Goldman Sachs: Impoverishing Truck Drivers

Much attention was paid when, in March, a derivatives trading executive at Goldman Sachs accused the investment bank of abandoning its proper mission: serving clients first. When he went to work at the firm twelve years ago, Greg Smith maintained, Goldman?s culture ?revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients.? But now, he said, the company sustains a ?toxic and destructive? environment. For its part, the company had commissioned a Business Principles and Standards Report that recommended ?a constant focus on the reputational consequences of every action we take. In particular, our approach must be: not just ?can we? undertake a given business activity, but ?should we.? ?

Goldman Sachs is an investment bank, of course, but it is also an owner of enterprises. As its website proudly declares, ?Goldman Sachs is one of the largest infrastructure fund managers globally, having raised more than $10 billion of capital since the inception of the business in 2006.? Goldman Sachs Infrastructure Partners owns 51 percent of a company called SSA Marine, which, with its affiliates, operates more container shipping terminals than any other company in the world.

In this capacity, Goldman Sachs is not just an employer of bankers but an employer of truck drivers who drive unloaded goods out of the ports. Except that, in a ruse to avoid paying benefits to these drivers (and taxes to state and federal governments), they are not classified as employees at all?rather, as ?independent contractors.? More of the nation?s 110,000 port truck drivers work for SSA Marine than for any other firm.

Since trucking deregulation began under President Jimmy Carter, trucking rates are no longer set by the federal government. They are set by companies like SSA Marine, which are not unionized and which relentlessly cut costs. One way to do so is to avoid paying benefits. This is neatly done if one?s truckers are not classified as employees.

I spoke recently with an SSA Marine driver, Leonardo Mejia, who has been driving cargo out of the port of Long Beach, California, since 2001. Mejia was one of a group who supported Occupy Oakland?s port shutdown on December 12 even as most longshoremen opposed it, which they were bound to do if they were not to forego a day?s wages.

He told me:

?When all the port drivers used to own our own trucks, the situation wasn?t so bad. It changed in 2008. At that point, most of the port drivers were making twenty-eight to forty thousand dollars a year before taxes. The ports created a plan to avoid pollution. They forced us to sell our trucks and buy new trucks, and the state paid the ports to buy new trucks, thinking that the truck drivers would be recognized as employees. But only fifteen out of 850 companies in Los Angeles have recognized the drivers.? Goldman Sachs?s SSA Marine is not one of them.

?If I want to keep working at the port,? Mejia said, ?I have to drive a new truck. Now most of the companies force drivers to lease the truck if they can?t buy it. You have to pay all the insurance, the diesel, the maintenance?you have to pay everything. So in the past year, I made eighteen thousand dollars. I have to pay three thousand dollars in taxes to the IRS. I work between nine and eleven hours per day, six days a week, or as many as the dispatcher says. I have no control. If I want to go to work for somebody else, I can?t do that. I must work only for that company. They say that we?re independent contractors but in reality we?re employees.?

Employees without benefits, that is.

Explaining their support for Occupy Oakland, Mejia and other drivers declared: ?The companies we work for call us independent contractors, as if we were our own bosses, but they boss us around. We receive Third World wages and drive sweatshops on wheels. We cannot negotiate our rates. (Usually we are not allowed to even see them.) We are paid by the load, not by the hour. So when we sit in those long lines at the terminals, or if we are stuck in traffic, we become volunteers who basically donate our time to the trucking and shipping companies. That?s the nice way to put it.?

The corporate practice of labeling controlled employees ?independent contractors? flies in the face of IRS regulations that technically distinguish between the two. As Andrew Leonard reported in Salon, the Obama administration last year asked for $46 million to pay for inspectors to enforce these regulations, but the GOP-controlled House did not take kindly to funding such enforcement. In October, however, California Governor Jerry Brown signed into law a ?Wage Theft Prevention Act of 2011,? which ought to help rectify the power imbalance between employers and ?contractors.?

Who benefits from such deceptions? An executive of SSA Marine told Bloomberg that Goldman Sachs Infrastructure Partners ?is primarily made up of pension plans of workers in the United States and Australia, and those groups hire money managers to manage their pension funds.? In his eyes, ?We are a union operation; we support union workers, family-wage projects and make investments to increase those job opportunities.?

SSA Marine maintains, in effect, that it impoverishes the truckers in order to benefit more fortunate workers who?thanks to decades of union victories now under pressure?enjoy pensions. In the view from Goldman Sachs, the pensions of the unionized are to be sustained by the ill-treatment of those denied union protection. This makes it ?a union operation.?

The claim is Orwellian, and it belongs on the same page with the claim so frequently heard these days that America?s one-percenters deserve to be paid so extravagantly because of their ?hard work.? Those who defend the tens of millions of dollars paid America?s wealthiest executives on the ground that they earn their ?compensation? because they work hard might like to tell the world in what way they work harder than Leonardo Mejia.

Todd Gitlin is a professor of journalism and sociology at Columbia University and author of the new e-book Occupy Nation: The Roots, the Spirit, and the Promise of Occupy Wall Street, also to be published in an expanded edition, in paperback, this August (HarperCollins).

Article cross-posted with OpenDemocracy. Photo: Occupy Oakland port shutdown in December (by nereocystis via Flickr creative commons)

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The Kurds

[W]hen we refer to all Kurdish fighters synonymously, we simply blur the fact that they have very different politics. . . right now, yes, the people are facing the Islamic State threat, so it’s very important to have a unified focus. But the truth is, ideologically and politically these are very, very different systems. Actually almost opposite to each other. —Dilar Dirik, “Rojava vs. the World,” February 2015

The Kurds, who share ethnic and cultural similarities with Iranians and are mostly Muslim by religion (largely Sunni but with many minorities), have long struggled for self-determination. After World War I, their lands were divided up between Iraq, Iran, Syria, and Turkey. In Iran, though there have been small separatist movements, Kurds are mostly subjected to the same repressive treatment as everyone else (though they also face Persian and Shi’ite chauvinism, and a number of Kurdish political prisoners were recently executed). The situation is worse in Iraq, Syria, and Turkey, where the Kurds are a minority people subjected to ethnically targeted violations of human rights.  

Iraq: In 1986–89, Saddam Hussein conducted a genocidal campaign in which tens of thousands were murdered and thousands of Kurdish villages destroyed, including by bombing and chemical warfare. After the first Gulf War, the UN sought to establish a safe haven in parts of Kurdistan, and the United States and UK set up a no-fly zone. In 2003, the Kurdish peshmerga sided with the U.S.-led coalition against Saddam Hussein. In 2005, after a long struggle with Baghdad, the Iraqi Kurds won constitutional recognition of their autonomous region, and the Kurdistan Regional Government has since signed oil contracts with a number of Western oil companies as well as with Turkey. Iraqi Kurdistan has two main political parties, the Kurdistan Democratic Party (KDP) and the Patriotic Union of Kurdistan (PUK), both clan-based and patriarchal.

Turkey: For much of its modern history, Turkey has pursued a policy of forced assimilation towards its minority peoples; this policy is particularly stringent in the case of the Kurds—until recently referred to as the “mountain Turks”—who make up 20 percent of the total population. The policy has included forced population transfers; a ban on use of the Kurdish language, costume, music, festivals, and names; and extreme repression of any attempt at resistance. Large revolts were suppressed in 1925, 1930, and 1938, and the repression escalated with the formation of the PKK as a national liberation party, resulting in civil war in the Kurdish region from 1984 to 1999.

Syria: Kurds make up perhaps 15 percent of the population and live mostly in the northeastern part of Syria. In 1962, after Syria was declared an Arab republic, a large number of Kurds were stripped of their citizenship and declared aliens, which made it impossible for them to get an education, jobs, or any public benefits. Their land was given to Arabs. The PYD was founded in 2003 and immediately banned; its members were jailed and murdered, and a Kurdish uprising in Qamishli was met with severe military violence by the regime. When the uprising against Bashar al Assad began as part of the Arab Spring, Kurds participated, but after 2012, when they captured Kobani from the Syrian army, they withdrew most of their energy from the war against Assad in order to set up a liberated area. For this reason, some other parts of the Syrian resistance consider them Assad’s allies. The Kurds in turn cite examples of discrimination against them within the opposition.