Ford Motor Co. says it plans to move its entire small-car operation to Mexico over the next two years, the type of below-the-belt punch to American workers that Donald Trump says he won’t allow to happen if he gets elected president.
Ford, meanwhile, assured its workers they would not lose their jobs because it will be expanding its large-car operations in Michigan, a familiar refrain that some aren’t buying, saying the larger trend is for auto-manufacturing to go north and south of the border – thanks to NAFTA and a new “free-trade” deal that’s brewing in Washington.
“This isn’t exactly new, but it is jarring news for many,” the Detroit Free Press reports. “Ford said in April it would spend $1.6 billion to build a new plant in Mexico and will build small cars in that plant and said last year it would end production of the Ford Focus and Ford C-Max in Wayne [Michigan] in 2018.”
Trump, the Republican nominee for president, immediately weighed in on the announcement, saying he would stop these types of off-shoring deals by ending 23 years of unfair trade agreements that sell off American jobs to Mexico and Canada.
“We’re gonna charge them a 35 percent tax, and you know what’s gonna happen? They’re never gonna leave,” Trump told Fox News.
And it’s not just Ford.
Carrier, Nabisco and Caterpillar are among the most recent major U.S. companies to announce major transfers of jobs to Mexico. Almost the entire U.S. textile industry left for Asia and Latin America after NAFTA was signed in 1993 by President Bill Clinton.
‘Business as usual’
Patrick Wood, an economist and author of “Technocracy Rising: The Trojan Horse Global Transformation,” said when he read about Ford’s announcement he had flashbacks to the candidacy of Ross Perot and the 1992 presidential election. Perot warned about the effects of so-called free-trade agreements.
“I heard the voice of Ross Perot talking about that ‘giant sucking sound’ going south, if NAFTA were passed, and I have watched the smoke of the exhaust pipes going down to Mexico ever since,” Wood said. “It’s just been an express train. They’ve packed up and left en masse. This is business as usual what Ford is doing.”
Caterpillar, Carrier and Nabisco, among others, have all announced plans to move jobs from the U.S. to Mexico over the past 18 months.
- Caterpillar announced in 2015 it would move two assembly lines and 230 jobs from Joliet, Illinois, to Monterrey, Mexico.
- In March, Nabisco ignored Trump’s warnings and said it would go ahead with plans to send 600 jobs from Chicago, where it makes Oreo cookies, to Mexico.
- United Technologies, which owns Carrier, informed 2,100 of its workers at two facilities in Indiana in February that it was shipping their factories and their jobs to Monterrey, Mexico. It wasn’t like the company wasn’t making a profit. It was. But it could make a bigger profit by exchanging those $20-an-hour jobs in Indianapolis for $3-an-hour jobs in Mexico.
- Philadelphia’s largest remaining manufacturer, Cardone, told 1,336 workers in February their services were no longer needed as the company would build brake calipers in Mexico instead.
- Grand Rapids, Michigan-based Dematic did the same thing to its 300 workers in January of this year.
“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,” writes Leo Gerard, International president of United Steelworkers, for IndustryWeek.com.
In one decade between 2000 and 2010, America lost 56,190 factories, 15 a day. And critics say almost all of that can be blamed on the North American Free Trade Agreement, or NAFTA. Now the Obama administration and its allies in Congress, which includes a majority of Republicans, are pushing a new “free trade” deal called the Trans-Pacific Partnership. Critics say this deal will have an even more devastating effect on American workers, pitting them against not only their peers in Mexico but 12 nations in the Pacific Rim.
While many GOP presidential candidates railed about illegal immigration and the need to build a wall on the southern border, none produced a plan to erect a barrier against the off-shoring of U.S. manufacturing jobs. Trump has since come out with a plan that would do just that, and he is now being lambasted on CNN and other networks that give a forum to globalist economists who say the Trump plan would actually hurt the U.S. economy. They say the trade deals are “good” for the American worker.
American workers are always told it’s not their fault that their jobs are sent to Mexico. It’s simply a “business decision” that boils down to mathematics. The minimum wage is 58 cents an hour in Mexico, while the United States requires at least $7.25. The U.S. also has strict environmental regulations compared to Mexico.
“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,” Gerard writes. “They’d vie for jobs with forced and child labor in places like Brunei, Malaysia and Vietnam.”
The ripple effect
These deals often have a ripple effect as well. When a major player in an industry, say a cereal maker, shifts its production to Mexico where it can hire workers at $4 an hour, it allows that company to cut its prices or avoid raising them, thereby putting pressure on competitors to cut their prices, move their factories overseas, or go out of business. The competition inevitably thins, allowing the major player that moved its production overseas to then increase its prices.
And Ford’s calming words about expanding its large-car operations in Michigan to make up for the loss of its small-car production should be taken with a grain of salt, Wood said.
The future would seem to be in smaller cars, not larger ones. And even if Ford is telling the truth about its plans to shift all the workers now making small cars in Michigan over to a new plant making large cars, that doesn’t discount the fact that America loses out on an expansion of its manufacturing base and must settle for a break-even scenario at best. Some jobs are leaving and some are being created but it’s a wash, instead of a net gain. Translation: It’s really a loss.
“My impression is that every time a company decided to shutter a plant and move to Mexico, the leadership of that company felt it necessary to justify themselves. Somebody invariably gets asked the question, ‘What are you doing this for? Why are you abandoning America for Mexico?'” Wood said. “So the company leadership always anticipates that question and sees a need to justify their actions and so they come up with some kind of explanation on why it’s a good thing for American workers, and it never made any sense to me. Ford saying it’s good for American workers because we’re going to build a new plant for Americans, but this is always what they do. I don’t know of any promise that was made along the way to help American workers that’s come true. There may be, but I’ve never seen it.”
Benjamin Clement, writing for Economy in Crisis, a daily economic report, wrote Thursday that “free-trade” agreements have put the “final nail in the U.S. economic coffin, making it too expensive for American auto companies to manufacture cars in the United States. Knowing they could no longer produce competitively, American automakers shipped their jobs to Canada and Mexico.”
So-called free trade gives foreign competitors unfettered access to the U.S. economy, tariff- and duty-free, “with products produced at labor rates in foreign countries much lower than ours — sometimes as low as $4 per hour – that we cannot compete with,” Clement writes.
He adds that free trade is “forcing us to outsource most of our manufacturing, enriching the individuals and companies that outsource our manufacturing, turning more millionaires into billionaires while our own labor force – the middle class – evaporates.”
The globalist agenda for America doesn’t stop with trade deals that sell out American jobs. The globalists not only off-shore jobs but they in-shore cheap foreign labor to work in America’s remaining factories. It’s a double-edged sword that works against the American middle class, Wood told WND.
“You just need to watch what they do not what they say,” he said. “It reminds me of that old Wendy’s commercial where the old lady asks, ‘Where’s the beef?”