By Tapsearch Com and Tapart News and Art that Talks Editor
Cleveland Plain Dealer Letters
Can American auto industry be resusitated?
Precendents in place for government to help their own as they helped foreign auto assemblers.
By Ray Tapajna
Editor and Artist at Tapart News and Art that Talks
Lost worlds in the Globalist Flat World
Nov. 23, 2008
Government played a major role in the betrayal of auto workers and other industrial workers for many years...Time to sort out their role in driving Globalization and so called free trade that is really not trade.
Government interventions
There are definite precedents for government to help U.S. automakers. The obvious one is based on the bail out of the financial communities.
Government also funded the moving of production and factories outside the United States starting in 1956. This "temporary program" never ended.
State governments have provided more than a billion dollars ( conservative estimate ) plus tax exemptions to foreign auto assemblers to build their assembly plants in America.
How can anyone say government should not be involved in saving the last U.S. automakers after all this has happened? Government played a major part in the destruction of the U.S. auto industry. It did not happen by itself, nor in any natural economic fashion.
Free trade has been driven by government. It is time to tell it like it is and restore a real tangible asset - the value of labor in our economy.
There are many stories to be told about payments and incentives given directly and indirectly to foreign auto assemblers. A prominent example shows what happens when government does this. The State of Indiana recently paid Honda millions of dollars to build their assembly plant in Indiana. All in all it added up to about $150 million dollars plus long term tax exemptions for Honda. About 5,000 new assembly jobs were created. The return on this investment may never come for the people of Indiana as a whole. On top of this, about 20,000 auto parts manufacturing jobs were lost in the state to making this a complete loser.
The same has gone on for years in other states. BMW was paid millions to build their plant in South Carolina in the early 1990s. The state even paid $40 billion dollars to build a runway for BMW planes. They only pay $1 a year lease for a $36 million dollars worth of real estate. They have enjoyed 43 to 62 percent less taxes than established old businesses in South Carolina.
In other states, reportedly, foreign auto assemblers come in an offer full time jobs but later these jobs degrade to contract workers and then to temporary workers.
Southern states in the U.S. have paid out more than a billion dollars recently to KIA, Toyota and Volkswagon to build assembly plants. This vast betrayal of labor in the United States grows and grows. The U.S. has actually experienced deflation when it comes to workers and labor. Labor is a real tangible asset. Its value is more real than money that is just images printed on paper needing some financial manipulation to add value to it. How can the investment community deny this. Making money on money economies have burn out. It was a sand castle built on sand.
Once the stock market rewarded companies by the number of workers they could employ at a decent wage with added value to their stocks. Then came free trade where jobs cuts were called an increase in productivity while in reality if was deflation in the value of workers and labor. Adam Smith held workers and labor as something "sacred" and the core of all societies. World War 2 was ultimately won by the awesome power of American industries. Our automakers played a large part in this victory quickly adjusting their whole operations for the war effort. This may never be posssible again. Now much of this value has been lost forever, while government plays a dangerous game of give away for the sake of greed. It is game of insane greed and it has snapped.
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