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June 27, 2012 - No. 97 Privatization of Public Interest Canada's Kleptocracy and the Revolving Door   Privatization
of
Public
Interest Privatization of Public Interest Canada's Kleptocracy and the Revolving DoorOrganizing the political and economic affairs of the country as a kleptocracy -- rule by thieves -- is not something the rich minority in power leaves to chance. Practical mechanisms are in place to ensure that private interests of the rich minority are politicized and the resources of government at all levels put at their disposal. One of these mechanisms is the interchange of top corporate personnel and top government officials, a mechanism the monopoly media refer to jokingly as the "revolving door." It is a serious matter, however, that it has become the rule to see self-serving governments hire the same small group of individuals who ruthlessly pursue the private interests of corporations to control top policy and decision-making positions in government.
It's certainly not BC Premier Christy Clark, who seems determined to assist TransAlta's thievery. Clark is promoting TransAlta's plans for private gas-fired generation in BC, as irrational as fossil fuel generation in BC might be, considering BC is a world leader in hydro-electric potential. However, Clark has instructed BC Hydro to provide incentives and for ministries to clear regulatory obstacles for TransAlta so that it can create private gas-fired generation as a market for TransAlta's BC natural gas plays. In all of the provinces and Quebec there are similar outrageous examples of individuals with anti-social, capital-centred outlooks travelling back and forth between corporate board rooms and top positions in government. Workers in Ontario are currently battling against the effects of the provincial austerity budget created by Don Drummond, one of the leading practitioners of this kind of corruption. Drummond went from being a Vice-President of Toronto Dominion Bank to his job preparing the Ontario 2012 Budget. Before that he was federal Assistant Deputy Minister of Finance under Paul Martin with responsibility for interprovincial relations (cuts to health care and social transfers) and tax policy (cuts to corporate tax rates).
These corrupt practices and other means of politicizing the private interests of the rich minority go hand-in-hand with marginalizing workers and the vast majority of people in political affairs and economic decision-making. People are told to leave everything in the hands of experts like Farrell, Drummond and Strong. These chieftains are painted as those who deserve to be in control because they are non-partisan, apolitical experts, able to steer economic affairs objectively in a direction required by the realities of life. In fact the decisions of these experts have a profoundly political character. Regardless of whether they are wearing their private or public hats, they put the needs of capital at the centre of every consideration and deny the people any role to think about and decide how society should be organized. Rio Tinto Alcan Lockout in Alma, Quebec The Company Must Respond to Workers' Concerns and Satisfy Their Demands   Rio Tinto Alcan executives have been saying for a while that they want to sign a collective agreement with the Alma workers who have been locked out for nearly six months. In early June, the union and Rio Tinto met separately with the mediator appointed by the Quebec government and then met with each other on June 13. The company's communications director Claudine Chagnon told the press: "Once again, we want to make it clear that the settlement must be within the parameters that exist in the aluminum industry." With its dogmatic repetition about "the parameters that
exist in the aluminum industry," Rio Tinto Alcan dismisses questions
raised by the workers since the beginning. It has not been able to
provide an argument that would justify its claim that to keep operating
in Saguenay-Lac-St-Jean, it must lower the working
and living conditions of the workers in the plant through
subcontracting. This would ultimately lead to the lowering of the
working and living conditions of all in the plant and in the region.
The Alma workers just went through five to six years in which the scope
of two-tier working conditions was extended by lowering the level of
health and safety conditions through subcontracting and further
imposing without restriction what Rio Tinto calls its "management
rights." Under the hoax of its "right" to impose subcontracting, the long-standing and beneficial practice of having teams of firemen on site who were regular unionized workers, was eliminated. The company claims this practice does not exist in the industry any more.
When RTA's communications director says that a settlement has to be "within the parameters that exist in the aluminum industry" and that Rio Tinto can only offer to the Alma workers what it offers globally, she of course neglects to say that the Alma workers went to see precisely what Rio Tinto is doing in other countries. This investigation only strengthened their determination to fight for the satisfaction of their just demands. In Tasmania, they saw how Rio Tinto went to the Supreme Court of Australia to block the efforts of its workers to unionize. Who wants that as a model or an "industry norm"?
After five months of its phony lockout, which is largely financed by the Quebec people and began with the illegal expulsion of the workers doing their shift, the ball remains in Rio Tinto's court to show some reason, negotiate in good faith and settle with the workers on the basis of the recognition and the satisfaction of their demands. Moreover, the Charest government must also be held to account for abdicating its duty to uphold the public interest and instead eagerly serving the monopolies at the people's expense. Hydro-Québec Buys $33 Million of Rio Tinto
Alcan's Electricity
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The appointment earlier this
year of Dawn Farrell as the
President and CEO of the aggressive Alberta-based energy monopoly
TransAlta is an outrageous example. Before joining TransAlta two years
ago, Farrell was the Executive Vice-President for Generation (and
Aboriginal Affairs) at BC Hydro. Now, with
her TransAlta hat on, Farrell is negotiating with BC Hydro for
long-term power purchase agreements involving TransAlta's plan to build
private gas-fired generation plants in BC. While Farrell was chief of
generation at BC Hydro the policy of handing all new power generation
over to private investors was developed.
Now she is helping TransAlta reap the benefit of this policy. This
raises the question with regards to public interests in the BC
electricity sector -- who's minding the store?
Another example from
Ontario is the appointment by the Bob Rae government of
Maurice Strong, a former CEO of Power Corporation, as head of Ontario
Hydro. Power Corporation is one of the most
powerful monopoly groups in Canada and among its holdings at the
time were extensive interests in the
electricity and other energy sectors. The effects of this appointment
are still being felt many years later. While he was head of
Ontario Hydro, Strong began the process of privatization which first
the Harris government and later the McGuinty
government worked to complete. This
privatization has been a bonanza for the rich and a disaster for
electricity sector workers and electricity users.
Rio Tinto keeps throwing its self-serving
argument of "industry norms" at the workers to impose working
conditions the workers denounce as retrogressive and unsafe. They
oppose subcontracting not only because it will seriously deteriorate of
their working conditions and the standard of living of the region, but
because it will lower their union membership. Already the workers can
see how a decreased number of union members makes it difficult to hold
management to the terms of the collective agreement and this is without
the green light to subcontract. 
For nearly six months, the
Alma workers have been
courageously fighting for an equilibrium in the production of
aluminum, labour relations and the exploitation of Quebec's natural
resources so that the workers, region and Quebec can benefit from the
fruits of their labour. Rio Tinto opposes them because according
to its executives, private monopoly interests must trump the public
interest. According to Rio Tinto's logic, which is also the logic of
the Charest government, RTA's private monopoly interests are synonymous
with the public interest. Rio Tinto Alcan does not even admit that it
makes
most of its profits based on the extraordinary
hydro privileges it has in Quebec and especially in a lockout
situation!  Sign put up by Alma workers on May 1, 2012 gives a running total of $52 million in money paid to Rio Tinto for its unused hydro. |
Furthermore, Hydro-Québec reported a dip in profits of $65 million compared to last year's first quarter. It blamed the decrease in profits on a decrease of $30 million in hydro exports to the U.S., a lower demand than usual during winter because of mild weather and its purchase of $33 million of excess power produced by Rio Tinto Alcan during the lockout.
Speaking to the media, the spokesperson of Hydro-Québec said that the public utility has no choice but to purchase this hydro because its link to RTA is a commercial agreement. The spokesperson neglected to say that this commercial agreement is part of a broad agreement signed in 2007 by the Quebec government, Hydro-Québec and Rio Tinto, whose many secret provisions, only recently revealed, include one that declares a lockout a case of force majeure.
This agreement spells out a series of obligations that RTA has to fulfil regarding, for example, investments and production output at its facilities. The government and the public utility commit among other things to buy all the hydro that is produced by Rio Tinto Alcan but not used in production.
In the case of a force majeure that affects any of the signatories, the obligations spelled out in the agreement can be suspended for as long as the force majeure lasts. Force majeure includes not only things like earthquakes and revolutions but strikes and lockouts. In all cases of force majeure, except strikes and lockouts, the affected party must show diligence in trying to remedy the cause or reduce the impact of the force majeure in order for the obligations to be suspended. In the case of lockouts and strikes, however, the affected party can do whatever it pleases for as long as it wants and no obligations or rights are suspended. The net result is that Rio Tinto Alcan can lock out the workers for as long as it wants and receive tens of millions of dollars and the whole thing is described as a mere commercial contract.
Following the release of the first quarter results, the workers were even more enraged. "This is a joke and at some point it has to end," said Pierre Simard, the President of the Syndicat des employés d'Énergie électrique of Hydro-Québec's quarterly report. "It is us, the taxpayers, who are being forced to buy the excess hydro of a multinational which took upon itself to lock out the Alma workers."
It is very convenient for the government to pretend that it is not responsible for the refusal of Rio Tinto Alcan to bargain with the workers in good faith. Neither the Quebec government, which has the duty to represent the public interest, nor Hydro-Québec, which is filling the coffers of RTA with public funds, consider themselves in the least bit responsible. This is not acceptable. The government has a responsibility to establish a certain equilibrium in the struggle and it could do so by suspending payments for the hydro or demanding that if the monopoly is to operate in Quebec it must carry out its social responsibilities and bargain in good faith. A deal which only provides for a declaration of force majeure to ensure that Rio Tinto Alcan's monopoly right is provided with a guarantee must be abrogated.
Step Up Support for the Just Cause of
the Rio
Tinto Workers in Alma, Quebec!
No to Subcontracting and Attacks on
Unions!
Demand that Government Uphold Public Interest, Not Monopoly
Right!
Denounce Government Corruption!
More Financial Support for Locked-Out Workers
As the lockout of the Rio Tinto Alcan workers in Alma, Quebec enters its seventh month in July, the need for financial support is more important than ever. Two local metallurgical unions recently gave generous support: the Rio Tinto iron and titanium workers in Sorel-Tracy and Métallos Local 6586 which represents the ArcelorMittal steelworkers in Contrecoeur, the old Sidbec-Dosco plant.
 Alma workers are warmly greeted by Rio Tinto workers in Sorel-Tracy, February 17, 2012. |
At their general membership meeting on June 13, the
members of the Syndicat des ouvriers du fer et du titane in Sorel-Tracy
voted unanimously for a proposal to support the Alma workers. Each of
the approximately 1,000 workers will give $5 a week until the end of
the lockout -- a total contribution of about
$20,000 per month. Hugues Villeneuve, vice-president of the Alma
workers' union participated in the Sorel-Tracy workers' membership
meeting where he briefed them on the latest developments in their
struggle against the lockout which has now reached almost six months.
The president of the iron and titanium workers' union Jacques Boissonneau, commented on the significance of the workers' support for the struggle in Alma:
"To support them is critical. This sets the stage for inter-union support that is both concrete and necessary for the Rio Tinto workers in Alma, whose values of respect and dignity [for workers] we deeply share. This is not just a struggle being waged by another trade union central, but rather the fight of colleagues who are part of the Rio Tinto family. These are men, fathers, workers who are standing up so as not to lose their rights and their working conditions for which they fought so hard. We must express solidarity with them because their fight is also our fight." The Sorel-Tracy workers have their own negotiating table as their own collective agreement ends on April 30, 2013. They report that they have already set up committees to work out their demands.
Back in Alma, Villeneuve spoke of the warm reception from the Sorel-Tracy workers and emphasized that the financial support is very precious and timely. The groundwork to develop the links between these two groups of Rio Tinto workers was already laid in late February, when more than 200 Alma workers rallied with the Sorel-Tracy workers at their plant.
 Contrecoeur steelworkers' flag at the mass rally in Alma, March 31, 2012. |
Meanwhile, the Contrecoeur workers are giving financial support of $5,000 a month until the end of the lockout. These workers have supported and popularized the Alma struggle since the beginning and were in Alma for the mass rally and demonstration on March 31. The Contrecoeur workers themselves are involved in a fight to get ArcelorMittal to make investments to expand production in their facility. In 2008 ArcelorMittal closed two mills at the Contrecoeur plant causing the loss of more than 500 jobs. The company pledged at that time that they would build a steel beam mill to offset the closure with some 200 jobs. Not only did they renege on this pledge, but the company refuses to make new investments to extend production, despite its greatly increased extraction of iron on Quebec's North Shore as part of the Northern Plan. Workers point out that this is an unsustainable situation where they are under increasing pressure to increase their output without the workforce to do so. Hence their campaign to change the situation entitled: "The lemon has been squeezed dry -- Invest!"
This valuable support from these two unions adds to the support expressed across Quebec, in the rest of Canada and in many countries for the just struggle of the Alma workers.
Low-Wage Job Offer at Jonquiere Smelter Corroborates Workers' Opposition to Subcontracting
A recent job posting from the Rio Tinto Alcan subcontractor Av-Tech shows the justness and the importance of the demands that the Alma aluminum workers have put forward against the use of subcontracting as a means to progressively de-unionize the workplaces and lower the working and living conditions.
The posting was for a potroom operator at the Jonquière complex, Rio Tinto Alcan's other aluminum smelter, besides the one in Alma, in the Saguenay-Lac-St-Jean region. The position offered gives a wage of $14 an hour. Usually potroom operators are part of the unionized workforce and make about $38 an hour.
This job posting caused
quite a stir in the region and
the subcontractor immediately rewrote the job offer to say that the
position that was offered was for a skilled labourer and not a potroom
operator. This does not change the essence of the matter. The workers
say $14 an hour is much less than what a unionized
skilled labourer makes in a potroom. That kind of maintenance position,
directly connected with production work such as the siphoning of
aluminum in the potrooms, is precisely what Rio Tinto Alcan is going
after
in its effort to drive down wages and working conditions. Rio Tinto
claims such jobs are non-core and non-essential and therefore perfect
for subcontracting out with conditions as low as possible. Rio Tinto
Alcan washes its hands of what
happens to these
workers, claiming that this is now the subcontractors' responsibility.
Meanwhile, RTA executives appear on TV and claim that working
conditions of the contract workers are very
good.
The subcontractor's low wage job offer explicitly states that to do the job, the worker has to be in top physical shape and able to work under high temperatures as do workers who siphon aluminum.
This episode says a lot about the kind of future Rio Tinto has in store for the workers and the region.
President of Rio Tinto Alcan Electrical Workers' Union Defends Just Stand
On June 19, Pierre Simard,
the President of the Syndicat
des employés d'énergie électrique of Rio Tinto
Alcan, was at a Labour Board hearing. The matter concerns the formal
notice he was served by RTA in March which demands that the local union
leader refrain from breaking what the company calls his
"duty of loyalty and confidentiality" towards the company. The warning
was issued following Simard's revelation of the scope of Rio Tinto's
ongoing sale of unused hydro to Hydro-Québec during the lockout.
Rio
Tinto also resents Simard telling a local paper his suspicion that the
company planned the Alma lockout
because of a downturn in the aluminum industry. Simard is demanding
that
the formal notice be declared null and void and is asking for $10,000
in damages.
According to a report in Le Quotidien, Simard told the Labour Board that he faced a wall of silence when trying to find out more about the company's intentions and the extent of the sale of hydro. Simard recalled that an economist had made a presentation a few months before the lockout in which he spoke of an unfavourable economic situation for the aluminum industry with high inventories and declining prices. This increased his suspicion that Rio Tinto was up to something, reports Le Quotidien.
"I have never seen a plant shut down so quickly." he told the Labour Board. He recalled that in previous rounds of bargaining with Alcan in 1992, 1995 and 1998, negotiations carried on way beyond the contract's expiry date: 14 months beyond in 1992; four months in 1995; and three or four months in 1998. In this case, however, the Alma workers were actually expelled by force from the plant while on shift about 24 hours before the contract expired and the lockout was decreed less than two hours after the contract had expired. As for the issue of duty and loyalty, Simard said he had a duty to go public about these concerns and that the information about the energy exchanges between RTA and Hydro-Québec and the amount of money that is involved is in the public domain anyway, Le Quotidien reports.
The trade union leader rejects the company's assertion that he is in breach of his duty of loyalty and confidentiality. The formal notice also raised other issues that were deemed to be in contravention to this duty such as taking unauthorized days off during the lock out, putting up trade union stickers and refusing to do overtime.
The hearings at the Labour Board will continue on September 25 and 26.
St-Jean-de-Maurienne, France
Rio Tinto's Blackmail Against Workers and Region
Rio Tinto Alcan's CEO Jacynthe Côté recently visited its smelter in St-Jean-de-Maurienne in the Savoie Department of south-east France. There, she expressed in very clear terms RTA's blackmail against the workers and the region -- that if a buyer is not found by late September, the company will close the plant permanently.
The St-Jean-de-Maurienne Valley is the cradle of the
French aluminum industry and the birthplace of the Pechiney aluminum
company. Pechiney was bought by Alcan in 2004 before it was in turn
bought by
Rio Tinto in 2007. The people of the region still call it Aluminum
Valley, although only the St-Jean
smelter remains, one of just two left in France -- the other being
RTA's
Dunkerque plant in Pas-de-Calais. There are more than 600 workers still
at
the St-Jean smelter and more than 2,200 indirect jobs would also be
lost if the smelter closes. The unions say that the closure of the
smelter could mean the end of the aluminum
industry in France. RTA's CEO conducted herself with the company's
typical arrogance since of course the private interests of RTA are in
contradiction with the interests of France and its workers.
RTA has been threatening to close the St-Jean smelter for some time. The main issue that Rio Tinto Alcan raises in its threats of closure is its hydro contract with Electricité de France (EDF) which ends March 2014. The agreement was signed 30 years ago with Pechiney and experts say that the price the company got was historically low and well under the market price. CEO Côté claims that its negotiations with EDF, which are being held in secret, are not to its satisfaction. The president of EDF says that the price proposed is the lowest to be found in Europe. Côté agrees, but says that she can find a cheaper price outside of Europe.
During her visit to St-Jean, she presented two options that, according to her, show "respect for everybody." Option one, she says, is to find a new buyer but the new buyer has to come forward and be accepted by RTA before this September. Option two is to close the plant. The excuse she gives for a September cut off date is that RTA needs roughly two years to close the facility including to help workers to retrain. Meanwhile the whole aluminum sector will be shut down thanks to RTA and its CEO's "respect for everybody." The cutoff date is also related to the end of the electricity contract with EDF in March 2014. The only option that RTA does not agree to entertain is a loss of profits to keep the livelihoods of the workers and the region alive. The CEO met with government officials and asked that the government intervene to get RTA a lower price for the hydro it must purchase, otherwise the plant is going to close.
The St-Jean Rio Tinto workers held a demonstration on June 6 in front of the Prefecture of the Savoir department in Chambéry to denounce the threats of closure and ask for the support of the political authorities. The union representatives say that the price of electricity is not the only issue involved in the possible closure. RTA has already decided to close all its aluminum smelters in Europe they point out, noting the recent closure of the Lynemouth smelter in Britain. They explain that RTA's new policy to demand a 40 per cent rate of return from its smelters will lead to the demise of all those it has in Europe. They do not believe RTA's pledge that it is going to keep its research centre in St-Jean-de-Maurienne even if it closes the smelter. They point out that these research activities are closely tied to the life of the plant, with constant back and forth activity between the research centre and the smelter for testing and experimentation.
Besides St-Jean, Rio Tinto Alcan is also threatening to close the casting plant in Castelsarrasin in south-west France, which employs about 40 workers. Again the whole thing is clouded in secrecy. This culture of secrecy, arrogance and threats gives the RTA's Alma workers a pretty good idea of what the Rio Tinto executives have in mind when they say that any contract signed in Alma must be within the parameters of what exists elsewhere in RTA's facilities.
(Quotes translated from original French by TML.)
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