AS AMERICA SPINS INTO THE NEXT DEPRESSION
GENERAL MOTORS DUMPS
THOUSANDS OF WORKERS AND CLOSES PLANTS
- Stockholders celebrate!
"It
identifies socialism with proposals for mild social reform such as
“Medicare for all,” raised and increasingly abandoned by a section of the
Democratic Party. It cites Milton Friedman and Margaret Thatcher to
promote the virtues of “economic freedom,” i.e., the unrestrained
operation of the capitalist market, and to denounce all social reforms,
business regulations, tax increases or anything else that impinges on
the oligarchy’s self-enrichment."
“The
yearly income of a typical US household dropped by a massive 12 percent,
or $6,400, in the six years between 2007 and 2013. This is just one of the
findings of the 2013 Federal Reserve Survey of Consumer Finances released
Thursday, which documentsa sharp decline in working class living standards and
a further concentration of wealth in the hands of the rich and the
super-rich.”
"The American phenomenon of record stock values fueling an ever
greater concentration of wealth at the very top of society, while the
economy is starved of productive investment, the social infrastructure
crumbles, and working class living standards are driven down by entrenched
unemployment, wage-cutting and government austerity policies, is part of a broader
global process."
"A
defining expression of this crisis is the dominance of financial speculation
and parasitism, to the point where a narrow international financial aristocracy
plunders society’s resources in order to further enrich itself."
GM Closing Five Plants in North America as Consumers Turn Against Cars
2:11
The turn of the American consumer away from cars in favor of SUVs and trucks has prompted General Motors to announce that it will shutter plants in Michigan, Ohio, Maryland, and Ontario next year.
The company said Monday that it will stop production at five plants next year. The affected plants are Detroit-Hamtramck and Warren Transmission in Michigan, Lordstown Assembly in Ohio, Oshawa Assembly in Ontario, Canada, and Baltimore Operations in Maryland.
The closures will affect some 3,300 workers in the U.S., and another 3,000 globally.
In corporate-speak, these plants will become “unallocated.” That means they will have no product to produce.
The affected plants and the vehicles they make are:
- Detroit-Hamtramck and Oshawa make the Chevy Impala.
- Detroit-Hamtramck is the sole producer of the Cadillac CT6, Chevy Volt, and Buick LaCrosse.
- Lordstown makes the Chevy Cruze sedan.
- Oshawa is the only plant that builds the Cadillac XTS sedan.
The move by General Motors follows similar shifts by Fiat-Chrylser and Ford. U.S. automakers are shifting production away from sedans and smaller vehicles in favor of cross-over SUVs and trucks, reflecting the preferences of U.S. buyers. In recent years, consumers purchases have increasingly been concentrated in the larger vehicle market.
The reasons for the shift include improved fuel efficiency and cheaper oil, which both make fing the larger vehicles less costly. As well, many consumers perceive the higher carriage of the trucks and cross-overs as preferable and safer.
All five of the plants will cease production by the end of 2019, according to GM executives.
The company said that it is making these changes now, while the economy is strong, to adapt to “fast-changing market conditions.”
Shares of GM were up by more than 2 percent Monday morning before being halted while the company announced the changes.
GM Announces Cuts At
Car Assembly Plants In Michigan, Ohio, Canada
Lordstown Assembly in Ohio, shown
here in 2008, is one of the plants that General Motors plans to cut production
in 2019.
Ron Schwane/AP
General Motors says it is planning
to cease production of some models at three vehicle assembly plants in the U.S.
and Canada in 2019. It also plans to cut production at two plants in the U.S.
that make transmissions. The company said the moves are part of an effort to
cut 15 percent of its workforce.
The decision, announced Monday, will impact Detroit-Hamtramck
Assembly in Detroit, Lordstown Assembly in Warren, Ohio, and Oshawa Assembly in
Oshawa, Ontario, Canada. Two transmission plants — one in White Marsh, Md., and
another in Warren, Mich. — are also set to stop production.
The company said it plans to halt
production of the Chevrolet Cruze at the Lordstown plant in March. In Detroit,
it plans to halt production of the Buick LaCrosse and Chevrolet Volt in March
and the Cadillac CT6 and Chevrolet Impala in June. In Ontario, it plans to halt
production of the Chevrolet Impala and Cadillac XTS by the final quarter of
2019.
The company says 5,901 hourly employees and 804 salaried
employees work at these plants.
"We are announcing the cessation of certain products
resulting in a number of plants being without allocated volume to
produce," GM spokesperson Julie Huston-Rough told NPR. She added that
shutting down or closing a plant is an issue that must be discussed in
negotiations with the United Auto Workers.
GM added that it expects to save some $6 billion by the end of
2020.
"With changing customer preferences in the U.S. and in response
to market-related volume declines in cars, future products will be allocated to
fewer plants next year," the company said.
UAW Vice President Terry Dittes called it a "callous decision" that would be "profoundly damaging to our American workforce."
"The UAW and our members will confront this decision by GM
through every legal, contractual and collective bargaining avenue open to our
membership," the union said in a statement.
BANKSTERS AND BILLIONAIRES
PREPARE FOR THE WORST.
REVOLUTION IS IN LOOMING AND
WILL MARCH RIGHT DOWN WALL STREET FIRST.
"A series of recent polls in the US and Europe have shown a sharp
growth of popular disgust with capitalism and support for socialism. In May of
2017, in a survey conducted by the Union of European Broadcasters of people
aged 18 to 35, more than half said they would participate in a “large-scale
uprising.” Nine out of 10 agreed with the statement, “Banks and money rule the
world.”
*
"The
ruling class was particularly terrified by the teachers’ walkouts earlier
this year because the biggest strikes were organized by rank-and-file
educators in a rebellion against the unions, reflecting the weakening grip
of the pro-corporate organizations that have suppressed the class struggle
for decades."
*
“The yearly income of a typical US household dropped by a massive 12 percent, or $6,400, in the six years between 2007 and 2013. This is just one of the findings of the 2013 Federal Reserve Survey of Consumer Finances released Thursday, which documents a sharp decline in working class living standards and a further concentration of wealth in the hands of the rich and the super-rich.”
“The yearly income of a typical US household dropped by a massive 12 percent, or $6,400, in the six years between 2007 and 2013. This is just one of the findings of the 2013 Federal Reserve Survey of Consumer Finances released Thursday, which documents a sharp decline in working class living standards and a further concentration of wealth in the hands of the rich and the super-rich.”
*
"The American
phenomenon of record stock values fueling an ever greater concentration of
wealth at the very top of society, while the economy is starved of
productive investment, the social infrastructure crumbles, and working
class living standards are driven down by entrenched
unemployment, wage-cutting and government austerity policies, is part of
a broader global process."
*
"A defining expression of this crisis is the dominance of financial speculation and parasitism, to the point where a narrow international financial aristocracy plunders society’s resources in order to further enrich itself."
"A defining expression of this crisis is the dominance of financial speculation and parasitism, to the point where a narrow international financial aristocracy plunders society’s resources in order to further enrich itself."
General Motors Says Factory
Closings and Restructuring
Will Cost 14,700 Jobs
2:30
The major restructuring of General Motors, the first since its bailout in 2009, will result in the company cutting up to 14,700 jobs.
The company said Monday that it would cut 15 percent of its salaried workforce in North America. That is likely to be around 8,000 employees.
In addition to the white collar job cuts, the company is shutting down plants that make models it is discontinuing. This will result in around 6,700 job cuts.
The closures and layoffs follow similar moves by other big U.S. automakers as the industry adjusts to lower consumer demand for passenger cars. While sales smaller cars temporarily boomed in the wake of the financial crisis, largely due to Obama administration subsidies and a steep rise in the price of oil, compacts and sedans have fallen out of favor with American consumers. Demand has shifted to trucks, vans, and SUVs.
The layoffs and closures will face protests from autoworker unions. The United Auto Workers union has said the move was callous.
General Motors employed around 180,000 employees worldwide at the end of 2017, with around approximately 103,000 in the U.S. Earlier this year, it offered a buyout package to some employees. It is not clear how many took the company up on the offer.
While the company has said that it believes tariffs on steel and aluminum will add about $1 billion in costs over the next year, there is little sign that the layoffs and closures are related to the tariffs. The company had around $145 billion in sales last year and costs of production of $118.7 billion, down significantly from $130.5 billion four years prior. So the overall additional costs of the tariffs is relatively small for GM.
Many of the cars that General Motors says it will cease producing were hailed as major break-throughs when introduced. The high-priced Chevy Volt, which initially benefited from enormous government subsidies intended to promote electric vehicles, and the more modestly-priced Chevy Cruze, however, both were sales disappointments. Both were derisively called “Obamamobiles” by some critics, based on the support the Obama administration through behind them.
November 28, 2018
Destroyed for Nothing
The closing of GM’s Detroit plant—erected at the expense of a vibrant urban neighborhood—is a final twist of the knife in a tale of displacement and destruction.November 28, 2018
General Motor’s announcement that it’s cutting thousands of jobs
and closing several plants has met intense criticism because the
company was the beneficiary of a $50 billion government bailout
in 2009—which wound up costing taxpayers $11 billion—even as
the government awarded the United Auto Workers’ health-care
fund a 17.5 percent stake in the restructured company. Like many
big American companies, GM has been the recipient of
government-subsidized largesse over several decades. One
particular piece of this history is especially noteworthy now.
Nearly 40 years ago, in one of the most egregious cases of eminent
domain abuse in American history, GM built a plant on land seized
from homeowners and businesses in Detroit, obliterating a multi-
ethnic neighborhood known as Poletown—all for a plant that will
now be shuttered so that GM can invest somewhere else in new
manufacturing facilities.
Beset by foreign competition, America’s automakers began retrenching in the late 1970s, closing manufacturing facilities in and around Detroit even as the city struggled to rebound from the riots of 1967. Dodge had closed a giant plant in Hamtramck, a suburb that adjoins the Poletown neighborhood, and when GM announced that it wanted to build a new plant somewhere in America with modern industrial technology—though it was closing plants elsewhere—Detroit officials pleaded for an opportunity to find a site for the new facility. Mayor Coleman Young came up with a plan: seize some 1,500 homes and 144 businesses in Poletown, a low-income community of 3,500 where Polish immigrants had once settled. By the early 1980s, Poletown was a more diverse neighborhood, housing older Poles but also more recent immigrants and black Detroit residents. As the city deteriorated, Poletown remained relatively stable. “There is no place for us to go, no place we want to go,” two elderly residents told the New York Times in 1980, to no avail. To Detroit officials, Poletown’s appeal was its proximity to the Dodge site, providing some 465 acres for GM—if officials could just move out those inconveniently located businesses and people. To help make it happen, in April 1980 the Michigan legislature passed its infamous “quick-take” law, providing that government agencies could seize land deemed necessary for a “public purpose” and determine later how much to compensate the private landowners. That law accelerated the process of clearing out Poletown.
The neighborhood did not go down without a fight, however. Homeowners and their advocates mounted legal challenges, refused government offers, and hunkered down. Some patrolled their property, brandishing weapons and daring the government to come in and take their property. What happened next was chilling. To “encourage” homeowners to leave, Detroit began withdrawing city services. The city had managed to empty out some buildings, such as apartment houses, by paying off renters, who had little stake in the neighborhood. A few elderly residents took the money for their homes and moved on, creating a landscape dotted with abandoned buildings marked with a blue X—a prescription for chaos, which quickly ensued. Looters moved in and, in a strategy that became all too familiar in the 1970s in places like the South Bronx and Bushwick, they proceed to strip the buildings of sinks, wiring, pipes, furnaces—and then burn them. “There was virtually no trash pickup, no police presence, and before long the once-quiet neighborhood was a jumble of looters and demolition crews during the day and arsonists and fire trucks by night,” wrote filmmaker George Cosetti, who witnessed the neighborhood’s last days while filming the documentary Poletown Lives! “The night air was always smoke-filled and people slept with guns nearby.”
Residents sought to have the quick-take law declared unconstitutional, but the Michigan Supreme Court ruled 5-2 that taking private property and handing it over to a business to provide jobs for the unemployed and taxes to pay for city services qualified as a legitimate public purpose. One dissenting judge did warn that justifying government seizure of land in order to create jobs was an extension of eminent domain that “seriously jeopardized the security of all private property ownership.” Even then, however, some residents hung on, forming a redoubt in Immaculate Conception church, a focal point of much of the resistance, until police arrived to cart away the group, which included a handful of elderly Polish women.
General Motors opened the new plant, Detroit-Hamtramck, in 1985. It employed some 4,500 workers, about 70 percent of the original projection of 6,500 jobs. But the plant fell far short of the claims that city officials used to justify the property seizures. They had envisioned Poletown as a crucial step in a Detroit renaissance—the plant would attract other carmakers and auto-accessories manufacturers to the area, they believed, and spark a jobs boom. These scenarios never materialized. Detroit’s economy continued to decline, people fled the city, and today Detroit, with some 670,000 residents, is about half its size in 1980.
In 2004, Michigan’s Supreme Court overturned the “quick-take” provision that allowed the state to seize Poletown before demonstrating a public purpose for the land. General Motors got 34 years out of the plant, thanks to a $200 million government subsidy (what it cost Detroit to clear Poletown). No one can say whether Poletown, which had existed as a vibrant neighborhood for more than 100 years, would have endured longer, serving as at least one bulwark against the decline of the city, had GM not moved in. But neighborhoods have a way of outlasting manufacturing plants. That’s one reason we shouldn’t destroy them willy-nilly for the sake of a few jobs—or even a few thousand.
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