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Bail out America? Employ Americans

Richard Neal will tell you that any bailout for Detroit's Big Three automakers isn't going to do anything for him or the hundreds of workers about to lose their jobs at the Lear Corp. auto supply plant in Tampa.

Neal, who is an electrical control technician and president of the plant's UAW local, believes an added shot of money will only help accelerate Lear's plans to outsource the plant's electronic components assembly work to Mexico and China.

"We were so damn good, we worked so hard," Neal said in frustration. He knows that within a year the Lear plant will be closed and jobs paying an average of $13.50 per hour plus another $10 per hour in benefits will have largely been moved to a country south of the border where the minimum wage is $5 per day.

If jobs — and the creation or retention of 2.5-million of them — is a major plank of an incoming Obama administration, then preventing good manufacturing jobs from leaking to other countries should be front and center.

The United States lost more than 4-million manufacturing jobs in the last 10 years, most during President Bush's tenure. Bush cared so little about the consequences of this to the middle class that his administration — in an effort to bolster the bad statistics — wondered aloud if food service employees shouldn't be reclassified as industrial workers. "When a fast-food restaurant sells a hamburger, for example, is it providing a 'service,' or is it combining inputs to 'manufacture' a product?" a 2004 White House economic report asked.

But Barack Obama isn't so blithe toward this hemorrhaging of decent, middle-class jobs. In his acceptance speech at the Democratic National Convention in Denver, Obama vowed to: "Stop giving tax breaks to companies that ship jobs overseas" and "start giving them to companies that create good jobs right here in America." It was a campaign theme, but there hasn't been much meat on those bones as yet.

What I would like to see is a little good old-fashioned American job protection built into these massive bailouts we taxpayers are funding.

How about a new twist on the Buy American Act? That Depression-era legislation — now loophole ridden — requires that U.S.-produced products get preference when federal funds are expended. In any automaker bailout, why not ask for some American-made guarantees down the supply chain?

You want taxpayer money? Then don't buy additional parts from a factory built right over the border for the sole purpose of paying workers one-sixth what an American would make.

Yet, when Sen. Sherrod Brown, D-Ohio, pointedly asked the CEOs of the Big Three if they would agree, going forward, not to purchase foreign-made auto supplies at levels any greater than before a rescue, they all refused.

So in the end, if we end up sending money to Detroit it will invariably find its way to Mexico and China to help keep workers there employed while more of ours receive pink slips.

Of course, "buy American" rules will only go so far. In the long run, the best way to protect U.S. jobs will be to make outsourcing less attractive. Robert Scott, senior international economist at the Economic Policy Institute, says the United States has to start insisting on proper exchange rates with Asian currencies — with their currencies rising relative to the dollar — and it has to start demanding enforceable labor organizing rights in trade agreements. Doing this would slowly recalibrate world trade.

Economic upheavals are times of terrible dislocation, but they also present opportunities. We know what happens when government's sole concern is the protection of capital and its free flow — we're living it. Now the pendulum has to swing back to where labor interests and job protection become part of the policy equation.

Helping auto parts workers keep their livelihoods, while salvaging American carmakers, is as good a place to start as any.

Bail out America? Employ Americans 12/13/08 [Last modified: Friday, December 19, 2008 2:49pm]

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