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Obama Calls on Bush Administration to Examine DHL-UPS Agreement for Services

Tuesday, July 29, 2008

FOR IMMEDIATE RELEASE
CONTACT: Michael Ortiz, 202 228 5566

More than 8,000 jobs could be eliminated due to the agreement

WASHINGTON, D.C. ­­- U.S. Senator Barack Obama today sent the following letter to Karl Zinsmeister, Director of the White House's Domestic Policy Council, asking the Administration to carefully examine the consolidation of DHL air operations under UPS. If the consolidation of these competitors' air services is successful, at least 8,000 jobs will likely be eliminated throughout the state of Ohio. In the letter, Obama calls on the White House to urge the Department of Justice to examine the agreement to ensure it is not in violation of antitrust laws and; ask the Department of Labor to detail its efforts to assist these unemployed workers and whether the Department's response could serve as model for other communities experiencing concentrated job loss.

The text of the letter is below:

Dear Mr. Zinsmeister:

During my recent travels, I visited with the mayor of Wilmington, Ohio and workers who would be affected by a proposed DHL-UPS agreement for services that would lead to the closing of the DHL facility in Wilmington.

I write to you in my capacity as a U.S. Senator because I believe that the Administration must act now on two fronts: first, the Department of Justice should examine the transaction to ensure that it is not in violation of antitrust laws and second, if it is not, then the government must work to ensure that these workers and this community are not left without assistance in finding new work for its people and new use for the existing infrastructure. I am pleased that you and Assistant Secretary of Commerce Sandy Baruah have been tasked with coordinating the government response to the situation and wish to offer any assistance I or my staff can provide.

As a matter of antitrust law, the proposed consolidation of DHL's domestic airlift operations under a competitor, UPS, raises concern. At the very least, the DOJ should examine whether having two competitors in a fairly concentrated market act as partners would have anti-competitive effects.

If the deal proceeds, Governor Strickland and Senator Brown have both told me that the DHL facility in Wilmington would likely cease operating. That would eliminate at least 8,000 jobs in Ohio and impact an estimated 41 counties. That level of concentrated job loss strongly weighs in favor of the government assisting them through the difficult time that will follow.

I understand that you are working with the Department of Labor and the Department of Commerce to coordinate a rapid response to what could be a crisis for the communities involved. As a Senator on the committee of jurisdiction over the Department of Labor, I would appreciate additional detail on your efforts and how responding to this situation could serve as a model for other communities where concentrated job loss is occurring due to plants moving overseas or increasingly consolidating markets.

Sincerely,

Barack Obama
United States Senator

Cc: Sandy Baruah, Assistant Secretary of Commerce for Economic Development