What are the banks doing with the bailout billions taxpayers gave them, to help us on the road to economic recovery?
In the case of Wells Fargo and the Quad City Die Casting (QCDC) factory in Moline, Illinois, nothing good. In fact the bank is a huge roadblock to recovery. That’s why on Thursday, June 11, several hundred angry people marched in the pouring rain outside of Wells Fargo’s offices in Chicago.
Among the crowd were members of United Electrical Workers (UE) Local 1174, the union at QCDC, who’d crossed the state in a car caravan to fight for their jobs, as well as workers from several Chicago UE locals. Those included members of UE Local 1110, who made national and worldwide headlines last December when, in a similar fight with Bank of America, they occupied their plant for six days.
Wells Fargo, a recipient of $25 billion in TARP (Troubled Asset Relief Program) funds, recently notified QCDC that it would terminate the company’s line of credit. The loss of credit needed for daily operations forced the company to announce it would be closing July 12. Over 100 employees will join the unemployment rolls if Wells Fargo gets its way. The plant’s 80 blue-collar workers, members of UE, are fighting Wells Fargo’s decision.
Quad City Die Casting has been in business for 60 years, making precision metal parts farm and recreation equipment. Its customers include Kawasaki and Case New Holland. Like many businesses, QCDC has seen a drop in orders recently, but it has not lost any customers. The company was profitable before the worst of the economic crisis hit last fall, and there’s no reason to believe that it would not return to profitability in a general economic recovery. During a recession like this, access to credit is essential for small businesses to weather the storm. But Wells Fargo, despite its long-term financial relationship with QCDC that includes managing the workers’ pension, pulled the plug. This has left workers wondering what the purpose of the TARP bailout was in the first place.
“I’ve worked there for 31 years, half my life,” says Deb Johann, a QCDC worker and the recording secretary for UE Local 1174. “My husband and I just bought a house last year. Now I don’t know if we are going to be moving to a cardboard box. It’s not right what Wells Fargo is doing with our money!”
UE is demanding that Wells Fargo continue financing QCDC until alternative credit or a new buyer can be located. “We are talking about thousands of dollars needed, not millions, certainly not billions, to save our jobs, our homes, the cars we are paying off and our children’s education,” says Frank Kauslarich, another shop worker and vice president of the local union. “Without our jobs, we are never going to see an economic recovery. We just need a little more time and Wells Fargo’s financing to make it.”
Wells Fargo has indicated it wants to pay back the TARP funds and escape from the federal oversight that came with the TARP money. But the Federal Reserve says Wells Fargo is short of capital and needs to raise more before it gets out from under TARP, according a June 9 report in the Los Angeles Times.
Many banks are desperate to get away, as quickly as possible, from the public scrutiny that accompanied the bailout. So they’re in a hurry to pay back the money, and for them that’s a much higher priority than extending the credit needed for economic recovery and for the survival of businesses that provide jobs, like QCDC. Bank executives are eager to return to business as usual — big bonuses, expensive trips, and the lavish lifestyle to which they feel entitled.
Meanwhile, the UE members at Quad City Die Casting are gearing up for a fight. They’re getting help from the members of UE Local 1110 in Chicago, the workers who in December occupied their workplace, Republic Windows and Doors. The six-day sit-in started when Bank of America cut off that company’s credit and the factory closed with only three days’ notice to workers. Not only did their militant action get union members the money they were owed; the plant has since reopened under a new owner who has recognized the union, renewed the union contract, and is gradually recalling the union workforce. Vice President Joe Biden, who recently toured the plant, now called Serious Materials, called these developments “a big deal.”
“We are with you all the way,” Local 1110 Vice President Melvin Maclin told the QCDC workers at the Chicago rally. “One thing we learned is if you do not fight, you cannot win. And when you do fight, we all win!” Despite being soaked by the downpour in which they had marched, protesters bid farewell to Wells Fargo by chanting, “We’ll be back!” And we will be back, because this fight isn’t over until justice is won and people are back to work.
Leah Fried is a Field Organizer for the United Electrical, Radio & Machine Workers of America (UE).