Boeing, Machinists open contract talks
By Dominic Gates
Seattle Times aerospace reporter

Tom Buffenbarger, the powerful national president of the International Association of Machinists (IAM), is optimistic about his union's chances for agreement with Boeing in the contract negotiations that formally kicked off Friday.
Buffenbarger said he believes the company understands what the union wants, and that Boeing Commercial Airplanes chief executive Scott Carson is someone he can engage with.
"Boeing has certainly indicated to us, without tipping their hand, that they want a successful conclusion to the negotiations," said Buffenbarger. "Chances are good we're going to find our way to getting a contract our members will feel good about."
Speaking at his Seattle waterfront hotel before the opening ceremony for the contract talks, Buffenbarger said that in addition to negotiating wages and benefits, the union will press for contract language on job security and will reject a company proposal to give new hires a 401(k)-style retirement plan instead of a pension.
He insisted he's not out to exploit Boeing's vulnerability to a strike this year.
"I'm about getting good contracts for our members," Buffenbarger said. "I'm not about taking advantage."
Yet he knows as well as anyone that Boeing, whose profits are soaring, cannot afford to trigger a strike in September while it struggles to get the first 787 into the air by the next month. In 2005, the union struck for a month.
Boeing's top labor negotiator, Doug Kight, said Friday afternoon that Boeing will offer a pay package that raises entry-level wages but will seek to negotiate alternative forms of additional compensation for higher-paid employees in lieu of a wage hike.
Boeing will also suggest an incentive pay scheme to reward employees for productivity gains.
The company said IAM-represented employees currently earn an average base wage of nearly $27 per hour, or nearly $56,000 annually before overtime, plus benefits valued at more than $24,000 annually. Boeing estimated average total Machinist compensation — including overtime pay, lump-sum wage payments and benefits — at around $91,500 per year.
But Buffenbarger dismissed out of hand one of Boeing's top goals: a proposal to switch new hires from Boeing's traditional pension plan to a 401(k)-style retirement plan.
He said that idea, outlined recently by Kight, meddles with union members' "very sacred benefits."
He said the move would simply transfer risk from Boeing to employees.
"We are not interested on gambling our pension plans on Wall Street," he said.
Boeing also proposes ending early-retiree medical benefits for new hires, an idea the union rejected in 2005.
Kight said both sides Friday reiterated their commitment "to listening to each other in a spirit of openness" on such issues.
Buffenbarger said the union also will press Boeing to include some job security in the contract.
He wants the company to provide more extensive in-house training for Machinists, backed with contract language that provides "a reasonable expectation that a person can take this skill they've developed through to their retirement years."
In past negotiations, the company has balked at assurances of job security. This time, Kight pointed to a company proposal to "stabilize employment and mitigate layoffs," intended to even out the huge employment swings in the cyclical airplane-building business.
Kight said that could be "a win for Boeing and for employees."
Boeing's global outsourcing strategy will also come up in the talks.
Citing production problems with outsourcing on the 787, Buffenbarger said the union will push hard to have Boeing build its next plane right here. "This is where the best aircraft makers in the world come from," he said. "Why would you abandon that to take a gamble on an unproven site?"
Buffenbarger heads a union that represents some 435,000 working Machinists and more than 200,000 retirees. It has a strike fund of some $150 million.
In January, the IAM and Boeing rival Lockheed Martin concluded a contract that Buffenbarger called "the best [contract] we ever got in 75 years and one of the few times we did it without a strike."
Such an outcome here this summer might satisfy both sides.
Dominic Gates: 206-464-2963 or dgates@seattletimes.com

Plame Seeks to Resurrect Lawsuit Against Bush Administration in CIA Leak Case

By Matt Apuzzo
The Associated Press
Friday 09 May 2008

Washington - Former CIA operative Valerie Plame is trying to resurrect a lawsuit against those in the Bush administration she says illegally disclosed her identity.
A federal judge dismissed Plame's lawsuit last year, saying there was no basis to bring a case. Plame's lawyers asked a federal appeals court Friday to send the case back before the judge and force him to consider its merits.
Plame and her husband, former Ambassador Joseph Wilson, sued Vice President Dick Cheney; his former chief of staff, I. Lewis "Scooter" Libby; former White House political adviser Karl Rove and former Deputy Secretary of State Richard Armitage.
Plame's CIA position was revealed in a syndicated newspaper column in 2003, during a time when her husband was criticizing the march to war in Iraq. Armitage and Rove were the original sources for that story, which Plame believes was retribution for Wilson's criticism.
The article touched off a lengthy criminal investigation. Special Prosecutor Patrick Fitzgerald never charged anyone with the leak but convicted Libby of obstruction and lying to investigators.
During the trial, it was revealed that Libby and former White House press secretary Ari Fleischer also discussed Plame with reporters.
Plame says those leaks violated her constitutional rights. But U.S. District Judge John D. Bates dismissed the case, saying the law requires Plame's complaints be raised under the Privacy Act. Plame's attorneys say that law is insufficient. They asked the U.S. Court of Appeals for the District of Columbia Circuit to send the case back to Bates for reconsideration.
With the exception of Cheney, those named in Plame's lawsuit have left the administration.
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Iraq Contractor in Shooting Case Makes Comeback
By James Risen
The New York Times
Saturday 10 May 2008

Washington - Last fall, Blackwater Worldwide was in deep peril.
Guards for the security company were involved in a shooting in September that left at least 17 Iraqis dead at a Baghdad intersection. Outrage over the killings prompted the Iraqi government to demand Blackwater's ouster from the country, and led to a criminal investigation by the F.B.I., a series of internal investigations by the State Department and the Pentagon, and high-profile Congressional hearings.
But after an intense public and private lobbying campaign, Blackwater appears to be back to business as usual.
The State Department has just renewed its contract to provide security for American diplomats in Iraq for at least another year. Threats by the Iraqi government to strip Western contractors of their immunity from Iraqi law have gone nowhere. No charges have been brought in the United States against any Blackwater guard in the September shooting, either, and the F.B.I. agents in Baghdad charged with investigating whether Blackwater guards have committed any crimes under United States law are sometimes protected as they travel through Baghdad by Blackwater guards.
The chief reason for the company's survival? State Department officials said Friday that they did not believe they had any alternative to Blackwater, which supplies about 800 guards to the department to provide security for diplomats in Baghdad. Officials say only three companies in the world meet their requirements for protective services in Iraq, and the other two do not have the capability to take on Blackwater's role in Baghdad. After the shooting in September, the State Department did not even open talks with the other two companies, DynCorp International and Triple Canopy, to see if they could take over from Blackwater, which is based in North Carolina.
"We cannot operate without private security firms in Iraq," said Patrick F. Kennedy, the under secretary of state for management. "If the contractors were removed, we would have to leave Iraq."
Still, serious risks remain for Blackwater and at least some of its current and former personnel. A federal grand jury continues to consider evidence in the Baghdad shooting. Although the company is not likely to face any criminal charges, people involved in the case say that some Blackwater guards involved in the shooting are cooperating with the F.B.I. as it pursues evidence against other guards.
Separately, a former Blackwater guard is under criminal investigation for the December 2006 shooting death of an Iraqi guard for an Iraqi vice president, and may soon face federal charges. In a third case, two former Blackwater workers pleaded guilty to weapons-related charges, but both received sentences that included no jail time in return for their cooperation with federal prosecutors in a broader investigation.
A House committee has also asked the Internal Revenue Service to begin an inquiry into whether Blackwater has designated its guards as independent contractors rather than employees to in order to avoid paying and withholding federal taxes. The State Department renewed the security contract for only one year - just long enough to take the company into the start of the next administration. And Blackwater's political connections to the Bush administration may not serve it well if the Democrats win the White House in November.
Given the furor that surrounded Blackwater after the September shooting in Baghdad, critics say the decision to renew the company's contract in Iraq is a sign of the Bush administration's inability to curb its reliance on outside contractors in the war.
"The shooting incident was like a hammer blow, but where are the consequences?" said Peter W. Singer, a scholar at the Brookings Institute and author of "Corporate Warriors," a book about contractors in Iraq. "I think it points to the fact that the dependence on contractors is like a drug addiction. They just can't help themselves."
Representative Henry Waxman, California Democrat who is chairman of the House Oversight and Government Reform Committee, which has been investigating Blackwater on several fronts, said, "I can't understand why Blackwater's contract was renewed. It seems to me the administration should have looked for others who could do the job, including the U.S. military."
In the past administration officials have dismissed the notion of using military personnel to guard diplomats.
Founded in 1997 by Erik Prince, a former member of the Navy Seals and heir to a family fortune made in the auto parts industry, Blackwater began to generate controversy in Iraq long before last September's shooting. Blackwater had developed a reputation among both Iraqis and American military personnel as a company that flaunted a quick-draw image that led its security personnel to take overly aggressive actions to protect the people they were paid to guard.
Last year the State Department acknowledged that Blackwater had been involved in significantly more shootings per convoy mission than DynCorp and Triple Canopy, which provide security for the State Department outside Baghdad.
The shooting death of the bodyguard for the Iraqi vice president in 2006 rankled the Iraqi government well before last September's shooting. An off-duty Blackwater guard who American and Iraqi officials said had been drinking heavily was the sole suspect. The off-duty Blackwater guard, Andrew J. Moonen, who no longer works for the company and who is a former Army paratrooper, is now under criminal investigation by federal prosecutors in Seattle. Although Mr. Moonen has not been charged, his lawyer, Stewart Riley of Seattle, said that he had recently been in contact about the case with prosecutors from the United States Attorney's Office in Seattle.
People familiar with the case said they believed that the Justice Department had recently concluded that it had found a way to skirt some of the jurisdictional problems that in the past made it difficult to bring charges in American courts for crimes committed by contractors in Iraq.
"I think they may come to a decision on what to do with this case in the next three or four months," said one person familiar with the matter. Mr. Riley says that Mr. Moonen maintains his innocence in the shooting.
In addition, a wrongful death lawsuit against Blackwater filed by the families of four Blackwater guards killed in Falluja, Iraq, in 2004 - an event that prompted the first major battle in Falluja between the American military and insurgents that year - is also still pending.
A federal appeals court is expected to rule this year on whether the families can proceed with their lawsuit or be forced into arbitration with Blackwater, an outcome the company prefers, according to the families' lawyer, Daniel Callahan of California.
Donna Zovko of Cleveland, the mother of Jerko Gerald Zovko, one of the Blackwater guards, says Blackwater has stonewalled the families.
"It is 1,501 days since he was killed, and I don't know one-tenth of what happened to him, and no one seems to care," Mrs. Zovko said in an interview.
Given so many headlines about his company, Mr. Prince until recently seemed eager to tell his side of the story, and there were reports that he planned to write a book. But on Friday, Anne Tyrrell, a Blackwater spokeswoman, said Mr. Prince's book project had been put on hold.
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FOR IMMEDIATE RELEASE
Contact: Danielle Brian or Beverley Lumpkin, 202-347-1122

POGO REVEALS INTERNAL OSC DOCUMENT
SHOWS BLOCH MISUSED OWN TASK FORCE

Washington, D.C. - An extraordinary document obtained by the Project on Government Oversight (POGO) from inside the Office of Special Counsel (OSC) reveals that Special Counsel Scott Bloch created a special task force to investigate sensitive and high-profile matters and then ignored virtually every recommendation made by it. The document lends support to POGO’s theory that Bloch used the task force to launch an investigation of the White House, issuing demands for documents termed by his own task force as “overly broad,” to create the appearance of a conflict of interest with an ongoing investigation into allegations that Bloch himself had engaged in misconduct.

“With this deeply troubling new evidence of Bloch’s misuse of his office POGO now believes the President has more than ample cause to fire Bloch immediately, said Danielle Brian ,” Executive Director, POGO.

The 13-page memo from the task force, dated January 18, 2008, is entitled “Summary of Task Force Activities and Recommendations.” (http://pogoarchives.org/m/wi/osc-tf-summary-20080118.pdf) It reveals that Bloch countermanded virtually every recommendation made by his own team; if they recommended pursuing a matter, he ordered them to stop, and if they advised that they lacked either jurisdiction or evidence to proceed, he ordered them to go forward.

Here are some examples gleaned from the memo:

· Regarding the White House Office of Political Affairs (OPA), the task force examined allegations that 25 federal agencies had received political briefings that might have violated the Hatch Act, which bans the use of government resources to promote or oppose a political party or candidate. But as the investigators proceeded, sending requests for documents to the agencies and the White House, they received a stream of new directions from Bloch that kept expanding the focus of the inquiry. In the memo, the task force finally exclaimed: “{TF expressed concerns that this request is too broad and may exceed OSC’s jurisdiction} (Emphasis in original.) When the task force recommended ways to narrow the scope of the investigation, they were denied. When they drafted a subpoena to the Republican National Committee, Bloch ordered it be expanded to include ten new topics.

· At the time of the firings of U.S. Attorneys by the Justice Department, former U.S. Attorney David Iglesias filed a complaint with OSC charging a Hatch Act violation. Bloch ordered the task force to broaden their probe to include all nine of the fired U.S. Attorneys. Amid Justice Department requests that OSC suspend its inquiry, and task force protestations that there was no evidence to support the theory of a Hatch Act violation – which only applies to Executive branch influence, and Iglesias had complained of interference from Members of Congress – Bloch refused to suspend his inquiry.

· After Justice Department officials testified before Congress about having considered job applicants’ political affiliations in hiring and promotion decisions, the task force recommended that “this case be opened immediately and that the [task force] investigate whether individuals at DOJ committeed any PPPs [prohibited personnel practices] when they took political affiliation into consideration when hiring and making other personnel decisions.” Prohibited personnel practices are within the clear jurisdiction of the OSC; nevertheless, Bloch nine days later directed the task force “not to open or investigate allegations concerning DOJ political hiring practices.” Four months later, the task force was permitted to open a file, but “no other activity or devotion of resources authorized at this time.”

In additional cases involving the possibility of politically-tainted prosecutions, a voter fraud case, and the concoction of a new case against former GSA Administrator Lurita Doan, and others, Bloch mostly contradicts the advice of his hand-picked task force.

POGO, along with the Government Accountability Project and Public Employees for Environmental Responsibility, has been calling for Bloch’s removal from office for more than three years. (http://www.pogo.org/p/government/OSCcompendium.html) In fact, the current federal investigation of Bloch’s alleged misconduct, which reached a significant new phase yesterday with the execution of search warrants at both his home and office, was launched in response to POGO’s and the other groups’ complaint.

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Founded in 1981, the Project On Government Oversight is an independent nonprofit which investigates and exposes corruption and other misconduct in order to achieve a more accountable federal government.

Go to Original

The Whistleblower's Unending Story
By Adam Geller
The Associated Press

Saturday 26 April 2008

Columbus, Ohio - The guest lecturer steps to the front of classroom 322 with a lesson plan, but not from any textbook.

Instead, Dave Welch comes with a story to tell, edgy and very personal. The names have been changed, he says, "to protect the guilty."

He directs students to the corporate financial forms projected on to a screen. Years ago, working at a small-town bank in the Virginia mountains, Welch combed through these figures and saw things that made him suspicious.

When he confronted the bank's president with his doubts, it cost him his job.

The story might have ended there. But this time - months after titanic scandals capsized Enron and WorldCom - things would be different.

There ought to be a law, Congress decided, protecting workers who expose what might be the next Enron. Who could've imagined the fight between the little bank and the fired accountant would become the new measure's most unlikely - and most strenuous - test?

More than 1,000 self-professed whistleblowers have come forward since.

The great majority have seen their cases rejected; about 160 settled before an initial ruling. Only six workers have won before a Labor Department judge - and the review board that hears appeals has not ruled in favor of a single whistleblower.

Now, Welch is ready to bring his story to a close. It's not easy, though, to conclude something that winds on without an ending.

"This is the message the courts are sending to whistleblowers," Welch says, the Tennessee in his voice taking on a chill. A new image beams on to the classroom screen - a pack of hunting dogs. In their midst is the prey, a nervous fox, head down low.

"When you're in deep trouble, keep your mouth shut and your eyes straight ahead."

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Six years ago, Americans embraced whistleblowers as a new kind of hero.

If only Sherron Watkins' warning had been heeded, Enron might have survived, some said. Then an auditor, Cynthia Cooper, exposed massive bookkeeping fraud at WorldCom.

The "year of the whistleblower," one magazine crowed.

In July 2002, President Bush signed a new law, known as Sarbanes-Oxley, requiring top executives to stand behind financial statements and work to prevent fraud and abuse.

But the law also spoke to corporate foot soldiers, offering whistleblower protection - albeit with loopholes.

From the start, though, that protection came into question. Hours after Bush signed, a spokeswoman said the administration believed it applied only to whistleblowers who talked to a Congressional committee pursuing an investigation.

"I don't see any room for interpretation here," responded one of the measure's authors, Sen. Chuck Grassley, R-Iowa. "Our intent was plain, to protect corporate whistleblowers, period."

Months later, tensions flared inside Cardinal Bankshares Corp., a holding company for the local bank in one-stoplight Floyd, Va., population 432.

Welch, the chief financial officer, refused to sign financial statements, saying they overstated profits. He told bank president Leon Moore he suspected him of insider trading. Moore was furious when Welch compared his 53-employee bank to Enron. The bank's board fired Welch.

He turned to the federal Occupational Safety and Health Administration, which enforces whistleblower protection. An investigator determined the bank was not at fault.

But a federal administrative law judge saw it differently. The new law "was expressly enacted by Congress to foster the disclosure of corporate wrongdoing and to protect" the workers responsible, the judge wrote in early 2004, ruling the bank should reinstate Welch.

The decision made Welch the first worker protected by the new law. Now came the acid test: What was that protection worth?

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There's not much call for accountants in the small towns of the Blue Ridge, much less for one battling his former employer.

But Welch, attached to a 22-acre farm bought from his wife's grandparents, was determined to stay. He spent six months sending out resumes and going to job interviews.

Afterward, though, employers seemed to vanish "into a black hole not to be heard from again," he says.

With unemployment checks running out, Welch listened when a friend recommended a finance job at a hospital 3 1/2 hours away. He rented an apartment there, driving home on weekends.

The job was eliminated in cost-cutting a little more than a year later. But shortly before, the Labor Department judge ruled in Welch's favor. The couple, who stumbled on the decision while checking e-mail during a vacation, embraced in the hotel lobby.

But the bank - denying Welch's accusations and accusing him of insubordination and incompetence - would not give in.

"We determined through a thorough and fair investigation that there was no merit to Mr. Welch's complaints," the board wrote in the weekly Floyd Press. "We believe our decision was right then and we believe even more firmly now that our decision was correct."

The bank appealed, investing in a case it saw as setting a crucial precedent.

"We just said, look, we're not going to set back on this," Moore says. "We're going to fight it."

Moore says people came up at the bank's annual meeting and urged the company not to give in. He took his viewpoint on the road, speaking about the case to banking industry groups.

Meanwhile, Welch decided that to find work, the couple would have to move. He became convinced of his status as an exile when he ran into a former co-worker at the counter of the Floyd Pharmacy.

"She looked around to see if anybody was watching her," Welch recalls, "and she said, 'Excuse me, I can't talk to you,' and she walked away."

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Congress sent a straightforward message to would-be whistleblowers.

A worker didn't have to be right. If the worker "reasonably believes" their company has broken securities law or harmed investors, and showed they'd been retaliated against for speaking up, that was enough.

But when the Labor judge ruled for Welch, the promise of resolution dissolved in a protracted tug-of-war.

The bank argued the ruling was not a "final" order. Taking Welch back was impossible. He'd already been replaced and reinstating him would severely disrupt life inside a small company where he was clearly not wanted.

Nearly 2 1/2 years after Welch was fired, the judge again ordered reinstatement and back pay. The company refused. The question of what to do bounced between Labor officials, federal court and the Administrative Review Board that has the Labor Department's final word.

Federal lawyers argued the bank had to take Welch back, even if temporarily.

In spring 2006, the ARB, too, ordered Cardinal to take Welch back on a temporary basis. The bank again refused.

In October 2006, four years after Welch's firing, a U.S. District Court judge in Roanoke, Va. declined to enforce reinstatement, while expressing concern.

"The delay in the administrative process has been inordinate," Judge Glen Conrad wrote.

By then, the accountant had long given up finding another job locally. Down to one paycheck, the Welches say they burned through $115,000 in investments. In late 2004, they sold the farm where they'd hoped to retire.

Meanwhile, debate grew over Congress' effort to protect whistleblowers.

Lawyers for companies say many corporate whistleblower cases failed because they are frivolous, brought by angry workers looking to settle a score.

In the few cases like Welch's that moved forward, the government has investigated carefully, determining that much of what workers allege is beyond the law's scope, said Michael Delikat, a New York attorney who represents employers in such cases.

Critics disagree. The Labor Department has been "defining more and more whistleblowers out of protection," said Richard Moberly, a University of Nebraska law professor who analyzed the outcomes of such cases.

Labor Department officials say they are administering the law as it was written.

"We're trying to apply things and understand them," said Nilgun Tolek, director of OSHA's whistleblower protection office.

The law, she says, applies to workers who report suspected wire fraud, bank fraud and other specific misconduct: "While some people may see that as reading the statute too narrowly, that is what the statute says."

The Labor Department's effectiveness is reflected, at least partly, in its brokering of settlements between workers and employers, officials say.

But critics note how few decisions favor workers. Through February, the government had ruled in 1,091 Sarbanes-Oxley cases, coming down on the side of workers just 17 times in initial rulings.

"The carefully targeted legislation that you've described is legislation that has failed to protect people," Rep. Tim Bishop, D-N.Y., said at a House hearing last year .

The promise to protect whistleblowers is falling well short of expectations, Moberly says.

The prime example, he says, is the odyssey of Dave Welch.

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Without work, Welch went back to school. When Franklin University in Columbus, Ohio called about a job early last year, he said a prayer.

At the end of his interview, Welch was shown in to the office of Paul Otte, the school's president at the time.

Otte is a blunt-spoken long-ago Marine who sits on two corporate boards. He'd heard about Welch.

"Let me ask you," Otte said. "Did you refuse to certify (the bank's financial statements) or did you sign them and then blow the whistle?"

"I refused to sign," Welch said, unsure which was the right answer.

It was good enough for Otte, who'd just written an article preaching this message: "The greatest failures resulting from unchallenged authority have occurred when people reporting directly to the CEO lacked the courage to challenge their boss."

Last July - nearly five years after Cardinal fired Welch - the Labor Department's review board ruled in favor of the bank. As a trained accountant, Welch could not have "reasonably believed" that the financial reports he objected to were problematic, the board said.

The ruling came weeks before Welch started his new job, supervising introductory accounting classes.

He makes the rounds of classes, offering his experience as a window into the real-world choices students will be expected to make.

But he and the bank have continued battling.

Soon after the review board ruled, Welch appealed. The case is set to be heard by a federal appeals court in Richmond, Va. in mid-May.

Both the accountant and the bank say they deserve to win. Both say that, whatever the court decides, the case may well continue.

Moore, the bank president, acknowledges Cardinal has spent heavily, but says it never considered settling. The stakes are too high to compromise.

"If you don't stand up for what you think's right, then you don't really need to be in this business," Moore says.

At least on that, the two men can agree.