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American Factory Worker Gets the Shaft

Discussion in 'Issues Around the World' started by ethics, Dec 30, 2002.

  1. ethics

    ethics Pomp-Dumpster Staff Member

    Maytag <a href="http://www.nytimes.com/2002/12/26/national/26MAYT.html">announced today</a> that it's Galesburg, Illinois refrigerator plant will be closing its doors and moving its operations to Mexico.

    Citing increasing competition from rivals moving operations to developing countries, Maytag argues that it is being forced into the move to stay in business: William Beer, president of Maytag's appliance division, said Maytag executives were mindful of the human cost. 'We deeply regret that we couldn't identify a cost-effective solution that would allow us to continue long-term production of refrigerators in Galesburg,' Mr. Beer said.

    The Maytag workers are fuming about the North American Free Trade Agreement, about Maytag's embrace of low-cost labor south of the border and about politicians who trumpet the benefits of free trade. 'This is heartbreaking,' said Aaron Kemp, a Maytag worker who attaches door hinges. 'This is one of the most unpatriotic, most un-American things I can imagine a company doing. They want Americans to buy their products, but they don't want to put Americans to work making those products.'

    Like many small towns, the economy of Galesburg is highly dependent on the plant both directly in the terms of the number of residents that Maytag employs, and indirectly in the demand for auxillary industries which supported the plant. Operating costs for Maytag are expected to drop from paying an hourly wage of about $15.14, to about $2.00.
  2. Steve

    Steve Is that it, then?

    As an American, it makes me sick to see the good jobs heading out of the country. But.......

    Sometimes I get to thinking about the growth of the U.S., Canada, Western Europe, Australia.....about how the Industrial Revolution brought about booming advances in materials technology, basic scientific research, technology development, and drastic reductions in labor costs, all pretty much at the cost of the rest of the world.

    I know there are historical factors that simply made England and the U.S. the "right places at the right times", and I fully understand the spread of American and Western European culture.

    But the fact is, the fantastic rate of development in these areas made it simply uneconomical for any other countries to do the same. Far better for them to ride the coattails of success, so to speak.

    So now we find ourselves at a severe disadvantage, labor cost-wise, and jobs are fleeing the country at an almost calamitous rate.

    And I think about how those jobs were ultimately created at the expense of the countries to where those jobs are going.

    Just a random observation......
  3. Coot

    Coot Passed Away January 7, 2010

    Aren't NAFTA and the WTO just wonderful organizations. Without Nafta, it would not have been anywhere near so financially advantageous for corportations to close up shop here and go to mexico.
  4. Sierra Mike

    Sierra Mike The Dude Abides Staff Member

    I'm not thrilled to learn that more jobs are leaving the US.

    However, I see a difference between these jobs going to Mexico and Shiny's job going to India.

    Mexico is, for better or worse, a country which is in general terms closely aligned with the US, even before NAFTA. What happens in Mexico does have a more direct effect on the US than, say, what happens in India, which has never really been an ally.

    I'm willing to play favorites in this regard, because while both Mexico and India are borderline shit holes, I think Mexico deserves some priority. Fixing up Mexico is one way to stop the tide of illegal immigrants and day workers flooding the US.

    We already do the same for Canada; Canada does not need to spend much in the way of maintaining a standing military, and the truth of the matter is, Canada's military could not defend Canada from any attack. Not to denigate the Canadian military--I would fight with them any day. But the politicos up there don't want to spend the money on such a thing, and as such, it's become part of the good neighbor in the US to provide that security.

    Sending jobs to Mexico is not that great for Americans as individuals, but it is good for America as a nation.

    Sending them to India is not.

  5. Sunriser13

    Sunriser13 Knee Deep in Paradise

    Even though costs for Maytag are to be reduced <i>drastically</i>, I'd certainly be willing to bet that we won't be seeing the cost to the consumer of a Maytag product being reduced at all.
  6. Sierra Mike

    Sierra Mike The Dude Abides Staff Member

    Re: Re: American Factory Worker Gets the Shaft

    AbsoLUTEly! And THAT pisses me off to no end!

  7. -Ken

    -Ken Guest

    Wait a minute.
    Did I get this right?

    "'This is heartbreaking,' said Aaron Kemp, a Maytag worker who <b>attaches door hinges."</b>

    So how much does it cost to have a "trained" American put on a door hinge? Anyone out there buy refrigerators that cost a couple of hundred dollars more because it was assembled by an American? How about that $48 dollar shirt. Face it, there are some jobs we are going to lose. Now, let's make it Maytag's responsibility to retrain this guy or find him a home in Corporate as a janitor.

    Let's also look at the facility. We have a factory building, which might be recycled into a high tech facility, a elderly housing complex or some other useful component of the community.

    Capitalism - we are supposed to buy the least expensive product of similar quality. This is what keeps the products inexpensive. I am wondering if that whooshing sound I hear is Ross Perot sucking in air as he made a prediction that all he jobs would leave immediately before we had the largest sustained economic expansion in history. Seems a shame to make fun of the guy, he meant well.

    So, if NAFTA was a failure, what happened?
    Was President Clinton a god at economic growth?
    <small>I have to admit I had trouble typing that one.
  8. Coot

    Coot Passed Away January 7, 2010

    Shipping jobs to Mexico is not in the best interests of the U.S. Mexico is a shithole for a variety of reasons, not the least of which is the level of corruption that is pervasive at all levels of their society. Mexico, while rich in natural resources, can't get their own economic act together precisely because of the corruption. Shipping jobs to Mexico doesn't lessen this, it reinforces it.

    The real purpose of NAFTA is to level the economic playing field for the entire continent. This is happening part and parcel. It really isn't in our best interest to strip away all the protections previously provided American workers in order to bring their standard of living down to such a level that everyone on the continent is vying for the same economic markers.

    The southern border is a dangerous and violent place. At some point, the federal government has to find the will to close it...even if they have to mine it.

    The solution that best benefits the U.S. and our citizens is to repeal NAFTA, put back into place the taxes that discouraged American companies from moving out of the country and staunch the hemorrhage of illegals across our border. Not doing it insures the demise of our civilization within two to three generations.

    The idea of transitioning to a pure service economy is ludicrous, it doesn't work. If you're not producing goods, then the whole economic premise becomes a house of cards.
  9. Sierra Mike

    Sierra Mike The Dude Abides Staff Member

    Well, that's true, as well. :)

  10. Sunriser13

    Sunriser13 Knee Deep in Paradise

    Here's a thought - what if, when a company elects to take their manufacturing elsewhere, they were also forced to take illegals from this country to man the plants? (At their expense, of course.)

    This could give those folks a job at home, save our government the expense and time of the paperwork and deportation, and free up resources our nation is using to support these <i>illegal</i> aliens, so they can help American citizens and legal immigrants.

    I'm quite sure this could be poked full of holes, but what an interesting idea...
  11. -Ken

    -Ken Guest

    If I may, nobody said anything about becoming a service based economy or the more commonly heard information based economy. We need to produce cutting edge products.

    It is our place to lead the way in genetics, semiconductor design, research and development in thousands of areas and the implementation of new technologies which make our infrastructure "better, faster, cheaper" while affording us better jobs that attaching refrigerator door handles.

    We need to educate our workforce to meet this challenges while making sure they receive a fair pay rate. We need to educate the scientists, technicians, engineers, teachers and a whole flock of skills we don't even know about.

    We do not need to be manufacturing old technology.
    Someone else can do it cheaper.
    And we love the cheap goods.

    Believe me, if Americans were willing to pay a premium for their appliances if they were made in America, the manufacturers would stay. We aren't and they aren't. If you're upset, look to yourself. Legislating it won't help either or should we return to protectionism?
  12. Coot

    Coot Passed Away January 7, 2010

    Apparently you don't get it. Prior to NAFTA, it would have been cheaper for these companies to revamp their manufacturing technology to lower the cost of production and create new products, now it is cheaper to simply export the old technology and the manufacturing jobs, while retaining the design functions in this country. Prior to NAFTA, manufacturing innovation was on the rise. During economic downturns, manufacturing innovation in this country used to balloon to reduce the bottom line. I have numerous industrial trade publications on my desk that show investment in automation and cutting edge technology is down.

    What is in the best interests of this country is not necessarily what is in the best interests companies like Maytag or of Mexico...nor should it be.
  13. -Ken

    -Ken Guest

    <small>As said by Coot,</small>
    "Apparently you don't get it."

    There has been speculation...

    <small>As said by Coot,</small>
    "I have numerous industrial trade publications on my desk that show investment in automation and cutting edge technology is down."

    Of course, automation obsoletes $15/hour people so that less expensive people can do more work because of technology.

    <small>As said by Coot,</small>
    What is in the best interests of this country is not necessarily what is in the best interests companies like Maytag or of Mexico...nor should it be.

    This we can agree on with the possible rewriting as "What is in the best interests of this country is what should be in the best interests companies like Maytag or countries like Mexico. Everything we do should be predicated on a win/win. It has to be. If we win and Mexico loses, we inherit the problem. We need for Mexico to be vibrant along with their neighbors. There is no reason (as you said) why it has to be bad for Mexico in order to be good for us.

    It is not that we need to lower our standard of living.
    It is for us to find a way to raise their standard of living.
  14. Coot

    Coot Passed Away January 7, 2010

    Actually, that is not the case. What has been shown, is that if you make goods more efficiently, the cost goes down...if it's a good that is needed or a need created, more of it needs to be produced, creating more demand, more equipment and more skilled operators.

    Only so far as it creates a market for our goods. Other than that, countries like Mexico need to fix their plethora of internal malfeasances. The only reason Mexico isn't an economic force is because of its culture. It is rich in resources. It cannot however, stop the pervasive corruption. In that respect, the entire country is like the alcoholic...it is addicted to it.
  15. Steve

    Steve Is that it, then?

    "Of course, automation obsoletes $15/hour people so that less expensive people can do more work because of technology."

    It doesn't quite work that way, actually. Direct wage and salary costs are a small component of total personnel expenses for most companies that offer benefits. If you replace a $15/hr person with an $8/hr person, you save $7x2080 or $14,560 per year per person. Not an insubstantial sum, granted, especially multiplied by numerous employees. But the costs of health insurance, workman's comp insurance, and other employee benefits remains the same.

    Sending the job out of the country is where the big savings are realized.
  16. Pyrion

    Pyrion Liquid Metal Nanomorph

    Of course there are two fields of employment where this crap doesn't happen: defense contracting and medical services. Perhaps these "low-skilled workers" oughta get off their butts, stop getting loaded on beer, go back to school, get some sort of education, and get a job that provides better natural job security than the unions could ever hope to accomplish.
  17. -Ken

    -Ken Guest


    Automation performs exactly as you described - in some cases. Witness ATM machines, which are starting to replace tellers in banks. How about the new automated checkout systems they are installing in supermarkets.

    Those are low level jobs. Let's talk higher up the pay scale. How about the dock strikes on the west coast recently? Didn't we have union guys who were expensive and somewhat obsoleted by newer technology. (I am not raising this point myself but rather highlighting a recent example of a topic which was discussed here.)

    Regarding Mexico, how can I argue that? The country is in a shambles. I was hoping President Fox might be capable of making a difference but I don't know.


    "Sending the job out of the country is where the big savings are realized."

    I do understand that. I also believe we should expect these assembly jobs to become extinct. They are not something which makes economic sense. Let the boring repetitive jobs to go away. We need to have the best trained/educated people in our workforce contributing the newest latest greatest (read most expensive) products. This is how we can afford to pay our people at a pay scale where they can actually afford to live here.
  18. Steve

    Steve Is that it, then?

    I agree with the stipulation that there will always exist unskilled, minimum wage jobs and a need to fill those jobs.
  19. FrankF

    FrankF #55170-054

    All jobs are valuable and are needed just as much as any other job... whether it is the guy who shines shoes at the airport, or whether it's Bill Gates. Many "low-skilled workers" do what they do because they like it, others because (for one reason or another) have no choice or that is where they are now.
    FWIW, I have worked as an engineer at a large non-union aerospace firm for almost 20 years, I only have a two-year degree, my salary is huge almost six figures, and I hate my job too. If I could support my family greeting shoppers at Wal-Mart I probably would switch careers in an instant.
  20. Sierra Mike

    Sierra Mike The Dude Abides Staff Member


    Can I come work at your place? :)


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