August 7, 2009 Volume 110 Number 15

Stimulus dollars trickle slowly to union workforce, if at all

By DON McINTOSH, Associate Editor

Nineteen months after the current recession’s official start, and nine months after employment levels fell off a cliff, it can be very hard to see the effects of the federal government stimulus plan announced with so much fanfare earlier this year.

Back in February, elected leaders were falling over each other to announce efforts to use government spending to resuscitate the economy. One February press conference in Portland drew both of Oregon’s U.S. senators, plus the Multnomah county chair, members of city council and the Metro regional government, and a school district official. Wyden, the senior and highest ranking elected official, likened the just-passed stimulus package to the New Deal programs that put Americans back to work during the Great Depression.

But it’s August, and unemployment has continued to rise. At last count, 9.4 percent of American workers are officially unemployed (12.1 percent in Oregon and 9.2 percent in Washington.) The statistics are worse in construction, a sector which had nationwide unemployment of 17.4 percent as of June. That’s 1.6 million unemployed construction workers, a number that has continued to rise every month.

Have stimulus efforts failed? Were they not enough to begin with? Is another round of stimulus needed, as Machinists Union President Thomas Buffenbarger called for in a June 26 letter to the president?

The federal stimulus package — the American Recovery and Reinvestment Act — had a much-repeated price tag of $787 billion. That sounds like a lot if you compare it to the roughly $3 trillion the federal government spends each year, but $787 billion was the stimulus’ estimated cost over a period of up to 10 years.

Of that total, 36 percent wasn’t spending at all, but rather tax cuts — to businesses and to individuals.

President Obama’s “Make Work Pay” tax cut, for example, lets workers keep an extra $8 a week to go out and revive the economy. Another 25 percent consisted of what might be termed “relief” — like longer-lasting, more generous unemployment benefits, increased food stamp benefits, and more money for Medicaid, the government health insurance program for low-income individuals.

Then 10 percent went to rescue state and local budgets, to stave off cuts in services and reduce public sector layoffs. That left about 20 percent, $160 billion, to be spent on infrastructure investments — the sort of “put-people-back-to-work” projects that some people expect when they think of “stimulus.”

When the bill was passed, the talk was about “shovel-ready” projects. The Labor Press set out to look for the shovels, starting with unions whose members would be first to wield them.

When ground is broken in Oregon public works projects, odds are good it’s broken by members of Operating Engineers Local 701, which represents workers who run heavy equipment. And when it comes to shoveling asphalt, Laborers Local 320 is the one to call. Neither union is seeing much stimulus work.

“It’s not having the effect we expected,” said Local 701 Business Manager Mark Holliday. Union-signatory contractors are finding work here and there on stimulus-funded projects, but that hasn’t stopped Local 701’s out-of-work list from approaching 25 percent.

Likewise, Local 320 Business Manager Dave Tischer says he was disappointed at the amount of infrastructure spending in the federal stimulus package. Highway construction and maintenance is the biggest line item in the infrastructure spending portion of the federal stimulus bill, and the one that was supposed to generate the most jobs quickly, but Tischer is looking at about 30 percent unemployment among his members.

“My job is to look down the road at the work ahead, and the picture is not that rosy,” Tischer said.

Local 320’s parent organization, Laborers International Union of North America (LIUNA), has been waging a campaign called “I build America,” calling for even more federal investment. The message: There’s plenty of work to do, and plenty of people who need work; all that’s missing is the jobs.

Of course, there ARE some jobs out there that wouldn’t be there without the federal stimulus money. The Labor Press found some that employ local union members.

  • TriMet got $44.8 million in federal stimulus money. The funds can pay for vehicle and equipment purchases, preventive maintenance, and new passenger facilities — but can’t be used to increase service or hire more drivers. So the transit agency will undertake about 30 construction projects even as a drop in payroll tax revenues forces service cuts. For example, work began May 29 on a new transit police building at the southern terminus of the future MAX Green Line. The project, thanks to $600,000 in stimulus funds, will employ about two dozen people through September. Howard S. Wright is the general contractor, and union subcontractors include McBride Sheet Metal and EC Company. And construction began in June on a $3.8 million project to light a path along I-205, in order to increase Green Line ridership. That work went to Team Electric, which employs members of Electrical Workers Local 48.
  • Union-signatory Long Painting got a stimulus-funded contract to do interior and exterior repainting for University of Oregon. That could employ five or six members of Painters Local 1277, said Painters District Council 5 Business Representative Patrick Smith. Another 35 to 40 painters may find extra employment, and likely overtime, as stripers at the tail end of stimulus-funded highway projects, Smith said. Close to 40 of Local 1277’s 120 members are out of work.
  • The Oregon Department of Transportation got $324 million in federal stimulus funds, and according to the rules, allocated them where the money could be committed in 90 days. That meant mostly small add-ons to projects that were already approved. So a massive $130 million project to build a straighter, safer stretch of US 20 near Eddyville got $13.8 million extra. That means the 200 or so members of Local 701 who are currently employed on the project will have months of additional work before the project is complete. And on the $64 million project to replace the MLK viaduct in Southeast Portland, $1.25 million in stimulus funds meant that ODOT could repave city streets on the truck detour route, which have been damaged by extra traffic. Subcontractor KF Jacobsen was put in charge of the add-on, and is employing members of Locals 320 and 701.

That last add-on makes for a strange parallel, since what is today the southbound portion of the MLK viaduct was built in 1936 by the federal Works Progress Administration. Oregon’s landscape is full of reminders of the 1930s federal effort to put people back to work — Mt. Hood Timberline Lodge was also built by the WPA, as was the masonry on seven Portland tunnels. Meanwhile the New Deal’s Public Works Administration built five landmark bridges on the coast, including the Yaquina Bay Bridge in Newport.

Just as this recession — the worst since World War Two — invites comparison to the Great Depression of the 1930s, so Obama-era stimulus efforts are judged by the standards of FDR's New Deal. Machinists District Lodge 24 Representative Joe Kear recently finished reading a book about the first 100 days of FDR’s first presidential administration. Kear, a longtime Freightliner worker who became a union rep in 2005, said today’s approach fails to impress.

Using stimulus funds, the U.S. Department of Labor made a grant of $405,000 to assist 80 laid-off Freightliner workers. That $5,000 each might have been a big help to pay for job training or living expenses while they hunt for other jobs, except they won’t see the money. The money goes to Oregon Department of Community Colleges and Workforce Development, which will contract with Worksystems Inc., a private nonprofit, to provide career counseling, job search and job placement assistance, and follow-up. The grant, according to the official press statement, “will allow affected workers to access the employment-related services necessary to obtain employment.”

In the ’30s, the federal government stepped up to provide employment. Today it funds employment-related services.

Kear said within 100 days of FDR’s inauguration, the Civilian Conservation Corps and Works Progress Administration were begun, which directly employed both skilled and unskilled workers. The Home Loan Mortgage Corporation refinanced home loans at favorable terms to stop foreclosures. The Federal Deposit Insurance Corporation was founded to insure bank deposits and restore confidence in the banking system.

“All those programs were successful because they gave money directly to the people,” Kear said, “either directly refinancing mortgages or directly employing them in jobs. There’s no comparable initiative on the part of the current administration.”

Home | About

© Oregon Labor Press Publishing Co. Inc.