Thursday, March 26, 2009


Blogger Squints said...

WSJ's use of the word "threaten" in its headline is misleading.

FedEx had the foresight to write into the contract the option to cancel. Which implies it had a good idea of the degree to which the relative economics depend on the state of labor law. I don't see how noting the fact constitutes a "threat."

1:18 PM, March 26, 2009  
Blogger Mike said...

Bad news for Boeing. They got a real shot across their bow by Northrop Grumman when it came in with a serious competitor to their tanker contract. Now they are standing to lose another major contract.

Good news for those of us who are sick are tired of union employees jacking up their wages more than they are worth... :)

1:54 PM, March 26, 2009  
Blogger HMT said...

Fedex was indeed smart to get a clause in the contract to let them back out if the economic terrain got bad. It makes sense for them to back out of the contract from a pure economic standpoint. Labor costs are likely to go up if some fedex sites unionize. The safe thing to do is take a "wait and see" approach before a large capital purchase. Looks like standard business to me.

I hope the law is passed (repealed?) A law that protects one company (FedEx) but and not it's competitor (UPS) is not a good one. Frankly the law should be completely repealed. Let companies and unions bash it out. It will all work out eventually.

2:10 PM, March 26, 2009  
Blogger uncle ken said...

I agree with the others. FedEx is just being prudent. Plus as the volume of business shrinks during the current economic debacle, the volume of business materials and documents to be shipped will also decline.

Unlike the US Post Office, which enjoys a monopoly by FedGovCo fiat, FedEx must compete. Postage is about to rise again btw. Surprise, surprise.

2:39 PM, March 26, 2009  
Blogger DADvocate said...

I also agree with the others. Funny how sound business practices are "threatening." Congress and the unions are threatening freedom, secret ballot and companies' health. FedEx is simply taking possibilities into account.

3:30 PM, March 26, 2009  
Blogger Larry J said...

Perhaps this will get some people in Congress to pay attention. Cancelling 30 777 airliners will not only hurt Boeing, it'll hit the engine manufacturers, the avionics manufactuers, and hundreds (thousands?) of suppliers of everything from rivets and aluminum to wires and tires. Those suppliers are spread across the country in many different political districts.

4:17 PM, March 26, 2009  
Blogger Peregrine John said...

I'm just waiting for FedEx to riposte, "Who is doing the threatening, exactly?"

6:57 PM, March 26, 2009  
Blogger Alex said...

The real question here is why 15-20% of the workforce is holding the economy hostage?

8:35 PM, March 26, 2009  
Blogger Laura(southernxyl) said...

"Postage is about to rise again btw. Surprise, surprise."

Time to go buy a bunch of Forever stamps. I wonder how long they'll be able to sustain that.

8:09 PM, March 27, 2009  
Blogger mmaier2112 said...

Alex, that's not quite the right question. The right question is "why does the government force a company to deal with unions in the first place?"

6:48 PM, March 28, 2009  
Blogger Alex said...

Michael Maier - it's well known that if we don't have unions in factory-type settings that the workers will be badly exploited by the evil, greedy management.

6:55 PM, March 28, 2009  
Blogger mmaier2112 said...

Why aren't the UAW workers ever called greedy for their ridiculous compensation?

7:38 PM, March 28, 2009  
Blogger Alex said...

Michael Maier said...

Why aren't the UAW workers ever called greedy for their ridiculous compensation?

7:38 PM, March 28, 2009

Who are you to say workers who labor doing back-breaking work all day long on the assembly line shouldn't get $70/hour + benefits? That's what unions have brought us, and it's out of control GOP Reaganist capitalism that has brought median wages down the last 28 years ever since the infernal Reagan took office.

7:56 PM, March 28, 2009  

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