Electrolux closure: A disaster for the community and nation that can be averted
The Swedish imperialists have announced the closure of a productive appliance factory in L’Assomption, Quebec and the transfer of its production capacity to a new plant in Memphis, Tennessee. The entire community near Montreal is reeling in dismay and anger at this outrageous attack. Not just the lives of the 1,300 Electrolux workers affected have been turned upside down. Those of thousands more, who depend directly on supplying the factory with goods and services and transporting the means of production to the factory and the finished product to customers are affected. The community itself will suffer the loss of taxes and the Electrolux and other workers’ claims on added-value that would normally go into the community through participation and spending on public and private facilities such as schools, daycare centres, recreation facilities, sports teams, restaurants and stores. The Quebec nation and Canada lose a prominent manufacturing facility that adds enormous value to the economy, funding social programs and public services. The actual and potential added-value from manufacturing appliances is torn from the country and to add insult to injury those same Electrolux appliances must now be bought as imports taking yet more value out of the Canadian and Quebec economies.
This sudden anti-Quebec, anti-Canadian announcement exposes the danger of free trade agreements and being ensnared within the imperialist system of states. The Swedish imperialists control the Quebec and Canadian distribution network for Electrolux appliances. Workers and salaried personnel at the L’Assomption factory could very easily carry on production of appliances, but Electrolux would block their distribution through its sales network.
To circumvent this blockade, a new brand and distribution network concentrating on Quebec and Canada would have to be set up and Electrolux restricted from distributing its appliances made abroad within the country. This could only be done with legislated action by both the Quebec and Canadian governments declaring that the factory and machinery must remain as productive assets of the nation and that the Swedish imperialists by dint of their nation-wrecking and refusal to produce appliances within Canada for the Canadian market have lost the right to sell their products in the country. Such pro-social actions by the Quebec and Canadian governments would confirm their commitment to nation-building, the well-being of the people and general interests of society. An effective Workers’ Opposition is required to ensure it does take place. It can be done.
This is an opportunity for the federal government to prove in practice that it wants to build a Canada that includes the Quebec nation, and that both the Canadian and Quebec governments have the political will to defend our sovereign right to have a vibrant self-reliant economy of which a basic feature must be manufacturing.
The Electrolux workers are not alone; they are flesh and blood of the Quebec nation and Canada. Together the workers from coast to coast can stop this nation-wrecking!
Manufacturing Yes! Nation-Wrecking No!
Sovereignty Yes! Annexation No!
On the face of what Electrolux officials have said publicly, the transfer of appliance production from Quebec to Memphis, Tennessee does not make economic sense. It appears also to have been concocted fairly recently. Something more is involved, most probably imperialist politics. From what was said in the media, Electrolux bought the factory in L’Assomption only eight years ago and retooled it to make Electrolux appliances. The means of production are still in their early years producing appliances although the structure itself may be old as it dates back decades producing other commodities under different ownership. The $40 million in pay-the-rich enticements offered by City of Memphis and the county are customary under imperialism and primarily involve the surrounding infrastructure, land and worker training. The state of Tennessee has offered $92 million for unspecified benefits, possibly the recruitment and training of workers. Those pay-the-rich grants and loans must be raised through public bonds, as the local and state governments do not have any ready cash on hand. The $40 million plus the state’s $92 million will not pay for the facility itself, which will cost several hundreds of millions of dollars. Those pay-the-rich handouts although large are much less than the overall costs of building a production facility encompassing 1,250 workers, which must be built from scratch, the costs involved to move all the machinery or buy new machinery, introduce inexperienced workers to factory production and set up a new supply chain and distribution network. Electrolux also says it will take a charge of $124 million just to close the L’Assomption factory. Imagine if that amount alone were put into the existing plant and machinery. All the features of modern production, which must be built anew in Tennessee already exist at the current site in Quebec including importantly an experienced workforce. In addition, Quebec offers cheap industrial rates for electricity and water.
Electrolux boasts that the move will centralize production in the middle of its biggest overseas market. But that is nonsense. Memphis relies on a long barge route down the Mississippi River as a water outlet. Montreal is on the St. Lawrence Seaway with easy container ship access to all the large cities on the eastern seaboard, and inland through the Great Lakes to Toronto, Detroit, Chicago and Duluth or Thunder Bay for transfer to the west, not to speak of far cheaper, easier and closer transportation to and from Europe.
Owners of capital rate of claim on added-value
The rate of claim on added-value could not be that much different between Quebec and Memphis even if Tennessee is a former slave state with little union organizing at this time. Comparing the claims of Quebec workers with projected claims by workers in Memphis, the difference is not that large and, if everything is considered, possibly equal. The difference in the proposed wage scale is around $6 an hour less in Memphis. However, in Quebec, workers have the benefit of public healthcare, which means they do not expect the monopoly to assist on that front at least not to the extent it has become necessary in the U.S. Other social programs and public services are greater in Quebec, which again lowers the pressure on monopolies to supply or pay directly for those services. The imperialists are now forcing down the standard of living all across Canada so the Electrolux owners of capital know there are other ways to accomplish the aim of raising their rate of claim on added-value rather than simply moving the plant. The point is that while the established standard of living and rate of claim on added-value are important when imperialists consider investments, more is at play here than meets the eye. If it were merely a matter of lower claims by workers, Electrolux would have gone to Mexico where not just workers’ claims but costs of production as well can be lower.
Resurgence of U.S. ties with European Nazi imperialists
In the last few years, there appears to be a new concentration of German manufacturing in the former slave states. This German monopoly capital, which has close links with Swedish capital such as Electrolux, has historical significance as Nazi monopoly capital that the U.S. imperialists rescued and resurrected from the verdict and ashes of the Second World War. Even the Nazi names are similar: ThyssenKrupp, Volkswagen, Siemens, Wacker Chemie, Electrolux. German along with Dutch (Royal Dutch Shell) and Swedish monopoly capital have already overtaken UK capital as the largest direct investor in the U.S. closely followed by Japanese monopoly capital, which similarly is U.S.-rescued and resurrected militarist capital from WWII and forms the basis for the U.S./Japan military alliance, the biggest threat to the peoples of East Asia, including the Japanese people.
Examples of the surge of direct investment by German monopoly capital in the former slave states include:
- ThyssenKrupp’s new $5 billion integrated steel mill just opened in Mobile, Alabama. Significantly, this is the first integrated steel mill built in the U.S. in decades;
- Volkswagen is building a multi-billion dollar vehicle manufacturing plant in Tennessee;
- Siemens has built a huge turbine manufacturing complex in Georgia and is one of the most active manufacturers and healthcare service companies throughout the United States; and
- Wacker Chemie AG based in Munich Germany announced December 9, 2010 plans to invest almost $2 billion to construct an integrated chemical production facility in Tennessee. The Wacker chemical monopoly, which began during the First World War and later expanded its war production significantly under the Nazi Reich, is still owned by descendents of the original Wacker family, having been returned ownership by legislation of U.S. occupied West Germany in 1953.
Even Canadian monopoly capital in the form of National Steel Car has built a new plant in Alabama to compete with and perhaps destroy its existing Hamilton plant. The Electrolux move raises the question of a possible connection to a resurgent Nazi alliance of monopoly capital between Germany/Netherlands/Sweden and the United States.
Manufacturing as a percentage of economic activity in the U.S. has fallen to 14 per cent, which is below other imperialist powers such as Germany at over 20 per cent. This is not just a feature of uneven development of capitalism because imperialism or monopoly capital operates in a much less spontaneous manner. Monopoly capital is far more conscious of its narrow interests than nascent capitalism and has the ability to use that consciousness to force its will on the world. The Obama administration is pushing for manufacturing in the U.S. and this has been seen with the debacle U.S. Steel has created with Stelco, which has closed its Canadian mills in favour of consolidating production in its U.S. mills. The same is true with the recent upswing in North American auto production, which appears to be concentrated in the U.S. as well.
The resurgence of German/Dutch/Swedish monopoly capital in the U.S. along with the old ties with Japanese militarist monopoly capital may also be connected with the war drums increasingly directed against China, the Democratic Republic of Korea and Russia. The issue to think about and investigate is the possibility that the European imperialists, especially those with the old Nazi ties have come to an arrangement to put a certain level of manufacturing back into the U.S. and in return have received something, whatever that may be. It may be connected to consolidating the U.S. military empire in Europe against Russia and expanding NATO worldwide to the benefit of European imperialism and in return not raising objections to U.S. military provocations on the Korean Peninsula or some other benefit to the U.S. Empire. The point is there is more to this Electrolux closure and transfer to Tennessee than meets the eye and workers and their allies should be aware and vigilant and oppose it with all their collective strength. The resurgent Nazi imperialists and their U.S. collaborators cannot be allowed to strengthen their forces without firm opposition. Electrolux and others must expect consequences for their anti-social actions. These pro-social consequences must become well known and part of the consciousness of the Workers’ Opposition and society. Imperialists should expect resistance whenever they attempt their filthy schemes. In this case, Electrolux should at the least face seizure of its assets in Quebec and banning of its commodities from entering the Canadian market from Europe or the U.S. If Electrolux refuses to make a suitable arrangement to continue production, at least to the level of its sales in Canada, then governments are duty bound to come up with some alternative for the plant and machinery and not leave the situation to chance. This is an opportunity for the federal government to show that it cares about Quebec as a viable nation within the country wherein economic viability is based on manufacturing and not on the vagaries and meagreness of added-value from resource extraction and exporting of basic raw commodities such as electricity.
Source: TML Daily, December 29, 2010 – No. 225