Oh what a tangled web (2)

So, the Globe and Mail (and almost everyone else) reportsGeneral Motors is shuttering its plant in Oshawa as part of a restructuring of its global operations to focus on autonomous and zero-emission vehicles … [and] … Two sources, who were briefed on General Motors’ plan, said the Oshawa plant will be completely closed down. Those sources said Canada isn’t the only country affected by the auto giant’s move to shift its investment away from traditional vehicles … [and, further] … The offices of Prime Minister Justin Trudeau and Ontario Premier Doug Ford were informed of the decision late Sunday before the official announcement on Monday. A federal official later told The Globe and Mail that the government will be examining the impact of the closing and what measures it might take to help laid off auto workers.

That would be the same GM (well, legally not, but …) that the Canadian and Ontario governments bailed out in 2009 and that would be the same General Motors (again, not quite the same when one reads the legal fine print) that saw about $1Billion of the money owed to Canada written off as a bad debt earlier this year according to an informative story on CBC News that bears reading from start to finish.

As a matter of principle I fully support GM’s decisions to close underperforming plants, edf69569f28b794d23533f8e98dc3552wherever they are, as part of their programme to meet the demands of a market that seems to be shifting away from gas guzzlers like the Buick Regal and Cadillac XTS , both of which are assembled at Oshawa, and on to more energy efficient vehicles. That’s just good business, additionally, the Good Grey Globe says that “automakers in Canada face higher costs of labour and other expenses than at factories in parts of the United States and Mexico.” Thus, I have no problem with capitalists and corporations doing what they should do: maximize shareholder value. I have no problem because I’m pretty sure that my pension funds and my meagre investments include stocks in many capitalist corporations that make similar decisions on a regular basis … it’s possible that GM, in giving pink slips to 2,600+ workers in Oshawa, is, actually, looking to maximize my return and yours, and your parents’ and children’s and the returns of your colleagues, friends and neighbours, too.

I confidently expect that union leaders like Gerry Dias and his ilk and many in the Laurentian Elites will say, “You, Prime Minister Trudeau, must treat GM‘s, Oshawa, lada-2105-do-renowacji-83000km-sosnowiec-478776559operations like you treated Trans Mountain Pipelines‘ expansion project and buy it; surely they will say, as David Olive of the Toronto Star suggests,  we could produce a Canadian government designed, by unionized workers, Lada-like “peoples’ car,” or, at the very least, you must treat it like Bombardier’s Montreal operations and pour in the cash subsidies.

One reason for General Motors‘ decision might be found in a story, in the Financial Post, in which Don Walker, CEO of Magna International, the Canadian auto-parts maker, says that ““I’m worried about what’s going on in Canada” … [and] …  “I get very frustrated when I see the decisions being made that put undue administrative costs and inefficiencies on our plants, specifically here in Ontario, because we have to compete… We’re not going to get business if we’re forced to be uncompetitive.”” Mr Walker cited “Ontario’s Bill 148 — the Fair Workplaces, Better Jobs Act — as an example of how the government is affecting business competitiveness.” (Bill 148 was passed by the previous, Liberal, Wynne government but Premier Ford has introduced Bill 147 – the Making Ontario Open for Business Act – which aims to reverse many of the provisions of Bill 148 that bother Mr Walker. While Don Walker said “Magna has not shifted investment out of Ontario, he added that if competitive advantages such as the low dollar disappear, “I think we’re going to be in trouble.” Magna has its headquarters and dozens of plants in Ontario … [and] … The company’s chief financial officer Vincent Galifi said the U.S. has become an increasingly attractive jurisdiction for investment because of its more competitive tax system.” These decisions, most taken by Jean Chrétien and Dalton McGuinty in the 1990s and early 200s and by Kathleen Wynne and Justin Trudeau in the mid 2010s, were, in the main, designed to buy the votes of industrial workers with their own money … instead federal and provincial Liberal policies are costing thousands of Canadians well paying jobs. This is tied into to something I said, just a couple of days ago, when discussing another matter entirely; I said: “We, the US led West, also need to rebuild our socio-economic cores. We need to lead the world in science, technology, engineering and mathematics (STEM) and in innovation and that must be done in the Screen Shot 2018-11-22 at 07.45.31face of a very serious Chinese challenge. This means that we need to reshape ourselves and rethink our values. It is very likely that über-progressive “sunny ways” are exactly the worst sort of thing for our society and we may need to restore the values of e.g. Margaret Thatcher, Louis St Laurent, Dwight Eisenhower … [and] … Winston Churchill.” Those values include thrift and hard work and belief in the notion that a job is the best of all social programmes. While some observers think that part of General Motors‘ corporate calculus is tied directly to President Donald Trump and MSGA, Mr Walker warns that the USMCA provisions that President Trump’s team demanded will backfire, saying that ““If we drove labour for everything in Mexico up, even doubled it, that means you’re not competitive anymore and a lot of products, it all goes back to China” … [and, he added] … “It would be very disruptive to everybody that’s doing operations down there, and we would lose the jobs out of (the NAFTA region) and drive the price of cars up a lot, which means consumers pay more.”” That’s exactly what many observers have warned against.

There’s nothing really surprising here, is there? Of course it’s very painful for Oshawa, Ontario and even Canada, but we’ve been watching, for two generations, as market forces (changes in consumer demand), costs (especially of labour and especially in Canada) and technology (manufacturers switching to robotics, for example) and other pressures (including the Trump/Lighthizer trade strategy) have disrupted long standing 9b26638be790f1aa3aa812c83de38a9cindustrial production models. I’ve mentioned before that I was stationed in NATO’s Central Command HQ in the very South of the Netherlands back in the early 1980s, the flat countryside near our home and in neighbouring Belgium and Germany was dotted with these symmetrical mounds: slag heaps, many convented to recreation centres, from the many coal mines that had been abandoned in the 1960s which was the beginning of a huge shift of industrial production away from Europe and North America that, as I have explained before, led to “dignity deficit” and to the rise of Trumpian populism. That all happened before the shocks of the 1973 oil price hikes that led to massive imports of energy efficient cars that were almost all made in Japan.

So, there’s nothing new, there’s nothing really shocking, this should not have been a huge surprise but it needs to be a warning to every other city and town in Canada, to every union local, to every provincial legislature, to every social policy advocacy group, to every national politician, and above all to every single voter: the liberal, capitalist and globalist world order which has served us so well for 70+ years is still working. Mary Barra is, simply, responding to what the market demands. Back in the 1980s I drove a Buick, even after the oil price shocks, but many, many people had already transitioned to Hondas and Toyotas and so on, and now we, too, have a smaller, more efficient and economical, Korean made car. Ms Barra and GM are just adapting to the marketplace.

This is a shock for Oshawa and for workers there and everywhere but it is NOT an excuse for Jerry Dias to demand handouts from the taxpayers and it’s not an excuse for Justin Trudeau to intervene in the economy. In fact, if anything, it is a good reason for workers and voters to evaluate the need for Jerry Dias and Justin Trudeau in their current jobs … they are, I think, part of the problem, not part of the solution:

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