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Aluminum Workers Rally for Power by John Stucke - Staff writer The Spokesman Review, May 5, 2001

Local Steelworkers grudgingly back Kaiser's position against BPA

Hundreds of aluminum workers rallied Friday at Bonneville Power Administration headquarters in Portland, urging the federal agency to sell smelters enough cheap electricity to restart.

Spokane Steelworkers joined the effort, even though many said they did so reluctantly because of their disdain for their employer, Kaiser Aluminum Corp.

It was the latest attempt by the aluminum industry to show BPA that a plan to shut smelters for two years will have human consequences.

Many of the 500 workers at the rally wore T-shirts that said "Wright is wrong!" for recommending closure of aluminum companies, which they say will cost at least 7,500 of the best-paying blue-collar jobs in Washington as companies are forced to operate elsewhere -- for good.

But Steve Wright, acting BPA administrator, said it's the best way to bring the region through a power crunch that threatens to more than triple rates for its broad customer base.

Under the BPA plan, aluminum workers will be paid during the two-year closure.

Among the workers at the rally were Steelworkers from Kaiser Aluminum's Spokane plants, nonunion employees of Alcoa Inc.'s magnesium smelter in Addy, and union members from other smelter towns.

"It is not my goal, it is not the goal of this agency, to put the aluminum industry out of business," Wright told workers. "But we do have a very difficult problem -- we are looking at a wholesale power market that has gone through the roof in terms of prices."

Some weren't convinced.

"They'll just move (the aluminum industry) someplace where they pay the workers 50 cents an hour," said Charlie Hudson, a worker at Alcoa's smelter in Ferndale.

Rallying for the aluminum cause, however, has been vexing for Spokane Steelworkers, who can't stomach siding with Kaiser.

Grudges linger from a two-year labor dispute that bankrupted some members and cut into Kaiser's customer base.

When workers returned to the factories last fall, many said they were met with hostility. Those at Mead were laid off while the company sold its federal power in an unusual contract provision that allowed Kaiser and two other aluminum concerns to buy low-cost megawatts from BPA, then sell the power in the soaring market.

The buy-low, sell-high maneuver netted Kaiser more than $400 million.

The company offered to share about $10 million with BPA to help offset rising rates in the region.

The federal agency sought more than $100 million, plus a detailed commitment to spend the rest of the proceeds to pay workers and invest in power generation.

Kaiser refused. The company is spending the money on a variety of corporate costs, such as debt reduction, that management says will put Kaiser in a better position for the long-term operation of Northwest plants.

David Foster, a Steelworkers official from Minneapolis, called the company a "villain" for not striking a deal with BPA.

He praised other companies, such as Alcoa and Golden Northwest Aluminum, for reaching agreements with BPA and paying workers with power sale profits.

Kaiser spokesman Scott Lamb said the company has set aside more than $57 million to pay laid-off workers and has invested more than $1 billion in the Northwest in the past 25 years.

"We value those assets, we value our employees, we are taking a long-term view of the situation and we want to produce aluminum," he said.

"So I guess I would say it depends on what your definition of a villain is."

Lamb said BPA has made the aluminum industry a scapegoat for a failed federal energy policy that isn't meeting demand.

"Northwest power prices are the highest in the world for any aluminum smelter, bar none," Lamb said, "so clearly there is an aberration in the market."

Wayne Bentz, head steward of Steelworkers Local 329 for the Mead plant, said Kaiser has poisoned the industry.

"Kaiser is a rogue, and they don't deserve a thing until they commit," he said.

Foster went further in a Forbes magazine story about Charles Hurwitz, the Houston financier who controls Kaiser.

"I hope Kaiser gets out of the region and someone else takes over the plants," Foster said.

The company's Steelworkers would like that, said Cathy Gunderson, a Mead Steelworker and political action campaign member.

In perhaps the entire industry's greatest hour of need, Kaiser's rift has kept arguably the most organized, powerful and effective aluminum union sitting on its hands.

There has been some letter writing and political efforts such as Friday's rally.

"Let's put it this way: We could be doing a lot more, but why should we?" she asked. "As workers, Kaiser has given us no guarantees . . . and none to the region."

"Instead, it's the same `We should be treated differently' spoiled-brat approach," Gunderson said.

"Our goal is that `Hey, if you're not going to play ball and do business in the Northwest, then maybe we should find somebody else who will,"' added Dave Carlson, president of Local 338 representing Trentwood Steelworkers. "They should sell these plants to somebody who wants to step up and operate.

"And unless we work out some sort of situation for power, there won't be a sale or quite frankly, an industry I'm afraid."

Some Steelworkers quietly lament that what may be good for Kaiser, this time may be good for them.