By David Sedgwick
Automotive News / August 13, 2003
Dana Corp. has signed an agreement with the United Auto Workers to allow the union to organize its factories.
The company and union confirmed the deal today.
In the United States, Dana owns 200 plants that employ 20,000 workers. Of those plants, the UAW represents workers at nine factories.
The union also has launched organizing drives at six other Dana plants. The Toledo, Ohio-based supplier has agreed to remain neutral in those and other membership campaigns.
Most important, Dana will forego plant elections to certify the union. If more than half of a factory’s hourly workers sign cards pledging support for the UAW, Dana will accept the union as a bargaining agent.
The agreement is another major victory for the UAW, which has negotiated similar agreements with Johnson Controls Inc., Intier Automotive, Magna International and Metaldyne.
Dana, a supplier of drivetrain, structural and engine products, ranks No. 6 on the Automotive News list of the Top 150 original equipment parts suppliers to North America. It had $5.3 billion in North American original equipment auto parts sales last year.
I'm sorry. I can't get too teary-eyed over this. From a technical acumen perspective, I can understand the argument from folks like JMAC and Schieve. I'm never in favor of slashing costs to produce inferior products.
Having said that, it's not going to change. Do what American do best...adapt. We still possess all the real ingenuity on this Earth. Our next role in the global economy may very well be...and I would suspect it will end up this way...as the global management. It's still a zero sum game...we're still recognizing the increased profits on our dollars invested. Unfortunately, the number of folks privy to those profits operationally will decrease significantly.
The only way for the average American to get a share of those profits would be in the capital markets. I don't care how I get to the number on my 1040 every year. If I have to work less and invest more, ok. I guess I'll upgrade my Tivo and sit back.
We are really close to warp speed capitalism. It will make our country wealthier, but unfortunately, it will bankrupt a lot more people who can't take part in the evolution of how the world will work.
Americans need to drop this sense of entitlement to the American dream and start chasing it. Make yourself invaluable. It's nobody's fault but your own if you are expendable. If you can be replaced with an 8 year old Chinese kid who can do the same level of work, good for the Chinese kid. I don't want to pay more for a car, computer, or software just because you have a degree and a mortgage.
This country will never punish those who work hard to create something. So maybe you have to act like a modern day frontiersman and go find your way. That's what this country was about back in the day. It wasn't about cushy service sector jobs or union labor.
I'm sorry. I can't get too teary-eyed over this. From a technical acumen perspective, I can understand the argument from folks like JMAC and Schieve. I'm never in favor of slashing costs to produce inferior products.
Having said that, it's not going to change. Do what American do best...adapt. We still possess all the real ingenuity on this Earth. Our next role in the global economy may very well be...and I would suspect it will end up this way...as the global management. It's still a zero sum game...we're still recognizing the increased profits on our dollars invested. Unfortunately, the number of folks privy to those profits operationally will decrease significantly.
The only way for the average American to get a share of those profits would be in the capital markets. I don't care how I get to the number on my 1040 every year. If I have to work less and invest more, ok. I guess I'll upgrade my Tivo and sit back.
We are really close to warp speed capitalism. It will make our country wealthier, but unfortunately, it will bankrupt a lot more people who can't take part in the evolution of how the world will work.
Americans need to drop this sense of entitlement to the American dream and start chasing it. Make yourself invaluable. It's nobody's fault but your own if you are expendable. If you can be replaced with an 8 year old Chinese kid who can do the same level of work, good for the Chinese kid. I don't want to pay more for a car, computer, or software just because you have a degree and a mortgage.
This country will never punish those who work hard to create something. So maybe you have to act like a modern day frontiersman and go find your way. That's what this country was about back in the day. It wasn't about cushy service sector jobs or union labor.
Awaiting Eric's monthly capitalist pig SCUD...
that's a god damn good perspective (claps) I was sorta thinking about this on the way home from work today, thinking about how the fuck people not only succeed but go even farther than that. At the office I see a lot of people who feel they are "next in line" and that the natural progression of business (people retiring and getting fired) that one day their number will be called and the flood gates to a better life in terms of power and wealth will be just handed to them. I say fuck that, the more I think about it it's not only unions that contribute to this (tho I still think they are by far the leader) mentality that people are just automatically entitled to a promotion or whatever simply because of their seniority. People lose sight that you have to bust your ass and earn those positions, how are you going to inspire a young new manager when there are 2 people in front of him for a promotion? Make them fight for it.
It isn't about "entitlement" or being spoiled, whiny Americans. The fact is, the OVERALL average is being driven down. We aren't enriching the third world, and we aren't simply shifting American focus to the next hot thing. I'm rapidly becoming convinced that a fundamental negative change is taking place, slowly but steadily.
The reason this is a problem mainly comes down to global population growth. I've read several books recently which arrive at very similar statistics in spite of being authored over span of about seven years. The average American in the early 90's competed with approximately only 2 people globally -- that's a cross-sector thing -- manufacturing, technology -- pretty much any type of work that can be sent overseas. By 2000 that number was up to about 24 due to both population growth and improved education abroad. By 2050, if the trend only continues as-is and does not expand (plenty of speculation both ways there), the average American will be competing with something like 120 people world-wide for the same job. And that's just from a skills perspective. Most of those 120 people will only be asking for the average per capita annual income, which by that time should be about $350 to $500 depending on whose numbers you use.
Swerving back to a more immediate focus for a moment, it isn't about making yourself invaluable. People who live thousands of miles away don't give two fucks whether you're invaluable. They'll whack you and the five hundred people that work near you if they think it'll look nice in 3Q, and the fastest way to do that is to hire a pack of foreigners with the best-sounding promise that they'll do a roughly equivalent job. Right now, keeping your job is strictly about getting lucky. Bust your ass and earn your position? Three of the highest ranking guys at my company of 25,000 (formerly 65,000) just got their asses handed to them. ONE guy out of 65,000 is secure. Those aren't good odds.
And for those of you running businesses and feeling smug about being in charge, you should start wondering who the fuck is going to be buying your products over the long term. I keep thinking, "I hope I'm wrong," but then I'm forced to come back to a basic truth: this little thing we call exponential population growth. That translates into two critical things: a continuing decrease in the average earning potential, at an increasing rate of decline. If the people you're selling to are progressively less wealthy, what does that mean to your sales? Are you ready to try exporting your widgets? Do you think Suresh Rhajabeeb in a grass-roofed hut in south India can afford your widget just because he has the same job as the people from Centerville USA who used to buy your widgets?
The difference between what I'm saying and what Smackie says is where the little dotted line is drawn between "making it" and "not making it". Make no mistake about it, that bar will be set very, very high, and it will keep moving up. In a nutshell, over the long term, the bottom is dropping out of America. There are just too many dirt-poor people willing to work for nothing on a relative basis. It doesn't matter how innovative you are, or how well you "buckle down" and "do what's necessary," there will always be some fly-covered raghead in a dirt hut willing to do the same thing for a new pair of Levis (which were made by his buddy in the dirt hut down the road).
Mark my words. This is a new thing -- the world has never had a population like this before.
I don't think I can argue with any of that. There's too many fucking people on this Earth. It is really that simple. We are truly heading back to the early tribal days when there aren't enough convertable resources for the demand. What happened back then is what will happen in the future. The strong will always eat and the weak will die. I'm comfortable with that. It's my job to find a way to keep me and mine fed and cared for. That's how nature works and how it always will no matter how much the civility of society sugarcoats it.
For generations, we've been overpaid and oversecure with the concept of employment. Either we have to leverage smarter or work harder in the future. Pandora's Box is open and we're going to have to find new ways to protect our workers, products, and markets.
That's part of why I don't mind us going apeshit on Iraq. New market, we control the buyers, we create new consumers. That's good fucking marketing. That's a helluva business plan I wish I had gotten in on.
All I can really tell you is that it's only going to get worse and if you are uncomfortable with the fact that your line of work can be outsourced at any time, either stock up on Maalox or look elsewhere. For hundreds of years, our country has believed in free markets and competition. It really is the best way for everyone. Go compete.
Sorry to hear about your company but that was a bad example. Macro-problems and internal politics don't have anything to do with overpopulation or conceptual job displacement. US companies have always been guilty of fat staffing. It's stupid. It's bad business. There is an oversupply of expendable workers and it's only that way because we've been protected from having to operate like the rest of the world for so long.
In the end, an equilibrium will be reached. Others will make more on the whole and we'll make less. Oh well. Do what you have to do be on the right side of the seesaw.
I'm hoping that the trend will revert itself eventually, but irreparable damage will have been done.
It's like the burst of the stock market bubble.
Once it bursts, everyone is flat on their arse and going back up will take a long while.
Companies that outsource will see one day that they can't sell anything anymore to the home consumers. The politicians will see that too, and there will be some laws enacted against outsourcing.
The few that outsource now will siphon the money that the rest of the companies pays to their US workers as salary. That can work for a while, and it's unfair to the US companies using US workforce. I don't think it'll take long for unfair business practices lawsuits to come up and put an end to extreme outsourcing.
I'll concede that my example to Craig was a bad one. My company's top guys were axed mainly due to politics, rather than anything related to globalization. On the other hand, as the execs get whacked or cut and run, their spots are often being filled by foreigners. Today, those replacements are most likely saavy enough to negotiate similarly lucrative packages, but I don't see any reason the right guy who happens to be just a little more hungry can't talk the board into saving a few million in bennies and salary with a few carefully chosen replacements. In fact, I believe THAT scenario becomes more likely as "the old guard" continues to age and retire.
This isn't about my job, or my company, or even IT. I know it sounds a bit hokey, but frankly this is about the survival of America. We'll become global managers? Do you understand that even management is being offshored now, too? We have so many Indian guys in suits these days, it almost doesn't faze me any more. Businessweek recently ran an article on offshoring and a sidebar contained a blurb about a CNC machinist who lost his job to a large Malaysian factory. His salary was only $28,000 per year. A man making a mere $28K to support a family of four is not a man who is whining about entitlement. It's already cutting deep, it's just that the noisemaking is focused on IT jobs because a so much money is involved there. The problem is more general and much more widespread, and precisely because it isn't about BIG money any more, the problem is very insidiuous. Everybody thinks it's only affecting someone else. Modern European nations are starting to feel the crunch, too. The press in the UK and Australia are brimming with stories about this.
In order to "go compete" on any long-enough timescale to matter, the ONLY option I see is a service job which requires a physical presence -- welders, plumbers, etc. Everything else can and will be sent overseas to the dirt huts. And even if you make the shift to such a line of work, even that income will drop steadily into the red because increasingly-smaller segments of the population will be able to afford your services.
I don't know what the answer is, but I'm sure it is NOT legislation. If you legislate against offshoring, you just delay the problem. Shortly thereafter, your imports eat you alive. So you tarriff and tax the living shit out of imports, and then what? The country has ALREADY pissed away it's manufacturing base, we don't export anything now except food, let alone exporting anything in this hypothetical future, and that latest round of taxes priced foreign imports out of reach of most people. Your economy is in the shitter. What next? It just won't work.
This is why I'm saying -- the gigantic, mostly-dirt-poor world population is creating a *new* problem.
You can cheerlead all you want about rugged individualism, but my fear is that the wave that's about to break is a LOT taller than any of us.
If you subscribe to the idea that the economy is going global, whether we like it or not (and I do), then there are two things that are going to screw us big time. The first is population growth, as Jim said. But the second one is trade deficits. The trade deficit between the USA and China is huge. From my experience, it appears they are taking all sorts of money FROM us, but they are a tiny selling market FOR us. As their average wealth increases, we would expect to see an increase in consumption once people can afford our stuff - but it doesn't happen that way.
As for innovating and changing, it comes back to the trade deficit. High tech in the USA has been decimated by outsourcing and the H1-B program. H1-B is nothing more than cost control on high-tech services. Problem is they sucked the program dry and we bloated ourselves with these workers, and when the market shrunk, we had an overflow of them - depressing prices even more.
The concept of the USA managing things and other countries producing them is a shitty one long haul, partly because managing of projects isn't something that we can keep a monopoly on forever, and partly because if you're creating a bunch of pyramids and advocating that the bases of them lie in cheap resource places like Pakistan, then you have very very few opportunities for being at the top of that pyramid in the USA. Ultimately, you need people to buy your product, and if you are making cheaper and selling cheaper, then your profits will wane.
Don't forget that ANY time there's someone who will work cheaper, then you're in jeopardy.
There is nothing we can do about global population growth, but there sure as hell is a LOT we can do about trade deficits. Right now we're not doing enough, IMO. I agree with McGuire - the bottom is ripe to fall out. It's easy to say we should adapt and innovate, but I don't think it's just the lower levels that are going to sink away - I think it's every level that is going to be affected. With the speed this economy operates at, and since we're so high on the prosperity chart, we're going to suffer the most, while the poorest countries prosper the most. Eventually we'll probably all get close to some median point, with politics, geography and natural resources being responsible for the various high's and low's on the chart.
Too bad we have 260MM people - a lot of them are going to be seriously fucked. And it's easy to say "hey, well just be one of the lucky ones!", but many won't get a choice. And Smackie you know as well as I do that if the bottom starts to fall out, and the gap between rich and poor grows greater, that can't be allowed to happen, so legislation will ensure the rich folks pay for the poor folks. Either way you'll be paying for your fellow American. If our society stumbles, we lose in EVERY respect, including attracting talented minds here (which will put a damper on our R&D, another of our major areas of success). Being one of the rich ones in a country that has seen some tough times may sound great "Hey everything will be so cheap!" but it won't be all it seems like.
My industry lost 500,000 jobs in the 1980's, more than the automotive and steel industries combined. At a recent conference we were told that there are currently only 1900 students in petroleum engineering programs domestically. In China alone there are over 35,000! Obviously there will be plenty of those chinese to staff the global oil industry. However, those US kids are considered a rare commodity and are receiving killer starting salaries and flight paths. They will be the ones calling the shots for the mass of chinese petroleum engineers (and their interpreters).
My point is that after an unbelievable purge in our industry, where no kid in his right mind would pursue a degree in petroleum engineering, there are now some great opportunities. But what happened to the 500,000?
I love my niches, bitches! [img]/images/graemlins/smile.gif[/img]
Another angle I take frequently is that we are basically engaged in economic warfare. This was openly discussed in Japan until only very recently. I have no doubts countries like China take a militaristic view of their trade relations. With regard to India and many other countries, the intent is not so malicious, but the end result is the same.
Here is an interesting handful of statistics where the economic warfare is beginning to directly impact our ability to conduct actual warfare. The quote is from Duncan Hunter (R), chair of the House Armed Services Committee:
