workers freedom

economics as if workers mattered

Monthly Archives: February 2017

Buy, Buy that American car…

Years ago, Charlie King wrote a song by that title. The Feb. 6 Business Week has a chart illustrating just how little sense it makes to think of products having nationalities in this age of corporate globalism.

Consider the humble automatic seat-control unit installed in car seats made (in Texas, Ontario Canada, and elsewhere) for an unidentified auto maker. It starts with a capacitator imported from Asian plants (and which of course has its own long backstory), which is bought by a contractor in Centennial, Colorado. The contractor ships the capacitors to Ciudad Juarez, Mexico, where it is incorporated into a circuit board (along with other parts from around the world). The circuit board is then shipped across the border to a warehouse in neighboring El Paso, Texas; according to Business Week for the purpose of avoiding paying Mexico’s value-added tax. It’s then shipped to Matamoros, Mexico, where workers at a Norwegian-owned factory assemble the circuit board (along with other parts from around the world) into a seat actuator, the electrical device that adjusts the seat with the press of a button. The finished control unit is then shipped to seat assembly plants in Arlington, Texas, Mississauga, Ontario, and elsewhere, to be incorporated into car seats, which will then be installed in cars incorporating countless other parts that have been engaged in their own journeys around the world.

The whole process is enormously wasteful, of course. Workers’ time and natural resources are exhausted moving billions of items in an endless circuit of the world, for one or two minor processes before they are shipped somewhere else. It’s done to seek out the cheapest labor, to avoid taxes and pesky environmental regulations, and to weaken the power of unions.