Saturday, December 03, 2005

GM To Close Saturn Factory Which Is In Isolated Countryside


By Elaine Meinel Supkis

If one is going to abuse someone, first get them into some isolated spot where there is no escape, no witnesses. All horror movies depend on this montage. The German and Japanese auto assembly plants (putting parts together that are shipped in from overseas) are all in very isolated communities and domestic automakers now imitate them. You can't organize unions or take a better job or even move if you are in a one factory town, without losing everything in the process.

From the NYT:
"Workers have got to be asking themselves, What do we have to do?" said Gary N. Chaison, a professor of industrial relations at Clark University in Worcester, Mass.

"The social contract was that if we build a quality product, we're going to have jobs, our kids are going to have jobs, and the plant will still be in town," Professor Chaison said. "Now, that idea is gone."

It certainly looks that way to Michael O'Rourke, who uprooted his wife and three children from Wisconsin to come south. Saturn was the promise of a future he could not find at his old plant.

"I still remember the day I gave away my snow blower, I was so happy," Mr. O'Rourke, the president of the United Automobile Workers local here, said this week.

These days, Mr. O'Rourke, who sits in an office with file cabinets plastered with bumper stickers reading "I Love My Saturn" and "Buy American, Buy Union," faces an uncertain future along with his co-workers.

About 1,500 workers at the plant are set to lose jobs that G.M. originally assured them were guaranteed. Another 4,000 jobs at Spring Hill, the second-youngest plant in G.M.'s American network, may hinge on whether the auto company gives this factory new models to build. Even if G.M. does allot new work, the vehicles are likely to be other G.M. cars.
What social contract? Even the devil's contracts are superior to the disappearing ink in American social contracts. A nation of mostly immigrants, there are fewer and fewer interconnections and now that more and more of our owners and bosses are foreigners who don't even bother to emigrate, we find ourselves looking into a black well of social destruction as we are coldly regarded as mere chips on the capitalist poker table.

The Japanese have different society. Nearly totally closed to outsiders, locked doors are hidden behind a western facade as they eat hamburgers and wear clothes with USA names on them, made in China. But they had their new foreign minister announce this week that Japan is a singular tribe and superior to us USA people. They don't build their factories in isolated hamlets! Everything, absolutely everything revolves around Tokyo, indeed, the countryside of Japan is emptying out of all the young people because of this.

Yet, when our Japanese overlords come to colonize factories in America they ONLY build in the isolated countryside! We enable and encourage this via giving tax benefits and development funds. American workers want to live in the country and not the city because of crime and bad schools. So the pastoral idyll is very appealing.

It is also a deadly trap. To live near a factory, one must buy property and build a home and set down roots only to see the factory move to greener pastures in order to shed an aging workforce. These elusive factories, instead of being updated as technology changes, cease morphing and simply pick up the top management and departs when it is time to refit the factory!

See? If they move, they get even more tax breaks and development benefits as well as insider loans! They can set the 50 states bidding each other down in a desperate price war to attract factories from each other and all those pesky workers with accumulated years of senority who are slowing down with age get thrown to the curb.

In turn, they discover the boom town is dead. You can't sell your home for squat, you can't even give it away. There then are no job prospects for one's kids, commerce in town dies as the big box stores rapidly close and leave, too. A box store is cheap to build and usually demands tax breaks and help, too, and do the exact same bidding war as the factory owners who are increasingly foreigners who despise us because we actually beat them during WWII.

Japan protects their workers for the capitalists fear a China-style revolution since Japan is small, geographically, the workers and assail and overturn the palace and the ruling elites so they are very cautious about aggravating their underlings. In America, can workers at the Saturn plant in the distant countryside assail their rulers who live a thousand+ miles away? Besiege DC?

Of course not. And because they are all isolated from all other factories which are far away, they can't do group mass meetings which are extremely important. Ask Europe. The workers there converge and demonstrate unity all the time, they can shut down whole cities and even whole countries! General strikes across a host of unions and trade groups can and do happen. They bring down governments if they are unhappy! Heck, they have caused many a revolution.

We will not see this here for we placidly went into isolation in this big country. Now we face the reality that our own capitalists have capitulated to former and present enemies who don't wish us well at all.

Yesterday, the yen dropped to 120 to the dollar. From the Asahi Shimbum:
The U.S. dollar on Friday was 19 yen higher than its level on Jan. 17, when it traded at 101.67.

Although the higher value of the dollar could push up prices of imported goods for Japanese consumers, analysts say the weaker yen will provide a significant boost for the nation's export-oriented economy.

"This low quote of the yen would be a plus for the Japanese economy, especially export industries, when the rise in oil prices has eased," said Junichi Makino, senior economist at Daiwa Institute of Research.

A lower yen decreases the cost of Japanese exports, such as autos and electric machinery, making them more competitive in overseas markets.

Analysts said currency traders were selling yen and buying dollars in light of the continued near-zero interest rates in Japan and rising interest rates in the United States.
Why does Japan have zero interest rates? This has been going on for quite a while now. Literally, the government is taking dollars and lending them at a loss to their own industries. They buy up all our debt and then use the interest differential to keep the yen at zero interest. In other words, we are paying higher and higher interest rates so the Japanese will buy our dollars and thus, are subisdizing Japanese incursions into our domestic markets while locking us out of Japanese markets!

No responsible government should allow this to happen but our GOP government is totally irresponsible now! So we are fucked, folks, big time. I go in vain to all the lefty blogs to see what the economic professors are saying about the yen and guess what?

They say nothing. Deluded by all the yap about the yuan which has been STABLE against the dollar, they ignore the peril broiling out of Tokyo. Not a peep anywhere about the yen! We should be thanking China for being a responsible trading partner! The media as well as our rulers want us to focus on China because they are all in the pay of the Japanese one way or another just like Ronnie Reagan. Remember that traitor? To this day, most Americans are convinced he was a clever lad to get the Japanese to pay him $2.5 million in bribes! Whoo hoo. When will the Japanese give me a few million in bribes? Then I will shut up!

Here is Brad Setser talking about the yuan this week. You can read his entire blog and look in vain for any mention about the alarming collapse of the yen vis a vis the dollar. Ditto Bradford-DeLong's blog. I read story after story about what ails the American auto industry, and many things ail it, but no mention about the nastiest and most troubling aspect: the direct connection between currency dependencies and the dying domestic auto industry. And this connects with the budget deficit and American expectations that deficit spending will make us rich and debt makes us richer still.

Our entire culture has become addicted to the Japanese recycling of American dollars into debt instruments. This is for any country a very unhealthy relationship and is now at fever pitch. How on earth should Greenspan be raising interest rates while our number 2 importer drops theirs to zero! Here is the traitor, Greenspan: From Yahoo:
Federal Reserve Chairman Alan Greenspan expressed concerns Friday that America's failure to deal with its exploding budget defict and worldwide efforts to erect trade barriers could disrupt the global economy.

Speaking at an economic conference in London, Greenspan said so far the United States has had no problem financing its current account trade deficit, which last year hit a record $668 billion, because of the flexibility of the American economy.

But he said such flexibility would be threatened by rising protectionism, which would increase barriers to the flow of goods and investments across the U.S. border. He also worried about the harm that could be done if the United States and other nations do not get their budget deficits under control.
This man is insane. Hell. Protectionism is rife in Japan. It always has been since day one, in 1858 to today! And the flexibility of our economy? Hogwash. We are destroying our industrial base rapidly. This isn't flexible. Chop off the head of a snake and it writhes for an hour. That is us.

As for our budget deficit: Greenspan loved Bush's tax cuts! He agreed with Bush in 2001 that the Skull and Bones tax cuts were fantastic. They gave the secret Skull and Bones high five and laughed like demons. And now, Greenspan wants to cut home heating aid and foodstamps and school loans to balance the budget and not tax him and his rich buddies.

If I wanted this blog to be popular, all I have to do is join the echo chamber. The blog world has this just as much as the mainstream media. Pointing in the opposite direction is a lonely business. But then, Cassandra never won any popularity contests.

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