Starbucks, General Motors & Sen. McCarran's armpit mirage

Expanded from the 12-9-2001 Daily Sparks (Nev.) Tribune

I'm suffering deja vu all over again, a serious repetitive stress disorder. I can remember history but am still condemned to repeat it like the guy Bill Murray played in "Groundhog Day."

Continuous loop instant replay lurks all around. General Motors wants to swill at the public trough like Starbucks. MGM-Mirage Resorts is perpetrating economic censorship in the hoary tradition of the late Sen. Patrick McCarran, D-Nev. And Oil-Dri is lying to the public like, well...a typical freakin' rape and pillage out-of-state mining company.

DIVIDE AND CONQUER — a lesson in broken solidarity for both General Motors and United Auto Workers Union Local 2142, members of which currently staff GM's Sparks, Nev., parts distribution center. This mini-pickup was recently photographed on a Carson City street. We will mercifully not identify the two unions which issued the bumper stickers. If the vehicle's owner indeed voted for Dubya, he or she should know that among Bush the Lesser's first official acts was a presidential executive order aimed at destroying unions. (The AFL-CIO sued and a federal court just found it unconstitutional. The Bush administration has vowed to appeal the decision.)

GENERAL MORTAR. This Tuesday afternoon, General Motors goes before the Reno City Council in lusty pursuit of obscene allotments of corporate welfare. The company sorely needs it. GM only makes a measly billion or two or five a year in profit.

GM wants the council to endorse a tax break pending before the Nevada Commission on Economic Development (NCED). The city staff report supporting the application is a barrel of laughs. It says GM will create 198 new jobs over the next 10 years, but will generate "zero" population growth and "zero" growth in total households.

That either means all 198 are living in Reno right now or, more likely, that Sparks and the county will get stuck with impacts.

GM has applied for the full rack of corporate welfare recently scored by Starbucks at a meeting where Lt. Gov. Lorraine Hunt, R-Las Vegas, allowed no public comment until long after the rubber-stamp vote had been taken. (Perhaps admiring such efficiency, North Las Vegas Mayor Michael Montandon just instituted a similar policy.)

I attended the November Starbucks hearing along with some of my fellow union guys.

We had some serious questions about Starbucks wages at its proposed Douglas County roasting plant. While we weren't allowed to speak, Lyon County Commissioner and NCED member Leroy Goodman raised many of the same points.

He noted that most of the 88 initial Starbucks jobs will pay well below the $15.09 per hour threshold required for state tax breaks. When a few executives and supervisors were removed from the calculation, the employees would average only $12.60 an hour, with some making as little as $9.53. He pointedly criticized the wisdom of a plant employing only 88 people and paying a personnel manager over $100,000 a year.

JOB-KILLING TAX BREAKS. The whole purpose of the corporate welfare legislation was to create good-paying jobs, not creative accounting. Ironically, the gap between Starbucks managers and workers is so wide that the state tax break could actually dampen hiring. The new plant is supposed to employ 200 when fully functional. But hiring too many new lower-paid workers could bring down the average and blow the tax break. So hiring could actually be diminished because of the public subsidy!

Goodman took a risk reading pay rates into the public record. Starbucks invoked complete secrecy under state law. I was denied almost all information by paranoid state officials. Nonetheless, Starbucks scored about $2 million in freebies, largely at the expense of local school children. (If all this sounds like LV casino mogul Steve Wynn's art gallery tax break, it should.)

Michael Moore behind Crackers, the Corporate Crime-fighting Chicken

READ THE GENERAL MOTORS BIBLE. Go to Michael Moore's home page. The award-winning writer-producer made "Roger & Me," the highly honored and definitive film about General Motors and corporate greed. He also authored the best-seller for the beleaguered American worker: Downsize This!

GM now wants the same goodies (about $1.16 million worth, which NCED will grant Dec. 12) when it moves its parts operation from Sparks to Stead. The relocation would have been unnecessary if GM had bought land to expand in Sparks while it was available. Now, the company is asking for corporate welfare, forcing local taxpayers to make up the difference.

When Starbucks built its York, Pa., roasting plant a few years ago, it bought land at a discount from a local developer in exchange for the landowner becoming the construction contractor. The York plant was built junky at non-union wages and continues to operate as a low-wage employer despite more than $15 million in tax giveaways. GM did the same kind of deal here with Dermody Properties and United Construction, a virulently anti-union contractor.

This irritates GM's unionized Sparks workforce, which has long been under the impression that the new plant would be built with local union labor. Now, the specter of the area's thousands of union workers no longer buying from local GM dealers is a real possibility. So is a plant which workers will not staff.

Former Nevada Gov. Mike O'Callaghan (D, 1971-1979) termed the Starbucks freebie "overboard with generosity" and called for a legislative review of companies which have received such subsidies.

In a recent column in his Henderson/Boulder City News, O'Callaghan wrote "Providian Financial Corp. announced it was closing its call center inHenderson. This action puts about 700 people out of work. This is the same company that the Nevada Economic Development Commission awarded a $116,000 grant to help train 300 employees," O'Callaghan stated.

"I suggest that the Nevada State Legislature call for a study of all the past tax breaks and grant recipients and determine how many are still here, the number of company employees each retains and the salary and benefits now in effect. This information should then be compared to the promises made when seeking state grants and tax breaks," O'Callaghan wrote.


GM has removed United Construction and appointed a new general contractor, Clark & Sullivan Constructors. While C&S is union signatory, it has developed a reputation for using lots of non-union subcontractors. Continuation of strict scrutiny thus remains in order. Stay tuned.

Read More About It:

North Las Vegas mayor emulates Lt. Gov. Hunt in stifling public comment—
Las Vegas Review-Journal
& Las Vegas Sun

General Motors fires low-wage Mexican workers for protesting wages and working conditions

Starbucks War Room

Steve Wynn's art tax break

One member of the commission asked for a similar review during the Starbucks hearing. Stay tuned.

GREASING THE SKIDS. Oil-Dri has filed mining claims on more than 6,000 acres of Washoe County land. They want to plunk a kitty litter plant within a quarter-mile of more than 500 residents.

Oil-Dri has promised to be a good citizen and is buying radio time to prove it. After all, you can't lie in advertising, can you? On one commercial, a girlish announcer quotes the wonderfulness of the company as noted by a mayor of some town in Mississippi. (Oil-Dri should feel right at home here in the erstwhile Mississippi West.) She talks about how delighted some Mississippians are to have an Oil-Dri plant operating just 150 feet from their homes.

She also makes a statement I find laughable: "Nowhere in the nation are mining laws as strict as they are in Nevada." Local environmentalists aren't laughing.

"Nevada was among the last states to pass a reclamation law (and) it has many problems," says Tom Myers, executive director of Great Basin Mine Watch.

"According to a study completed by former miner Jim Kuipers with funding from the National Wildlife Federation, Nevada has some of the weakest standards for reclamation," Myers states.

"Kuipers also projected that Nevada underestimates bonds by from 20 to 100 percent. That can be seen by considering the existing bankrupt minesites in the state. When the BLM calls the bonds and contracts for independent clean-up, they're finding they don't have enough money," Myers said.

"The contract process is ongoing and these are preliminary results based on various discussions with different people," he added.

"They represent merely my opinion for now until the final numbers are available. Jim's work is based on his analysis," Myers asserted.

"Regarding the protection of water resources, Nevada's laws essentially say that 'thou shalt not pollute', but the regulations don't implement any standards," Myers noted.

Lee Dazey of the Western Shoshone Defense Project says "the mining companies themselves get to set the rules as to how they operate and remediate.
"To stop the environmental and cultural abuse, we have to reform the mining act (of 1872) which gives away public lands to mining corporations from abroad. Native folks are disproportionately affected. Oil-Dri is less than a quarter mile from a community of 500 people of people who don't want it. If as citizens we cannot say no to companies that would harm us, we have a serious problem in our democracy. If the state cannot stop Oil-Dri, I sure hope the Washoe County commissioners will stand by the community and deny Oil-Dri a special use permit," she stated.

"Tax breaks don't keep a company here when the ore or stone source has been depleted," O'Callaghan noted

"Past experiences with mining in Nevada tell us that when the ore is gone so are the large corporations which leave behind jobless people and a hole in the ground," O'Callaghan stated.

Read More About It:

Heidi Walters' Las Vegas CityLife story which really pissed off MGM-Mirage.

Las Vegas United Way CEO pays with his job for criticizing casinos' pre- and post-Sept. 11 Scroogie stinginess

Battle Mountain Bugle Editor Lorrie Baumann fired

Washington Post: Battle Mountain — Armpit of America. Available for free only through 12-15-01.


ETHICAL DEPRESSION. Speaking of black holes, if you think thuggish censorship went out with the McCarran-McCarthy commie witch hunts of the 1950s, you're wrong. Back then, Sen. McCarran convinced almost every Las Vegas gambling joint to boycott the Las Vegas Sun because he didn't like what editor Hank Greenspun wrote. In 1952, Greenspun sued McCarran and the clubs under federal anti-trust law and beat them. (See "Pat McCarran: Political Boss of Nevada," by Jerome E. Edwards, University of Nevada Press, 1982.)

Fast-forward half a century. MGM-Mirage, the world's largest gambling company and recipient of the art tax breaks noted above, canceled ads in CityLife, the Las Vegas alternative weekly. MGM didn't like an article critical of the company's post-Sept. 11 "charity" activities.

The company not only pulled advertising, but also resorted to corporate strongarm tactics such as trashing the paper to other media, perhaps an implied threat.

The disease is spreading. Last week, the Washington Post ran a story naming Battle Mountain "armpit of America," but also noting that the reporter found some praiseworthy things in a visit to the rural northern Nevada town.

Battle Mountain Bugle editor Lorrie Baumann was fired for agreeing in a Post interview with the armpit designation. (Read the whole article, accessible at right, and you will find she acquitted herself and the town quite well.) Reminds me of similarly ruffled feathers over an article about sparsely-populated central Nevada which has since turned into the state's long-running "loneliest highway in America" promotion.

For firing Baumann, Battle Mountain lives up to the old saying: God created the world, man built the cities and the devil thought up the small town.

I can think of a few people I'd like to relocate there. I'd even give 'em tax breaks for moving.

Be well. Raise hell.

NevadaLabor.com | U-News | C.O.P. | Sen. Joe Neal
Guinn Watch | Deciding Factors


© Andrew Barbano

Andrew Barbano is a 32-year Nevadan, a member Communications Workers of America Local 9413 and editor of NevadaLabor.com and SenJoeNeal.org/ Barbwire by Barbano has originated in the Daily Sparks (Nev.)Tribune since 1988 .


Site composed and maintained by Deciding Factors (CWA signatory)
Comments and suggestions appreciated. Sign up for news and bulletins.