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An Employer s Tipping Point is as Sensitive as an Assayer s Scale |
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Written On: Spring 2003 |
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Written By: By Don Brunell, AWB President |
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As a young paperboy in a mining town one of my customers was an assayer. He was a pretty important guy in Butte, Montana, because he determined the quality and value of the metals in the ore samples prospectors brought to his shop.
It was a simple formula: No assay, no ore shipment. No ore shipment, no payment. No money, no mining supplies or food for the table.
The assayer could make or break a miner, who survived on the money they received from one ore shipment to the next. In the early days, it was a hazardous occupation as well. For example, my grandmother told me stories about some miners taking their samples to the assayer’s office with one partner guarding the door with a Colt .45 and the other with one hand on the gun in his holster just to make sure the assayer didn’t cheat them.
His shop was always loaded with rocks, dusty bottles of various chemicals and various other equipment designed to tell the assayer the type and grade of ore that miners were digging. The only spotless instrument in that office was the delicate scale with its precise weights. That scale was as important to the assayer as a Remington rifle was to a buffalo hunter.
Assayer’s Scale was Tipping Point
There is a correlation between as assayer’s scale and the “tipping point” at which an employer remains in business. Just like a miner who finds different minerals with varying degrees of richness with each shipment from his claim, employers face that same uncertainty as they struggle to stay alive, provide jobs and make a profit. Little things make a difference.
Today, in a way, government is like the assayer. More and more, government can determine if an employer makes it or goes under. Consider what a bureaucrat can do to a business.
If an inspector decides he or she doesn’t like an employer, they can delay permits, issue stop orders, or continually fine someone. For example, an inspector for the Dept. of Labor and Industries (L&I) decided an upstanding farm chemical company in eastern Washington, which received national recognition for its environmental excellence from EPA, needed to put in a new and costly valve at a dock where the fertilizers were transferred from barges and storage tanks.
When the employer disagreed and made the case that the existing equipment was safe for workers and the environment, the inspector didn’t like the answer and started fining the company’s owner. After three months, the fines that company faced were more than $18,000 and growing each month. That’s when the owner contacted AWB and, fortunately in this case, the L&I director intervened and the attorneys for both sides straightened out the situation.
Lawmakers Can Make “The Difference”
The Governor too is like an assayer. If he allows the weight of government to tip the scale against employers, companies close, jobs are cut, and tax revenues are lost.
Fortunately, Gov. Locke proposed balancing the scales. What he has proposed with his “Priorities of Government” recognizes that the rich ore deposits are gone, other states and nations are stealing our businesses and jobs, and
state government must adjust to live within its means.
As the 2003 legislation winds its way toward adjournment later this Spring, lawmakers must do the same. The increased costs of workers’ comp, unemployment insurance, skyrocketing health and liability insurance premiums, and the regulatory quagmire threaten to drive operating costs so high that employers either have to scale back jobs, close their doors, or look elsewhere to do business. Its equivalent to the prospector who found the costs of mining the ore no longer covered expenses so he moves onto another place to stake his claim.
That actually happened in Butte in 1979. For years, the Anaconda Copper Mining (ACM), the region’s major employer, told the miners and smelter workers union that operations on “The Butte Hill” were becoming increasingly marginal at best. They warned them not to strike for higher wages and benefits.
But the miners treated it like past strikes, not realizing that Anaconda really had reached its “tipping point.”
The “tipping point” formula for the Butte mines was simple: When the metals on the commodities exchanges were high, the ACM made money on the copper, silver, gold and other metals, but when it was low the company lost millions and closed the mines. In 1979, Anaconda reached the point of no return and closed its 100-year old operations for good.
Competitor states like Arizona, Nevada and Utah could mine copper—the primary mineral of the Butte Hill—at lower costs. So could countries like Chile. But no one ever believed the ACM would close the mines and implode the smelters in Great Falls and Anaconda. But when the miners went on strike it happened, and many of my relatives were suddenly jobless.
Miller Brewery Hit Tipping Point
A similar thing is happening in Tumwater, Wash. The Miller Brewery, which brewed “Oly” beer for 106 years, will close. In this case, the drawn out battle over treating the company’s wastewater was the “tipping point.” The Tumwater Brewery was one of seven in the Miller system. It was the smallest and most expensive to operate. Something had to give and with the uncertainty and costs of treating water growing, Miller had no choice and, come July, 400 workers will work their last shift.
It would be wise for our elected officials to remember that just because companies like Miller, Weyerhaeuser and Boeing have a long tradition of providing jobs in our state, they have to compete with other producers around the world. So do thousands of other small businesses across Washington.
I remember Butte as the “richest hill on earth” because of its abundance of copper, silver, gold and other minerals. I learned from Montana history that Butte was the primary reason Montana was nicknamed the “Treasure State,” and the state motto is “Oro y Plata,” the Spanish word for gold and silver.
I don’t want to remember that in 2003, lawmakers in Olympia had the chance to tip the scales toward prosperity and jobs, but didn’t make the hard decisions to lessen the “tipping point” for employers. That could easily happen if Washington’s legislators punt on tough issues likes workers comp, taxes, fees, regulations, tort reform, unemployment insurance and health care costs.
Most of all, I wouldn’t want to show my grandchildren the sites where the Boeing plant or Miller Brewery were. When I take our family back to Butte, I have to explain why the mines are closed even though there is plenty of ore left in the ground.
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