EXPORTING JOBS: HOW BEST TO STANCH THE FLOW? Domestic content legislation I leads to fa dead end
Parker, Michael Urquhart and Michael
Domestic content legislation leads to a dead end BY MICHAEL URQUHART AND MICHAEL PARKER Multinational corporations are blackmailing American workers and their communities. The increasing mobility...
...The increasing mobility of capital has given business more leverage against organized labor than at any time since the 1930s...
...Theoretically, foreign corporations would invest in the United States to maintain their market share, but there is no requirement that they do so...
...Unfortunately, the campaign for domestic-content legislation has become indistinguishable from past protectionist crusades: Racism and jingoism have been tapped to attract wide support...
...Today, the AFL-CIO and some of its constituent unions support tariffs (covering motorcycles), bilateral trade agreements (to aid U.S...
...The Dodge brothers and Henry Ford may have been committed to making autos, but today's Ford Motor Company—like General Motors, Toyota, and the- other "auto" manufacturers—are committed only to making profits...
...Therefore, labor campaigns to turn back the corporate attacks are deserving of everyone's support...
...Any gains or losses for unionized workers will ultimately spread to the nonunionized sector...
...The United Auto Workers believes it has a better idea...
...Most other projections—including the Congressional Budget Office's—fall somewhere in between, showing a small net gain or loss...
...The union maintains that its domestic-content program is unlike traditional protectionist schemes because it focuses on U.S.-based companies that shift investment and plants overseas...
...The exodus of production and investment is only one factor in the loss of more than two million manufacturingjobs in the United States since 1979...
...Both plants make heavy use of robots, are resisting unionizing drives, and have imposed work rules that would eliminate thousands of UAW positions if they were adopted in unionized shops...
...The Japanese...
...Honda started a factory in Marysville, Ohio...
...At the company level, contracts need to contain language limiting the power of an employer to move work and capital overseas...
...Such swipes at Japan are no accident...
...If the UAW had negotiated such a clause when it granted concessions to GM, the union might have kept GM from providing the Isuzu corporation with $200 million to tool up for the import of200,000 small cars into the United States...
...But for unions to accept racism and use it to achieve short-term gains is suicidal...
...But whatever influence these individuals have on stated UAW policy, they have not altered the real dynamic of the campaign...
...The UAW's most recent estimate suggests that almost a million jobs would be saved or created...
...they were born of the realities of world capitalism and an ideology that was designed to keep the working class divided...
...They were sentenced to probation and a $3,000 fine...
...And they demonstrate that direct control of investment is a solution...
...A popular television newscaster in Detroit, commenting on imports, says, "What the Americans did to the Japanese during World War II was peanuts compared to what Japan has done to Detroit in the past six years...
...Not only does racism drive a wedge between workers, it also strengthens the conservative forces that are striving to cut social spending, increase military spending, cripple the unions, and protect the corporations...
...Simply making concessions in the hope that they will improve profitability is a disastrous course, as workers in autos and steel have discovered...
...Advocates of the domestic-content bill argue that it represents a step toward social control over investment...
...If labor is to stem the erosion of gains made at the bargaining table in the last fifty years, it must develop a strategy to counter capital's power to take flight...
...Of course, the UAW didn't invent racism...
...Though such efforts pose a direct challenge to corporate prerogatives, success is far from guaranteed...
...Government aid to reactionary, anti-union regimes...
...Organized labor remains the best hope for bringing about progressive change, and that is why its preoccupation with destructive stop-gap trade measures is so disheartening...
...Nissan, for instance, opened its new plant in Smyrna, Tennessee...
...They clearly and correctly identify the enemy: the multinational corporations...
...Furthermore, the effect of a domestic-content law on workers in other industries is difficult to predict...
...Erecting a wall around a market dominated by monopolistic firms would not necessarily spur an increase in production, for the corporations may find it more profitable to maintain present levels while raising prices—as the steel companies did after they won import restrictions in 1977...
...There is nothing wrong in principle, it seems to us, with attempting to control trade, but that is no substitute for building a movement that challenges corporate power...
...Some of the union's staff and officials would like to believe that the campaign for domestic-content legislation is about "investment policy," the targets of which are multinational corporations...
...The steel workers have done this in several areas devastated by plant closings...
...Who is left to be the enemy...
...They also believe the issue can embarrass Ronald Reagan...
...The UAW leadership does not expect the legislation to win Senate approval and the President's signature...
...But at least these kinds of initiatives offer positive steps toward relief...
...The actual impact of a domestic-content program would depend on hundreds of variables in the economy...
...For union locals that have adopted a cooperative relationship with management, the rank and file can be roused only by bashing cars made in Japan, picketing auto import dealers, and attempting boycotts of all Japanese products...
...Unions did not inject national chauvinism and racism into the consciousness of the working class...
...Communities, too, can conduct drives to keep plants open, demanding that factories slated for closure be turned over to the workers or a public body...
...If a few of those variables were to change, the effect could be quite different from what the UAW anticipates...
...The further down one goes in the union structure, the more the issue is phrased in explicitly anti-Japanese terms...
...When GM decided to discontinue its domestic subcompact program and ship the capital investment and work abroad, the UAW organized no demonstrations against GM...
...union officials see their campaign as a pressure tactic for the continuation of restraints on Japanese exports and for the adoption of more traditional protectionist measures in the United States...
...Many unions have turned to protectionism for help...
...This would, in effect, build a wall around the American market...
...The UAW International has urged locals to publicize the "interlocking empire of law firms, lobbyists, PR people, and consultants whose aim is to help Japanese companies get a lock on the American market...
...Since the UAW's central strategy is to cooperate with the auto makers—as demonstrated by concessions, the touted "non-adversarial relationship," and quality-of-worklife programs—the membership cannot be mobilized against the corporations...
...Though a domestic-content rule would probably save jobs in the auto industry, any new foreign investment would probably be made in low-paying, nonunion areas of the United States or plowed into new labor-saving technology...
...Nor are domestic corporations required to pick up the slack if foreign companies decide, for some reason, to leave the...
...There are no bumper stickers attacking GM's "outsourcing" policies, but there are plenty of bumper stickers linking Toyota, Honda, and Datsun to Pearl Harbor...
...The next step is to seek contracts establishing uniform conditions throughout the multinational firms' operations—a direct challenge to the corporations' ability to foster competition among workers...
...On the other hand, Wharton Econometrics, in a study commissioned by the government of Japan, predicted a net loss of almost a million jobs...
...More important, a decision to implement protectionism in the United States, the strongest nation in the world, would encourage other countries to adopt similar measures for their key industries...
...Yet, as if to demonstrate how little UAW policy shapes the actual campaign, the Pearl Harbor bumper sticker remains prominently displayed at the main gate to the union's international headquarters—along with two other statements, Unemployment: Made in Japan and 300,000 Laid-off UAW Members Don't Like Your Import...
...Years ago, unions moved out of single shops and secured industry-wide contracts...
...It will also be necessary for American labor to provide tangible support for organizing campaigns in other nations...
...However, China, an economic weakling compared to Japan, immediately retaliated when quotas were placed on its textile exports...
...The UAW dismisses the idea that Japan would strike back with measures of its own...
...unemployment...
...Now, more than ever, unions need to develop international links to confront the multinational corporations...
...One sticker depicts a UAW Pac-Man figure chasing a racist caricature of a Japanese...
...Domestic content does not require any specific level of investment or production in the United States...
...Please Park It in Tokyo...
...Under the rules laid down by multinational companies, the wages and working conditions of American workers can now be determined by comparison to foreign wages and working conditions...
...This would have to be accompanied by domestic political pressure demanding the halt of U.S...
...The steel industry's experience is instructive in another way, too: U.S...
...Today's economic stagnation has highlighted the productive overcapacity of some industries, and competition has turned cutthroat...
...In June 1982, two men in a Detroit-area club insulted Vincent Chin, apparently thinking he was Japanese—or in some other way responsible for U.S...
...The references to Pearl Harbor have been denounced in the UAW's national magazine...
...How the unions respond to the business offensive will affect all of the society...
...textile and apparel companies), trigger prices (on "unfairly" low-priced steel), and import limits (against steel and textiles...
...But for certain industries, notably auto and steel, it is a severe problem—and getting worse...
...Most analysts agree that any significant increase in global protectionism would have devastating consequences for world trade...
...Unions are warned that if they do not make concessions to help hone the competitive edge of their employers, they will see jobs moved abroad...
...After a scuffle, the men chased Chin and beat him to death with a baseball bat...
...A massive public works program or the "Rebuild America Act" proposed by the Machinists are possible starting points for such a campaign...
...If it turns out to be more profitable to build widgets in Malaysia, become a banking power, or raid other companies, that is what they will do...
...But domestic-content legislation would do no more than prohibit imports above a specified level, blocking them when the domestic content in a manufacturer's total sales drops below the prescribed percentage...
...Steel did not use its recent windfalls to modernize plants or boost output...
...market...
...As a step in this direction, unions could call for uniform contract expiration dates and establish an international strike fund to back up the demand...
...instead, it bought Marathon Oil for $ 1 billion...
...In the United States, the debate over a national industrial policy presents unions with the opportunity to help promulgate policy that would defend jobs, wages, and communities...
...joblessness...
...The political issues behind domestic-content legislation have been obscured by the debate over its specific economic virtues or liabilities...
...The companies have a global strategy, after all, and so should organized labor...
...There is also a distinct possibility that other nations would retaliate against a domestic-content rule, creating still more U.S...
Vol. 48 • January 1984 • No. 1
