YEARS OF MAGICAL THINKING

Posted in Rants on July 27th, 2015 by Ed

When living outside of a major metro area the economy tends to revolve around a very small number of large employers. Most often these are, despite what right wingers would lead you to believe, either government (city/county, school districts, police and fire, etc) or private industries that are little more than thinly disguised conduits for government money (hospitals, higher education, state contractors). Usually there are a handful of actual private enterprises that are large enough to matter; the monolithic Factory or Mill that lends a company town feel to the area. Its fate and the fate of the local population are intertwined, Accordingly the average person becomes more intimately familiar with the inner workings of otherwise unremarkable companies than a person living in, say, New York or Boston would ever be. A thousand people are probably laid off or otherwise rendered unemployed in New York City every four hours. In the middle of nowhere, where the prospects for finding a different job at anything above the minimum wage, no benefits plateau are bleak, that same 1000 layoffs will hit the community like an earthquake.

Late last week – "Break bad news on a Friday" being one of the cardinal rules of modern corporate PR – Mitsubishi announced the closure of its sole U.S. manufacturing facility in Normal, IL. Along with State Farm insurance and Peoria-based Caterpillar, Mitsubishi was one of the sole companies with a major employment presence in Central Illinois (and one of the only blue collar employment opportunities). Now other than State Farm (and Beer Nuts…) the Bloomington-Normal area, population 135,000, is entirely dependent on Illinois State University and other public sector sources for employment at any level above the service industry. Local reaction has been the predictable mixture of anger, sadness, and resignation; this has happened so many times "downstate" (i.e., any part of Illinois not immediately adjacent to Chicago) that it hardly surprises residents anymore.

The reason for the plant closure could not be more obvious. Unless you live in the area, where employee-discounted Mitsubishis are ubiquitous on the roads, or are really interested in the auto industry, there is a good chance you had no idea Mitsubishi still sold cars in this country. They have not been a player in any segment of the U.S. market for two decades. Other than their $40,000 boy racer Evolution model, a favorite of the teen Fast & Furious set, no product they've made since the early 90s has garnered more attention than the bare minimum obligations of the automotive press. Nor have any reviews surpassed "Well, I guess it's not awful, but there are probably 10 options I'd buy before this" in the realm of the positive. More often the commentary has been downright brutal; what may be the company's final new model in this country, 2014's Mirage, was almost immediately placed on "10 Worst Cars of all time" lists. The Normal factory was producing about 50,000 cars annually – most sold at a substantial discount and loss to employees or in annual summer fire sales – despite having a capacity of over 300,000. It didn't take a genius to figure out that this wasn't a going concern.

Irrespective of the complete lack of advertising for Mitsubishi products and their stark inferiority to the competition, I'll give you ten seconds to guess who or what shoulders the majority of the blame for the factory closure in the local press.

If you didn't guess the UAW, try again.

I don't know what I expect from people anymore. We've all read What's the Matter with Kansas? and internalized its narrative by now. We've all become well enough versed in armchair psychology to understand that people who experience this kind of economic dislocation are going to look for someone to blame and their choice of whipping post might not be terribly logical. But I want to grab people and shake them, not to make them See the Light but simply to get an answer to the question of what exactly the absence of unionization would have done to improve this situation.

What exactly is it that could have helped this situation – a moribund, clueless company designing products for third world markets and then trying to sell them to Americans at market prices? Are we angry that the UAW didn't give Central Illinoisans the right to work for the $8/hr Mitsubishi could have paid factory workers in rural Mississippi? Are we upset that we never had the chance to work for the $1/hr that Mitsu pays its manual labor in Thailand, Malaysia, and India to assemble cars (the justifiably maligned Mirage is made entirely in Thailand)? This isn't an example of a company closing a factory and moving it elsewhere for cheaper labor. The company is getting ready to abandon the U.S. market entirely because it sucks at what it does and it is not remotely competitive in this market at any labor cost.

It used to be that when the company went through layoffs and firings, people got angry with the company. Or "the bosses." Or "management." Even a passing understanding of this situation would direct the area's anger toward Japanese boardrooms where bad decisions and bad products originated. If ever a company had a legitimate economic argument for closing a factory, Mitsubishi has one here. Nobody buys their cars because their cars are shit. I understand how "the unions" are an easier, more proximate target than a faceless corporation. I understand why people blame them even when it makes absolutely no sense in context. It would be interesting, though, to know exactly what these anti-union people envision would have happened here without Union Interference. The obvious answer – "Everyone would have made less and then gotten laid off anyway" – hardly seems worth getting in knots over. An unemotional observer might describe that as no real loss at all. A smart one might conclude that the only chance we missed was for the situation to be worse.