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Leo W Gerard: “Do No Harm” Still Hurts

Photo of locked gate at closed steel mill by Getty Images.

Promises were made.

And workers believed candidate Donald Trump when he pledged to stop corporations from exporting American factories. Workers cast votes based on Trump swearing he would end the trade cheating that kills American jobs.

This week, though, workers got bad news from Washington, D.C. President Trump proposed virtually eliminating funding for a Labor Department bureau that helps prevent U.S. workers from having to compete with forced and child labor overseas. In addition, the administration issued only vague objectives for renegotiating the job-killing North American Free Trade Agreement (NAFTA).

When NAFTA has cost at least 900,000 Americans their jobs, vague is unacceptable. Commerce Secretary Wilbur Ross said his first rule in negotiations for a new NAFTA would be to “do no harm.” That’s not good enough. That’s the status quo, and promises were made. The first rule should be to “do substantial good.”

Substantial good would start with clear, firm goals for renegotiating NAFTA. That would include returning those 900,000 jobs to the United States. That would include restoring the jobs the United States continues to lose, like the 350 that disappeared this year when Rexnord closed its Indianapolis ball bearing factory and moved production to Mexico. And like the 632 jobs at Carrier in Indianapolis that will begin vanishing this week when the first layoff notices are issued because the heating and air conditioning manufacturer shifted some production to Mexico.

In Monterrey, where both Rexnord and Carrier moved jobs, the minimum wage is $3.90 a day. Not an hour. It’s $3.90 a day. There is no way for American workers to compete with that. What they were looking for from the NAFTA renegotiation goals is some help.

Instead, they got pabulum. Yes, there’s a whole section on labor, and it says the labor provisions should be in the main document, not in a side agreement. But the fuzzy language doesn’t provide much hope for workers like those who just lost their jobs at Carrier and Rexnord.

It says, for example, that NAFTA countries should have laws regarding minimum wage, hours of work and occupational health and safety. That’s great. But Mexico has a minimum wage. It’s one so low that, as former presidential candidate Ross Perot would say, it sucks American factories right across Rio Grande.

The NAFTA negotiation targets don’t say that the minimum wage should be a living wage or specify how it would be policed to prevent forced and child labor.

Within the U.S. Department of Labor, there’s a section called the Bureau of International Labor Affairs that monitors compliance with labor provisions in international trade agreements and pays for programs to reduce child and forced labor internationally. The intent is to prevent American manufacturing workers earning family-supporting wages from competing with third world children paid with bread and blankets.

The administration has, however, said it wants to gut that program, cutting its funding by 80 percent. In addition to workers, American food and clothing corporations have objected. Nate Herman, a senior vice president for the American Apparel and Footwear Association, told the Washington Post that without the bureau’s efforts, “you’re saying, basically, that it’s okay for forced labor and child labor to run rampant, which undercuts our own labor force.”

Without specific protections in NAFTA and without even the Bureau of International Labor Affairs programs, U.S. workers are subjected to a no-win competition with exploited foreign workers. The Americans end up unemployed, like those at Carrier and Rexnord. The foreign workers continue to be abused.

Promises were made to American workers. They need to be kept. Big league, not halfway.

For example, the solution to Carrier, owned by United Technologies, moving out of Indiana was a half measure.

United Technologies spared about 700 jobs at the Indianapolis Carrier plant only after Vice President Mike Pence, then governor of the state, handed the corporation $7 million. None of the 700 jobs at the other United Technologies plant in Indiana was saved. All of those went to Mexico.

That’s not what Donald Trump promised on the campaign trail. At a rally in Indianapolis last spring, he pledged: “Here’s what’s going to happen. They’re going to call me, and they are going to say, ‘Mr. President, Carrier has decided to stay in Indiana . . . One hundred percent. It’s not like we have an 80 percent chance of keeping them or a 95 percent. 100 percent.”

But then, it was President-elect Trump who called Carrier. And it wasn’t 100 percent. It wasn’t even 80 percent. And, to make matters worse, United Technologies CEO Greg Hayes said that the millions he’d promised to invest in the plant would be spent on automation, further reducing jobs.

This is, according to the Trump administration, Made in America Week. It began at the White House Monday with a showcase of products produced in every American state, from fire trucks to door hinges. But to really revive American manufacturing, the administration must keep its campaign promises. And that means strong language in a renegotiated NAFTA and strong enforcement of other international trade deals and trade laws.

“No harm” is not enough for the administration that promised to cure the injury that international trade inflicted on workers.

Trump’s Conflicting Statements About Business Taxes Leading To Offshoring And Raising The Minimum Wage

Donald Trump (Image by Gage Skidmore FLIKR CC)

Donald Trump (Image by Gage Skidmore FLIKR CC)

In typical Trump fashion, Donald Trump says one thing but really means another.

Over the weekend Donald Trump went on Meet The Press where he talked about his tax “proposal” and the minimum wage.  Trump’s tax proposal would of course save him millions in his taxes, even though he said wealthy “people like me” could handle paying more in taxes.

He also stated businesses are leaving the United States because we have the highest business tax burden.  Businesses are not leaving because of high taxes, they are leaving because their biggest expense, labor itself, can be purchased in other countries are drastically reduced prices.  Corporations move overseas to avoid paying minimum wage standards set by state and the federal governments.

Case in point: Carrier is closing their factory in Indianapolis, Indiana and moving to Mexico.  Workers and elected leaders revolted over the idea that Carrier would toss aside 1,400 workers in this “business decision.” Workers tried to negotiate with Carrier to keep their jobs.  Carrier’s response: “they could possibly stay if the workers agreed to cut their pay from about $23 an hour to $5.85 an hour.”

Yes, Carrier is willing to stay if workers are willing to work below the federal minimum wage and give up nearly $17 an hour in wages.  Even with our “high business tax rate” corporations can still make huge profits by hiring workers in other countries and then exporting their goods back to the United States.

This is a product of multiple bad trade agreements that exploit foreign workers and allow corporations to skirt U.S. laws and taxes.  A fair trade agreement would make it more appealing for corporations to manufacture and distribute their products from inside the U.S. giving the advantage to American workers. Sadly that is not the current case.

In the interview on Meet The Press we can see that Trump recently changed his view on the Minimum Wage.  Before he was opposed to raising it at all even implying that we should eliminate the minimum wage. Now he believes we should raise the Minimum Wage but that it should be done by the states, not the federal government.

This is the political equivalent of punting.  By saying the states should set the Minimum Wage, Trump is trying to absolve himself of any responsibility for raising the Minimum Wage.  The old “it’s a state’s rights issue” defense.

The fact is that states’ already have the ability to raise their own state Minimum Wage but have failed to take any action to raise the floor for millions of low-wage workers.  They would rather see hard working Americans living in poverty and relying on government assistance that take action to raise the Minimum Wage.

We need the next Congress and the next President to take strong swift action to raise the minimum wage because the state’s are completely unwilling to do what is right. You cannot be the leader of the nation if you are not willing to lead on issues like Minimum Wage.

Watch Donald Trump try to explain away his contradictions on taxes and the minimum wage.

Indiana Carrier Plant Workers Take Their Case Directly To UTC Shareholders

Members of the Indianapolis community rally behind USW Local 1999 on March 23, 2016.

Members of the Indianapolis community rally behind USW Local 1999 on March 23, 2016 after United Technologies announced they would be moving the plant to Mexico. Image by USW 1999

Steelworkers travel to shareholders meeting, deliver petition calling on Carrier’s parent company to reconsider moving production from Indianapolis to Mexico

United Technology shareholders came face-to-face with workers being destroyed by insatiable corporate greed.

On February 10th, United Technologies (UTC) announced its “business decision” to shutter the Carrier plant in Indianapolis and move production to Monterrey, Mexico.  The move would eliminate at least 1,400 jobs in Indianapolis. A video of the heartless announcement was posted on YouTube and has received more than 3.7 million views, drawing national attention to UTC offshoring plans.

On Monday, members of the United Steelworkers Local 1999 who work at the facility scheduled for closure traveled to the UTC shareholder meeting in Florida.  The USW members delivered a petition signed by 4,500 people, asking the company to reconsider moving their jobs to Mexico, and called on UTC to keep good, family-sustaining jobs in Indianapolis.

“Abandoning the Indianapolis plant will have a devastating effect on not only 1,400 workers, but also our families and our community,” said USW Local 1999 Unit President Donnie Knox. “UTC’s decision to move our jobs to Mexico and the video of a manager’s callous delivery of that devastating news to workers in Indianapolis have made Carrier and UTC into poster children for corporate greed.”

United Technologies’ greed is not unusual. It is exactly what many of the other American companies have done over the last thirty years.  Corporations sell out American workers, who labored to build the company from the ground up, only to watch their jobs shipped overseas so the stockholders can make a quick buck.

In October, United Technologies, Carrier’s parent company, used a stock buyback program to temporarily inflate the share price.  They announced plans to buy back $12 billion worth of the corporation’s own stock — boosting the price per share up by almost 5%.  UTC plans to spend another $3 billion later this year, to buyback even more shares. This is great news for the wealthy executives and Wall Street hedge fund managers who hold the majority of UTC stock (even though it’s one of the reasons for a recent downgrade in UTC’s bond rating).

What about the people who work for UTC?  Instead of reinvesting in the company, expanding current operations or increasing the wages of the hard working men and women who built the company, UTC decided to use all those billions to buy back their own stock.

Just imagine what that $12 billion could have meant for the 195,000 workers employed by UTC.

As if spending $12 billion to buy back their own stock was not bad enough, let us not forget that UTC also paid out dividends to stockholders.  In 2015, UTC paid a quarterly dividend of around $0.66 per share. This means that over the year UTC paid out $2.50 to all 843 million shareholders, totaling $2.1 billion dollars in dividend payouts.

That’s more than $14 billion total paid to stockholders in buybacks and dividends.  The amount of money would it take to keep these 1,400 workers in Indianapolis would be just a drop in the bucket, compared to what is being shelled out to stockholders.  The greedy executives do not seem to care about the workers, their families, or the city they will destroy when they close this factory.

Knox, and his fellow Steelworkers, delivered a petition with more than 4,500 signatures from Carrier employees and their supporters from Indianapolis and around the country, calling on the company to reconsider its heartless decision to abandon American workers.

Carrier’s decision to move these jobs to Mexico is what is wrong with too many American corporations. They no longer care about building a lasting company that employs as many Americans as they can, they only care about how they can boost their stock prices to further line their own pockets.

The members of Local 1999 are going to continue to fight until Carrier reverses their decision to send these jobs to Mexico.

On Friday, April 29, members of USW Local 1999 will take the fight to save their jobs to the streets with a march and rally at the Indiana State Capitol. The rally will be headlined by USW International Vice President Fred Redmond, U.S. Senator Joe Donnelly and AFL-CIO President Rich Trumka.


Here are three articles on United Technologies stock buyback program:

http://www.wsj.com/articles/united-technologies-unveils-12-billion-buyback-1445343580

http://www.reuters.com/article/us-utc-results-idUSKCN0SE1AR20151020

http://www.marketwatch.com/story/united-technologies-sets-6-billion-accelerated-buyback-2015-11-12


Related reading on stock buybacks from the NH Labor News:

Read the series about Verizon as a case study of what’s wrong with the economy, starting here.

Read “What Mitt Romney taught us about America’s Economy” here.

Read “McDonalds: Paying Billions (of Borrowed Money) to Stockholders” here.

Read more NHLN coverage of stock buybacks here.

Leo W Gerard: Murdering American Manufacturing: ‘Strictly Business’

Via YouTube

Via YouTube

In the week before Valentine’s Day, United Technologies expressed its love for its devoted Indiana employees, workers whose labor had kept the corporation profitable, by informing 2,100 of them at two facilities that it was shipping their factories, their jobs, their communities’ resources to Mexico.

A few workers shouted obscenities at the corporate official. Some walked out. Others openly wept as United Technologies shattered their hopes, their dreams, their means to pay middle-class mortgages.

Three days later, 1,336 workers at Philadelphia’s largest remaining manufacturer, Cardone, learned that company planned to throw them out too and build brake calipers in Mexico instead. Two weeks earlier, a Grand Rapids, Mich., company called Dematic did the same thing to its 300 workers.

No surprise. In the first decade of this century, America lost 56,190 factories, 15 a day.

Republican presidential candidates talk incessantly of building a physical wall to keep impoverished Mexican immigrants out of America. What they fail to offer is an economic barrier to prevent the likes of United Technologies and Cardone and Dematic from impoverishing American workers by exporting their jobs to Mexico.

2016-02-21-1456072225-9430429-UnitedTechnologies.jpg

The president of Carrier, owned by United Technologies, gathered the Indianapolis factory employees, skilled workers who earn an average of $20 an hour, and informed them that the corporation planned to kick them to the curb but expected them to perform to the highest standards until Carrier opened a new plant in Monterrey, Mexico, where workers will be paid $3 an hour.

Carrier President Chris Nelson told the group, “This was an extremely difficult decision.”

Such difficulties for poor, poor United Technologies! It was making a nice profit at its Indianapolis and Huntington factories. But it was not the big fat profit it could pocket by paying Mexican workers a mere $3 an hour, providing no health or pension benefits, and doing it all in the nation with the longest work weeks among the 36 countries in the Organization for Economic Co-operation and Development.

It would be “extremely difficult” for United Technologies to abandon Indiana after the corporation grabbed $530,000 from the pockets of hard-working Hoosiers over the past nine years as the state’s economic development agency forked over taxpayer cash to the corporation.

It would be even more “difficult” to turn its back on America considering that United Technologies grabbed $121 million from a federal tax credit program established specifically to ensure that green manufacturing jobs remained in the United States. Carrier took $5.1 million of those tax credits in 2013.

“This is strictly a business decision,” Nelson told the jeering workers. It wasn’t because of anything they had done. It was just that Mexico allows corporations to exploit its people in ways that America does not. It permits $3-an-hour pay, while the United States requires at least $7.25. For now, at least. Some GOP president candidates (Donald Trump) have said they think that’s too high.

The North American Free Trade Agreement (NAFTA) ensnared Mexican and American workers in a race to the bottom. And the proposed Trans-Pacific Partnership (TPP), a free trade deal among 12 countries instead of just three, would place American and Mexican workers in an even worse competition. They’d vie for jobs with forced and child labor in places like Brunei, Malaysia and Vietnam.

Under NAFTA, cheap American grain shipped to Mexico without tariffs destroyed peasant farming. And that prompted migration north. Meanwhile, American factories saw desperate Mexicans willing to work for a pittance, a government unwilling to pass or enforce environmental laws, and because of NAFTA, no tariffs when the goods were shipped back to the United States. That propelled factory migration south.

Before NAFTA, the United States had a small trade surplus with Mexico. That disappeared within a year, and now the annual trade deficit is approximately $50 billion.

Though it has been 22 years since NAFTA took effect, a report issued last week by the AFL-CIO says, “Labor abuses in many cases are worse now than before NAFTA. . . In short, NAFTA has contributed to labor abuses, not improvements.”

The report says the Mexican government fails to enforce labor laws and refuses to ensure that workers can form independent labor unions to try to protect their own rights. In fact, the report says, “The human and labor rights situation in Mexico is rapidly deteriorating.”

As a result, workers are powerless and completely at the mercy of corporations. So corporations like United Technologies can pay them $3 an hour and get away with it. This is not good for Mexican workers. And it’s not good for American workers.

The AFL-CIO report makes it clear that the TPP would worsen the situation because it would give corporations like United Technologies the option of moving to places like Vietnam where they could pay trafficked workers and child laborers $1 an hour. Or less.

Just like with NAFTA, there’s nothing enforceable in the TPP that would stop the labor abuses. It would facilitate corporations forcing workers from Indianapolis, Philadelphia and Monterrey, Mexico, into competition with 14-year-olds laboring 60-hour-weeks for $1-an-hour in Malaysia.

Just like United Technologies, these corporate CEOs would say it was “strictly business” to offshore American mills, industry that had served as city centers for decades, even centuries, factories so synonymous with towns that the communities took their names like Ambridge (American Bridge) and Hershey, which, by the way, laid off workers at its Pennsylvania home in 2007 and opened a chocolate plant in Monterrey, Mexico.

The AFL-CIO investigation of the TPP determined that it would do nothing more than increase corporate profits while sticking workers – in the United States and elsewhere – with lost jobs, lower wages and repressed rights.

For 22 years NAFTA has destroyed subsistence farming in Mexico and good, middle class factory jobs in the United States. Maybe corporations have made out like bandits. But the banditry should be stopped for the heartache it has caused on both sides of the border.

As Carrier President Nelson told the Indianapolis workers, members of my union, the United Steelworkers, that he was taking their jobs from them so that shareholders and corporate executives could make a few extra bucks, the workers protested. Nelson kept saying, “Quiet down. Let’s quiet down.”

That’s exactly the opposite of what American workers and communities should be doing. They should shouting from rooftops, “No TPP!”  For the love of American manufacturing, they should be yelling bloody murder.

Watch The Young Turks Epic Take Down Of Carrier’s Decision To Lay Off 1,400 Workers

If you thought the greed of corporations could not get any worse, just look at what United Technologies ( Carrier air conditioning corporation)  just did to 1,400 workers at their Indianapolis plant.

Carrier just announced that they would be laying off 1,400 workers over the next year to move the plant to Mexico where workers make around $6 a day.

The manager who broke the news to the workers made it very clear that this was a “business decision.”

But was it really as tough a decision as the manager claims it was?

The Young Turks laid out the truth about how corporations have rigged the entire political system to make it even easier for corporations like United Technologies/ Carrier to toss American workers aside for low wage workers in another country.

Outside of the billions in profits that United Technologies brought in last year and the outrageous CEO pay there is one more thing that really caught my attention, their stock buyback program.   Yes they dumped millions of dollar into buying back their own stock to artificially boost their own stock prices, which is exactly how many of the corporations executives are compensated.

Watch this short 15 minute video from the Young Turks as they explain how corporations have rigged the system for those at the top.

Here are three articles on United Technologies stock buy back program:

http://www.wsj.com/articles/united-technologies-unveils-12-billion-buyback-1445343580

http://www.reuters.com/article/us-utc-results-idUSKCN0SE1AR20151020

http://www.marketwatch.com/story/united-technologies-sets-6-billion-accelerated-buyback-2015-11-12

Related reading on stock buybacks from the NH Labor News:

Read the series about Verizon as a case study of what’s wrong with the economy, starting here.

Read “What Mitt Romney taught us about America’s Economy” here.

Read “McDonalds: Paying Billions (of Borrowed Money) to Stockholders” here.

Read more NHLN coverage of stock buybacks here.

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