Bush's idea of ideal labor-management practices and corporate leadership in general
appears to have been embodied by Frank Lorenzo, the most celebrated and hated
banquerotteur of US air transport. Before his downfall in early 1990, Lorenzo combined
Texas Air, Continental Airlines, New York Air, People Express, and Eastern Airlines into
one holding, and then presided over its bankruptcy. Now Eastern has been liquidated, and
the other components are likely to follow suit. Along the way to this debacle, Lorenzo
won the sympathy of the Reagan-Bush crowd through his union-busting tactics: he had
thrown Continental Airlines into bankruptcy court and used the bankruptcy statutes to
break all union contracts, and to break the unions themselves as well. Continental pilots
had been stripped of seniority, benefits, and bargaining rights, and had been subjected to
a massive pay cut under threat of being turned out into the street. In 1985, the average
yearly wage of a pilot was $87,000 at TWA, but less than $30,000 at Continental. The
hourly cost of a flight crew for a DC-10 at American Airlines was $703, while at
Continental it was only $194. It is an interesting commentary on such wage gouging that
Lorenzo neverthless managed to bankrupt Continental by the end of the decade.
George Bush has been on record as a dedicated union-buster going back to 1963-64, and
he has always been very friendly with Lorenzo. When Bush became president, this went
beyond the personal sphere and became a revolving door between the Texas Air group
and the Bush Administration. During 1989, the Airline Pilots' Association issued a list of
some 30 cases in which Texas Air officials had transferred to jobs in the Bush regime and
vice versa. By the end of 1989, Bush's top Congressional lobbyist was Frderick D.
McClure, who had been a vice president and chief lobbyist for Texas Air. McClure had
traded jobs with Rebecca Range, who had worked as a public liasion for Reagan until she
moved over to the post of lead Congressional lobbyist for Texas Air. John Robson,
Bush's deputy Secretary of the Treasury, was a former member of the Continental
Airlines board of directors. Elliott Seiden, once a top antritrust lawyer for the Justice
Department, switched to being an attorney for Texas Air. [fn 11]
When questioned by Jack Anderson, McClure and Robson claimed that they recused
themselves from any matters involving Texas Air. But McClure signed a letter to
Congress announcing Bush's opposition to any government investigation of the
circumstances surrounding the Eastern Airlines strike in early 1989. Bush himself has
always stonewalled in favor of Lorenzo. During the early months of the landmark Eastern
Airlines strike, in which pilots, flight attendants, and machinists all walked out to block
Lorenzo's plan to downsize the airline and bust the unions, the Congress attempted to set
up a panel to investigate the dispute, but Bush was adamant in favor of Lorenzo and
vetoed any government probes. [fn 12]
Lorenzo's activities were decisive in the wrecking of US airline transportation during the
Reagan-Bush era. When Carl Icahn was in the process of taking over TWA, he was able
to argue that the need to compete in many of the same markets in which Lorenzo's
airlines were active made mandatory that the TWA work force accept similar sacrifices
and wage cuts. The cost-cutting criteria pioneered with such ruthless aggressivity by
Lorenzo have had the long-term of effect of reducing safety margins and increasing the
risk the travelling public must confront in any decision to board an airliner operating