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Lights Out at GE

Bloomington’s jobs are going south—with taxpayer help.
general electric

BLOOMINGTON, INDIANA—“There was a time you couldn’t find a place at the plant to park,” says Joy Finley, who works at the Local 2249 of the International Brotherhood of Electrical Workers (IBEW), which represents the manufacturing workers at the local General Electric plant. “Folks were getting towed.”

On Thursday, March 31, however, the scene is starkly different in the GE parking lot just off Curry Pike on the outskirts of Bloomington. The lot is mostly empty. Nine out of every 10 autos here are American, which contrasts with the part of town near Indiana University, where about half of the cars are Japanese. Bumper stickers range from “Bush-Cheney-Daniels” to “Kick that son of a BUSH out.” More than one car’s bumper declares, “Jesus is Life: the rest is just details.”

Many of those leaving the first shift after 3 p.m. (they started at 6:30 a.m.) are carrying empty crock pots or casserole dishes they brought for the retirement of someone on their line. About 70 were lucky enough to take retirement the day before the layoffs came. Friday would be the last day for another 470 workers.

According to the official story, the April Fools’ Day layoffs were happening because GE planned to “discontinue production of mid-line, side-by-side refrigerator models that are not competitive on cost or product features.” While that is technically true, a very similar new line of refrigerators is being started up at the GE plant in Celaya, Mexico. All the workers in Bloomington understand that their jobs are being sent south of the border. And they all point the finger at the same two targets.

“Free trade and NAFTA are the worst things that have happened to the working man,” says Tracy Pritchard, who worked at GE for 10 years until he was laid off April 1. He plans to go to school and maybe become an electrician. “I’m gonna stay outta factory work—not much future there.” The other culprit? “Corporate greed”— a cliché at the plant and the union hall.

Pritchard, like his coworkers, didn’t know it wasn’t free trade, strictly speaking, that has helped GE move their jobs to Celaya. The corporate welfare state—specifically, the Export-Import Bank of the United States—played a role.

In Celaya, a General Electric joint venture named Mabe makes appliances, including the side-by-side refrigerators that had been made in Bloomington. As part of another joint venture called Qualcore, GE built a separate plant in Celaya to supply parts for the appliances made at Mabe. That’s where the U.S. taxpayers got involved.

To reduce the cost of the Qualcore factory, GE called on the Export-Import Bank (Ex-Im), a federal agency. Ex-Im provided a subsidy in the form of a $3 million loan guarantee because the new plant would include components made in California and Illinois.

At the IBEW’s office right behind a pawnshop, Joe Adams sits down to talk to me. He’s the local vice president, but he’s getting laid off by GE on Friday, after 10 years. He tells me about when he was first looking for work. “They told me I couldn’t get a factory job without factory experience. That didn’t make sense. What’s the experience you need?” Joe soon learned what was required. “Are you gonna be here, on time, every day? Are you experienced with the mundane? Can you stand to do the same thing again and again?”

Inside the plant, I see what Joe means. Work that an outsider might expect to be done by a machine—attaching a support bracket to a refrigerator’s evaporator, for example—is done by hand. A conveyor belt carries the evaporator up to Patty McGinn, who picks it up, attaches the supports with a few simple motions, and puts it back down. Then she does it again. And again.

Patty stands out. Most workers at the plant look considerably older than their age. But with short blonde curls and a fresh face, Patty is in fact one of the more senior employees. She isn’t getting laid off this time, but nobody here expects the plant to be around much longer.

Patty, like many at GE, met her husband at the plant. He can’t read or write, and he started here before the plant required a high-school diploma. Many of the laborers, like Patty, started at age 20 or younger. This is part of what makes the layoffs so tough. These workers make $20 to $24 an hour. Without training or experience, in relatively low-cost Bloomington, they earn over $41,000 (up to $50,000) per year, plus benefits and possibly overtime. “Where else you gonna find this sort of money?” is the common refrain.

Some of the workers see how their generous wages relate to their jobs’ southward motion. It’s conventional wisdom in Bloomington that the Mabe workers make $2 to $3 an hour. “We knew labor costs were getting out of hand,” says Glenn Collins, IBEW’s local president. After NAFTA, the union took a gamble and agreed to set up a two-tier wage structure. That means new employees get paid less than more senior workers—a radical idea in a union factory.

Corporate management, however, at the same time created new projects that would allow the recent hires to jump immediately to the same wage as everyone else, wiping out any savings this new union contract would have provided. For Collins, this was just one more example of GE’s lack of intelligence when it comes to saving money in Bloomington. As he sees it, and he is not alone among the plant workers in this, manufacturing in America is doomed and has been doomed—some say since NAFTA; others think that agreement just expedited the inevitable.

Tony Smoot may be setting a record, getting laid off by GE for the third time. In 2000, when GE moved its biggest refrigerators (30 and 27 cubic feet) to Celaya, there was a round of layoffs. Some workers, including Smoot, were hired back after others retired. In 2001, in another round (as the 24- and 25-cubic-feet models went south), Smoot got the axe again. After a few months, he was back. This time he doesn’t expect to be rehired. He agrees manufacturing is dead, and he thinks George W. Bush only makes things worse. “Bush says, ‘buy American, buy American.’ Hell, go to Wal-Mart. Ain’t nothing made in America anymore,” Smoot says. “You can’t even buy an American flag that’s made in this country.”

Dennis Briscoe of Elletsville shows up Thursday for his second-to-last day here. He began work at GE 13 years ago, after he was laid off from Otis Elevators, less than a mile down Curry Pike. Briscoe hopes to attend Ivy Tech, also just down the road, using federal funds provided by NAFTA in these situations. He will go into biotech or nursing. I ask him how he feels about both of his jobs going to Mexico. “Hell,” he says, with the same sad smile most of these workers have this week, “if I had my own business, I’d do the same thing.”

On Friday, Jim Sips plans to work a double shift. That puts him in the plant from 6 a.m. to midnight. When I run into him, he’s sitting on a chair, watching refrigerator casings go by him, checking to see if the paint job is even. He’s wearing a Bush-Cheney inauguration t-shirt he got because he contributed to the 2004 campaign. “GE’s been good to me,” he says. Sips acknowledges that the plant will shut down entirely in the near future, but he doesn’t blame the company. Even in the face of being laid off, he sees benefits to free trade. He points to his colleagues and says, “These folks complain about everything going down to Mexico, but they shop at Wal-Mart.”

Sips also brings up a subject only the older workers will mention: America’s work ethic. It’s a subject Jeff Cain, a recent retiree, has no problem discussing with a reporter. “Americans are lazy,” he says. After visiting his wife, who still works at the plant, Cain tells me, “Everybody wants a paycheck, but nobody wants to put in eight hours.”

Collins, too, finds other culprits besides “corporate greed.” In the union offices, he tells me, “In the U.S., we’re constantly being monitored by OSHA. The EPA is on our case. … Why take a beating from the EPA and OSHA when you can just build your stuff down in Mexico with nobody bothering you?”

Collins is keeping his job at the plant, and he’s one of the few workers I tell about the Ex-Im deal that helped build GE’s manufacturing setup in Celaya. Joe Adams is in the room, too. “Well, that’s just great,” Joe says. “My taxes are paying to ship my job to Mexico.”


Timothy P. Carney is a Phillips Fellow and a freelance writer in Washington, D.C.



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