A Momentive lesson

The members of IUE/CWA at the Momentive plant in Waterford are back at work following settlement of a hard-fought contract struggle. But the strike at Momentive represents an epic continuing battle with no less than the future of our economy at stake.

Just four miles to the south in Green Island, 39 UAW members at Honeywell have been locked out for over nine months, along with 320 UAW members in South Bend, Ind.

On one side of these fights are workers fighting desperately to preserve their wages and benefits, wages and benefits that keep their families in the middle class, and out of poverty.

On the other side are Wall Street billionaires who rake in unfathomable profits by stripping away those benefits and lowering those wages — a strategy that is erasing the middle class from this country.

It’s a battle that’s playing out in communities across the country —aggressive wage cuts, outsourcing and elimination of pensions and benefits have left today’s young adults to think of middle class jobs as modern-day folklore.

To be clear, this economic destruction didn’t just happen. It’s the direct result of actions taken by powerful men like Steven Schwarzman and Leon Black, the billionaire Wall Street fund managers who bought Momentive 10 years ago and have used it to make massive profits — at the expense of the company’s employees and the community.

In 2009, Momentive slashed pay for production workers by 25 to 50 percent and outsourced dozens of jobs. In 2013, the company froze pensions for workers younger than 50.

In 2016, Momentive demanded drastic cuts in health care coverage for active employees, and elimination of all health and life insurance for retired workers, many of whom are suffering from job-related illnesses caused by exposure to dangerous chemicals. Workers at the plant fought back, and that’s why 700 workers were on strike for over 100 days.

The Hedge Clippers campaign, which provides information on how billionaire-driven inequality is pushing regular people and their families over the edge, released a report (tinyurl.com/jdmrfnw) on how the fund managers destroyed jobs at Momentive and companies across the country to enrich themselves.

And these billionaires have made a lot of money for themselves. Black, who runs the hedge fund that is the majority owner of Momentive, has grown his personal wealth to $5.1 billion and bought both a $50 million Manhattan mansion and Tom Cruise’s $40 million Beverly Hills estate. Schwarzman, who runs a hedge fund that owns a big chunk of Momentive, got even richer — his personal fortune is estimated at over $11.1 billion, and his personal pay last year was an astounding $811 million.

Their scheme is just like so many other hedge fund managers who buy up companies in communities like ours: they bought Momentive, loaded up the company with huge debt, took massive management and interest payments, and then forced their managers to cut pay, benefits and jobs.

Schwarzman has been named as Chair of President Trump’s “Strategic and Policy Forum,” where he leads 16 major CEOs in advising the president on economic policy. If his actions are any indication, we can expect that advice to include more tax breaks for the wealthy, removal of government regulations that protect workers and communities from corporate raiders, and more ‘freedom’ to destroy middle class jobs and the unions that protect them.

The crisis at Momentive demonstrates the worst aspects of today’s billionaire-driven inequality economy. Black and Schwarzman—who never even acknowledged a letter from union leaders appealing for help in preserving good jobs in Waterford — together with the rest of the Wall Street multimillionaires and billionaires, have taken unprecedented wealth out of our communities, causing the rest of the economy to sputter.

Working families and middle class jobs are the engine of our economy — building a strong middle class is the only way to build an economy that works for all of us, and that creates thriving communities in upstate New York and across the country.

Clearly, Donald Trump and his hedge fund sidekick Stephen Schwarzman are interested in padding their bottom line, no matter the cost to working people. But what about the Democrats? Any politician who truly cares about the future of the middle class and shared prosperity must challenge the hedge fund and corporate agenda. They have to fight for jobs with good wages and benefits and reject tax breaks and other loopholes for CEOs and billionaire fund managers.

Leon Black and Stephen Schwarzman, and others like them, keep getting richer by taking wealth from us, our families and our communities. It has to stop.

• Karen Scharff is executive director of Citizen Action of NY and Hedge Clippers leader. Bill Ritchie is president of the Albany County Central Federation of Labor.