WASHINGTON—Providing evidence of huge pay cuts, lost pensions, high health care charges, finance-driven collusion and monopolies, and outright destruction of firms, families, and unions, the Mine Workers and their allies made the case on Capitol Hill against secretive unaccountable “vulture capital” hedge funds.
Their poster boy for corporate greed: Three hedge funds, Apollo Global Management; BlackRock; and Kohlberg, Kravis, and Roberts. Their billions in assets include virtual controlling interests in Alabama’s Warrior Met coal company.
At that firm, the hedge funds’ influence led managers to stiff the 1,100 workers, members of several UMWA locals, unless the miners caved in to its recessionary demands, at a time when Warrior Met was shoveling more than $1 billion in payouts to the hedge funds.
When the workers overwhelmingly refused, the managers, with the hedge funds lurking in the background, forced the workers to strike on April 1, 2021. They’ve been out ever since.
But coal miners are tough, and the Mine Workers have come to their aid with strike fund dollars and health insurance. The rest of labor has pitched in, too, and will do so again with a mass nationwide rally via Zoom on February 22 at 8 pm Eastern Time.
Rally sponsors include People’s World, the Coalition of Labor Union Women, the South Dakota and Sioux Falls AFL-CIOs, the Chicago Federation of Labor, and Operation PUSH.
Mine Workers President Cecil Roberts told lawmakers the hedge funds’ financial greed led Warrior Met managers to offer workers a minimal raise of $1.50 an hour over five years, propose health care cuts and cede unlimited power to fire workers without cause. That means the bosses could fire all the workers they forced to strike.
The mine firm’s bosses also demand workers get only three paid holidays a year, and bosses plan to impose a “four strikes” attendance policy. That edict says if you’re absent—excused or not—for all causes four times in a year, you’re canned.
That’s after those same funds, when they took over the mine from bankrupt Jim Walter Coal Co., in 2015, ripped up the union contract, forced $6-an-hour (20%) wage cuts, and imposed high health care premiums and co-pays on a workforce in the black-lung afflicted industry, witnesses told the Senate Budget Committee. The hedge fund financiers and Warrior Met bosses refused an invitation to testify.
“The growing trend of vulture capitalism as practiced at Warrior Met Coal in 2016 is creating havoc among working people who have the misfortune of being employed by a company” bought by such private equity funds, Roberts said.
“In case after case, workers end up with lower pay, worse health care benefits, less time to spend with their families, and an increasingly oppressive working environment.
“By their very nature, private equity firms have no incentive to care about workers, their families, or their communities. They are not part of these communities. They never see the havoc they create. They never experience the personal anguish workers and families endure as a result of decisions made…miles away in New York, Boston, or other financial centers.
“For private equity, the only consideration is the size and speed of a return on their investment. They use America’s failed bankruptcy laws to gouge where they can” out of workers and pensioners, he said. And then they take the profits and run.
But the hedge funds’ maledictions hit far more industries than coal mining, and far more companies than Warrior Met, other witnesses told the senators.
For example, Sen. Elizabeth Warren, D-Mass., who pushed her bill to control the financial monsters, again warned loved ones to check if hedge funds control nursing homes. If so, run, she said.
“Research even shows that when private equity takes over a nursing home, short-term mortality rates jump by 10%,” Warren explained.
And the toll is in far more than money, added Mine Workers Local 2368 Committeeman Braxton Wright, of Brookwood, Ala. His local is one of those whose members have been forced to strike.
“When you are required to work 12 hours a day, six to seven days a week” to satisfy bosses’ pursuit of profits from 24/7 production to meet the hedge funds’ payout requirements, “you are lucky if you see your spouse or children more than a few hours a day,” Wright said.
“Before the bankruptcy contract, many spouses stayed home because the pay and benefits allowed for families to live well. After the bankruptcy, many spouses were forced to work outside the home while still being the primary caregiver for their home and family. So children saw BOTH parents less as a result of the cuts in the bankruptcy contract.
“It would break your heart to hear how many times my oldest daughter Averi would ask me ‘Why weren’t you at my game?’ “Why didn’t you come to my field trip or awards day at school?’ ‘Why can’t you go with us to the park?’ Every time I had to answer, ‘I had to work,’ or ‘I had to sleep,’ knowing my child deserved to have time with both her parents.
“There have been hundreds of children asking these same questions to their parents for the past five years” that the hedge funds have been in control of Warrior Met.
But it’s not just Warrior Met and the hedge funds that control it, other witnesses said. It’s hedge funds—and their secretive investors interested only in greed—as a class.
Indeed, some of the most devastating testimony came from former top Wall Streeter Nomi Prins, now turned whistleblower against the capitalist corporate greed the hedge funds manifest.
“As these institutions expand further, their ability to dictate corporate control and outright ownership in every sector of the economy will have a greater human cost,” she warned. “Private equity business practices are largely designed to extract capital, not build it. As a result, small businesses and communities caught in the private equity crossfire will come under greater control of big finance that puts cost and job cutting ahead of worker stability.
“Today, BlackRock and these other institutions have expanded to such a magnitude that they effectively are the market. This represents a monopoly sort of influence over competition, assets, and transactions. It elevates the systemic risk that the global financial system faces.
Sen. Bernie Sanders, Ind-Vt., chairing the session, gave the workers and their allies a sympathetic hearing. Sen. Tommy Tuberville, R-Ala., former head coach at one of his state’s university “football factories,” Auburn, didn’t—though it’s his constituents who are hurting.
“In the U.S., private equity firms or hedge funds own half of all daily newspapers, have invested over $800 billion in fossil fuels over the last decade, and control over 8,000 U.S. companies that employ more than 12 million Americans, including household names such as Hilton, Dollar General, Dunkin Donuts, Fender, Toys ‘R’ Us, K-Mart, J. Crew, and Payless Shoes,” Sanders said.
“However, the industry’s overreliance on debt-finance buyouts leave Americans paying the price while huge Wall Street firms walk away with exorbitant profits.”
Tuberville didn’t address the issues, or the workers’ pain, at all. He blasted the hearing’s “overt political nature of this hearing and blatant pro-union stance….Congress should not try to tip the scales in one direction.” And while Tuberville piously hoped Warrior Met bosses and the Mine Workers can reach “a beneficial agreement,” his short statement was silent about the fact Warrior Met forced the strike.
SOLIDARITY WITH STRIKING WARRIOR MET MINERS
TUESDAY, FEB. 22, 2022 – 8 P.M. EASTERN
REGISTER HERE
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