NAFTA strikes again! Tyco announced it is closing its East Berlin Plant where approximately 300 workers are employed.

22 years ago previous Ohio Congressman Jim Trafficant stated on a talk show for Americans to hold on tight because within the next couple of years people would be losing their jobs, their homes and their cars. Few Americans paid attention to his warning message.

17 years ago presidential candidate Ross Perot released a book “Not For Sale At Any Price,” listing all the types of jobs that would be affected within a couple of years. Again, few Americans paid attention and labeled Perot a whacko.

It is said we reap what we sow. Americans have continued to sow elected officials who care not about them but about becoming rich or richer. Americans are now reaping the “benefits” of their sowing.

When both the Republicans and Democrats agree on something, you can be sure the middle class will get hammered. As much as NAFTA is doing for Mexico, they still can’t keep their people from coming to this country.

Shame. When I heard that Hershey was closing its California plant and moving it to Mexico I thought that was along the lines of sacrilege. Globalization was the answer.

long article - part below - full article found at http://www.latimes.com/news/local/la-me-hersheys31may31,0,2122686,full.story?coll=la-tot-callocal

Hershey plant to kiss Oakdale goodbye
Globalization hits Oakdale, Calif., as Hershey moves its factory to Mexico. Protesters ask, ‘Who’s next?’
By Steve Chawkins, LA Times Staff Writer
May 31, 2007

click to enlargeOAKDALE, CALIF. — On a warm May weekend in this Central Valley town, the irony was as thick as melting fudge.

As usual, the annual Chocolate Festival was drawing hordes of fun-seekers. However, they were streaming in by the thousands just two weeks after Hershey Co. — Oakdale’s biggest employer and the nation’s biggest candy company — announced its plan to close its sprawling plant, eliminate all 575 jobs and open a new factory in Monterrey, Mexico.

On one side of busy Yosemite Avenue, the festival drew children to games where they slathered their heads in syrup as their parents patiently stood in line to buy bookend-size chunks of toffee.

Across the street, to frequent, approving honks from motorists, protesters waved signs denouncing the company whose philanthropic, long-dead founder is still reverently referred to by some local employees as Mr. Hershey. One man wore a T-shirt that said on the front: “Where did ‘the great American candy bar’ go?” Asked for the answer, he whirled around to display the back: “Mexico!”

For Hershey workers in Oakdale, globalization is no longer just an abstraction. Like legions of other Americans, they suddenly face questions as immediate as how to make a living and as far-reaching as whether their 20th century manufacturing skills will count for much anywhere else. Production at the plant is to be phased out by the end of the year.

When she heard the news, Mabel McNaught, a school custodian, wondered how her family would recover. Her husband, Philip, 50, is a forklift driver at the plant, and she figures that finding another job nearby with similar pay and benefits won’t be easy.

“I was devastated,” she said. “I just started crying.”

The sign she held as traffic snaked past the protest was cautionary: “Who’s next?”

The 113-year-old company has described the plant shutdown as part of a “global supply-chain transformation.” Some 3,000 of Hershey’s 13,000 workers will lose their jobs, including as many as 900 in the company’s hometown of Hershey, Pa., where the streetlights are shaped like Kisses. By 2010, Hershey says, the moves will save shareholders as much as $190 million annually.

There are many factors that contribute to these job losses. I honestly don’t think NAFTA is the only one to blame. What about some of the following:

- Over paid corporate executives and their outlandish perks/golden parachutes. Why is it that an executive in charge of a couple thousand makes millions per year while the President, in charge of over 250 million, makes only $400,000? For that matter, name one executive in charge of a multi-trillion dollar debt and budget…
- Union wages. Why does an assembler at Harley make $22 per hour while the skilled labor supplying his parts from a local venddor only makes $10-12?
- Corporate taxes. The US has some of the highest corporate taxes around for domestic corporations. I can start an off shore business in Barbados and only pay 1.5% vs. 34% in the US.
- Over all cost of labor (not just salary). Health care costs are through the roof.
- Litigation for frivolous crap.
- Keeping up with the Jones’… this drives up salary demands from workers that are in short supply.

When you combine these costs with some of the options like lower cost and comparable work forces in other countries, lower taxes on profits, etc., you can’t help but make the decision to move.

Not sure what the fix is, but it is needed. We are slowly bleeding to death. We are living way beyond our means as a society on a whole.

Let’s not forget the pressure of stock holders to improve the bottom line no matter what the cost to people’s lives.

It seems like every time I need customer service, I end up speaking to someone in India!!

Alex - 21 June 2007 10:56 PM

There are many factors that contribute to these job losses. I honestly don’t think NAFTA is the only one to blame. What about some of the following:

- Over paid corporate executives and their outlandish perks/golden parachutes. Why is it that an executive in charge of a couple thousand makes millions per year while the President, in charge of over 250 million, makes only $400,000? For that matter, name one executive in charge of a multi-trillion dollar debt and budget…
- Union wages. Why does an assembler at Harley make $22 per hour while the skilled labor supplying his parts from a local venddor only makes $10-12?
- Corporate taxes. The US has some of the highest corporate taxes around for domestic corporations. I can start an off shore business in Barbados and only pay 1.5% vs. 34% in the US.
- Over all cost of labor (not just salary). Health care costs are through the roof.
- Litigation for frivolous crap.
- Keeping up with the Jones’… this drives up salary demands from workers that are in short supply.

When you combine these costs with some of the options like lower cost and comparable work forces in other countries, lower taxes on profits, etc., you can’t help but make the decision to move.

Not sure what the fix is, but it is needed. We are slowly bleeding to death. We are living way beyond our means as a society on a whole.

● The executives don’t lose their jobs or take a pay cut. In fact they give theirselves a slap on the back and a raise for cutting wages from dollars per hour to cents per day.

● If the problem was union wages, then the jobs would move to a state where they could hire non-union workers, not overseas.

● The cost of business in the US is much higher; corporate taxes, insurance, and government mandates like SS, OSHA, EPA, min wage, etc. are costs that can be eliminated overseas.

The government is responsible for the high cost of living and doing business in the US. It’s impossible to compete with slave wages and little regulation. Before NAFTA, tariffs were imposed in order to make up for these costs. Now nothing is made in the US. I even bought expensive special purpose clothing online once. I thought that with the high cost it would have to be US made, but no. Still made in China.

Some businesses can’t afford to move to non-union areas. Imagine how much it would cost Harley-Davidson to move all of it’s plants to areas where there was no union? What about Chrysler, Ford and GM? The cost of starting up a new plant elsewhere would far outweigh the cost of the union labor.

Also, it is not about non-union areas… unions are everywhere. In York, union workers make Harley’s for anywhere from 18 - 23 per hour. Meanwhile, there are companies in York making the parts for those bikes and they are only paying 10 - 12 an hour with little or no benefits. Quite a pay difference. I am not picking on Harley on this one because they are not alone with this problem. The same thing exists in Detroit and elsewhere in America where there are major manufacturing facilities.

Execs are over paid for what they do. Then when they screw up, they walk away with a beautiful package. Did you know that Lou Gerstner, former CEO for IBM was paid a 7-digit salary in retirement, free use of corporate jets, $10,000 per day consulting fees, etc? How about Michael Ovitz, 14 month head of Disney… $39 million in cash and over $101 million in options for a SEVERANCE package. The bum was fired for pete’s sake! I got laid off a few years ago and was delighted with my bountiful severence package of 4 weeks pay for 3.5 yrs of service as a senior manager. I was a lucky one too - most got nothing.

Corporate greed, shareholder demands (not the little guy either - the big institutional investors), Union wage demands, trying to keep up with the Jones’… it all adds up to what Ross Perot called a “giant sucking sound.” That sucking sound is all the jobs going where it is cheaper to operate.

There are many factors that contribute to these job losses. I honestly don’t think NAFTA is the only one to blame. What about some of the following:

- Over paid corporate executives and their outlandish perks/golden parachutes. Why is it that an executive in charge of a couple thousand makes millions per year while the President, in charge of over 250 million, makes only $400,000? For that matter, name one executive in charge of a multi-trillion dollar debt and budget…
- Union wages. Why does an assembler at Harley make $22 per hour while the skilled labor supplying his parts from a local venddor only makes $10-12?
- Corporate taxes. The US has some of the highest corporate taxes around for domestic corporations. I can start an off shore business in Barbados and only pay 1.5% vs. 34% in the US.
- Over all cost of labor (not just salary). Health care costs are through the roof.
- Litigation for frivolous crap.
- Keeping up with the Jones’… this drives up salary demands from workers that are in short supply.

When you combine these costs with some of the options like lower cost and comparable work forces in other countries, lower taxes on profits, etc., you can’t help but make the decision to move.

Not sure what the fix is, but it is needed. We are slowly bleeding to death. We are living way beyond our means as a society on a whole.

NAFTA has a lot more to do with job losses than you think! Are you aware of the fact that since NAFTA passed every state’s constitution had to be amended to comply with NAFTA???? That’s called undermining one’s nation’s sovreignty a/k/a treason!

As far as wages being cheaper in other countries that isn’t totally true. I several people that worked at Bethlehem Steel shipyards. Instead of work being sent to their shipyard, it was sent overseas to Turkey. The claim was that Bethlehem Steel workers made too much money but upon further investigation shipyard workers in Turkey were making the same amount of wages. These were American flagged vessels to boot!

Don’t forget about the fact that we hardly charge import taxes to countries bringing product into the US.  But look at what our companies have to pay to import/export product.  A lot of time it makes more sense to make the product where the product is going to be sold, or even to make it there and bring it back to the US.  I think China is exempt from import taxes totally.  This is a MAJOR factor, we don’t even need half the crap.

Alex - 25 June 2007 10:09 PM

Some businesses can’t afford to move to non-union areas. Imagine how much it would cost Harley-Davidson to move all of it’s plants to areas where there was no union? What about Chrysler, Ford and GM? The cost of starting up a new plant elsewhere would far outweigh the cost of the union labor.

And moving their plants overseas is cheaper than moving it across state lines? The point I was making is whether the plant is union or not, US workers can’t compete with a system that is totally unfair to us. We can’t compete with people making next to nothing. Even if union workers took pay cuts down to min wage, workers in China, India, etc still make much less.

I agree, I’m saying this needs to be changed also.  Whether we’re losing jobs to another state or losing them to another country, all of the factors need to be addressed because the corp is always going to what’s best for the bottom line.

Now I see the apple growers are woried about China. Five years ago the US produced more apples than China. Now they produce 5x what the US does. What are they trying to do, monopolize the entire US economy? It seems they aren’t going to stop until we become their vassal. It’s becoming a national security issue.

In regards to China… I traveld the Carribbean quite a lot in 1995 and 1996 on business. I was in Barbados, St. Lucia, Union Island and a few others. When I landed in St. Lucia, I noticed the flag of the Peoples Republic of China flying at the airport next to the flag from St. Lucia. There was a plaque in front of the poles… it read something to the effect of “This nice airport built with the generous help of the Peoples Republic of China.”

A few days later I went to Union Island… same thing. Now, if you recall, in 1983 we invaded Grenada because Cuba was digging in among other things. They were helping to build a very large (10K foot) runway there. This was a runway capable of supporting Soviet bombers.

Not long ago, we turned over the Panama Canal to Panama. Guess who bought the land and major control of the canal area… a company from Hong Kong (which is now part of the PRC). In fact, this same company owns a large interest in the former US Base, Ft Howard in Panama.

I have no doubt China knows what it is doing. My guess is they will build a very strong economy, hurt us along the way. Then one day they will decide to take back Taiwan by force. Of course, we will come to help and they will remind us that it is not worth it when they launch some very stealthy cruise missiles from Panama or one of the islands… those missiles would have enough range to smack our refineries on the Texas coast.

Now, this is all pure theory. I studied China when I was in the service. In many respects, they are a worse enemy then the Soviets ever could have been. It is a known fact that they Soviet Army was falling apart at the seams due to their large ethnic mixes and segregation. Odds were pretty good that any attack in Europe would have been vicious at first but then would have collapsed quickly. China on the other hand… very much like Japan in WWII. Very proud people, very dedicated. Although they have not fought many wars, they have fought with tenacity. They own a large fleet of diesel subs too - those dang things are virtually silent when running batteries.

Food for thought…

Diesel subs? A relic of the cold war. In 1980 or so it would be a relevant topic. Today’s SSNs are way faster and quieter than the retreads that China are making based upon old Soviet designs. A short regional war, effective at best but the big one, drawn out, its just another kill painted on the conning tower of the hunter. The last engagement involving a diesel sub was the Falklands war. The Argentine sub Santa Fe was sunk by the British navy with relative ease after finding her. They were undoubtedly aware/respectful of the 2 Argentine diesel subs in the theatre - but modern technology prevailed.  BTW - the Santa Fe was an American diesel sub named the Catfish until it was sold to Argentina in 1971.

Meanwhile the British SSN Conqueror sunk the Argentine flagship (ex-American cruiser) and it never saw it coming.

To topic. Japan waged an econimic war on the States after WW2 - they knew what they were doing too. Now Sony, Diawa, Alpine, Fujitsu, Mazda, Mitsubishi, NEC, Nikon, Nitendo, Nissan, Pioneer, Ricoh, Sanyo and many others are now staples of American life. You can expect the same from the Chinese giant that is quickly becoming an economic player in the world too.

Militarily, I don’t wish to imagine how that would turn out. You are right, they know what they are doing.

tim_k - 27 June 2007 04:19 PM

Now I see the apple growers are woried about China. Five years ago the US produced more apples than China. Now they produce 5x what the US does. What are they trying to do, monopolize the entire US economy? It seems they aren’t going to stop until we become their vassal. It’s becoming a national security issue.

Yes, I believe they are and we are doing nothing but enabling.

I was watching O’Reilly last night or the night before and Cliff from Cheer’s was on (can’t remember his real name), but China came up, he made the point that so many Americans are upset about how we treat the environment, but never say anything about China, never protest them, or call for boycotting of their products.  But China pollutes the earth “more than we did at our worst” and they are exempt from any regulations.  He also said that within the next decade, one third of CA’s pollution will come from China.

The ecomonic and polluting problems that are hapening will continue to spiral out of control (just like our border problems) because our government is full of liars, crooks, and wimps who have a blame America first mentality and never do anything about anything.

Now I see the apple growers are woried about China. Five years ago the US produced more apples than China. Now they produce 5x what the US does. What are they trying to do, monopolize the entire US economy? It seems they aren’t going to stop until we become their vassal. It’s becoming a national security issue.

I wouldn’t eat an apple from China for a million dollars. I’ll continue to support local apple orchards any day!

BTW importing of certain seafood from China has been called to an abrupt halt.

China it seems is out to poison all Americans.