On the road to the White House, Franklin D. Roosevelt declared: “Never shall the federal government part with its sovereignty or with its control of its power resources while I’m president of the United States.”
As part of that vision of sovereignty, the federal government created the Tennessee Valley Authority under Roosevelt, when it acquired a constellation of private utility companies.
The TVA also served as a much-needed economic development project for the Tennessee Valley against the gloomy backdrop of the Great Depression. Today, it illuminates the lives of 10 million people from Memphis and over the Smoky Mountains’ rocky spine to Bristol.
But now that corporation, created to give Americans jobs, hatched a plan to give away American jobs.
In a recent advertisement, U.S. Tech Workers, a nonprofit representing workers harmed by outsourcing, brought to light TVA’s plan to outsource American computer and software development jobs. That, of course, stood conspicuously at odds with the corporation’s pledge to employ “your neighbors, your friends and your family” rooted in the Tennessee Valley.
U.S. Tech Workers got the attention of President Trump with its campaign. Out of the political fog through which the administration has struggled to find the direction, Trump emerged to strike a blow for American workers.
Trump fired the chair of the TVA, plucked from the board another rotten apple, and threatened to claim more heads should they continue outsourcing.
The federally owned corporation has a nine-member board of directors, each nominated by the president and confirmed by the Senate. The chief executive officer, Jeff Lyash, drinks in a cool $8 million annual salary.
Trump also signed an executive order, instructing the Department of Labor “to create regulations to prevent foreign workers on H-1B visas from moving to contracting roles that would displace American workers” in federal jobs.
The president was justified in taking direct action against the board. Roosevelt himself removed the TVA’s first chairman, Arthur Morgan, after he contradicted the president’s stated directives. Likewise, the executive order was necessary because the people that use outsourcing to replace Americans exploit every possible loophole.
TVA, for example, planned to retain contractors through what are called “body shops.” These are firms that contract low-paid workers out to other corporations, most of which are in the United States on the H-1B visa.
By hiring contractors, TVA would be able to skirt labor laws that prevent them from underpaying federal employees. Nor would TVA be responsible for any benefits.
Responding to criticism, TVA claimed outsourcing was consistent with its aim to provide services “at the lowest reasonable cost.”
Indeed, according to the Economic Policy Institute, 60 percent of all H-1B positions certified by the Department of Labor are paid well below the local median wage for the occupation. In other words, TVA was willing to cut costs by replacing federal employees with lower-paid contractors.
Under pressure from the president, TVA announced it would change course and not outsource technology jobs.
“We were wrong in not fully understanding the impact on our employees, especially during the pandemic,” Lyash said. “TVA will not lose sight of any facet of TVA’s mission of service,” he added, suddenly aware of the corporation’s roots, “providing low-cost, reliable power while also serving to protect American jobs and create economic development across the Tennessee Valley.”
The rank and file that stood to lose their livelihoods celebrated the reversal.
“We are thrilled with the actions the president has taken on behalf of our workers at TVA, and we actually feel like this is a big win not just for IT workers at TVA but for all of TVA and for the whole country,” said Gay Henson, a TVA employee working in management at the Sequoyah Nuclear Station.
She is also president of a union representing 2,500 white-collar workers, including engineers, scientists, technicians, IT professionals, program administrators and operation support specialists. These are America’s best and brightest.
Outsourcing sends 300,000 jobs overseas each year. Under the benign name of “restructuring,” employees will be forced to train their replacements as a condition of keeping their severance pay. It’s often the case that entire departments will ultimately end up abroad. Workers across America have for long suffered through this in silence.
In California alone, for example, more than 654,000 people have lost their jobs since 2001 due to outsourcing to China.
Though she considers this a victory, Henson worries that should public scrutiny fade away, TVA will quietly resume its plan to outsource jobs with the body shops waiting in the wings. TVA still retains the companies it planned to use for outsourcing, and the foreign contractors are still around.
The battle in the Tennessee Valley is one in the broader struggle to keep alive the American dream for millions of men and women. “Trump is the only person who could have made a difference in this situation,” Henson said.
And it might take the president to ensure TVA keeps its promise.