PART ONE
GROWING APART
CHAPTER ONE
Trading Away the Working Class
INTRODUCTION
By Kari Lydersen
On Chicagoâs Southeast Side, there sits a huge, mostly empty expanse on the shores of Lake Michigan. The only structures rising amid the tall grass and trees are a small brick former union hall and a pair of crumbling âore wallsâ stretching toward the lake. But this land was once teeming with people and pulsing with sound and light. It was U.S. Steelâs South Works plant, employing 30,000 people at its height and supporting countless families in the once-thriving surrounding neighborhoods.
Today those neighborhoods are depopulated. After hemorrhaging jobs in the 1970s and 1980s, the plant had effectively closed by 1992. Ambitious plans for a sprawling residential and commercial development on the site were canceled in 2016 for lack of investment. For the foreseeable future it will likely remain a forlorn monument to the loss of good-paying unionized manufacturing jobs, and the economic and social devastation that follows. Similar sites exist across the country, in places like Bethlehem, Pennsylvania; Youngstown, Ohio; and Galesburg, Illinois. The latter two towns are spotlighted in this chapterâs opening and penultimate pieces, respectively.
The sharp decline of the U.S. steel industry was triggered by the appearance of cheaper imports in the 1970s. This dynamic, which had been gutting other manufacturing sectors like apparel and electronics for years, accelerated as markets continued globalizing and politicians failed to erect trade barriers. The countryâs auto industry also struggled to compete with imports; âFear and Loathing on the Chrysler Assembly Lineâ shows what a plant closing looked like on the ground. In 1970, manufacturing made up about 25 percent of total U.S. employment; in 2013, it was 8.8 percent.
Of course, the implementation of the North American Free Trade Agreement (NAFTA) in 1994 didnât help, as David Moberg notes in âRun for the Border.â More agreements followed, such as the Central American Free Trade Agreement and the (unratified as of late 2016) Trans-Pacific Partnership, even as NAFTAâs disastrous impacts became clear. U.S. manufacturers automated plants or just moved operations abroad. Even when plants didnât move overseas, the threat that they might gave employers the upper hand over unions and workers. Strikes were replaced by concessions. For most laid-off workers, federally-backed Trade Adjustment Assistance and retraining programs were too little, too late, as John Judis explains in âTrain in Vain.â
It is impossible to quantify the economic and social impact on American society of the loss of manufacturing jobs. Far more than union locals have disappeared. So has the idea that an average young personâeven one with only a high-school educationâcan confidently look forward to a stable career that supports a family and funds retirement.
But something deeper and more pernicious has occurred with the countryâs industrial decline during the last forty years. The idea that an American is entitled to a clear path to stable, decent-paid work has been gutted. The climate of instability, fear, and transience that has arisen in the wake of the manufacturing crash has meant not only plummeting rates of union membership; it has also eroded the culture of collective struggle, replacing it with individual desperation and competition.
The recent economic crisis shredded the last vestiges of economic stability and opportunity for many families and communities already squeezed by the collapse of the manufacturing economy. It caused more closures and layoffs among the manufacturers still in business, but it also provided convenient cover for employers already planning to slash their workforces or move operations. More than 2 million manufacturing jobs were lost during the recession starting in 2008. During the tail end of President Barack Obamaâs first term, there was hopeful talk of âreshoringââcompanies like Nike, Target, and Master Lock bringing jobs back to the United States. Thousands of manufacturing jobs were reportedly âreshoredâ in 2014, driven by rising wages and currency values in China and quality concerns about products made there. The movement was also, ironically, bolstered by the increasingly âcompetitiveâ nature of U.S. laborâmeaning lower wages and benefits than in years past (in inflation-adjusted dollars), and less need for people altogether due to automation.
In recent years, President Obama, regional leaders, and manufacturing employers have touted high-tech manufacturing as the future, pointing to the promise of 3D printing, clean energy, and flexible hybrid electronics, among others. But itâs doubtful that these hyped sectors can generate positions equal to the number of downwardly mobile former âlow-techâ manufacturing workers.
So can there ever be a real renaissance of manufacturing in the United States, tapping new technology and offering stable, decently paid union jobs? Itâs an open question. The aforementioned bright spots pale beside the continued loss of manufacturing jobs due to free trade, automation, and other factors. The country lost a net 5 million manufacturing jobs between 2000 and 2014. Multinational corporations are freer than ever to search abroad for the cheapest wages, a dynamic In These Times highlighted back in 1977 in âU.S. Multinationals Make Labor Put on Its Fighting Shoes.â When rising Chinese wages cut into profits, companies head to places like Bangladesh. The results can be fatal, as Michelle Chen makes clear in âFactory Collapse in Bangladesh Exposes Cracks in the System.â
What is clear is that as manufacturing has declined, exacerbating inequality, American workers have grown alienated and angry. Watch the YouTube video of the president of Carrier Corporation informing employees at an Indianapolis plant in February 2016 that they would all lose their jobs because the company was moving operations to Mexico. Amid boos and jeers, one terse response can be heard: âFuck you.â
Versions of this scene have occurred in thousands of U.S. factories during the last 20 years; we can expect to see the scene replay again and again. This is why, last year, the issue of trade took on a prominence not seen since the 1992 presidential campaign; itâs a large part of what powered the unexpected success of Bernie Sanders and Donald Trump. The GOP nomineeâs antiâfree trade stance was laced with xenophobic nationalismâwhich neednât be the only alternative to the dominant neoliberal trade regime, as Leon Fink notes in his contribution to this chapter. But whether or not the trade status quo changes, in the years ahead weâre likely to see more politicians appealing to the wounded psyches of millions of Americans left abandoned by a shifting economy to fend for themselves.
Donald Gorobegko is one of those Americans. A fifty-eight-year-old veteran and machinist who once made $45 an hour at union jobs, he now struggles to find temporary work paying $10 an hour. He often spends his days in the Chicago Public Library filling out job applications. Gorobegko is among the many people who live in a makeshift encampment of the dispossessed on the Near South Side of Chicago, between the river and the railroads that once transported manufactured goods across the land.
âIf we could organize, we could take this country back,â Gorobegko said one cold winter day beside his tent. âThis is supposed to be the greatest country in the world. What happened to that?â
âYOUNGSTOWN STEEL PLANT DELIBERATELY ABANDONEDâ
By Daniel Marschall (1977)
Youngstown, OhioâAt the heart of the Mahoning River Valley in Ohio lies the Campbell Works of Youngstown Sheet and Tube Co., a reddish, pulsating mass of blast furnaces, coke ovens, open hearths, and rolling mills that occupies over one hundred acres along the river.
For factory workers here, producing steel is not just a nine-to-five job, but a source of pride and a way of life that begins at the mill and extends into the neighborhood bar, the corner church, and the local union hall.
Despite warning signs, few expected that it could perish so abruptly.
The fatal announcement came on September 19, 1977ââBlack Mondayââwhen the Lykes Corp., a shipping/mining/manufacturing conglomerate based in New Orleans, decided to close most of its steelmaking facilities around Youngstown, dumping 5,000 out of 8,500 workers.
The corporation charged that foreign steel imports and environmental controls necessitated the shutdown. But conversations with steelworkers, local political figures, and lower-level union officials reveal that their decision was actually the last step in a series of moves by Lykes that had steadily drained profits and investment from the Youngstown operations to other parts of their business.
âThe day after the announcement, there was a blood donors drive in Campbell,â says Duane Irving, a young grievanceman in United Steel Workers Local 1418. âPeople said they wished Lykes were here now so they could draw blood from them like they took it from us.â
Two weeks after the companyâs sudden decree, the residents of Campbell and Struthersâthe two towns surrounding the millâwere still stunned and discouraged. The term âghost townâ was used to describe the regionâs economic future.
TOTAL HATRED
Shirley Richards had heard it all. A stocky, blond-haired woman, she operates âShirleyâs Place,â a tiny tavern up the hill from the main entrance of the Campbell Works and across the street from the split-level union hall of United Steelworkers (USW) Local 2163.
She blames both union and management for the problem and resents the callous refusal of the Carter administration to help. âPeople had an inkling something like this was coming, but still thought that it would be years before it all went to hell. Their first reaction was shock, then bewilderment, and then anger. Their attitude towards Lykes: total hatred,â she explains.
Mismanagement at the âupper echelonsâ of Lykes is primarily responsible, according to Andy Ragan, a first helper in an open-hearth furnace. âThey just let the place go to hell. They took all the money and put in nothing for improvements.â
Middle-aged men like Ragan will be particularly hard hit; theyâre too old to readily find another job, too young to qualify for a pension, and usually have a family to support and a home mortgage to pay. He worked in the mill for twenty-nine years, nine months, and twenty-two days and thus may not even be eligible for his thirty-year pension.
Wilford Brown, a twenty-five-year-old black man, had labored there for seven years as an electrician in open-hearth maintenance. Unlike many of his fellow workers, he has been promised a chemical plant job in Headline, Alabama, and is happy at the chance to leave the area. âThereâs no future here and we all knew it. You could see it coming,â he says.
âThe first five years, we were working steady. Then we were off all the time and things began to fall apart. In the last few years theyâve cut expenses in every department by scrapping machines and offing people. It was like the difference between night and day.
âThey drained this place to the extent that everything needs to be worked on. Iâve seen breakdowns where foremen told me to go make the parts myself. They stopped keeping the machines cleanâthere was oil and grease all over the place. The company just ran it until it fell apart, and now theyâre throwing it away. This place is deadâeverything but the casket.â
The union, in close cooperation with the steel industry, is pushing for higher import quotas. At one press conference, Youngstownâs mayor wondered whether the United States had really won the Second World War, and a local union officer proposed a campaign to encourage local housewives to wear buttons with the slogan: âIâm shopping for American products.â
Not all officials are satisfied with the unionâs current efforts, however. Russell Baxter, president of Local 2163, is infuriated at the lies of company representatives, the inaction of international officers, and the empty rhetoric of the governor and other politicians. âLloyd McBride [USW president] cares no more for 5,000 people than the man in the moon,â he declares. Two-thirds of his local will be wiped out by the layoffs.
Weeks before the announcement, Baxter and other union officials were assured by the company that rumors of a shutdown were âcategorically false.â
Campbell Mayor Mike Katula, whose father and grandfather worked in the mills, hopes to compel Lykes to fulfill its obligation to local residents by at least tearing down the vacant plants and donating the property to the town for new industry.
âWhat weâre dealing with is a multifaceted corporation,â he says. âThey donât care about people. All theyâre looking for is profits. They deal with industries like pieces on a checker board. Lykes milked this plant dry and put the profits elsewhere. Now theyâre getting rid of the cow.â
âU.S. MULTINATIONALS MAKE LABOR PUT ON ITS FIGHTING SHOESâ
By John Judis (1977)
Next to the extension of slavery, it was the main issue that divided the North and the South before the Civil War. In the last decade of the twentieth century, it may be the main issue that divides capital and labor.
In 1978, it will probably be the main issue that divides President Jimmy Carter and labor.
The issue is that of free trade versus protectionism: in present terms, whether the United States should make the elimination of all trade barriers its first priority, or whether it should pass tariffs or impose quotas to protect the jobs of American workers that might be lost from rising foreign imports.
In April 1977, thousands of garment workers demonstrated around the country to demand import controls on foreign garments and textiles, whose share of the American market has risen from 4 to 35 percent in the last ten years. According to union officials, these rising imports have cost American workers 145,000 jobs.
Prior to that, labor leaders had vigorously protested President Carterâs refusal to go along with the International Trade Commissionâs recommendation that import quotas and tariffs be imposed on rising shoe imports.
In the months to come, Carter will be faced with demands for import controls on color TVs, steel, and rubber products. Indications suggest that he will go to great lengths to avoid acceding to these demands.
PREVENTING ECONOMIC CHAOS
In the past, American labor and industry usually agreed on trade questions. Beginning in the early nineteenth century, they united in support of tariffs that they saw as necessary to protect infant American industries from foreign competition. Then, after the Second World War, with American industry the most advanced in the world, they turned to free trade as essential for American growth.
Both capital and labor believed that postwar policy must aim to prevent trading blocs and to eliminate all tariffs and quotas. Within such a âfreeâ world market, American goods would hold a competitive edge, and exports would rise.
Rising exports would provide needed security against another depression. âForeign trade,â as a United Auto Workers statement put it, âcan be the margin between a drop into economic chaos and a steadily expanding economy.â
But between 1962 and 1970, a sharp turnabout occurred. While labor has by no means abandoned its support for free trade, it has come to insist on protection for industries jeopardized by free trade policies rather than simply on compensation for workers whose jobs were lost.
Three things have shaken laborâs confidence in free trade. The first is the ability, largely unforeseen in 1962, of European and Japanese firms to compete successfully with American firms in such highly touted American fields as steel, auto, ...