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Today is the 25th anniversary of a pivotal event in American economic history, the day the nation's air traffic controllers went on strike. President Reagan fired them. Today the air traffic controllers union and the government are again locked in a dispute, and now a strike isn't an option.

NPR's Kathleen Schalch reports.

KATHLEEN SCHALCH reporting:

On August 3, 1981, at the height of the summer travel season, the skies fell strangely silent. More 12,000 members of the professional air traffic controller's organization had walked off the job, and President Ronald Reagan issued one of the defining statements of his presidency.

President RONALD REAGAN: They are in violation of the law. And if they do not report for work within 48 hours, they have forfeited their jobs and will be terminated.

SCHALCH: Now tensions are running high again.

Ms. RUTH MARLIN (NATCA): Moral is worst than it was in 1981.

SCHALCH: According to Ruth Marlin, executive vice president of NATCA, the National Air Traffic Controllers Association, which replaced PATCO. Again, the union and the FAA can't agree on a new contract, so the FAA plans to impose the one it wants featuring big wage concessions. Concessions, Marlin says, will make it harder to do the job.

Ms. MARLIN: Experienced controllers who transfer to busier facilities would take a large pay cut to do it. So what we'll see is new hires going into very busy airports: Dallas, Fort Worth; Atlanta; Chicago. We've never trained new hires at places like that.

SCHALCH: And the starting salary for these new hires would drop to $31,700.

Ms. MARLIN: This proposal is not simply a we want to roll the gains that were made in the last contract. It is de-professionalizing air traffic control.

SCHALCH: Not surprisingly, the FAA has different take. Spokesman Geoff Basye says the agency is starved for cash. Under the last contract, he says, the annual cost of paying air traffic controllers has climbed by a billion dollars. Air traffic controllers earn an average of just over $100,000 - plus benefits.

Mr. GEOFF BASYE (Spokesman, FAA): When you have a union that on average is making what they're making, and they're turning down or walking away from a contract that not only protects that but will raise it through performance-based measures, you can't help but say that it takes a special kind of audacity to do that.

SCHALCH: But hardly the kind of audacity on display 25 years ago when PATCO decided to go out on strike.

Mr. KEN MOFFETT (Mediator): We tried everything.

SCHALCH: Ken Moffett was the chief federal mediator. He said the air traffic controllers wanted a shorter workweek and higher pay, and thought they had the upper hand.

Mr. MOFFETT: They were instilled in this belief that if they were taken away, that the safety of all the people flying would be at risk, and that the world wouldn't go around anymore if they weren't on the job. But it didn't work out that way.

SCHALCH: Moffett says it was a calamity, not just for the fired air traffic controllers but for unions everywhere. Before 1981, he says, most labor negotiations centered around the size of workers' raises.

Mr. MOFFETT: But subsequent to that - with the firing of the controllers - it was almost like all bets are off for all management and they started going after all the unions, as far as concessions, laying people off, you name it.

SCHALCH: Georgetown University historian Joseph McCartin says the key change was that before PATCO it was safe to strike. Firing strikers and hiring so-called scabs was seen as unseemly, even if it was legal. After PATCO, McCartin says, those inhibitions disappeared. The likelihood of replacement workers being hired in response to a major work stoppage jumped more than tenfold.

Mr. JOSEPH MCCARTIN (Historian, Georgetown University): Any kind of worker, it seemed, was vulnerable to replacement if they went out on strike. And the psychological impact of that, I think, was huge.

SCHALCH: Large-scale strikes have plummeted from an average of 300 per year in the decades before 1981 to fewer than 30 today.

Mr. MCCARTIN: The loss of the strike as a weapon for American workers has some rather profound long-range consequences.

SCHALCH: McCartin counts falling union membership and rising inequality among them. Like many other unions these days, the air traffic controllers say they're prepared to make major concessions, just not at all the concessions the FAA wants. They still hope Congress will exercise its right to intervene and try to resolve the dispute. But if it doesn't, the FAA is likely to get its way.

Kathleen Schalch, NPR News, Washington.

MONTAGNE: And you can read how the 1981 showdown between President Reagan and the air traffic controllers unfolded at our website, npr.org.

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