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TUCoPS :: Phreaking Technical System Info :: blstrike.txt

How AT&T made a major fortune from the strike of 1983

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|+|+|+|+|[%> Bell Walk-out <%]|+|+|+|+|
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|	  by: kid & company	      |
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  Contract talks were breaking down between American Telephone and Telegraph
and three major unions of their employees.  As a result, workers walked off the
ir jobs at midnight on August 7th.  The AT&T strike was on!

  We all remember the phone strike of '83.  It caused us to hold on directory
assistance for several minutes.  It gave us many unique error messages.  It
made it virtually impossible to make any operator-assisted calls from all
around the country.  For the first time in along while, the voices at AT&T were
not answe ring the phone.

     As well all know, a strike is an organized work stoppage by the employees
in order to compel the employer to meet some demand. If the workers go on strik
e, it stands to reason that the company should suffer. If, for example, the uni
on of Cabbage-Patch producers was to strike, then none would be made, and consu
mers would rant and rave. If the local Cabbage-Patch conglomerate had anticipat
ed a strike, they could step up production, fill several hundred ware houses wi
th millions of surrogate orphans and, when the strike occurred, they could sell
 the surplus. The workers would lose their bargaining power in this case, unles
s the Cabbage-Patch truckers' union also struck, or perhaps people stopped adop
ting the cretins, however unlikely that might seem.

     This analogy leads us back to last summer when 675,000 telephone employees
 went on strike. A walk-out of the magnitude should have devastated any company
. AT&T though, is the exception to the rule. What AT&T depends on are phones, w
ires, switching systems, computers, electrictiy, some optical fibers, satellite
s, microwave towers, and other nifty 21st century things that are all designed
to run without the interference of human decision. The people are really just t
here to remove illegal third party phone calls from your bill, to make sure tha
t your handwritten check matches the computer-read phone bill, or to tell you t
hat the machine you are at cannot return your dime and that you will get a chec
k for 10 cents in the mail. 97% of the calls made today don't use any operator
assistance at all. And most of the other 3% could have been dialed without the
assistance of a human. More and more "services" of your phone company are becom
ing completely automated. With ESS, customers can dial overseas direct.

Android information is popping up left and right. AT&T, a leader in technology,
 doesn't need their workers all that much.

     Glen E. Watts, president of the Communications Workers of America, said, "
In 1950, for example, total labor costs amounted to about 45% of the telephone
dollar while in 1980 they amounted only to 29%." John Patrick Phillips (author
of Ma Bell's Millions) says that the company encourages or even "maneuvers" a s
trike. According to him, Ma Bell reaps huge rewards from a strike. Phillips, a
disgruntled ex-employee, who at times compares the phone company to fascism, wo
uld have presented AT&T's organized scheme last August like this:

     675,000 workers strike for about 3 weeks. 3 weeks out of a year amounts to
 5.8% of a worker's salary. Let's say a phone worker made at the time of the st
rike a modest $250 per week (operators made $373, while systems technicians, th
e best paid workers, made $535).

     At this time AT&T provided substandard service to the people for the same
prices. The 3% loss in phone usage due to lack of operators was proably easily
made up by people making an extra effort to dial direct and by the fact that so
me of the calls were being handeled by scabbing supervisory level employees. An
d so, the company nets pure profit: 3 week strike x $250/week x 675,000 workers
 = $506,250,000!

     Phillips also notes that because managers and supervisors were doing the d
irty work of the phone company, these people could not work on new projects. Th
is means that several hundred million dollars would not be invested in expendit
ures on new projects because there is no one to do the work. So AT&T would get
interest on this money during the strike and even for some time after it was se
ttled until work had resumed. This yields several more million dollars in profi
t for AT&T.

     AT&T proably made out directly over half a billion dollars for the strike.
 At the same time companys like New York Telephone sought to delay a $160 milli
on rate increase so it could ask for another increase to reflect the new contra

     As part of the settlement 21 days later, top craft workers got a 5.5% incr
ease for the first year of their 3 year contract and 1.5% for each of the next
two years. They also got a $31 million training fund ($46 per employee) to help
 them deal with new technology and remain employable humans. All of these "gain
s" are subsidized by the half a billion dollars gaining lots of interest which
AT&T did not have to pay to their employees. AT&T at first offered a ridiculous
 3.5% increase for the first year and no increase for the next two, but after l
osing 5.8% of their salary by striking, workers got a 5.5% increase above the c
ost of living which is probably entirely subsidized by the strike itself and by
 rate increases.

     It's certainly a nifty deal for Ma Bell. Their workers blow off steam and
pay for their own raises, and stockholders don't have to worry one bit.

     The strike had its effect on the consumer. As we all know, many were diali
ng, touchtoning, or redialing their calls almost like usual and other were seve
rely inconvenienced by a few managers and supervisors working as long distance
or directory assistance operators often for many hours overtime. New installati
ons came to a standstill and many were backlogged for several months. Any emerg
ency repairs had to be handled by supervisory personnel. But after all this, th
e same fat phone bill came to people's homes the next month, without any delay.

     In actuality, users cannot complain to or boycott the phone company as the
y could the Cabbage-Patch manufacturers, in our earlier scenario. They cannot m
ake AT&T or their local company do anything because each customer is as unimpor
tant as each employee. We, as customers, are all dependent on the phone. We hav
e at least one in each home. We are billed if we use it or not, and are billed
more to have it shut off for a month or two. We are all so dependent on the lin
es that run into our homes and on the one and a half million payphones that abs
orb our money that complaints of any one or even thosuands of us are quite usel
ess. All of this utility (note the meaning of this word) was until recently cot
rolled almost exclusively by one company, so in the name of human spirit, roll
on with the divestiture.


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