[Marxism] Recommended: "Waning era of the middle-class factory job"

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Headline:  Waning era of the middle-class factory job
Byline:  Mark Trumbull Staff writer of The Christian Science Monitor
Date: 12/08/2005

(FLINT, MICH.)For Mary Aremia-Van Alst, the happiest day of her 10 years 
working at
Delphi Corp. is easy to pinpoint: It was the day she got the job.

"I was ecstatic," she says, referring to that day in January 1995. The
auto-parts company, then a division of General Motors Corp. (GM), was
hiring in Flint for the first time in years.

The job offer was a passport to a paycheck that more than doubled her
$10-an-hour wage at Citizens Bank.

It was also a ticket to a world where a working-class job could produce
a middle-class lifestyle, with strong benefits and the money to send
her children to a Catholic grade school.

Now, with Delphi headed to bankruptcy court early next year, employees
like Mrs. Aremia-Van Alst may have to take pay cuts of up to 50
percent. Suddenly, that solid standard of living appears to be hanging
by a thread.

"I made a lot of life decisions based on the way things were supposed
to be," she says, in between bites of an omelet at Toshi's, a diner
near the Delphi plant. "Now they want to take half [of our pay] away
from us."

What's playing out here in America's automotive alley may be the last
gasp of the assumption that good factory jobs will last a lifetime. And
workers here see it as something more: a warning that the American
dream itself is at risk.

The outlines of the challenge go beyond the auto industry, they say -
global competition, shrinking union bargaining power, an eroding
industrial base. If middle-class paychecks continue to be clipped, they
wonder, what will drive the economy forward? What tax revenue will the
government have?

"It's a national problem that's going to escalate," says Mary's
husband, Neil Van Alst, who also works at Delphi.

Such views are fed, in part, by the circumstances around them. As
lifelong residents of this area, Mary and Neil remember the Flint of
their youth, then known as "Buick City," as a kind of automotive
boomtown. GM employed as many as 80,000 workers in a city with a
population barely twice that number, propelling prosperity far beyond
the city limits.

Today fewer than 20,000 auto jobs remain here.

Unemployment, at about 7 percent, is well above the national average of
5 percent. The home of Buick no longer makes that brand. An arch
downtown proclaims Flint to be "Vehicle City."

This is also among America's most heavily unionized states. More than
20 percent of Michigan's workers are trade union members, almost double
the national average.

But if the concerns of Mary, Neil, and other auto workers here are
rooted in local circumstances, they also have broader grounding.

Nationwide, unemployment remains low by historical standards, but
sectors of the labor market, especially manufacturing, have been losing
in recent years. And despite a growing economy, wages for
nonsupervisory workers haven't been keeping pace with inflation.

Against that backdrop, the views of people like the Aremia-Van Alsts
form one side of a sharp national divide over the future of the economy.

Two views of US manufacturing

One view, espoused by free-market disciples, is that the nation's
prosperity hinges on its extraordinary flexibility in deploying labor
and investment. That explains its edge in job creation compared with
Europe's tepid performance. But it comes with difficult adjustments,
such as the one Delphi faces.

The other side contends that as global competition grows stronger,
flexibility alone isn't enough. They call for new policies to help
retain and build middle-class jobs. The recipes vary, but they
generally urge keeping a closer watch on whether free-trade policies
are fair, fixing a hodgepodge health insurance system, and greater
public investment in promoting new industries.

It isn't just the union rank and file who echo such views. GM chief
executive officer Rick Wagoner, writing this week in The Wall Street
Journal, said US manufacturing faces "fundamental challenges,"
including soaring healthcare costs and unfair trading practices by
foreign rivals - such as an artificially weak Japanese yen - that a
company like GM can't solve on its own.

"Some say we're looking for a bailout. Baloney," Mr. Wagoner wrote. He
conceded that many of GM's problems the company must face on its own.
But "what we want ... is the chance to compete on a level playing
field."

No city symbolized GM's past prosperity - accounting for more than half
of the US car market in the years after World War II - like Flint.

And no region is more loyal to "made in the USA," at least when it
comes to cars.

It's possible to drive the 80-odd miles from Detroit to Flint without
seeing a single foreign nameplate on the road.

But Flint's population has declined since 1980, and its prized jobs
have been steadily disappearing. GM plans to stop production at an
engine facility, one of its several remaining plants here, in 2008 as
part of a recently announced downsizing.

Delphi used to have two huge complexes here. Now, just one remains, and
two of its seven plants have closed.

The next steps, as the partsmaker navigates bankruptcy, appear likely
to include layoffs, wage cuts, and possibly the elimination of pensions
for future retirees.

Lessons for the family

For the Aremia-Van Alst family, it is a time of tough lessons. "I can
only hope and pray," says Mary. But she and Neil are also thinking
ahead to a possible future without Delphi paychecks from the plant
where they work on fuel-tank parts.

Mary says she may try to finish a degree in business management. Neil
says he could do carpentry work. And both say they might train to be
school teachers. In the meantime, they are trying to make sure their
five children stick to the straight and narrow in their own education.

When one son got a few Ds last year, Neil says he hammered home this
point: "If you don't go to college you're not going to be able to
afford an apartment, let alone a vehicle."

Their oldest daughter, ninth-grader Rachel, has a clear sense of the
challenges the family faces. "I want to keep my grades up," she says.
She hopes for a career in healthcare, and hopes her parents can keep
their jobs and house.

This isn't the first time the auto industry has been through wrenching
transition, thanks to rising foreign competition. And lots of unionized
companies, from the steel industry to airlines, have been down the
bankruptcy road before Delphi.

In many cases, the economy's vaunted flexibility has helped displaced
workers find new jobs, but typically at lower pay than before. That's
what has happened with legions of US steel workers since the 1970s,
when that industry declined.

Jared Bernstein, an analyst at the Economic Policy Institute in
Washington, says that the typical layoff results in a 10 to 20 percent
pay cut for the workers involved. And US manufacturing, long a foothold
of working-class prosperity, has been hit particularly hard. "We are
losing that foothold at a very rapid pace," he says.

In some ways, the auto workers are a victim of their own past success.
As the industry rose, Henry Ford was once able to double worker wages.

Today, hourly manufacturing pay in Flint remains extraordinarily high,
$31 an hour - nearly twice the national average.

But fewer have those jobs today. Per capita incomes in this city have
fallen below the US norm, and could fall further still as the auto
industry goes through its next phase of cuts.

A coming restructuring plan at Ford Motor Co. will match GM in job
cuts, eliminating 30,000 positions within five years, according to a
report in Wednesday's Detroit News that cited people familiar with the
plan.Delphi CEO Robert S. "Steve" Miller has said drastic action is
needed for domestic industry to remain competitive.

That may be. But Neil Van Alst says the industry should survive by
creativity, as well as cutbacks.

"Step up and create more innovation," he says. "That's what started all
of these plants to begin with."





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