Monday, July 25, 2005

The Decline Of Labor In A Declining Economy

This weekend the American labor movement hit a new snag as four large unions are preparing to bolt the AFL-CIO organization. This is another huge blow to a united front by the working class to counter the huge dominance of business influence both in politics and driving wages down through mega-stores such as Wal-Mart who are nonunion, low paying and offer few benefits. And it could also be potentially bad for prospects for a revival in the Democratic party for a strongly prolabor candidate to emerge for President, as the influence of labor shrinks and more and more corporations, rather than unions gain influence in both parties. Indeed even former Republican, Hillary Clinton is sounding more and more Republican in her opinions, with a new report she'll probably support John Roberts for the Supreme Court, and an attack on a video game that had a minor bit of pixelated cartoon sex available as a Internet download. Her attack on this game was especially shrill, when one considers the minor bit of sexual content was a very minor part compared to an overwelming violent theme of shootings and murders, including of a prostitute. Hillary Clinton is championing small time nonsense issues like this, while the American union movement has slid to representing only 8% of American workers, down from a peak union membership of one third of all workers in the 1930's. And American industries are picked apart by predatory capitalist practices from Asian competitors.

Not only are mega-businesses and globlized corporations who have no loyality to any state or flag, only to their own internatonal power, squeezing out American labor unions. But the predatory capitalist business practices of Japan, Korea and China have spelled economic doom for many high paying American manufacturing jobs, and weakened the American economy down to a level of an increasing level of low paying service jobs.

After WWII, as a war damaged Japan sought to rebuild their battered nation, the generations of militaristic instincts remained. But instead of centuries of military conflicts with other nations, including Russia, China, Korea or other states, Japanese businesses instead focused on economic war against targeted American corporations to build their economy and to secure world economic dominance.

In the 1960's it was the parent company that produced Panasonic televisions, Matsushita Electric Company, that decided to target the American television industry for a Pearl Harborlike destruction and assimilation of defeated corporations. In the 1960's America had Zenith, RCA, GE, Maganavox, Quasar and Philco-Ford as television manufacturers. But today none survive as an American brand. And Quasar, one of Matsushita's targets, became assimilated into the Matsushita corporation. In fact Matsushita has assimilated 589 world companies, and now has equity in 81 more.

And the American automobile industry of the 1960's had six manufacturers, GM, Ford, Chrysler, AMC, Studebaker and Checker. As far back as the 1950's the American automobile producers were so powerful that when Hudson and Nash mergered in a mid50's mega-deal involving $191 million dollars, it was the biggest corporate merger in the history of the United States. Packard and Studebaker were also considering entry into this arrangement, but an unexpected death of a major executive, and some financial problems doomed not only this deal, but also Packard and Studebaker as a maker, although Studebaker did merge assets with other corporations. Given this strength, how could the American automobile industry also take a another hard hit, and hundreds of thousands of high paying union factory jobs disappear. First with Volkswagon, but then more significantly with Japanese automakers, American companies lost market share and now only GM and Ford survive as American brands. Some Japanese companies have only been building automobiles since 1966, such as Subaru, whose 1969 $1,297 dollar 360 model was the first entry into America. Now every block has Subarus, Toyotas, Hondas, Nissans and other cars including Korean Hyundai and Kia automobiles. Slowly $3,500 Chevrolets, Fords, Plymouths, Commanders, Marathons and Ambassadors sold less and less. While many Japanese automobiles such as Toyotas and Hondas are manufactured here, often they are in right to work states or other areas with far less than normal Detroit wages. Even the German name plate BMWs are produced in South Carolina for wages far way below the wages paid in Germany for workers building identical models for the European market.

From the experience of a culture that worshipped the warrior, rather than the teacher or preacher like other nations, a culture to develop an aggresive economic view of business developed in post war Tokyo. While most Americans believe in more gentle "free market" economics that believe in business startups that believe in more gentle competition. But since the role of Matsushita in bringing down the America television business, in which TV sets were sold for prices far below the comparable price for similar models in Tokyo, simply to undercut and destroy the American industry, the role of undervalued currency, product dumping, predatory pricing, unfair labor practices to cut production costs, and extremely cheap foreign labor have all been used to undermine and target American manufacturing for destruction by Japan, Korea or China.

China, the communist giant is hardly a true "free market" state like America, but a giant predatory capitalist state, although officially communist in government form. The yuan was deliberately linked to the American dollar which undervalued it by 40% on world currency markets, until this week, where China has agreed to finally let the yuan float against several world currencies, similar to the way most other world currency is valued. And the Chinese minimum wage of 40cents an hour was often not paid in factories, with many workers only paid about 24cent in many factories building products for export. And dirty and dangerous factory conditions, often in violation of Chinese law further cut costs to create unfairly low priced Chinese made products to drive American products off the shelf.

And even South Korea found that it has become so prosperous, that a South Korean bank actually loaned American television manufacturer, Zenith , operating funds in a loan agreement, but then pulled in the loan, and now Zenith is a Korean brand. And banks in Japan, Korea and China loan the American government billions of operating dollars by the bonds they hold.

In business, some will complain that American workers earned too much money and business could not compete, but no American wage cuts could compete with 24cents an hour Chinese labor, steel dumping, product dumping, predatory pricing, unfair labor practices, or any other unfair foreign marketing threats to American industry. Interestingly Japan, China and South Korea all had a culture of a generation or more raised in war. These hardened values were carried over to the modern world of economics where these three nations play economic hardball in shipping masses of goods into America with unfair practices to undercut American industry. By contrast, European states generally only erected trade barriers to American goods, and generally failed at successful marketing of most goods, except the sometimes successful Volkswagon into America.

I don't know where America labor unions are headed with their breakup from the AFL-CIO this weekend. But high paying jobs are disappearing in America. And entire American industries are being destroyed by predatory capitalist practices. And just a couple weeks ago, a Chinese government official proclaimed that "America has no business in the agriculture business", which means that the generally low paying jobs in American agriculture, many even held by recent migrant laborers, might also be threatened as well. There is no end in sight to segments of the American economy that will fall to the aggressive practices of predatory capitalism from Japan, China and Korea.

America is aggressive at protecting itself from Osama Bin Laden and Al Qaeda. Yet it leaves the front door wide open to foreign competitors who tell America that we have "no business" in certain industries that foreign countries think they should control in America. This makes no sense.

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