What It Takes To Divest

WHAT does a company have to do to make the University divest from it?

Does the University have a moral obligation to divest from a company in which it owns 65,300 shares and which is involved in questionable practices within the United States? Such a company is Phelps-Dodge Corporation, a mining company with operations in Arizona, Texas Chile, South Africa, and elsewhere. Phelps-Dodge is faced with a 17-month strike by its workers in the United States, and the evidence seems to indicate that union busting by Phelps-Dodge is behind the strike.

The Phelps-Dodge copperworkers struck on July 1, 1983 after the company failed to sign a standard, industry-wide contract which all of the other companies in the industry did. Even after offers of substantial wage and benefit cuts by the copper workers, the company refused to continue to negotiate, but instead it hired non-union workers and began a movement to decertify the United Steel Workers of America from the right to bargain collectively on behalf of the workers. This means, in effect, that the copper mines would be de-unionized simply by firing all of the union labor. The easiest way to fire workers is to simply precipitate a strike.

A report by a congressional committee a year ago said the Phelps-Dodge "provoked and prolonged" the strike.

The striking mineworkers have since been evicted from their company-owned homes within the company towns in Arizona and Texas. There have also been charges of police brutality prompted by the company. Regardless, precipitating a strike and throwing people out of their jobs when a series of reasonable settlements are at hand is simply cruel, a startling case of corporate immorality.

Although copper prices are so slow that the company loses money by continuing to operate the mines, it is continuing to do so. The union contends that the company is intentionally losing $30 million a year by doing so, but it is going ahead because continuing to operate will allow a decertification vote that will end unionization at the plant and considerably cut wages over the long run. In other words, the company is intentionally losing money in order to decertify the union so it can make more money when the price of copper goes up by paying its workers less.

The question at hand is a simple one. Should Harvard hold stock in union-busting companies? The gains of unionization may be debated, but the question remains. The fact that the company has cruelly treated its striking employees and violated the fundamental principles of corporate-labor relations set down in the New Deal also remain. President Bok and the Harvard Corporation ought to openly, publicly, and immediately debate selling stock in this company. They have a responsibility to invest ethically and an ethical duty to at least consider divestiture.