While Ohio is traditionally thought of once being a center of auto manufacturing, there was such a strong tradition of light-bulb production in the state that the world's largest maker of light bulbs, General Electric, located the headquarters of its light bulb division in Cleveland. The jobs provided by light-bulb manufacturing allowed people to buy homes, send their kids to college, and fuel a vibrant economy in Ohio for decades.
But in the last decade, GE has closed over fifteen factories in Ohio and downsized numerous others. Since 1980, employment in GE Lighting has dropped by 68 percent.
A large chunk of that manufacturing has gone to China, and now GE plans to send even more to China in the wake of new clean energy policies. By 2014, Americans will only be able to purchase more energy efficient CFL light bulbs. However, GE has located all of its facilities for high-efficiency light bulbs to China and has told the union representing the workers that they have no intention to locate compact flourescent facilities in the United States.
GE is currently threatening to close one factory in Niles, Ohio that produces light bulbs. The workers, members of United Electrical, Radio, and Machine Workers of America (UE) at one are calling on GE to look for a way to refit their plant so that they can be part of the new clean energy economy. Ohio Sen. Sherrod Brown and Rep. Tim Ryan wrote a letter to GE's CEO Jeffery Immelt expressing "deep concern" for the workers at the plant:
"The workers and tradition of the Niles facility present an enormous opportunity to show how we can transition manufacturers from contracting industries, like incandescent bulbs, to emerging industries in energy and medical IT."
Ohio could indeed be a hub of new light bulb production. Recently, a Chinese-owned manufacturer of high-efficiency light bulbs has opened a factory, citing Ohio as having some of the world's most highly skilled light-bulb workers.
Ohio's legacy of bulb production, and its factories that could easily be converted from incandescent production to CFL production, presents a grand opportunity to employ workers in building a green energy economy in Ohio.
The IMPACT Act introduced by Brown in the Senate would help small and medium-sized manufacturers transition to the clean energy economy. Brown's bill creates a $30 billion Manufacturing Revolving Loan Fund to provide these manufacturers with much-needed access to credit to improve energy efficiency and retool for the clean energy industry.
The Apollo Alliance--a coalition of business, labor, and environmental groups--estimates that the IMPACT Act could create 680,000 direct manufacturing jobs nationally and 1,972,000 related jobs over the next fiver year.
So far, GE has shown every intention to take the American tax dollars being used to subsidize the green-energy economy and use them to build Chinese factories and pay Chinese workers. As I wrote earlier this week, in spite of GE CEO Jeffery Immelt's statement that companies need to stop outsourcing, GE continues to lead the effort to outsource clean-energy jobs. Most recently, GE has cut off a contract with a windmill factory in Indiana and shipped the work to China despite the factory offering to sell their parts at the same price as their Chinese competitors.
To add insult to injury to workers losing their jobs from foreign outsourcing, GE has even launched a television ad campaign promoting American manufacturing. "GE has the ability to locate its new manufacturing for CFL's, LED's, as well as the new incandescent lighting technologies in Ohio and elsewhere in the U.S. So far they have not done this, and we see no sign that they are even considering doing this. GE Lighting workers in the U.S. see little to cheer in GE's pronouncements and feel good advertising because for several decades now every plant has been on an extended deathwatch," said Chris Townsend of the United Electrical, Radio, and Machine Workers.
It's time that CEO's like Jeffery Immelt live up to their word and help rebuild the American economy by keeping American manufacturing jobs in America. It's also time that we adopt a comprehensive policy that promotes American manufacturing and prevents companies like GE from using taxpayer funds intended to stimulate the American economy to undermine our economy instead.
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Wage labor in China is slavery plus inflation.
Put the pieces together, people.
And if China or some other country wants to have a tarriff war on the basis of us demanding that goods imported to the US pay workers at least a quarter an hour, let them. A trade war with China would solve our manufacturing jobs shortage quickly.
"A trade war with China would solve our manufacturing jobs shortage quickly."
Hardly. For one thing we do not have the necessary workforce to replace their manufacturing capacity (a burger flipper is not going to become a metal worker over night). We would have to shell out the capital investment (which only amortizes in 5-15 years) and in many cases we do not even own the necessary IP... so we would have to buy that, too.
The very same can be achieved with a higher corporate income tax and that might even be the better solution.
You are probably correct , given that most economists seem to agree with you. It is the economic orthodoxy.
However, there is a possibility that tariffs applied only on low wage low ecological standard countries would be a motivation for the next plant to be placed in the USA. This is the same effect that occurs when the dollars declines in value - something that does not happen when countries artificially support their currency.
How would a low wage low ecological standard country retaliate?
Personally, I am willing to pay 10% more for a light bulb if it means that we are supporting a robust middle class. That seems to be what it comes down to.
But like I said , based upon prevailing opinion you are probably correct. I merely think that I might be correct and am willing to risk being wrong:
http://corporatestatesmen.org/images/LEVELISM.pdf
http://corporatestatesmen.org/policies.html
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Why would a semiconductor manufacturer who is running their plants below capacity at the moment, and will be running them even lower after the price of their products have been increased artificially, open a new plant in the US? Especially since they do not have any significant competition for their product? Your hypothesis only works for products for which competition exists or can be built quickly. And that is simply not true for the majority of high tech products which are literally owned by a handful of manufacturers in their fields. And those happen to be the only products for which the US is truly competitive and a market leader... so you are shooting your good foot to help your bad one?
"How would a low wage low ecological standard country retaliate?"
You misunderstood the argument... there is nobody to retaliate because the only people your tariffs would hit are US. And my company would, for sure, not even write a letter to Washington. We are way to smart to assume that a small business can make any difference on that level. Why waste a piece of paper? Instead, we would simply raise prices and be done with the problem.
In order to be effective with tariffs, you would have to make them between 100-200% on most industrial and consumer products. We are talking about factors of two here, not 10% effects.
"I merely think that I might be correct and am willing to risk being wrong:"
Happens to a lot of guys who do not know what they are talking about because they do not work in industry in positions where they can actually see the magnitude of the problem.
:-)
And, there should be no avoidance of taxes on overseas companies based in the USA and there should be tax incentives for companies that are based over here coupled with penalties for moving overseas.
I realize this is all wishful thinking but that is exactly what it will take to get American jobs going again. There is going to have to be a carrot and a stick somewhere along the line.
Our corporate taxes are indeed high as you state, but you conveniently omit all the available tax breaks and loop holes that US corporations enjoy.
As far as tariffs on foreign goods sold in the US I will concede that this might not be the best way to level the playing field but when the Chinese Government will not buy products from Foreign owned corporations but prefers to buy from Chinese owned corporations instead, I have to ask why is it wrong when we do that?
One last point, you are throwing around the tired Free Market Capitalism BS about lower taxes on Corporations will increase domestic spending when the entire article was written to show that GE is going to take Manufacturing Revolving Loan money and spend it on new production facilities in China. If they will take loan money and not keep or create jobs in the states what in the world makes you think they would do anything different with tax cuts?
Please explain where the Constitution says that. And if the Constitution does not, why would you make a law that cuts your own people off the pursuit of happiness (i.e. in this case profit)?
"All foreign made items sold in this country should have a tariff that would effectively neuter any such notions."
A tariff is still just a consumption tax on US citizens. It does not force anyone to manufacture at home. All it does is to make the manufactured items more expensive to us. But since the factory might (and in almost all cases will) sell their goods also to other countries, it's effectively useless to prevent the corporation to move it to the most cost effective location.
"And, there should be no avoidance of taxes on overseas companies based in the USA and there should be tax incentives for companies that are based over here coupled with penalties for moving overseas."
This will never pass. If it would, all it would do is to split off the foreign holdings of US corporations as independent firms. That's something that can be easily done and has been done many times in the past. So if you are trying to decapitate your own manufacturing sector by completely removing any and all foreign proceeds from US balance sheets...
And they will not hold GE liable for all the toxic mercury in CFL lights they sell. This is truely a lose lose situation for America.
:-)
So you break a tube, you open the windows and let a breeze go through it. Then you remove the broken glass of the tube and dispose of it in the trash. Let the room air our for the next couple of hours. Nothing bad will happen to you unless you do this a couple of times a week. And who does that and why?
http://www.bls.gov/news.release/empsit.t12.htm
While the specific facts of the article are pretty much indusputable, that the light bulb factories in question were moved to China (probably at U.S. taxpayer expense), there is another truth that is not addressed in the article. It is that the largest growing sector of the economy today is the green sector, the renewable energy sector, and that most of that sector cannot be outsourced.
A wind turbine farm, a solar collector, a geothermal plant, a biomass plant, an insulation company,or a tidal energy plant, employs U.S. workers both in the construction and in the continueing operation and maintenance. There have been abuses in the economic models of many American manufacturers, who have shifted production overseas for short term profit, but the green sector in general, when the construction of power plants is in America, cannot easily be outsourced.
Overall there are huge benefits to be accrued from the building of a renewable energy infrastructure. From possibly halting global warming, to the permanent creation of good jobs, to the ending of our reliance on oveseas petroleum production, there are many reasons to go ahead with the development of green jobs.
Maybe Monday we will hear about the passage of this taxpayer nightmare, but that will be after it is voted in. How many of these senators are against single payer?
http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=111&session=1&vote=00242
Mukhtar AK. Knoladge Computers
GE's policies are shortsighted, to say the least. They not only have eliminated blue-collar jobs, but they have eliminated the need for American white-collar jobs, as well. Once the factories are set up and running smoothly in China, only a very few people at the top of the GE food chain will see any profit from this, and that only temporarily. In the end, the factories will be able to save money by selling under a different brand name, eliminating GE (and their stockholders) from the light-bulb picture completely.
I really thought GE management was smarter than this. They have cut their own throats, and they are too dumb to realise it.
Immelts "keep American jobs in America" speech is pretty hollow