How Can Our Government Let This Happen?'

GREENVILLE, MICHIGAN

By next March, when Electrolux AB moves its Frigidaire-brand refrigerator factory from Greenville, Mich., to Mexico, fully 2,700 workers will lose their jobs. Greenville will lose the plant that has anchored its economy since 1877, when John Gibson began making iceboxes here. And Michigan will suffer yet another blow to its state unemployment rate, highest in the country. In the last four years, more than 300,000 Michigan jobs, once the mainstay of manufacturing in Grand Rapids, have gone to Mexico or China.

The Electrolux exodus will strip $400,000 in annual taxes from Greenville (population 8,100) and may force neighboring Clarion Technologies, which makes plastic refrigerator bins, to close. "We're working on a package to keep Clarion here," says Greenville Assistant City Manager Bryan Gruesbeck, but Clarion's 100 non-unionized workers are not optimistic. Michigan's $119-million savings and grants package failed to keep Electrolux home. "We're holding our breath," says a Clarion receptionist who believes her job will "disappear with Frigidaire." Some employees have grabbed significantly lower-wage sales positions at the new Wal-Mart just outside town.

SEVEN BUCKS A DAY. Meanwhile, Electrolux is building a 1.5 million-square-foot facility for 3,000 workers in Juarez; this will be the largest industrial plant in the Mexican state of Chihuahua and will operate at full employment by the end of 2006, according to Electrolux spokesman Tony Evans. Assembly line workers there will average $7 per day plus bus fare and lunch, says Miguel Navaraez, director of NAFTA development in Mexico's U.S. embassy. (The average hourly wage/benefit package for assembly line workers in the United States is over $21.) As for health care, "employers pay about 5 percent of wages into Mexico's health system," Navaraez notes.

He expects to attract many more U.S. firms because NAFTA and the 1989 Mexican industrial development law save foreign manufacturers billions of dollars — $80 million annually for Electrolux. Most U.S. companies locate just over the border, where Mexican free-trade zones, unlike those in this country, permit the duty-free importation of machinery, parts and the like.

In Greenville, waiting for the ax to fall, Electrolux employees belonging to United Automobile Workers Local 137 have struck a severance deal for $400 per year of credited pension service. "That means if you worked 10 full years, you get $4,000 on which you pay taxes," says union Pres. Jim Hoisington. He will become unemployed, along with two brothers and their wives, when Electrolux leaves town.

"How can our government let this happen?" Hoisington asks angrily. "I have nothing good to say about Bush and his administration. I know they'll try to make our Democratic governor look bad when elections roll around, but she's had a Republican-controlled House and Senate that left us desolate."

Greenville is negotiating its own severance from Electrolux. "We think we're entitled to parting gifts, like their building," Gruesbeck says. "We expect companies to demonstrate responsibility to a community. We have to cut city employee health services and capital expenses. We've yet to measure the impact on our schools."

Evans says that "Electrolux gave careful consideration to alternatives that would allow us to continue manufacturing in Greenville." In the end, nothing could compete with $80 million in annual savings. And so they go.

— Joyce Winslow