While many the US were celebrating seemingly positive job numbers yesterday, for London, Ontario residents such news was caustic, rock salt poured into a gaping wound.
Caterpillar subsidiary Electro-Motive Diesel (EMD) has announced that it is transforming the lockout at its London, Ontario diesel-locomotive manufacturing facility into a plant closure.
Six weeks ago, Caterpillar locked out the 465 production workers at its London plant after they overwhelmingly rejected the company’s demands for a 55 percent wage cut, the elimination of their pension plan, and other sweeping concessions.
EMD announced the closure Friday morning in a terse press release that blamed uncompetitive labor costs and worker intransigence for its decision. “The cost structure of the operation was not sustainable,” said the release, “and efforts to negotiate a new, competitive collective agreement were not successful.”
Just last week Caterpillar boasted that the 2011 fiscal year was the most profitable in its history, with profits rising by 83 percent to US $4.9 billion.
Take a moment to absorb the jarring ironic contrast between those last two paragraphs, then listen to London Mayor Joe Fontana give Caterpillar the business for letting naked greed determine the bottom line — at the expense of local workers whose lives have now been callously thrown into total flux.
And wither the Harpercons? Alas, Canada’s market fundamentalist government always respects the sanctity of the Invisible Hand (except when it doesn’t).
Prime Minister Stephen Harper used Electro-Motive as a backdrop in 2008 to promote big tax breaks for industrial capital investments, but the federal government declined to get involved in the labour dispute.
“This matter falls under provincial jurisdiction, and we are also disappointed that the Ontario Government was unable to mediate a solution to the dispute between the company and its employees,” read a statement from the Prime Minister’s Office.
The statement also promised that the federal government will continue to work on a plan that will generate new jobs and opportunities for those affected by the closure.
Thanks for providing a great campaign backdrop, but, um, we have our majority now, and besides, we can’t help it if the crummy Ontario Liberal Government is teh suck. So, uh, anyway, don’t call us — we’ll call you.
Of course, the matter of government responsibility — yes, at all levels — goes beyond mere inaction.
It is not so much its inaction that looks bad on the Harper government, but that the lockout undermines its argument that corporate tax cuts produce jobs. Electro-Motive Canada, under a previous owner, was given $5 million in tax cuts by Harper personally. The Harper government recently lowered Canada’s corporate tax rate by an additional 1.5%, voluntarily cutting almost $3 billion from government revenue. This at a time when it is planning massive budget cuts to reduce its deficit.
The lockout is equally damning to the Conservative claim that free trade will attract job-creating foreign investment. The federal Conservatives are finishing up a new free-trade deal with Europe and have plans for a deal with India next. Given the fact that the government will not discuss the details of these free-trade negotiations, there is no way of knowing whether they would leave Canada more vulnerable to actions like those of Caterpillar’s.
Premier Dalton McGuinty has largely escaped the anger directed toward Harper. That may be in part because Harper is seen as more of a poster boy for the free-market policies.
But McGuinty is equally committed to corporate tax cuts and free trade. He is planning to cut another $2 billion in corporate taxes in the 2012 budget, and is an enthusiastic supporter of free trade, even if a deal with Europe risks overturning local content rules in the Green Energy Act, his chief response to Ontario’s manufacturing losses.
Given Harper’s preference for an Alberta-style resource economy, his indifference to Ontario’s manufacturing losses can be understood. For McGuinty, the Caterpillar lockout hits closer to home.
Partisan/jurisdictional slap-fighting aside, 465 workers have been pink-slipped and now find themselves stuck in financial limbo as severance negotiations delay the already-tedious Employment Insurance application process.
Federal MPs stressed that the workers couldn’t get EI because they hadn’t officially lost their jobs. Well now they have – sacked in fact – and that’s a game changer. Terminated by their employer, they now qualify for EI. The problem is that they are fighting for severance at the same time and EI can’t kick in until that is solved. So here’s something you can finally do without any jurisdictional excuses. Seek to streamline the access to EI in this unique situation. Given Caterpillar’s modus operandi, the severance issue might not be settled for months. Get these workers EI now and help them to survive. The maximum a veteran worker gets is two-thirds of their salary for 42 weeks. They’re about to lose their homes, so maybe a little intervention would be nice – it’s now in your jurisdiction. If severance is an issue, then arrange it so that it can be clawed back out of EI once the negotiations are concluded. But please, do something. This isn’t about your party’s detached position but about human justice, ostensibly offered to every worker who has paid into the system.
In an age when austerity rules, justice for workers is a rare commodity — especially in London, Ontario, where the willfully indifferent, cruelly banal machinations of the 1% have become all too apparent as a community reels in shock from the latest top-down missive of an ongoing, all-too-asymmetrical class war.
Related: Indiana goes ‘Right to Work’ just as Caterpillar appears to be moving EMD production to Indiana.
Entirely coincidental, I’m sure.