The following article was written by Ewin Hannan and published in The Australian Financial Review, one of two national newspapers in Australia. Hannan met with BCTGM Strategic Campaign Coordinator Ron Baker and Local 300 members while traveling through Chicago last week. The article is published here with permission.
Near Marquette Park in Chicago’s south-west side, where Martin Luther King led a 700-strong protest against housing segregation 50 years ago, the smell of Oreos wafts from the Nabisco plant. Although not for much longer.
Nabisco’s parent company, Mondelez International, is laying off 600 of its 1200 workers as the snack food colossus shifts some of its North American production to a refurbished plant in Salinas, Mexico.
By mid-2016, Oreos, marketed as the “world’s favourite cookie”, and brands such as Chips Ahoy, will cease being made in Chicago.
Factory job losses in the US are hardly novel, with Chicago alone losing 60,000 manufacturing jobs since 2000. But Nabisco’s offshoring has left a sour taste with consumers, and been seized on by Donald Trump, Hillary Clinton and Bernie Sanders as they pitch to disillusioned blue-collar workers in manufacturing-heavy states. Overt support for free trade principles has become very unfashionable during this US election campaign.
Across the road from the South Kedzie Avenue plant, machine operator Laura Martinez sits in a modest first-floor apartment that has been converted into a campaign office by the local arm of the Bakery, Confectionery, Tobacco Workers and Grain Millers Union.
“It’s really hard because I am the only one working in my house,” says Martinez, who has worked at the plant for eight years and is among 368 Nabisco employees to so far receive lay-off notices.
“My husband got sick four years ago. He can’t work no more. He got bone cancer. It’s very hard for me because I really need a job with insurance for him. Otherwise, how am I going to support my family? I really need my job back.”
Leonard Aiello, 57, lost his job after four years working as a dough mixer. He earned $26 an hour, roughly $1000 a week. There was also overtime, at time-and-a-half, “if you wanted it”.
A GOOD WAGE
It is considered a good wage in an area still recovering from the 2008 financial crisis. Nearby streets are notable for the number of houses that remain vacant, their windows and doors boarded up.
Aiello believes he could find more work locally but in a lesser paying service or retail job, offering $10 to $15 an hour. He intends to move with his wife to Arizona where he has family.
“I’m OK, my concern is people like her,” he says, gesturing to Martinez. “She’s got a sick spouse at home. There are young people with children who have just bought a house. They are going to lose everything.”
Aiello was present last month when the union office – filled with trestle tables, union banners and a Marilyn Monroe poster (put up by the owner to cover a hole in a wall) – played host to Clinton.
Clinton highlighted the $US90 million in tax incentives and subsidies given to Nabisco in 1993 after it agreed to stay in Chicago and not move to Mexico.
“I think they should have to pay that money back and that money would be used to reinvest in the community and the workers,” Clinton told the employees.
Sanders sent Larry Cohen, a campaign adviser and former president of the Communications Workers of America, to meet the workers. “Trade, and how we act and fight on trade is a major issue in this campaign,” he said.
Trump has declared he will “never eat another Oreo again”.
“I don’t want their cookies made and sold [in Mexico],” he said “I just don’t want it. It’s unfair to us. Chicago is losing this large plant. It’s going to another country.”
PLANT TO STAY OPEN
In fact, Chicago is not losing the plant. While four “lines of the future” in Mexico will replace nine Chicago production lines, 600 workers will remain employed at the Chicago plant, albeit producing less popular brands.
Mondelez estimates the Mexico move will save the company $US46 million annually.
Foreign production allows the company to access cheaper labour, with union officials estimating its Mexican workers earn, on average, $US60 a week with minimal or no benefits.
Mondelez also accesses lower tax rates than the US rate of 35 per cent. According to the Chicago Sun-Times, the company’s effective tax rate in 2015 was 7.5 per cent, 13.8 per cent in 2014 and 2.5 per cent in 2013.
Gianfranco Giurasi, 57, who has worked at the plant for 36 years, says Nabisco employed 5000 workers at the plant’s commercial peak. He says workplace morale has deteriorated in recent years as Mondelez culls long-time managers.
‘I have seen so many changes but the one change that I have seen that really struck me is the relationship between management and the employees,” he says.
Ron Baker, the union’s strategic campaign co-ordinator, says the union is pursuing a national boycott of Mexican-made cookies, urging consumers to check Oreo labels to determine their origin. He says the fact that the presidential candidates are talking about the cuts shows the issue is resonating with voters.
“I have been across the country quite a bit in the last two-and-a-half years,” Baker says. “The winds are changing. Americans are pretty patient when it comes to stuff like this. They kind of take it on the chin and then turn the other cheek. But the American people are about done taking it on the chin and you are going to see more and more of this pushback.
“They try and feed you this stuff that if you’re not a free trader, you’re an isolationist. Well, what’s free trade got the American worker or any workers for that matter in any part of the world other than misery, unemployment and seeking the next job on a lesser amount of pay?”
‘KICK IN THE TEETH’
Jesus “Chuy” Garcia, a local Cook County commissioner and Democrat, says the job cuts are “one more kick in the teeth” to Chicago workers and the city’s middle class.
“When you have an intolerable level of violence in the Chicago land communities every day, when you read about how many people are shot, the reason that people are resorting to violence is because they don’t have good paying jobs,” he told a recent rally of workers
“This is an irresponsible corporate decision that has been made only because of greed, only because this corporation seeks to find new workers to exploit by paying the lowest possible wages. This is known as a low-road strategy. This doesn’t help workers anywhere.”
Aiello is positive about Clinton’s response, but sceptical about what she can ultimately achieve.
“She seemed very concerned about it. Her response was right now there are no laws or regulations to stop companies from offshoring or to penalise them,” he says.
“Her response was very favourable, plus she was here. But let’s face reality even if she gets elected as president, she’s got to get Congress on her side to do anything and that could be years from now.”
Giurasi says he fears the plant will not be operating in five to 10 years. “I hope it is, I hope it stays open,” he says. ‘When I started, you could smell the aroma of the baking. I haven’t smelt it for a long time. Now I smell rats and corporate greed.”