Negotiations took on a predictable tempo. The teams sat down in the morning. The IBU proposed something. The Koch people left for hours, returned, conceded nothing, and then indicated it was time to go home for the day. After negotiations wrapped up on Thursday, the Koch team returned to Atlanta. Sometimes it was weeks before they could find another opening on their calendar. Nine months into the negotiations, it seemed like they’d made no progress. Yet the IBU team held tight.
Finally, a small victory. Don Barnard agreed to let the IBU retain its health plan rather than moving into the Koch plan, as long as the IBU employees were willing to pay out of pocket, for the first time, to keep the privilege. In the beginning, they would pay 20 percent out of pocket, and then 25 percent in forward years. After so many grinding hours of negotiation, the IBU took the offer.
Almost immediately after this development, however, the IBU was informed that Don Barnard no longer worked for Koch Industries. They would be getting a new negotiator to deal with. There was something disconcerting about this abrupt departure, like watching a diplomat of some hostile government get executed right in front of you for disobeying his rulers. The IBU team was convinced that Barnard was fired for letting the IBU keep its health care plan, although Barnard’s former boss insisted that this was not the case.
Regardless, Barnard’s departure sent a chill through the team. Back in his cramped office at the Longshoremen hall, Bucknum tried to figure out who Barnard’s replacement would be. Bucknum was told through back channels to the Koch negotiators that the IBU team would “sorely miss Mr. Barnard.” Bucknum said this warning turned out to be true.
* * *
When Don Barnard reported back to Atlanta, he reported to a man named Ken Harrison. Harrison was vice president of labor relations for Georgia-Pacific, overseeing the company’s negotiations with labor unions at various plants.
Harrison was a trim man in his early sixties, nearing the end of a decades-long career. His hair, once bright red, had faded to a thin and silvery gray. He wore a tightly trimmed goatee, also gray, that highlighted the severity of his high cheekbones and slender face. His face could convey a lot of feeling with even a small grimace or a half smile. Harrison measured his words with extreme care and dispatched them with a surgeon’s precision. Harrison began traveling frequently to Portland to negotiate directly with the IBU.
“You could tell that he thought this little group of a hundred people in Portland, Oregon, was beneath his pay grade. He didn’t really like to be bothered by us,” Bucknum remembered. “He didn’t look kindly at us—or the people on his side of the table.”
With Harrison in charge, the negotiations took a harder turn. Barnard had been infuriating, in his placid way, but Harrison was simply unmovable.
“I remember Ken Harrison looking across the table once and going ‘What part of “no” don’t you guys get?’ ” Hammond recalled. Hammond shook his head and widened his eyes at the recollection. The IBU team subscribed to the naïve notion that the bargaining session would be a series of compromises. Harrison disabused them of this notion.
“It just floored us all, you know?” Hammond said. “Because we just never heard anything like that. Now, bear in mind that we’re just a bunch of forklift drivers and stuff. We’re deckhands on boats, and things like that, negotiating against lawyers. The working man really didn’t have too much of a chance against those guys anyway.”
When he wasn’t at the negotiating table, Harrison had a surprisingly easy air about him. When asked how he came to be one of Georgia-Pacific’s top officials over labor unions, Harrison cracked a half smile and replied, “A drunk sailor charted my course through life.”
Harrison earned degrees in both business and law before spending his career at Georgia-Pacific. One reason Harrison was so stern at the negotiating table, so measured in his words, was that he knew loose language could create a chaotic process. If the other side didn’t believe what you said, it could upset expectations and create uncertainty and delays. That could undermine the company’s leverage.
“Full faith and credit; your word’s your bond,” Harrison said. “If it’s not, you’re going to be paying more than anybody else.”
Harrison, then, did not improvise. Like Koch’s commodity traders, Harrison based his actions on deep analysis. During every negotiating session, Harrison and his team set up a private “caucus room” where they could strategize. It was possible to do this because the negotiations had been moved from the Georgia-Pacific offices to a nearby hotel called the Red Lion, which was seen as neutral territory. The parties rented one room for their meeting, and Koch rented a second room for its team. Inside the caucus room, the Koch negotiators drank hot coffee and sat at a table with their laptops as they conferred.
The caucus room was essentially a makeshift trading floor. Harrison and his team developed a point of view on the large, multiyear trade to which they were committing Koch Industries. They evaluated the multiyear price that Koch should pay for the IBU workers’ labor, and they treated this trade exactly as Koch treated a multiyear hedge on oil prices. They sucked in data from diverse sources like federal labor statistics, private financial services, and even other labor unions. Backed by a team of analysts with spreadsheets, they analyzed the market and figured out their view on what the true price of the labor should be. This was a technique that Koch Industries had used since at least the 1990s. Randy Pohlman, the former Koch human resources executive, said Koch’s team in the caucus room used spreadsheets to tweak and tailor the numbers even as negotiators worked next door.
When Harrison and the team settled on their price for IBU’s labor, they were encouraged not to pay a penny more. While Koch didn’t introduce any radical new negotiating tactics to Harrison’s team at Georgia-Pacific, the new owners did provide a new emphasis: “Run it more efficiently at a lower cost.” Because of the billions in debt that Koch loaded onto Georgia-Pacific, Harrison was told to help cut costs and lower overhead wherever he could. (Koch later said that Harrison’s superiors don’t remember giving him this directive. But the company did embrace the strategy of making Georgia-Pacific more efficient.) This explained the deep gulf between what the IBU wanted and what Koch was willing to offer.
After the process dragged on for months, the IBU implemented lessons they learned from Lynn Feekin. They decided to fight outside the negotiating room.
* * *
The IBU set up a large stage in Pioneer Courthouse Square, a public plaza in downtown Portland. The plaza was shaped like a shallow bowl, bordered by a gently ascending slope of stairs where curious onlookers sat and watched the show. Bucknum and David Franzen arrived for the rally, carrying placards stapled to wooden sticks, with the IBU insignia and the message “WE ARE ONE—RESPECT OUR RIGHTS.” Another protestor carried a sign that said: “CORPORATE GREED MAKES ME SICK.”
This was the modern-day equivalent of a union picket line—meaning that it was no picket line at all. The IBU rally was held in partnership with a local progressive political group called Portland Rising and a national group called Jobs with Justice. It was a circus-like event designed to garner publicity and to shame Koch Industries into agreeing to a better deal. The IBU didn’t have the clout to actually go on strike, and the members knew it. The rally was a publicity tool, not an economic weapon.