumping from $3 to $10. Brand-name and formulary scripts have even larger price increases.

That’s the key, isn’t it? “At least where I live”. No guarantees that what you got at your job is available to the people who work at the local Von’s - or, if it is, there’s no guarantee an employee can get the time off to visit a clinic when it’s open.

I feel health care is a right, not a privilege. And making health care employment-based and subject to affordability requirements makes it a privilege - available only to those who can find work and afford even the co-pays. And the Census Bureau tells us there are 43.6 million people who don’t meet one of those requirements - or both.

**They already had that, didn’t they? Where is it written that out-of-pocket health care costs have to increase every so often, if at all?

Call me cynical, but I rather think the opportunity to pass more of the cost of health insurance on to the employee, thereby cutting down on corporate expenses, probably did a lot to calm any outrage Von’s executives might have felt.

I certainly have no evidence to believe that, but I wouldn’t be surprised if it were true.

That, IMO, is not the union’s job. Their primary job is to make sure the unionized employees don’t get left out in the cold when the corporation does decide it needs to cut costs somewhere in order to keep profits up.

But wouldn’t the ability to add a bunch of stores be a good indication of better marketplace performance? On the surface of it, it seems paradoxical that a grocery store chain on the verge of tanking would make an attempt to acquire another entire chain. I just don’t see how you can’t form conclusions about a corporation’s financial robustness when you find out they’ve successfully taken over a competitor.

Gangster Octopus - Teamsters Local 630, at least, is honoring the picket line. I don’t know what other trucking locals are in the area, but I figure if Von’s is able to get scabs to work the stores, they can probably find non-union or scab truckers to ship the goods in.

79

You’re reaching for the wrong analogy. You should be thinking of the air traffic controllers’ strike in the United States in the early 1980s. The union tried to shut down a vital function. In response, the government stepped in and prevented massive and potentially life-threatening disruption.

Your suggestion that striking employees would be able to open the stores up again and “run things by themselves” is, once again, completely and utterly stupid. You are so completely uninformed about how the American economy functions that you are effectively disbarred from having an opinion on any of the issues being discussed in this thread.

Grocery stores are part of the distribution system. Their function in the American economy is to efficiently transfer goods from producers to consumers. The American distribution system is second to none and ferociously efficent – that’s why there is such a vast array of consumer goods available in the U.S. and why things – especially food – are so inexpensive in the U.S. in relative terms.

This raises two points. First, the physical plant of a grocery chain (warehouses, trucks, retail stores, etc.) is only part of what makes a grocery chain work. The larger part is the complex web of legal relationships the grocery chain has with its supply chain. One of the reason that Walmart, for example, has such good prices is that it has agreements with its suppliers that give it extremely good prices. In addition there are, of course, all the other legal relationships and agreements that make any complex business go: credit terms, insurance, leases, etc., etc. The entire distribution system, is, therefore, based on legal rights and respect for the legal system that recognizes and enforces them. A bunch of grocery clerks physically occupying a grocery store won’t benefit from any of this – they’ll just be a bunch of trespassers occupying a building, not a grocery store chain.

Secondly, and more fundamentally, a grocery clerk revolution isn’t going to put food on anyone’s table. Remember, grocery stores are part of the distribution chain. They don’t produce any goods, they provide a service: distribution. Taking over a grocery store and keeping its doors open by force isn’t going to stock the shelves.

I must also remark that your incredible obtuseness regarding Dewey’s point is bizzare. It’s not a difficult concept. You have grocery store chain A and chain B. Chain A has 500 stores, Chain B has 500 stores. Chain A and Chain B merge their operations. The combines chain now has 1000 stores but it is foolish to claim that the combined company has now “doubled” its sales in one year.

In fact, bad times are one of the key things that drive mergers like this. It often happens that two business rivals, facing escalating costs and diminishing profits, relaize that the only way to survive is to merge their operations, close down unprofitiable stores and cut their overheads. In other words, mergers are often a sign that a company is in trouble, not that it is making obscene profits and gobbling up its competition.

80

I’d actually thought about taking the time to address some of the points you bring up about organizing production and distribution, but this lovely little nugget trumps them all.

Who the hell are you to tell anyone else what opinions they can and cannot express in this thread, on the SDMB, or anywhere else? I’m not forcing anyone to agree with me. You don’t like what I have to say? There’s a whole World Wide Web out there full of stuff you’ll probably find more palatable. Hell, there’s actually a whole world out there as well, full of things you might enjoy doing and people with whom you might enjoy talking. Go find them and quit being an ass in here if you don’t have anything constructive to add.