Statement of Michael B. Enzi, Ranking Member
Senate Committee on Health, Education, Labor and Pensions
May 12, 2011
HELP COMMITTEE HEARING
“The Endangered Middle Class: Is the American Dream Slipping Out of Reach for American Families?”
Good Morning. I am pleased that we are holding this hearing on the Middle Class and the American Dream. Central to achieving the American Dream is one element – a job. As I travel around Wyoming and the rest of this country I hear one refrain more than any other: Where are the jobs?
As this chart shows, unemployment has remained around 9% since May 2009, reaching a high of 10.1% in October 2009. The last two months have been the first time in almost two years that it decreased below 9% and job creation numbers were finally where they should be for an actual recovery, and let me say I was very pleased to see those numbers. But the so-called true unemployment rate, or U-6 rate, has reached almost 18 percent. This figure includes “underemployed” individuals who are working part time but would like to work full time and those who have left the labor force entirely because they simply have given up search for employment.
You can’t blame the American people for being frustrated. Although we have heard a lot of talk about job creation, often this Administration’s actions have been counterproductive and come at a steep cost to our growing debt and deficit. One of the first was enactment of the stimulus bill in February 2009 – a bill I did not support. This bill cost more than a trillion dollars when you add in interest, and was primarily a spending bill funding pet projects, but creating few jobs. The American people were promised that passage of the stimulus would keep unemployment below 8%. As you can see in the chart, that was not the case. However, the bill did considerably add to the national debt and is one of the reasons it jumped from $10.6 trillion in January 2009 to more than $14.3 trillion today, a 35 % increase.
For over a year the Administration and the majority in Congress focused like a laser on the Healthcare law that will drive up costs and paralyze employers who are uncertain of their future obligations. They enacted a Financial Services reform bill that failed to ease the flow of credit to the small businesses that are our nation’s economic engine. The Administration has adopted an energy policy that will result in increased prices for Americans by limiting the use of our nation’s cheapest, most abundant energy source, coal. The President’s decision to allow the EPA to regulate greenhouse gases under the Clean Air Act will kill jobs throughout the country. Additional job-crushing regulations in the works and the continued threat of tax increases will continue to paralyze our job-creators. Meanwhile, the Workforce Investment Act (WIA) which would help Americans retrain for good jobs in this modern economy continues to languish, the findings of the National Deficit Commission are being ignored and a major credit rating company lowered its outlook for the U.S.A. from stable to negative.
Instead of taking actions to create a positive job growth environment, this Administration has taken some steps that actually discourage and prevent job growth. One of the driving forces behind these actions is the ideology that every employee should be a union member paying union dues. It has become increasingly clear that when some members of this Administration say they want good jobs for everyone, they mean only union jobs.
Let me be clear, I fully support the National Labor Relations Act and the right of employees to collectively bargain when they choose to do so. What I do not support is government stepping in to limit employees’ ability to exercise their right not to form or join a union. We’ve seen rulemaking from the National Mediation Board changing the way election results are counted to favor unions and actions by both the Department of Labor and the National Labor Relations Board (NLRB) that limit the information provided to employees to exclude their right to refrain from union activities. The President issued Executive Orders aimed at boosting unionization among federal contractors. And most importantly, we and have seen dozens of decisions from the NLRB limiting the ability for employers to make their case to employees and restricting the ability of workers to decertify a union.
These government sponsored efforts to increase union density have done nothing to create jobs. In some cases they have been counterproductive to that goal. For example, on April 20, 2011, National Labor Relations Board (NLRB) Acting General Counsel filed a complaint against The Boeing Company alleging the company committed an unfair labor practice by opening a new production line for the 787 Dreamliner aircraft at a non-union plant in South Carolina. The complaint argues that Boeing is opening the South Carolina production line in retaliation for past strikes in Washington State by the union there and seeks to have the second production line moved out of South Carolina to Washington State. The outrage over this agency’s attempt to intervene in a U.S. company’s legitimate business decision and take jobs away from South Carolina has been very widespread. And, I am pleased that we are able to have a representative from Boeing here today, Michael Luttig. Judge Luttig is the General Counsel and Executive Vice President of Boeing, and prior to that served as a federal judge on the 4th Circuit Court of Appeals for 15 years. We thank you for appearing here today.
The Boeing story illustrates this Administration’s focus on favoring unions at the cost of creating the kind of middle class jobs we all want. In early 2009, Boeing announced that it was going to build a second production line for the 787 Dreamliner in order to meet increased demand. The existing collective bargaining agreement between the two sides did not require union consent if the company sought to open new worksites outside of Washington State. Still, Boeing voluntarily entered into discussions with the machinists union about bringing the second production line to Washington State. No agreement was reached and Boeing announced that it would locate its second production line at a facility it had recently purchased in South Carolina. The employees at this facility had been represented by the International Machinists union, but in September 2009 they exercised their legal right to decertify their union and voted 199 to 68 to do so in a secret ballot election.
And so Boeing moved forward with plans to expand their manufacturing in the United States in the middle of a deep recession. They hired over 1,000 new employees in South Carolina and invested millions of dollars in the plant facility there. At the same time, production and hiring were also increasing in Puget Sound. Boeing created over 2,000 new union represented job in Puget Sound since 2009 – again, all during the height of the recession. The jobs they created are among the highest paid aerospace workers in the United States. Mr. Chairman, this company deserves our congratulations and respect, not demonization.
But 17 months after Boeing announced the second production line, and just 3 months before production was set to begin, the NLRB Acting General Counsel issued this complaint and an accompanying press release trumpeting that action. Employers across the country have been greatly disturbed by this complaint and the possibility that a government bureaucrat serving in an acting capacity could direct U.S. companies about where to locate facilities, what work to do where, and who to hire. This is not the way to encourage new job creation in the U.S. or even keep the jobs we currently have.
This complaint has also raised considerable concern that the NLRB is now targeting the 22 Right to Work states, which have been an engine of new job creation and attracted many foreign companies to manufacture in the U.S. Many states that did not have a wide manufacturing base historically have found a path to significant new job creation by offering high skilled job training for their workforce and attracting foreign employers. I will join my colleagues in fighting any attempts to deter investment in Right to Work states in order to prop up unionized workforces.
Freedom is the quintessential American value. Freedom to build a new plant, create a new job, join a union, reject a union – all of these choices are threatened by the NLRB complaint. While I hope the complaint will not be ultimately successful, as it works through the process it will create a chilling effect nationwide.
With last month’s positive job numbers, I hope we are truly at the brink of an actual recovery that will create more jobs and get this country back on track. Job creators are trying to do their part, but as the NLRB complaint against Boeing shows, this Administration has yet to get the message. We’ve heard speeches and seen opinion pieces – it is time to see action and real changes in policy. New job creation is key to preserving this country, the middle class and the American dream for future generations.