What made Eastern GO Under?

[B-J-J Fighter]

Was it the union or Frank Lorenzo. If someone knows the story and has time give me a little info about this.

 

[flywithruss]

"Hard Landing"

Read the book "Hard Landing" by Thomas Petzinger. It gives an excellent history of the airline business and I think it should be required reading for anyone considering an airline career. It is very illuminating, to say the least. It talks in great detail about the end of Eastern, among many other things.

The short version on Eastern, as I understand it, is that as the company had problems they kept going to the union till for more concessions. Soon, the unions (specifically the Machinists) started saying NO ... this is when the BOHICA buttons (Bend Over, Here It Comes Again) proliferated at EAL.

Frank Borman (EAL CEO) and Charlie Bryan (Machinists union) wound up getting in to a big personality conflict, and Borman finally said the company needed big concessions or it would sell. The union wouldn't budge, and the company was bought out by Texas Air (Lorenzo & Co.). Lorenzo proceeded to use Eastern as a write-down for the massive changes he was engineering at Texas Air ... this was right around the time of the "Big Bang" ... the day Frontier, People Express, New York Air, and Continental became a single carrier in 1987. Lorenzo basically took whatever assets he wanted for Continental from Eastern for no compensation. That was pretty much what did it.

This is the Reader's Digest version, so I hope it isn't too general. The whole saga is quite fascinating, from a historical perspective. Read "Hard Landing" to get the details far better than I can recall.

Tailwinds, y'all ...

R

 

[Typhoon1244]

Lorenzo bought Eastern with the intention of breaking it up and selling it for parts. To do that successfully, he had to break the unions...he said so publically! Right up front! (There are a lot of union busters out there, but Lorenzo was the first one in a long time to be up-front about it.)

The original cause of Eastern's death was (1) a long history of poor management--for example, Rickenbacker bought Electras when everybody else was snapping up 707's and DC-8's--and (2) a pissing contest between chairman Frank Borman and IAM leader Charlie Bryan. The fatal blow was an unsuccessful strike. Too many people crossed the picket line.

The strike was supposed to stop Easern's heartbeat long enough to convince Lorenzo to leave. Instead, thanks in part to the availability of scab labor, Eastern slowly bled to death. It was not pretty.

I went with my father to two of the ALPA teleconferences...I also walked more than a few picket lines with him. You have no idea how impressive it is to see so many people willing to sacrifice so much to save their company.

Sad truth: if the strike had been called off as soon as it became clear it wasn't working, the employees could probably have fought Lorenzo successfully from the inside...and the Great Silver Fleet would still be airborn today, in some form or other.

 

[~~~^~~~]

Typhoon - thanks for the perspective on history. I fear we are in danger of seeing history repeat itself. As you know, ALPA let those scabs back into the union without a penny of back dues. In fact they served cake and ice cream and took a bunch of pictures.

Many pilots now ask themselves, if scabbing means nothing to ALPA, why would it mean anything to me? Our current union leadership has embraced alter ego airline operations to the point where six pilot groups fly Delta passengers on domestic routes and many more on international routes. With the approval of the Delta, Continental Northwest deal, a Delta seniority number will be about worthless, because, if they struck, who would care?

 

[Boeingman]

Typhoon - thanks for the perspective on history. I fear we are in danger of seeing history repeat itself. As you know, ALPA let those scabs back into the union without a penny of back dues. In fact they served cake and ice cream and took a bunch of pictures.

Many pilots now ask themselves, if scabbing means nothing to ALPA, why would it mean anything to me? Our current union leadership has embraced alter ego airline operations to the point where six pilot groups fly Delta passengers on domestic routes and many more on international routes. With the approval of the Delta, Continental Northwest deal, a Delta seniority number will be about worthless, because, if they struck, who would care?

Point of fact. The scabs I think you are reffering to from Typhoon's message are the EAL scabs at CAL. If so, they were not granted amnesty, and in fact, ALPA is still pursuing judgements and assements against the EAL pilots who crossed now at CAL.

I have said repeatedly on this board that the problems we faced at CAL with people crossing the picket line had little (admittedly some) to do with greed, but a deep seated anger and resentment towards ALPA and past practices. This is now being repeated today with an entire generation of younger pilots who are very angry at this union. I ask again? Why are so many scab pilots former ALPA members? What is wrong with this picture?

I do not share your view of scabbing meaning nothing to ALPA. I believe that ALPA finally realized they made some serious mistakes at CAL and the abysimal manner in which our strike was handled. The silver lining in that disaster was the lessons learned to help future job actions. Personally, I think it would be career suicide to walk against a management team bent on operating. I don't see that changing anytime soon with this climate in the industry.

For those die hard union loyalists who wish to laugh and scoff at this opinion go ahead. You are just burying your head in the sand. Been there, seen that.

"Those who do not learn from history are bound to repeat it" *

*Author unknown (Churchill?)

 

[Boeingman]

Lorenzo bought Eastern with the intention of breaking it up and selling it for parts. To do that successfully, he had to break the unions...he said so publically! Right up front! (There are a lot of union busters out there, but Lorenzo was the first one in a long time to be up-front about it.)

The original cause of Eastern's death was (1) a long history of poor management--for example, Rickenbacker bought Electras when everybody else was snapping up 707's and DC-8's--and (2) a pissing contest between chairman Frank Borman and IAM leader Charlie Bryan. The fatal blow was an unsuccessful strike. Too many people crossed the picket line.

The strike was supposed to stop Easern's heartbeat long enough to convince Lorenzo to leave. Instead, thanks in part to the availability of scab labor, Eastern slowly bled to death. It was not pretty.

I went with my father to two of the ALPA teleconferences...I also walked more than a few picket lines with him. You have no idea how impressive it is to see so many people willing to sacrifice so much to save their company.

Sad truth: if the strike had been called off as soon as it became clear it wasn't working, the employees could probably have fought Lorenzo successfully from the inside...and the Great Silver Fleet would still be airborn today, in some form or other.

Correct me if I am wrong, but didn't Bavis call off the strike and was overruled by more hard line elements within the MEC?

Anyone see any similarities within the IAM today at UAL and U with EAL?

 

[Toecutter]

Another factor in the downfall of Eastern was our President. Bush could have intervened and forced a settlement to get the airline running again. Like other members of his family, he was in the pockets of big CEO types like Lorenzo. For all you guys that voted for Bush, yes , history IS bound to repeat itself. (i.e. Enron, Worldcom)I know many of you just love to hate Clinton, but at least he was one the most labor friendly Presidents we've had since FDR.

 

[SDF2BUF2MCO]

Let's give credit where credit is due....
If I remember correctly from the book, 'Hard Landings', it was Ted Kennedy who was looking for an issue to pimp off of. Airline deregulation was his issue. In addition, several well known Dems like Maxine Waters and Jim Wright also supported this. It also seems like Lorenzo went to Kennedy to get support for his plundering of Eastern.
Said it several times before, politics is a professional wrestling match - it's a staged and fixed event. To me both parties are anti-labor and both are for sale to the highest bidder.

 

[bigr]

another view point of this is in frank borman's book "countdown". most of it is about borman's astronaut career, however he does detail his fight with the head of the machinest union.

one of the fights was over borman's wish to eliminate the union job that was for a man to stand behind the aircraft and make sure it was all clear as the plane backed out of the teminal. borman wanted this man to have other duties, rather than sit and wait between aircraft. well you know the story, that would take someone else's job...

Charlie Bryan's quote: :"Frank Borman's had his Apollo 8, now its time for mine."

Another incident occured on the flight deck when borman was in the jump seat. the captain just complained and complained thru the whole flight...blah blah blah. at the end of the flight the first officer who couldn't get a word in edgewise turned to borman and said: "been gettin' any lately"

Eastern became like the Lame zebra on the african plains, it couldn't keep up and the lions (Lorenzo) came up for the kill.

 

[publisher]

all most right

I do not think that it is correct that Lorenzo bought it to break up. That was more a result than a reason for the purchase.

He felt that if he took over, the tension would be relaxed and he could save it and bought cheap. He was wrong and went ahead to make the best of his investment. He just did not appreciate the ill feelings that existed and the entrenchment.

While he was no saint, he gets a bad rap for a deal here that he did not create. Like dinosaurs, big things take a long time to hit the ground when falling.

 

[chawbein]

Why do airline pilots continue to rely on the "unions" for their jobs and their careers? The airline industry is broken, and the only way to fix it is to give unions the boot. The market will determine pay and ability/experience will determine assignmnets. The unions are artificially lowering the supply curve for pilots. Think if there were no union tomorrow, do you really think all pilots would lose their jobs? No. Would their salaries go down? Most definitely. Would there be as many young pups willing to fly for peanuts when there is no prospect to be making six-figs after five years? No. I understand that "that's just the way it is", and I don't think poorly about anyone for supporting the union, after all it is in their own best interest. Forgive me for being such an unadulterated capitalist; however, most people in other industries seem to do just fine without union representation.

 

[Cavpilot]

Why do airline pilots continue to rely on the "unions" for their jobs and their careers? The airline industry is broken, and the only way to fix it is to give unions the boot.

I used to have a similar opinion to yours...untill I got my first airline job.
When I ran my family's business in the construction industry, I watched my union shop competitors fold all around me. We treated our employees with respect, so the union coming into our shop was never a concern. I could not figure out why my competition could not treat their people the way we did.
My opinion changed when I went to work for Comair. If there was ever a textbook case as to why unions are so strong in the airline world, it is them. At least they were equal opportunity opressors, they treated all of thir employees like dirt. I shutter to think how they would treat their pilots if there was no contract to protect them.
I escaped Comair about the same time the strike ended. I am told that it is a lot better there now. I hope so, I still miss the peolple I flew with there.

 

[enigma]

For all you guys that voted for Bush, yes , history IS bound to repeat itself. (i.e. Enron, Worldcom)I know many of you just love to hate Clinton, but at least he was one the most labor friendly Presidents we've had since FDR.

Maybe my memory's a little foggy, but didn't Clinton allow the AA pilots to take a hosing?

BTW, Enron was a company that existed only because the energy industry was basically de-regulated. Do you happen to know who was president when 99% of the lobbying (read that bribery), that allowed Enron to build its house of cards, was successful? Whose administration did Robert Rubin work in? Which ex-Secretary of the Treasury called the Bush administration begging Bush to cover up the Enron mess? Can you say Robert Rubin, Treasury Sec, under Clinton. Which administration ignored Mr. Rubins' requests?

Same for worldcom. These business's went down because of fraud and deceit allowed during the Clinton administration.

The sad truth is that this country decided in the early sixties that we no longer needed to follow the moral dictates of a supreme being, you are now seeing the results of a society with no moral center. It's all our fault. But Misters Clinton ("that depends upon what is means") and Gore (" there was no controlling legal authority") are much more exemplary of the breakdown of society than are either of the Bushs.

regards,
8N
BTW, I consider a president who allows this laborer to keep more of MY money to be labor friendly.

 

[enigma]

Why do airline pilots continue to rely on the "unions" for their jobs and their careers?

I don't rely on the association (ALPA/union) for my career or job. I do rely on the association to protect me from arbitrary and capricious treatment at the hands of managment. The airline industry runs twenty four/seven. We work nights/weekends, holidays/ etc. In the absence of decent work rules and a union to enforce fairness, management plays favorites. In other words, your quality of life can be dramatically affected because someone else kissed the bosses behind. The unions established seniority to prevent such favoritism. I have worked at a non-union carrier that did not respect seniority. I can tell you that in such an environment, the amount of inequity was huge. Upgrades were based upon how well you kissed up, schedules always seemed to reflect who happened to be the favorite, and who was on the outs with managment. Oh Yea, getting on the outs was as easy as refusing to fly a broken/illegal airplane.

The ALPA was started as a safety organization, and I believe that safety still functions as our number one priority. ALPA is responsible for limits on flight and duty time; absent those limits, management would take the chance that I wouldn't crash at the end of twenty hour day. ALPA was responsible for almost all of the regs that force companies to operate safely. You'd think that business sense would dictate that an airline want to operate safely, but recent actions by the AirTransport Association to sue the FAA over the Whitlow letter, reveal the true spots of the companies. BTW, the Whitlow letter was an FAA interpretation of duty time that said a pilot could not be on duty over 16 hours, period. The ATA fought that tooth and nail. Even after the AA MD80 at LIT crashed when the crew was at end of a max duty day.


Gotta go, Sorry for the less than perfect composition, I'm short of time. Please think about some of this and let me know what you think.
regards,
8N

 

[Typhoon1244]

Re: all most right

[Lorenzo] felt that if he took over, the tension would be relaxed and he could save it and bought cheap. He was wrong and went ahead to make the best of his investment. He just did not appreciate the ill feelings that existed and the entrenchment.

Bull__it. Bavis and Bryan offered to meet with Lorenzo shortly after the buyout to discuss matters. He flatly turned them down, saying "I don't talk to unions."

While he was no saint, he gets a bad rap for a deal here that he did not create.

Hitler wasn't such a bad guy either, once you got to know him.

 

[MetroSheriff]

Re: all most right

I do not think that it is correct that Lorenzo bought it to break up. That was more a result than a reason for the purchase.

He felt that if he took over, the tension would be relaxed and he could save it and bought cheap. He was wrong and went ahead to make the best of his investment. He just did not appreciate the ill feelings that existed and the entrenchment.

While he was no saint, he gets a bad rap for a deal here that he did not create. Like dinosaurs, big things take a long time to hit the ground when falling.

Nothing personal, but that is an ADBSURDLY generous mischaracterization of Eastern's demise. Your view of corporate raidership in the 80, Lorenzo in particular, must be interesting through those rose colrored glasses of your yours.

Typhoon has it right. By your twisted logic, Hitler just thought he was improving the "economic" situtation for the Fatherland when he tried to take over Europe. The 6 millionn innocent people he murdered were just victims of unintended circumstance.

Hopefully you will never decide to go into airline management.

 

[Toecutter]

Enigma,

I must say that you live up to your name. Although I disagree with your response to my post, I think your second post was right on the mark. I'm not going to start a "who's the most corrupt administration contest."just because I know it won't change anybody's mind on how they feel. However, the second post answered my thoughts exactly on someones earlier post about why we need unions. I've heard horror stories on what is was like flying for airlines like Value Jet and Fine Air.

 

[Typhoon1244]

Oh and speaking of scabs the guy who started Gulfstream...SCAB!

Yes, they're everywhere. The late Legend Airlines had one in its command structure.

My dad spent a total of two weeks at AirTran during the late Nineties. During ground school he found out the head of their in-house union was a scab. Adios.

As for presidential administrations, I'm not going to waste everybody's time by comparing the level of corruption in each. I'll only remind everyone that Frank Lorenzo was one of George Herbert Walker Bush's larger campaign contributors. Let's just say I'm not a big fan of that gentleman...or his dim-witted sons.

Publisher: I'm still aghast at your view of Lorenzo's work at Eastern. Are you related to him or something? As militant a pilot group as Eastern had...sometimes I'm amazed Lorenzo is still breathing!

You know one way you can tell an airline has class? If the stripes on the cuffs of the pilots' uniform jackets go all the way around the sleeve...the way Eastern's did. When winter rolls around, take a good look at a Delta or ASA pilot's sleeves. (Yeah, ASA's leather jackets are expensive...but they're not as silly-looking as the blazers.)

I was a true E.A.L. baby. My first ride in an airplane was at six months...MIA-SJU, so my mom could show me off to her family. It was a DC-8-60...'course I don't really remember it too well.... Whenever fate ever brought me to some unfamiliar city, if I saw a silver jet with a two-tone blue hockey stick--"Caribbean blue" and "ionosphere blue," of course--I had the funny feeling of still being connected to home. Sounds wierd, I guess.

I miss it...and I didn't even work there!

 

[mckpickle]

WOW good for your dad, that takes gutts!

 

[flight-crew]

One of my mentors who helped me so greatly in my pilot career was (is) a scab. I've known him since I was a young kid and well before I even started flying. He will always be my friend. But I strongly disagree with scabbing. And I think that there will always be a part of me that resents what they have done.

And maybe Eastern would still be around were it not for all the scabs who stole the jobs of the Eastern pilots. Although I was only a young kid when most the scabbing took place (CAL 83', UAL 85', and EAL 89'), I can't help but look back at the past and realize the true damage that these individuals have done to the whole industry. You can really learn a lot about history by looking at the past. For the pilots who truely disagreed with the above strikes and crossed the line, I'm not sure if they totally did it out of greed, but maybe more because of the way they felt. I look at them more as "picked line crossers" or "strike breakers." But the pilots who came right off of the street (SCABS), are scabs in every sense of the word. They knew that there was an active strike in progress and made their decision.

Now if ALPA just wanted to get rid of Frank Lorenzo at CAL and EAL by strikes and didn't care what happened to the striking CAL and EAL pilots, then that was wrong. But you have to remember one thing, a strike is always voted on by the pilots. The pilots voted.

 

[JetPilot500]

I have worked at a non-union carrier that did not respect seniority. I can tell you that in such an environment, the amount of inequity was huge. Upgrades were based upon how well you kissed up, schedules always seemed to reflect who happened to be the favorite, and who was on the outs with managment. Oh Yea, getting on the outs was as easy as refusing to fly a broken/illegal airplane.

There may be some operations out there that are poorly run without a union. But, I worked at several non-union aviation jobs including flight instruction, part 135 and part 91 corporate. I can tell you that in all of those jobs, you were rewarded for hard work and not because of the day you were hired. A pilot was upgraded on ability to do the job...what is wrong with that. The guys who didn't have the ability or weren't "team players" were not given opportunities for advancement. And being a "team player" does not mean bending the rules or kissing butt, it means helping the company out when they need you.

At my 135 job, one day we all got a 25% raise! And that raise had nothing to do with a union strong arming the company into giving the raises. We started to have some turnover because good people were leaving to take higher paying jobs. Well, the laws of economics took over and the company gave everyone a raise to stop the bleeding.

A union contract has its benefits, that is for sure. When you get that many employees, it is nice to have an agreement on how certain things should be handled.

IMO, UAL is in trouble, in part, due to the UNIONS. The Unions have strong armed the company into paying rediculous salaries that the company simply could not afford. And in the process of strong arming the company, they scared away many of the customers. The company didn't agree to those contracts because they suddenly realized they could afford them, they agreed so the UNIONS would stop pushing away all of its customers! No customers, no airline! I don't know one person who tells me they enjoy riding on UAL. They all talk about how bad the employee attitudes are. I choose AA any day before UAL, even if I have to change planes versus going non-stop. A bad attitude should get you fired! However, the unions keep protecting these people who don't deserve the jobs they have.

I've worked for an ALPA airline, and I'll tell you, it is definately part of the reason I did not go back to that job when I was recalled.

There needs to be some reform to all this mess, the system no longer works.

JetPilot500

 

[Typhoon1244]

Now if ALPA just wanted to get rid of Frank Lorenzo at CAL and EAL by strikes and didn't care what happened to the striking CAL and EAL pilots, then that was wrong.

I was about to tell you what a great post that was until I got to this sentence.

ALPA wasn't trying to get rid of Lorenzo, the Eastern pilots (and, of course, the F/A's and mechanics) were trying to get rid of him. The people who got caught in the middle--the rampers, gate agents, etc.--love to blame ALPA for what happened, but that blame is misdirected.

As far as its structire is concerned, ALPA is a little like a religion. There are thousands of (for example) Baptist churches in the country, all with the same basic core beliefs, but each church has its own concerns and does thing its own way. Just as all the ALPA pilot groups have the same core beliefs, but each MEC (in other unions called a "local") does things its own way.

As for your friend, I admit, I have a little respect for someone who has the guts to say "this is wrong" and do what they think is right. It's a little like a soldier who, in combat, decides it's wrong to kill and refuses to take part. But if he gets a handful of his buddies killed...?

 

[Typhoon1244]

A pilot was upgraded on ability to do the job...what is wrong with that. The guys who didn't have the ability or weren't "team players" were not given opportunities for advancement. And being a "team player" does not mean bending the rules or kissing butt, it means helping the company out when they need you.

I know of one non-union carrier where being a "team player" and "helping the company out" mean agreeing to falsify the aircraft log book so that your duty time problem will go away. I know of another where many upgrades are based on management favoritism and nepotism. But I guess you'd prefer that to being a member of a union who could back you up when the company was trying to screw you over.

I've worked for an ALPA airline, and I'll tell you, it is definately part of the reason I did not go back to that job when I was recalled.

I suspect you wouldn't have been happy at that airline whether it was ALPA or not.

Companies, not just airlines, tend to have the unions they deserve. Northwest has a militant pilot group because they have a management team that treats employees like cattle. Employees who are treated with respect don't form unions.

Part 135 outfits, flight schools, and other small operators tend to not have unions because (1) nobody works there long enough to care, and (2) everybody knows that if a union organization was attempted, the company could just go out and find new people who are so desperate for a job, they'll ignore a union. Chicago Express is a perfect model for this. Before 9/11, "Windy City" was just a stepping stone, and the pilots just swallowed the occasional abuses. But now that Osama Bin Laden has decreed that C.E. pilots are stuck where they are for the forseeable future, the pilots are starting to feel differently about ALPA.

ALPA is not perfect by any stretch of the imagination...but it beats the heck out of the alternative.

 

[pilotyip]

Union's

I have worked for two union companies, ALPA and Teamsters.
Both companies are now out of business. The unions came in to fix pilot problems, in fixing the problems, mostly more time off, the airline was not as profitable as it was before the contract, true it was a better place to work with protections, but they had a cost structure and management constraints that made it harder to remain profitable. Sinece they were privately held they elected to do something else with there money and not operate airplanes. I am kinda neautral union wise, but a union can not make a silk purse out of a pig's ear.

 

[skyking1976]

Not to open old wounds...

Lorenzo bought Eastern with the intention of breaking it up and selling it for parts.

Hey Air Wis guys...
Sounds like someone we used to know. Maybe.... Bill Andres? It still makes my stomach turn.

 

[race#53]

Eastern employees needed to look into the future to see how UAL's pilots used the Co's own rules to get what they wanted (be carefull what you ask for though).
A better example is the French that put their lives on the line laying down on the runway and no one flew. A smarter version of the French tactic combined with the UAL pilots would be for several thousand employees to just drive to the airport and obey the speed limit around the terminal, wouldn't that be a sight!!!

 

[rumpletumbler]

I don't think it is as complex as most folks like to make it. Isn't the real reason Eastern went under is because the pilots wouldn't go to work?

RT

 

[publisher]

missed point

Obviously when you post stuff here you try and keep it short (except of course for Surplus1). This leads to generalities and some misconceptions.

My point was that Frank Lorenzo did not take a perfectly good company and drive it into the ground at Eastern. The company was in a death spiral when he showed up.

Lorenzo nor Icahn were ever airline guys. They were entrepeneurs and business opportunists. He misjudged the situation at Eastern. Perhps I am wrong but I see Bryan as much of the problem as he was of any solution. He was entrenched in his position, the employees were entrenched and wanted nothing less than someone who would lead them back to prominance, an airline guy who recognized the history and the value of the name. Lorenzo was not that guy but that guy was not going to show up.

My posts were not a defense of Frank Lorenzo at all. Merely that to lay the blame for the demise of Eastern on him is a bit off base. My feeling is that Borman did the most damage.

When companies like this go down, sharks come around for the feed. Lorenzo was one of those just like Marty fed off it for awhile. They are rarely the people that wounded the animal.

Many excellent people were hurt over Eastern and its demise. Some crossed and some did not. There are no kudo's to be passed out here for unionism or much of anything else for they turned out to be just as bad as the management they were fighting.

They continually misjudged the situation, the condition of the airline, and let their personal feelings determince courses of action. What happened at Eastern is a perfect example of labor run amok.

To me, there were no scabs, no hero's, no goats, just a bunch of basically good people caught up in the moment not understanding anyone elses position. It was a business tradgedy.

 

[flight-crew]

To me, there were no scabs, no hero's, no goats, just a bunch of basically good people caught up in the moment not understanding anyone elses position. It was a business tradgedy.

That is a bold faced lie. There were plenty of SCABS who came off the street during the Eastern strike. When a pilot crosses an active picket line to work, that makes him/her a scab by definition.

 

[B-J-J Fighter]

Thanks

Thanks for your comments, this has turned into an interesting thread!