– Close to 15,000 decry foreign company’s bid to slash Canadian workers’ wages and benefits
By Mark Taliano
If it wasn’t so ridiculous or “radical”, or “extreme”, it might even be funny.
In 2010, Industry Canada allowed American-owned Caterpillar to bulldoze its way into London, Ontario to purchase Electro-Motive Canada, a plant which assembles locomotive diesel engines. They even humbly accepted offer an offer from Canada’s prime minister, Stephen Harper, of $5 million dollars of taxpayers’ money in the form of tax breaks.
Politicians were no doubt pleased that Caterpillar profits increased by 95% in the first three quarters of 2011, which amounted to a staggering $3.4 billion in profits. Better yet, production was up by 20 per cent and Canadian workers, who were being paid about $36.00 per hour, hadn’t had a raise for about six years.
Then, in a scene that could have come directly from Naomi Klein’s Shock Doctrine (create or exploit a “shock” to undemocratically force societal changes), the corporation insisted that its Canadian employees accept a 50% pay cut from about $36.00 per hour to $16.50 per hour, no cost of living adjustment, a new co-payment plan for health insurance and the elimination of pension plans. This was the “shock”.
Adding salt to the wounds would be the fact that CEO James Owen received $22.5 million in 2011 for half a year’s work and he pocketed a pension worth $19 million. (It’s always good to know that the taxpayer’s money is being well spent.)
Naturally, the CAW rejected the offer, and about 500 workers were locked out on New Year’s Day. Nice timing.
The company’s hidden agenda lies buried just below the surface. Now that they’ve exploited Canada for its technology and market share, they will likely employ the socially reprehensible but all too common tactic of relocating.
Caterpillar has acquired low-cost assembly operations in Brazil, Mexico, and Muncie, Indiana were wages run between $12.50 and $14.50 per hour so it would seem to be a “no-brainer” that the company will re-locate to sunnier climes. Lax labour laws would permit replacement workers/scabs, but that is unlikely since the work requires relatively high skill levels.
Those affected will be the workers and their families, but also about 2,000 other workers and their families who supply and support the plant. It’s a classic case of the continued assault on Canada’s middle class, on Canada’s unions and on our way of life. Sid Ryan, President of the Ontario Federation of Labour accurately observed; “Good jobs and retirement are being threatened by greedy corporations and every level of government. If workers don’t start to fight back, decent jobs will become a thing of the past, and the middle class will be decimated.”
What is happening is commonly referred to as a “race to the bottom.” Huge transnationals, enabled by governments and trade agreements, go where operating costs are cheapest, regardless of working conditions, environment, labour, or health impacts. Countries and workers are exploited, and the corporations don’t clean up the externalized messes that they leave.
Where is the “bottom?” Currently it is totalitarian, communist China, where much of our manufacturing has been relocated. The Apple manufacturer Foxconn supplies gadgets for Apple, Sony, Nintendo, HP and other companies. In 2010, eighteen “suicide protestors” jumped from the top of the building. Fourteen died. More recently, one hundred and fifty workers threatened to leap from the roof to protest dust-choked factories, piece-meal pay and so on. This time, they were coaxed down after two days. Now there are “nets” around the building.
Psychopaths do not have a conscience, and the lack of moral restraints of transnationals like Caterpillar, dressed in the clothing of “cost-efficiency,” reveals a psychopath mentality, oblivious to the societal damage that it is creating.
Thankfully, Canadians are fighting back. On Saturday, January 21, a huge rally, numbering as many as 15,000 people, rallied first at Victoria Park, and then at the Caterpillar plant in London. Occupy and Labour chants co-mingled, as did shared goals and sentiments. As Canadians we are being exploited, and we’re fed up. Government is supposed to selflessly govern for the people’s best interests, but instead it is in thrall of an economic theory which enables corporate profits to the detriment of the common good.
Part of the battle involves a re-structuring of our collective mind-set.
Obsessing over primary industries is part of the problem. In the last nine years, Canada lost 627,000 manufacturing jobs. Our reliance on energy exports drives up the dollar, thus making manufacturing more expensive and less effective. It’s called the Dutch Disease, and it is transforming us once again to a country of “hewers of wood and drawers of water”. This is part of the problem.
Foreign ownership is also part of the problem. Fifty per cent of our manufacturing is in foreign hands, while the U.S, Japan, Germany, U.K, France, Italy, Netherlands, Norway, Finland, and Sweden have all kept outside ownership of their manufacturing to 4 per cent. We need to strengthen, not weaken, the Investment Canada Act, and thereby shake off our colonial mind-set. Despite the photo-op it offered to Prime Minister Harper during the election, Caterpillar, with its well-entrenched anti-labour reputation, should not have been allowed to purchase Electro- Motive Canada. (Needless to say, P.M. Harper was conspicuously absent during the rally.)
We need to change trade deals and tie corporate welfare to social responsibility. If the citizens are going to subsidize corporations with tax breaks, then there must be an enforceable and clear net benefit to the citizens. The common political mantra of “Corporate Tax Cuts” is becoming increasingly abrasive to more and more Canadians.
We also need to re-direct spending priorities. According to a U.S study (“The Page That Counts” Yes! Magazine) a billion dollars spent on the military yields 8,555 jobs, the same amount on health care yields 10,770 jobs, the same amount on education yields 17,687 jobs, and the same amount spent on mass transit yields 19,795 jobs. It’s an American study, but the numbers are likely relevant. Corporate and government propaganda will argue that pipelines are about jobs, but better, more ethical job numbers are elsewhere.
Finally, we need to stop passively blaming “globalization” for our economic woes, and start actively changing “globalization” so that people in Canada and world-wide, take precedence over insular corporate profits. Caterpillar’s bulldozing of Canadians is one of many symptoms of a dysfunctional system, but the system can be changed to the benefit of the people over the corporations. It should be a “no-brainer”.
(Mark Taliano is a resident of Niagara, Ontario and a regular contributor of news and commentary to Niagara At Large.)
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You may be right on many levels Mark, but I also think ever escalating union wages are part of the problem. Surely $35 per hour is more than enough. Why don’t the unions make a pact that they will reduce their wages if the CEOs will reduce theirs an equal amount and between the two of you figure out a way to raise up salaries of those who do not work for unions. Then we would know you are truly concerned about all the citizens.
Thanks to Mark Taliano for his participation in this important rally , as the “we are the 99%” moves on and takes hold and we finally begin to realize that more-then -most of us and those in our families and extended frienships are part of the 99%. Thanks too for Mark’s excellent reporting!
Pat, it is a complete waste of time for a union to go to negotiations and demand that CEO’s will reduce their wages by an equal amount. It’s just not going to happen. It’s naive to even suggest that. And I’m speaking as someone who is very sympathetic to your major concern – Niagara Health System (or lack of system).
How the HELL is one company and union employees going to “figure out a way” to raise the salaries of non- union employees? The provincial government sets minimum wages and the so-called business community screamed blue murder and the sky is falling the last time the minimum wage was raised.
Look at the Republican candidates – they are already arguing that child labour laws are ridiculous.
Employees have made committments – mortgages, car payments, etc. based on current wages. Especially when the company if profitable but wants massive new profits for the stockholders. It’s a disgrace and our present economic system is a disgrace.
It is illogical to blame the unions for not raising wages for non-unionized staff – they only have the resources to fight for their own members. it’s up to the intelligent and the courageous to unionize. It’s up to the rest of us to vote for parties that promise to raise the standard of living (remember the US 1960’s War Against Poverty?) for everyone, even if we get taxed a little more – especially large corporations.
I am commenting here because I am glad there were people that stood up against this. This has been happening all over Ontario and probably the rest of Canada for years now, which is why we are getting less “good jobs” and more “bad jobs”, as CEOs continue to reap more and more money for all their “hard work”. As for CEO salaries, concerned shareholders should become more active and demand that CEO salaries not be much higher than a certain multiple of the company’s lowest paid workers. In my view, no individual is worth millions and millions of dollars a year, especially when these folks turn around and devalue the labour of others, esp those that help earn them this money.
The battle lines are being drawn,could we be entering a new age of class warfare,with this NAFTA, it is entirely possible. They say eat our demands or we move,to the States in the meantime they lock the workers out, I see the return of the dirty thirties , deja vu, We are now in the age of corporate greed.this is how the Communism idea took a hold on working people, if you are hungry anything looks good.Our laws about investment review on foreign take overs are merely wall paper and are toothless.I predict big trouble in the near future.
This is a complex problem. Unions were necessary and still are, but their demands are out of control. I read the book by Lee Ioccoca. He stated for years the car companies caved into all the union demands as they were making money hand over fist and saw no reason to slow down the gravy train. He said they created a monster as demands got out of control and the price of their product escalated, inflation rose and they found it more and more difficult to compete. (Hence the GM bankruptcy.)
Companies, natually want an ever increasing piece of the pie and all the executives are saying, we should be paid way more than union people as we have more responsibility, stress, blah, blah, blah.
People that are caught in the middle of this crunch are not stupid or lazy. For the most part they are hard working, bright people that aren’t fortunate enough to get a union job…or CEO position. Often times they are scraping at the bottom wondering what to do….how to survive. This is what is wrong with the system.
Newspaper writers are a good example. Many are very well educated, extremely bright and very hardworking. Not many get paid anywhere close to union wages, such as teachers, policemen, firemen, nurses, public sector workers, factory and steel workers and the list goes on.
If these union workers are the 99%, what do you call the non-union workers…..the poor?
Who is fighting for them?
Pat, you’re right there. There’s certainly nobody in MY corner. I am self-employed, get no paid vacations, no holidays, no sick days and work in excess of 70 to 80 hours a week and earn next to nothing … I am not saying scrapping the unions is the answer, as they are still necessary. The workers at Caterpillar will not have had the support they did without the fact that they are unionized. But we need to move the standards of living for ALL of us, not just continue to rake everybody, or the 99%, to the race to the bottom, while a few reap off the top.