'You're kind of raised to hate tourists': Maui fires fan tensions on Hawaiian island

Holly Honderich & Max Matza in Maui - BBC News
Tue, August 15, 2023 

Many of Maui's tourists heeded calls to leave the island. Others remained


After wildfires devastated parts of the Hawaiian island of Maui, one of the most popular tourist destinations in the US, officials warned visitors to stay away. But thousands remained and others continued to fly in, angering residents in the wake of the tragedy.

At Maui's Wailea Beach on Monday the skies were bright and clear. Luxury hotels lined the beachfront, their guests spread on the sand. Some waded in the ocean, while others sat under umbrellas with white monogrammed towels on their chairs.

Inside one of the hotels, beyond a pool, a two-tiered fountain and a glass-walled habitat for the resident parrot, was a wooden-framed screen advertising a relief fund for the resort's employees - the first sign of the destruction in Lahaina, just 30 miles (48km) up the coast.

In the wake of the wildfires, the deadliest in modern US history, frustration at tourists who have chosen to carry on with their holidays has grown. Many in Maui say the devastation has highlighted what is known as the "two Hawaiis" - one built for the comfort of visitors and another, harsher Hawaii left to Hawaiians.

"It's all butterflies and rainbows when it comes to the tourism industry," said a 21-year-old Maui native and an employee at the hotel who asked to remain anonymous. "But what's really under it is kind of scary."




Last Wednesday, a day after the wildfires, the county asked visitors to leave Lahaina and the island as a whole as soon as possible.

Officials soon urged people to avoid the island entirely, except for essential travel. "In the days and weeks ahead, our collective resources and attention must be focused on the recovery of residents and communities that were forced to evacuate," the Hawaii Tourism Authority said.

Many travellers heeded the advice. In the immediate aftermath of the fires, some 46,000 people left the island. The grass field separating the airport from the surrounding highway is now lined with rows upon rows of suddenly surplus rental cars.

'It's devastating' - Inside Lahaina after wildfires


Hawaii wildfires: Your questions answered

But thousands did not. Some ignored requests to leave Maui immediately, while others flew in after the fire - decisions that have angered some.

"If this was happening to your hometown, would you want us to come?" said resident Chuck Enomoto. "We need to take care of our own first."

Maui's Wailea is the domain of the island's wealthy visitors

Another Maui local told the BBC that tourists were swimming in the "same waters that our people died in three days ago" - an apparent reference to a snorkelling excursion on Friday just 11 miles from Lahaina.

The snorkelling company later apologised for running the tour, saying it had first "offered our vessel throughout the week to deliver supplies and rescue people but its design wasn't appropriate for the task".

But the opposition to tourists is not without complications given the island is economically reliant on those travellers. The Maui Economic Development Board has estimated that the island's "visitor industry" accounts for roughly four out of every five dollars generated here, calling those visitors the "economic engine" of the county.

"You're kind of raised to hate tourists," said the young hotel worker. "But that's really the only way to work on the islands. If it's not hospitality then it's construction."

Surplus rental cars sit outside Maui's airport after thousands of visitors left the island

Several business owners expressed concern that the growing anti-tourist sentiment could hurt Maui further.

"What I'm afraid of is that if people keep seeing 'Maui's closed', and 'don't come to Maui', what little business is left is going to be gone," said Daniel Kalahiki, who owns a food truck in Wailuku. Sales have already dropped by 50% since the fire, he said. "And then the island is going to lose everything."

Still, in the days after the fire, the disparity between Maui residents - reeling from catastrophic loss - and the insulated tourist hotspots has been laid bare.

In one Hawaii, locals face an acute housing crisis. Many live in modest one-storey homes in neighbourhoods like Kahlui and Kihei, some in multi-family dwellings, with each family separated by a curtain or a thin plywood wall.

And working a number of jobs is common, locals told the BBC, to keep up with rising costs. Jen Alcantara shrugged off surprise that she worked for a Canadian airline in addition to a senior administrative position at Maui's hospital. "That's Hawaii," she said.

In this Hawaii, the effects of the fires are everywhere. At shops and grocery stores, evacuees look for essentials, trying to replace their lost possessions with whatever money they have. At restaurants, workers can be seen in kitchens and behind bars holding back tears and making phone calls to co-ordinate relief efforts.

Here, collections were being taken for the survivors nearly everywhere you look. An upscale coffee shop in Kahului was offering to refrigerate donated breast milk. Food truck owners were volunteering their services to the front line and farmers were carrying bunches of bananas to shelters.

Daniel Kalahiki says tourists are 'essential' to prevent the Lahaina disaster from spreading

Things are different in the other Hawaii.

As you reach the end of the 30-minute drive from the island's urban centre to Wailea, home to Maui's high-end holiday rentals and resorts, the earth suddenly changes, dry brown grasses become a rich, watered green.

"It's a blunt line," one local said, another hotel employee who did not want to be named.

Inside Wailea, gated communities border golf courses, that are connected to luxury hotels. Inside those hotels, obliging staff provide surf lessons and pool-side meals, including a $29 burger.

Staff told the BBC that many of the guests were sympathetic to the crisis on the west of the island. Others had complained about scheduled activities in Lahaina - horse-riding, ziplining - being cancelled, said Brittany Pounder, 34, an employee at the Four Seasons.

The day after the fires, one guest visiting from California, asked if he could still get to his dinner reservation at the Lahaina Grill - a restaurant in one of the hardest-hit areas of the town. "It's not OK," Ms Pounder said.

There is mounting concern that the eventual rebuild of Lahaina will further cater to this second Hawaii.

Already, wealthy visitors have contributed to exorbitant house prices, buying land and property in a place where homeownership is out of reach for many permanent residents. Famous billionaires Peter Thiel and Jeff Bezos both have homes in Maui. Oprah Winfrey is the island's largest landowner.

Rumours have spread of estate agents approaching Hawaiian property owners in Lahaina, asking about possible deals.

Several locals told the BBC they worried Lahaina would be refashioned into another Waikiki, the ritzy waterfront of Honolulu, dominated by oceanfront high-rises and branded luxury shopping.

"We don't need another Waikiki," said Chuck Enomoto. "But it's inevitable."

Maui satellite photo shows full scale of deadliest US fire for more than a century

Harry Baker
Tue, August 15, 2023 


A map of Maui with Lahaina highlighted in a white box. A majority of the town is covered in flames.

A new satellite photo has captured a somber aerial view of the devastating wildfire that burned through the town of Lahaina on Hawaii's Maui island last week.

On Aug. 8, fast-moving flames appeared on Lahaina's border and rapidly spread through the town, burning down buildings, exploding cars and filling the air with ash and smoke. Many survivors, who either fled the town or escaped into the ocean, reported knowing almost nothing about the fire until the flames were almost right on top of them, CNN reported.

At least 99 people were killed by the fire, making it the most deadly U.S. fire in more than a century. But the death toll is expected to rise significantly as emergency responders continue to search destroyed buildings for people who are still missing, Hawaii governor Josh Green told CNN.

A night time satellite image of Maui with a bright yellow patch representing where the flames were

The Landsat 8 satellite, which is co-owned by NASA and the U.S. Geological Survey, captured an image of Maui at around 10:25 p.m. local time on Aug. 8, which reveals the fires almost completely engulfing Lahaina, as well another large but less deadly wildfire northeast of Kihei. The satellite image shows the spike in infrared radiation given off by the flames overlaid on a natural color image of the island.

The Lahaina fire moved rapidly because it was fanned by unusually strong winds, which were fueled by a strong high-pressure area to the north of the island and the remnants of Hurricane Dora to the south, according to NASA's Earth Observatory. The gusts ranged from 45 to 67 mph (72 to 107 km/h). Green said that at its peak, the blaze traveled at around 1 mile (1.6 kilometers) every minute.

The Federal Emergency Management Agency has said it is too early to calculate the cost of the damages caused by the fires, but Green told CNN the losses could equate to up to $6 billion. "This is the largest natural disaster we've ever experienced [in Hawaii]," he added. "It's going to also be a natural disaster that's going to take an incredible amount of time to recover from."

Why the Maui Wildfires Were So Deadly

Solcyre Burga

TIME
Wed, August 16, 2023

The devastating Maui wildfires have killed at least 99 people so far, and have burned more than 2,500 acres across historic towns like Lahaina, destroying homes and businesses in the region. It is now the deadliest wildfire incident in the U.S. in over a century, and the worst natural disaster in Hawaii’s history.

The catastrophe began on Aug. 8. High winds, that some officials say may have been as strong as 60-81 mph, engulfed the area in flames at a rate that was difficult to escape. A lagging emergency warning system caused chaos on the island, with anecdotes of survivors running to the ocean to escape the flames. More than a thousand people remain unaccounted for.

A week later, officials still do not know what the exact cause of the fires were, but experts say that the wildfires' devastation is due to a mix of high temperatures, strong winds from a Category 4 storm near the islands, and drought conditions that dried out grasses on the island.

Annually, about 0.5% of Hawaii’s total land area burns due to wildfires, according to the Hawaii Wildfire Management Organization. Seventy-five percent of these fires are caused by humans and therefore preventable, but none have ever been as devastating as the Maui wildfires.

Read more: What Remains After the Flames: Scenes From the Ash-Colored Streets of Maui

Experts warn that extreme weather conditions and disasters like these wildfires will occur more frequently and with greater intensity due to climate change, though that is not the only contributing factor at hand. “When the air is hotter it can hold more water vapor, so that means you get more water evaporating from plants, and that dries them out,” says Jeff Masters, a meteorologist for Yale Climate Connections. “But you can't blame it just on climate change, that's for sure. Humans are causing this wildfire risk in multiple ways.”

What caused the fires? 

Officials are still unclear on what exactly sparked the fires in Maui, though focus has turned towards the state’s biggest power utility company, Hawaiian Electric, to assess their role in the wildfires.

Lahaina residents are suing the company because they allege Hawaiian Electric’s equipment was not strong enough to withstand such fast winds, and that the company should have shut down the power before winds reached such high levels—a common practice in states like California, which experiences the most wildfires nationwide.

Regardless, the deadly blazes were also caused by a combination of conditions including hot weather, strong winds, and a drought that has been affecting the state since the month of May.

The island was under high alert because of Hurricane Dora, a Category 4 storm that traveled hundreds of miles away from the island, making its closest approach to the islands on Aug. 8. The exact effect Hurricane Dora had on the wildfires remains unclear. Hurricane Expert Phillippe Papin from the National Weather Service’s National Hurricane Center tweeted that the hurricane may have played a minor role in the fires because it had a small wind field, which is the area that is potentially affected by the storm’s sustained winds. But other experts like Masters note that the tropical storm still created a “very strong high pressure system” that may have contributed to the high gusts of wind.

“If you give a spark in those kinds of conditions, drought plus heat plus wind, it can lead to very rapid fire spread and very intense fires,” Masters says.

Read more: How to Help Those Affected by the Maui Wildfires

Temperatures on the day of the fires were also up to 90°F, which dries out vegetation and makes it more fire prone, according to Masters.

He adds that the presence of invasive grasses, like guinea grass, also fueled the fires forward. Nonnative grasses that were used to feed livestock or for ornamental purposes were brought to the island decades ago, and are now posing hazardous risks because they are highly flammable.

Was the community prepared for it?

Questions related to the preparedness of the state have risen as details about the day of the fires revealed that emergency sirens did not alert residents to what was happening.

“I don't think we were ready for it,” Maximus Yarawamai, a 63-year-old gardener, tells TIME. Yarawamai, who traveled from his home on the Big Island to Lahaina to help the community in need, compares the damage he’s seen to what he imagines Pearl Harbor or the Twin Towers to have looked like after those catastrophes. “I think we never thought that this would happen in Hawaii. We've had fires but not this magnitude.”

Yarawamai’s words echo the sentiments not just of many Hawaiian residents, but likely also of officials who may have been unprepared for fires of this magnitude. A February 2022 emergency management plan by the state of Hawaii rated wildfires as low and medium risk across the board for its effect on people, property, the environment, and emergency management program operations.

A 2021 Maui County report found that the number of incidents caused by fires on the island has increased over the years. While there are annual fluctuations in the destruction caused by fires, Hawaii’s acre burnage before the Maui wildfires peaked at more than 50,000 acres in 2019 compared to slightly over 10,000 in 2007. That report also pointed out potential issues in times of emergency, including limited roads in and out of Maui County that make it more difficult to provide emergency care, and also limit escape routes for residents.

“The investigation revealed that current budgets, combined with County and State access to Federal emergency relief funding, are adequate to meet the current fire threat, but are inadequate for an effective fire prevention and mitigation program,” the report says.

Now, residents like Yarawamai are asking for the government to think of long term solutions. “I think the immediate needs [for disaster recovery] are there,” he says, “but what's the next move? What's the next thing we need to do?”

https://www.marxists.org/archive/bordiga/works/1951/murder.htm

Murder of the Dead by Amadeo Bordiga 1951 

Murder of the Dead ... The basis of marxist economic analysis is the distinction between dead and living labour. We do not define capitalism as the ...

Lahaina, site of incalculable Native Hawaiian importance, reels from cultural losses

we want to organize the ‘Rebuild Maui’ campaign before disaster capitalists do

Claire Wang

THE GUARDIAN
Tue, August 15, 2023 

Photograph: Rick Bowmer/AP

A week after wildfires ripped through western Maui and killed at least 99 people, residents and historians are still processing the full scope of destruction in Lahaina, an 18th-century coastal town that was, for a time, the capital of the Hawaiian Kingdom.

Designated a national historic landmark in 1962, Lahaina is a place of incalculable importance for Native Hawaiians. In 1810, King Kamehameha I unified all the Hawaiian islands and made the town his royal residence for the next three decades.

Following the fires, thousands of homes, businesses and cultural treasures lay in ruins, including a church where royals were buried and a 150-year-old banyan tree believed to be the largest in the US.

Wildfire wreckage in Lahaina on Thursday. Photograph: Rick Bowmer/AP

The cost to rebuild Lahaina is expected to exceed $5.5bn, according to the Federal Emergency Management Agency.

“Lahaina was one of the few locations in Hawaii that has been truly important throughout every era,” said Kimberly Flook, deputy executive director of the Lahaina Restoration Foundation, which restores and maintains more than a dozen historic landmarks in the area.

Flook said a handful of historic sites the foundation maintains had sustained severe fire damage, including the Baldwin Home, a missionary compound built in 1834 that is now a museum; the Wo Hing Museum, a wooden temple that functioned as a gathering space and cook house for Chinese expats; and the Lahaina Old Courthouse, built in 1858. The first lighthouse on the Pacific coast, built in 1840, seemed to have been spared. The status of other landmarks remained unclear from social media footage, first responder accounts and satellite images, Flook said.

While the scale of human and cultural loss is unimaginable, Flook said she remained hopeful that the town could be restored with time and resources.

“This is absolutely shattering,” she said, “but we don’t find it impossible to rebuild.”Interactive

Davianna Pomaika’i McGregor, a founding member of the ethnic studies program at the University of Hawai’i, Manoa, and a historian of Hawaii and the Pacific, said Lahaina served as a “very active political, economic and intellectual heart” during the 19th century.

Lahaina was the royal capital from 1820 to 1845, when it was replaced by Honolulu. During those decades, it grew into a global trading hub with the arrival of whaling ships. Royalty and chiefs were educated at Lahainaluna high school, the oldest school west of the Rocky Mountains; kings and queens were buried at Waiola church, the first Christian church on Maui. In 1840, King Kamehameha III drafted the Hawaiian Kingdom’s first constitution at the high school. Both buildings, established about 200 years ago, were damaged in the fire.

“Lahaina represents the transformations that Hawaii has undergone over the centuries,” McGregor said. “Layers of history are reflected through its landscape and architecture.”

Related: Maui wildfires: Hawaii governor says at least 99 dead amid ‘incredible’ destruction

The Maui wildfire was the deadliest in the US in more than a century, surpassing the toll of the 2018 Camp fire in Paradise, California, which left 85 dead. The disaster has exacerbated a burgeoning housing crisis: more than 2,200 buildings were destroyed, nearly all of them residential. As many as 4,500 people are in need of shelter, county officials said on Facebook on Saturday. (Lahaina has a population of roughly 13,000 people.)

In modern times, travel companies and media outlets have come to market Lahaina primarily as a resort paradise with immaculate surf breaks and snorkeling sites.

But the framing of Lahaina as a “tourist destination” buries both the rich history of the town and ecological devastation that colonialism has wrought on the island, said Kaniela Ing, national director of the Green New Deal Network and a seventh-generation Native Hawaiian who was born and raised in Maui.

Children check boxes of donated toys at a distribution location in Lahaina on Sunday. Photograph: Étienne Laurent/EPA

The cause of the fires is still under investigation, though experts say they were fueled by dry vegetation, low humidity and hot, strong winds from Hurricane Dora. But the climate crisis is not the only cause of the tragedy, Ing said. Decades of sugarcane and pineapple farming uprooted native trees and browned the rain-soaked slopes of the West Maui Mountains.

“The fire is an exclamation point, but it’s not the only injustice,” said Ing. “When you look at Lahaina’s path from royalty to whaling to pineapple tourism to luxury, the fire is just the terminal point.”

Last June, mandatory water restrictions were leveled on west Maui residents in response to a historic drought. While residents were fined $500 for using water for non-essential activities, such as washing cars, the tourism industry faced no such penalties, despite being responsible for nearly half of Hawaii’s water consumption.

“While Front Street is laden with racist tiki bars and tacky shops, the people who live there are some of the most rooted Native people in the world,” Ing said. “They’re keepers of knowledge that will get us out of the trajectory of ecological collapse.”Interactive

As a former state lawmaker, Ing said he had consulted Indigenous fishermen about marine issues, like an invasive species of coral that elected officials had sought to label as endangered. With ancient farming practices, Maui’s Indigenous farmers have been restoring the depleted food forests that fed their ancestors.

Ing said rebuilding Maui required not only direct relief but also a long-term plan to pivot from an extractive economy to a regenerative one. The first step was putting an indefinite halt on tourism to preserve resources for Native Hawaiians.

“We need time to grieve and heal,” he said, “and we want to organize the ‘Rebuild Maui’ campaign before disaster capitalists do.”

https://www.teenvogue.com/story/what-is-disaster-capitalism

What Is Disaster Capitalism? A Cycle of Crisis, Exploitation... 

Sep 2, 2021 ... Disaster capitalism, according to Klein, occurs when private interests descend on a particular region in the wake of major destabilizing events, ...

https://www.theguardian.com/us-news/2017/jul/06/naomi-klein-how-power-profits-from-disaster

Naomi Klein: how power profits from disaster | Hurricane Kat... 

Jul 6, 2017 ... The long read: After a crisis, private contractors move in and suck ... the disaster capitalism free-for-all that followed Katrina and the ...

Lahaina wildfire insured property loss to be about $3.2 billion - KCC

Reuters
Wed, August 16, 2023 

Aftermath of the wildfires in Lahaina


(Reuters) - Insured property losses from the wildfire that ravaged the resort town of Lahaina in Hawaii last week are estimated to be about $3.2 billion, catastrophe modeling firm Karen Clark & Company (KCC) said on Wednesday.

The inferno killed at least 106 people after racing from grasslands outside town into Lahaina last Tuesday.

The fire charred a 5-square-mile (13-square-km) area of town in hours and has brought with it the logistical challenges of recovery, taking a toll on many of Lahaina's 13,000 year-round residents, who are also facing the prospect of precious tourist dollars evaporating.

More than 2,200 structures fall within the fire perimeter, KCC estimated, citing an independent geospatial analysis of satellite and aerial imagery.

The majority of damaged structures were residential buildings, though many commercial buildings were affected as well, KCC said, adding that the disaster was the most destructive wildfire in Hawaii history.

The high proportion of wood frame and older construction present in the Lahaina buildings likely contributed to the damage, it said.

Insurance broker Aon last week said the extreme devastation to homes, businesses and other structures in Lahaina would likely drive economic and insured losses into the hundreds of millions of dollars.

Moody's Investors' Service said on Tuesday that estimated insured losses from wildfires on Maui in Hawaii would be at least $1 billion.

The report said large insurers such as State Farm, Tokio Marine, Allstate have exposure in Hawaii, but added the companies are expected to readily absorb the losses as their business in Hawaii is a small fraction of their overall insured portfolios.

(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Saumyadeb Chakrabarty)

Maui wildfire insured losses in range from $2.5bn – $4.5bn: Bloomberg  Intelligence

16TH AUGUST 2023 - AUTHOR: STEVE EVANS

Another estimate for the potential insurance and reinsurance market loss from the devastating Lahaina wildfire on the island of Maui, Hawaii, has come from Bloomberg Intelligence, whose analysts believe it could be as much as $4.5 billion.

Data from the property and casualty insurance equity analyst team at Bloomberg Intelligence suggests that the insurance market loss from the wildfires in Maui will come in above $2.5 billion.

They see the top-end possibility as $4.5 billion, giving a mid-point estimate of $3.5 billion.

That mid-point sits very close to the estimate released by catastrophe risk modelling specialist Karen Clark & Company, who said that the insured property loss from the wildfires would be around $3.2 billion.

Previously, analysts at RBC had said they expected the wildfire in Lahaina would drive an insurance and reinsurance industry impact of around $3 billion.

Officials had pegged the rebuilding cost of related to the wildfire that burned the historic town of Lahaina at an estimated $5.52 billion, with 2,207 structures reported to have been destroyed by the blaze.

As we’ve explained in our coverage of these terrible fires, there is significant uncertainty over insurance market losses, as on top of direct property damage and the destroyed structures, claims are also likely to come from smoke damage, burned vehicles, additional living expense claims, and buildings contents as well, which could all push the ultimate toll a bit higher for the industry.

How the fires started remains a subject of some contention and utility Hawaiian Electric has seen its share price plummet some 55% since the blaze, as some claims emerged that its equipment could have been responsible for these fires.

That could have ramifications for the insurance and reinsurance industry, of course and will raise memories of the subrogation secured in California from utility PG&E after the devastating wildfires there a few years ago.

Estimates seem to currently be pointing to an insured loss of between $3 billion and $4 billion, but the additional costs of auto claims and other expenses could drive the ultimate higher, it seems.

Maui’s wildfires could send housing and insurance prices soaring

Jeronimo Gonzalez
Tue, August 15, 2023 

Hawaii Department of Land and Natural Resources/Handout via REUTERS

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Jeronimo Gonzalez


The devastating wildfires in Maui — the state’s worst natural disaster and the deadliest one in the U.S. in a century — razed more than 3,400 structures valued at $3.3 billion.

Hawaii wasn’t considered very risky by underwriters. Residents paid the lowest home insurance rates in the country partly because of how rare natural disasters are in the state. The wildfires will likely make insurers reconsider policy rates and coverages. “I think insurers are going to start factoring in the increased frequency and severity of wildfires• 1 ,” a professor of risk management at Appalachian State University said.

 “You’ve already seen that in California.”

1
The New York Times, Maui Fires Come at a Moment of Turmoil for the Insurance Industry

Rebuilding costs will likely be higher, especially in old towns such as Lahaina, where most infrastructure isn’t designed to withstand such high temperatures. “The bottom line is the reconstruction is going to have to account for wildfire risk that it hasn’t in past• 2 ,” said Jesse Keenan, a professor of sustainable real estate at Tulane University. “It will require new building materials and techniques that’s going to add to the overall cost of the already inflated housing construction market.”2

2
Bloomberg, Maui’s Fires Risk Pushing Up Housing Costs in Strained Market

Hawaii Gov. Josh Green had recently declared a housing emergency in the state to combat the housing shortage by making it easier to build. The wildfires are now likely to drive Hawaii’s housing prices — one of the most expensive markets in the U.S. — even higher. Partly because 40% of Maui’s housing stock is vacation rentals, the median house price there had surpassed $1 million before the fires. “Many of the displaced families are now going to be looking for local housing, raising demand for what little housing is available• 3 ,” said Justin Tyndall, an economics professor at the University of Hawaii.3

3
Fast Company, Hawaii already had a housing crisis. Maui’s fires will make it much worse

5 things to know about a possible UAW strike

Veronica Roseborough
Tue, August 15, 2023

With one month before the United Auto Workers (UAW) contract expires on Sept. 14, President Joe Biden is asking the union and the Big Three automakers to work together and forge a fair agreement.

Negotiations between UAW and the Big Three — Ford, General Motors and Stellantis — began in early July over pay increases, pensions and career security. Autoworkers are particularly concerned about how the shift to electric vehicles (EVs) could threaten their jobs and compensation.

5 big questions about the ‘summer of strikes’

“The need to transition to a clean energy economy should provide a win‑win opportunity for auto companies and unionized workers,” Biden said in a statement released Monday.


“Companies should use this process to make sure they enlist their workers in the next chapter of the industry by offering them good paying jobs and a say in the future of their workplace.”

A fair contract, Biden added, would mean that Big Three auto workers could support their families, sustain their right to organize and have priority to fill the jobs that the transition to clean energy will create.

Biden meets with UAW president while group withholds 2024 endorsement

“The UAW helped create the American middle class, and as we move forward in this transition to new technologies, the UAW deserves a contract that sustains the middle class,” Biden concluded.

Here’s what you need to know about the ongoing negotiations and impending strike:

What are the UAW’s demands?

In this image from video, Shawn Fain, then a candidate for president of the United Auto Workers, is interviewed in Detroit, on Friday, Jan. 13, 2023. (AP Photo/Mike Householder, File)

UAW President Shawn Fain said last week the Big Three are facing “the most audacious and ambitious list of proposals they’ve seen in decades.”

The union is calling to eliminate tiers on wages and benefits, something that was included in the tentative agreement between UPS and the Teamsters. They are also calling for double-digit pay increases, more paid time off and higher retiree pay.

In addition, the union is demanding the reinstatement of some previous policies, including cost of living adjustments (COLA), defined benefit pensions and medical benefits for retirees.

The union is looking to secure their right to strike over plant closures. If a plant does close or the companies leave their towns, UAW is demanding that the companies pay the workers who are left behind to do community service work.

What is the context behind these demands?

People arrive at the Flint Assembly Plant for a free tour and open house, Aug. 11, 2015, in Flint, Mich. (Jake May/The Flint Journal via AP)

Following the release of the Big Three’s quarterly earnings reports in late July, Fain said that the automakers have made a combined $21 billion in profits in the first six months of 2023.

He argued that the companies are subsequently funneling billions into stock buyback schemes to “artificially inflate” the companies shares rather than support their workers or devote that money to the electric vehicle transition.

“Our message going into bargaining is clear,” Fain said. “Record profits mean record contracts.”

He also provided a chart to compare the union’s 2007 contracts to the present, which he used to demonstrate that starting wages have decreased and the number of years it takes to earn the top rate has increased.

He also pointed out that COLA was suspended during the Great Recession in 2009, and though the companies have bounced back, COLA has not been reinstated to adjust paychecks to compensate for inflation.

Prior to 2007, Fain added, every member of the Big Three received a pension and retiree health care. However, with the two-tiered system, many workers receive either no pension and health care plan or a pension that hasn’t increased since 2003.

“[This] paints a damning picture of what’s happening, not just in our industry, but across the economy,” Fain said. “The rich are getting richer while the rest of us are getting left behind.”

“When I was elected, I said, ‘The UAW is back in the fight,’ and that’s what the Big Three are going to see when we head into bargaining,” Fain added.

How have the Big Three responded?

The Ford logo is seen on signage at a Ford dealership, Tuesday, July 27, 2021. (AP Photo/Gerry Broome, File)

General Motors (GM) went public right out of the gate with a website dedicated to providing negotiation updates.

They touted the total compensation and benefits package they provide to their team members in a July 18 release by GM Chairwoman and CEO Mary Barra. The package includes a health care plan, a profit-sharing program and career development and training opportunities

“We have a long history of negotiating fair contracts with the UAW that reward our employees and support the long-term success of our business,” Barra said. “Our goal this time will be no different.”

Mike Perez, vice president of GM labor relations, also said they have opportunities for every worker in the transition to all-electric.

GM said in a video that since the signing of its 2011 contract with UAW, they have provided $1,000 in profit sharing for every $1 billion GM earns in the North American market. Following fiscal 2022, GM said hourly union-represented employees received up to a $12,750 profit-sharing check.

The rest of the cash flow, they said, goes to upgrading facilities, retooling plants, engineering vehicles, developing technology and building up supply chains, with a small percentage going to shareholders.

In an Aug. 3 response to Fain, GM said they expect to increase wages but don’t agree with all of the demands.

“The breadth and scope of the Presidential Demands, at face value, would threaten our ability to do what’s right for the long-term benefit of the team,” the statement read. “A fair agreement rewards our employees and also enables GM to maintain our momentum now and into the future.”

Ford has also come out with its own response in the form of an op-ed, written by CEO Jim Farley and published in the Detroit Free Press.

Contrary to Fain’s claims, Farley said that UAW-Ford employees have received wage increases and annual inflation bonuses, which have exceeded what they would have been paid with COLA in place.

He added that 80 percent of those employers make the top wage rate of $32 per hour, in response to the proposal to end the tier system and the claim that it takes 8 years to reach the top wage rate.

In a response to the op-ed, Chuck Browning, vice president of the UAW’s national Ford department, commended Ford for their handing out profit-sharing checks, expanding health care benefits and giving many part-time workers full-time status. However, he pushed back on wages, saying that workers were still not compensated enough to attain a decent standard of living, job security or retirement “with dignity.”

Stellantis senior manager Jodi Tinson said in a statement that the company and UAW have a long history of working together. She added that Stellantis is focused on ensuring its future competitiveness as well as preserving good wages and benefits that recognize workers’ contributions.

In a letter sent to employees and obtained by Reuters, Stellantis North America Chief Operating Officer Mark Stewart said he is committed to reaching an agreement based on “economic realism.” Agreeing to UAW’s current demands, he said, could endanger the company’s ability to make decisions surrounding job security in the future.

“This is a losing proposition for all of us,” he wrote.

Stellantis has made proposals to reduce the fixed cost structure of the business in response to government electric vehicle rules, according to Reuters. Fain said this included cuts to health care coverage and fewer vacation days for new hires, among other proposals.

Fain criticized Stellanis’s “concessions” on a Facebook livestream, throwing them in the trash and calling them a “slap in the face.”

Stewart said that Fain did not fairly represent the negotiations and that “theatrics and personal insults” will not move the two sides any closer to an agreement.
Who will be affected by a strike?

From the start of negotiations, Fain has said that members should be prepared to strike. On the livestream, he reaffirmed that conviction, reminding viewers that the strike fund is healthy and that UAW leadership has a plan for work stoppage.

“Come Sept. 14, if these companies don’t deliver, they’re going to see this plan unfold,” Fain said.

Traditionally, UAW has singled out one automaker to target, but a spokesperson told the AP that the union could choose all three.

Evercore ISI analyst Chris McNally told Axios that the chances of a UAW strike are at least 50 percent, so if all 150,000 UAW workers were to strike with a fund of $825 million dedicated to paying workers $500 per week, the union could strike for about 12 weeks.

The 40-day UAW strike in 2019 cost GM $3.6 billion. However, Stewart said in his letter that it’s too soon to determine whether there will be a strike.

“At this very early stage, no one should jump to any conclusions about the outcome of the process,” he said.
What are the political risks for Biden?

While Biden has pledged to be a staunch ally of unions, he has yet to secure UAW’s endorsement for his reelection campaign. The union backed Biden against then-President Trump in 2020, but it announced in May it would withhold its endorsement.

Fain insisted the union must see a “just transition” to EVs as the Biden administration pushes to shift automaking to a greener future.

The Hill.

UAW President Shawn Fain responds to workers worried about pay loss during a strike

Phoebe Wall Howard, Detroit Free Press
Wed, August 16, 2023 at 6:05 AM MDT·3 min read

Again and again, UAW President Shawn Fain has scheduled updates for his members on Facebook live to discuss contract negotiations and sometimes even skewer an automaker.

Thousands of viewers have tuned in to watch and submit questions via chat that he addresses in real time. They submit thumbs up and heart emojis as he speaks. Other members, who usually list their local union affiliation when commenting online, scold him for being too negative. Fain acknowledges by name the members, their local offices, their priorities and responds to them.

"The audience for our Facebook Lives keeps getting bigger every time," Fain told the Detroit Free Press on Tuesday. "Being the first (UAW) president directly elected by the members, I wanted to have that direct connection with folks all across the union."

UAW president Shawn Fain walks towards one of the employee entrances outside of Ford's Michigan Assembly Plant in Wayne on Wednesday, July 12, 2023.

Gone are the days of UAW communication by news release only via email. This is a different kind of labor organization than the union that negotiated the four-year contract in 2019 with General Motors, Ford Motor Co. and Stellantis, which owns the Jeep, Ram, Chrysler, Dodge and Fiat brands.

Only Stellantis has pushed back publicly on the UAW demands. Fain, who worked as an electrician at the Stellantis automotive parts plant in Kokomo, Indiana, has longtime family connections to Chrysler.

Fain, after hosting a Facebook live update Tuesday asking union members to vote to officially authorize a strike if needed, responded to strategy questions from the Free Press. These are his responses, unedited:

Is the UAW member demand list so ambitious that any potential deal will have trouble winning ratification? Are expectations too great? "It’s the Big Three’s massive profits that are setting expectations. Members are right to demand that record profits mean record contracts," Fain said.

Does transparency impede negotiations? Does it back automakers into a corner and not allow them to save face by brokering concessions? "Transparency makes us stronger," Fain said. "When I was a national negotiator, it was incredibly frustrating to see the president go behind closed doors and cut a backroom deal. It’s not the power of the president that wins a strong contract. It’s the power of a mobilized membership. Because the members have been driving these negotiations from day one, our position at the bargaining table is so much stronger."

More: GM confirms future wage hike for UAW members, but other demands 'threaten' company health

More: 'Shake up' UAW, purge staff, prepare to strike: Document reveals Shawn Fain's draft plans

Some UAW members say they cannot afford to strike and they’re worried. What do you say to them? "In my opinion, as wages and conditions have regressed in the most profitable time in the history of these companies, we can’t afford not to strike if the occasion calls for it," Fain said. "If there is a strike, it’s the Big Three who’ll be striking themselves. Their profits have been astronomical. They can afford our demands. But if the companies do force a strike, we have been preparing. We have increased strike pay substantially. Our locals have been getting ready to assist members who need it. We will make sure every member has what they need to win."

The UAW contract with the Detroit 3 automakers ends at 11:59 p.m. on Sept. 14. The UAW led a 40-day strike on GM four years ago. This year, the union voted to increase strike pay to $500 for workers on the picket line.

Note: The UAW uses the term "Big Three" and the Free Press uses the term "Detroit Three," because Detroit automakers are no longer the largest. Toyota, which has had a research and development presence in Ann Arbor for more than 40 years, is the top-selling automaker globally.

This article originally appeared on Detroit Free Press: Shawn Fain responds to UAW members worried about strike, impact on pay

MONOPOLY CAPITALI$M
American industrial icon US Steel is on the verge of being absorbed as industry consolidates further

Associated Press
Tue, August 15, 2023






 A worker arrives for a shift at the U.S. Steel Clairton Coke Works on May 2, 2019, in Clairton, Pa. With two bidders revealed in a matter of days and more in the wings, United States Steel Corp. seems poised to be purchased by a competitor sooner than later.

(AP Photo/Gene J. Puskar, File)

With two bidders revealed in a matter of days and more in the wings, United States Steel Corp. — a symbol of American industrialization that for more than a century helped build everything from the United Nations building in New York City to the New Orleans Superdome — appears be on the cusp of being absorbed.

Here’s what's happened so far, and how the acquisition of U.S. Steel could reshape steelmaking globally.

BIDDING WAR

After rejecting a $7.3 billion buyout proposal from rival Cleveland-Cliffs on Sunday, U.S. Steel said it was considering its next move. On Monday, industrial conglomerate Esmark offered $7.8 billion for the Pittsburgh steelmaker.

Shares of U.S. Steel soared more than 30% Monday with good odds that bids for the 122-year-old steel producer will head higher.

U.S. Steel says it has other offers to consider as well, and the company gave no timeline for if and when it might make any decision about selling itself.

A POTENTIAL GIANT

Cleveland-Cliffs said its proposal, first made on July 28, would create a company that would be among the 10 biggest steelmakers in the world and one of the top four outside of China, which dominates global steel production. Cleveland-Cliffs CEO Lourenco Goncalves said a tie-up between the two U.S. steelmakers would create “lower-cost, more innovative and stronger domestic supplier for our customers.”

Goncalves said he's ready to continue talks with U.S. Steel despite its rejection of the company's initial offer.

Cleveland-Cliffs is the largest producer of flat-rolled steel and iron in North America. Acquiring U.S. Steel would further shrink the number of players in the U.S. steelmaking industry, which has experienced significant consolidation in recent years, including the two steelmakers at the center of developments this week.

The proposed acquisition would give Cleveland-Cliffs control of about 50% of the domestic flat steel market and 100% of blast furnace production, Citi analysts wrote in a note to clients. It would also create “close to a domestic monopoly” on auto body sheet steel and close to 100% of U.S. iron ore.

That will most certainly garner the interest of antitrust regulators who, under the Biden administration, have raised the bar for mergers in a number of industries. Automakers and other big buyers of steel will also likely push back over shrinking competition among U.S. steelmakers.

SOARING STEEL PRICES AND CONSOLIDATION

Soaring prices have helped fuel consolidation in the steel industry in this decade. Steel prices more than quadrupled near the start of the pandemic to near $2,000 per metric ton by the summer of 2021 as supply chains experienced gridlock, a symptom of surging demand for goods and the lack of anticipation of that demand.

Cleveland Cliffs acquired AK Steel in 2019 right before steel prices began to spike and within a year, it acquired ArcelorMittal USA in 2020 for $1.4 billion. U.S. Steel bought Big River Steel the following year.

Prices have settled back to around $800 per metric ton, but that remains at the top end of the spectrum for steel prices over the past six years. An extended economic rebound, particularly in the U.S, has helped keep prices for flat-rolled steel elevated.

U.S. STEEL HISTORY

U.S. Steel has been a symbol of industrialization since it was founded in 1901 by J.P. Morgan, Andrew Carnegie and others, and the domestic steel industry dominated globally before Japan, then China, became the preeminent steelmakers over the past 40 years.

The company survived the Great Depression and became an integral part of U.S. efforts in World War I and II, supplying hundreds of millions of tons of steel for planes, ships, tanks and other military gear, in addition to steel for automobiles and appliances.

During the late 1970s and early 80s — amid an energy crisis and multiple recessions — U.S. Steel cut production and spun off many of its other businesses. With oversupply and an influx of lower-priced steel imports dragging down prices into the new century, the company reorganized in 2001 and separated its energy business, which became Marathon Oil Corp.

The 64-story U.S. Steel Tower still looms over the Pittsburgh skyline, but U.S. Steel is no longer its biggest tenant. That would be UPMC, a local health system, and its name is now at the top of the tower.

GLOBAL STEEL PRODUCTION

China and Chinese companies have come to dominate global steel production. Of the nearly 2 billion tons of steel produced annually across the globe, about 54% comes from China, according to the World Steel Association.

China's Baowu Group, a state-owned iron company based in Shanghai, churned out nearly 120 million metric tons of steel in 2021.

Cleveland-Cliffs and U.S. Steel combined that year produced almost 33 metric tons of steel, according to the World Steel Association. The combined entity would vault immediately to a top 10 steelmaker globally, but it will still be at the lower end of that list.

It would not alter the position of U.S. steelmaking as a whole, of course, which current ranks No. 4 behind China, India and Japan.

The Real Story of That Chinese EV Graveyard Isn't What You Were Told

James Gilboy
Mon, August 14, 2023 

A graveyard of abandoned electric cars in China

You've probably seen that video circulating the internet of a field full of supposedly unsold EVs in China by now. They're claimed to be all manner of things, from the result of defrauding Chinese EV subsidies to evidence that EVs aren't selling. But while the site is indeed a car graveyard—for the most part, anyway—it's the final resting place of an industry other than car manufacturing.

The field of cars was explored by Inside China Auto on YouTube, who translated the markings on the cars to explain their origins. The site is widely purported to contain up to 10,000 unsold new EVs, for the reasons outlined above.

However, a closer look reveals the opposite to be true: These are not new EVs, and they only number in the hundreds. Most are five to six years old and have seen significant use, with aftermarket accessories, trash in their interiors, and other signs of wear. That's because you're looking at a fleet of retired rideshare cars that were once operated in large cities in China.

https://www.youtube.com/watch?v=uD8qqEx4G18

The way Inside China Auto tells it, there was an e-bike sharing bubble in 2016 that was rapidly copied by services offering short-range EV rentals. But just like in the United States, these ventures struggled, as they were far more expensive to start and maintain than bike sharing. That cost was passed on to customers, who could apparently rent a bike, ride the subway, or even take a taxi for less than these ride shares would cost. What's more, renting an EV was often slower than these alternatives. They also left you to park a car at the end of your journey, at either an inconvenient stall or in a paid spot.

In the end, these businesses' failures and the rapid advancement of China's auto industry have orphaned hundreds if not thousands of beaten-up short-range EVs, most of which are worse value than a cheap new Chinese EV. That said, they're not the only occupants of the lot. A wider view reveals that the ex-rideshare cars also share their space with retired taxis, wrecked cars, and some new, unregistered EVs from foreign brands (which are indeed struggling to sell).

While EV uptake is indeed approaching a slowdown, it's for reasons more complicated than sensationalism on controversial topics like China and EVs would have you believe.

CASHLESS CAPITALI$M

Safaricom launches M-Pesa mobile money service in Ethiopia

Dawit Endeshaw
Wed, August 16, 2023


Safaricom Ethiopia employees walk past a billboard during the Safaricom ceremony to officially launch its operations in Ethiopia, in Addis Ababa

ADDIS ABABA (Reuters) - Safaricom's M-Pesa mobile money service went live in Ethiopia on Wednesday, in a boost to the Kenyan telecoms operator as it seeks to kickstart growth in one of Africa's biggest economies.

Safaricom, which is part owned by South Africa’s Vodacom and Britain’s Vodafone, launched its voice and data network in the Horn of Africa country last year and has signed up more than 2 million active users.

Safaricom introduced M-Pesa in Kenya in 2007. The service has grown to become the company's biggest moneymaker and is also offered in the Democratic Republic of Congo, Egypt, Ghana, Kenya, Lesotho, Mozambique and Tanzania.

"M-Pesa is known to be a game-changer for financial inclusion," said Stanley Njoroge, Safaricom Ethiopia's interim CEO. "We will continue to broaden the services our customers receive from the M-Pesa platform."

Safaricom became the first private telecoms provider in Ethiopia after the government in 2019 liberalised a sector that had long been dominated by the state-controlled Ethio Telecom.

The company is betting that Ethiopia, which has around 120 million people and one of Africa's youngest populations, will power growth for years to come.

Analysts said the market offers enormous opportunities, but also requires huge investments that will put Safaricom under pressure to deliver quick results.

Safaricom's core earnings fell by a fifth in the year to March 31, hit by the cost of starting operations in Ethiopia.

The company also faces stiff competition from Ethio Telecom, whose profits more than doubled in its latest financial year. In July, Ethio Telecom reported having more than 34 million subscribers to its mobile money service Telebirr.

Mobile money services are common in East Africa, allowing customers to send and receive money and pay for goods and services.

(Reporting by Dawit Endeshaw; editing by Elias Biryabarema, Aaron Ross and Jane Merriman)