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 PORTSIDE LABOR 

 TRUMP LAMENTED LOSS OF OREO JOBS TO MEXICO. HIS TAX BILL COULD MAKE
MORE JOBS GO SOUTH.   [https://portside.org/node/16105] 

 

 Justin Miller 
 December 12, 2017
The American Prospect
[http://prospect.org/article/trump-lamented-loss-oreo-jobs-mexico-his-tax-bill-could-make-more-jobs-go-south]


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 _ Trump promises to protect US jobs have proven false as Nabisco
shuts down its Chicago plant to move to Mexico and Ford reneges onits
promise to reinvest in Detroit. Under the new tax bill, even more
manufacturing jobs are likely to move overseas. _ 

 , 

 

The historic ten-story Nabisco plant in Southwest Chicago had long
been a point of pride—and a source of good-paying union jobs—in
the Windy City, thanks to its production of one of America’s
favorite cookies: Oreos. The good feelings went both ways. In 1993,
Nabisco received $90 million
[http://articles.chicagotribune.com/1993-12-15/business/9312150012_1_rjr-nabisco-nabisco-biscuit-ritz-crackers] in
tax subsidies from Chicago and Illinois to invest in upgrading and
expanding its production capabilities for snacks like Oreos, Ritz
crackers, and Fig Newtons.

More than 20 years later, in the spring of 2015, rumors were
circulating at the 1,200-employee plant that Nabisco’s parent
company, Mondélez International, might once again invest more than
$100 million to modernize the Chicago plant and add new production
lines. That July, however, management announced that the company would
instead be investing that money to expand operations at a new $500
million plant it had opened Salinas, Mexico—a move that the company
said would save it about $46 million a year. Nabisco would end the
production of Oreo cookies at its Chicago plant, where they had been
made for decades. That meant pink slips for about 600 employees.

Managers had demanded that the unionized workers would need to swallow
$46 million in cuts to their annual pay and benefits for the company
even to consider keeping Oreo production in Chicago. The offer,
Anthony Jackson, one of the Chicago bakers who lost his job, says in a
new report on Mondelez’s outsourcing, “was so egregious the
company knew it could never be accepted. After they had invested $500
million in a new facility, they had no intention of letting it go
unused.”

“I’ll never eat another Oreo again. Ever. Ever!” Trump declared
in October 2016.

With the crisis of offshoring playing a central part of the 2016
presidential campaign, the Oreo layoffs in Chicago became a
flashpoint
[http://money.cnn.com/2016/03/11/news/companies/oreo-trump-clinton/index.html], as
Hillary Clinton, Bernie Sanders, and Donald Trump all denounced
Nabisco for shipping good American jobs abroad. Trump in particular
relentlessly railed against Nabisco. In several
[http://www.factcheck.org/2015/11/about-trumps-oreo-boycott/] of his
stump speeches, he pledged that he’d never eat the cookies
again—and that he’d get tough with American companies that ship
jobs abroad. “I’ll never eat another Oreo again. Ever. Ever!”
Trump declared in October 2016. “So I’m going to talk to them. I
don’t want their cookies made and sold there. I just don’t want
it. It’s unfair to us.”

In recent months, a coalition of faith and labor leaders traveled
around the country to cities with Mondélez-Nabisco plants—Chicago;
Fair Lawn, New Jersey; Richmond, Virginia; Portland, Oregon—talking
with current workers and those who were laid off. Activists also
traveled to Monterrey, Mexico, in late November to learn about the
working conditions at a Mondélez plant there. The Bakery,
Confectionery, Tobacco Workers, and Grain Millers' International
Union, which represents Nabisco workers around the country, and
Interfaith Worker Justice, a faith-based labor group, has now released
a report, “Breaking Faith: Outsourcing and the Damage Done to our
Communities” detailing the impact of Mondélez-Nabisco’s
outsourcing on workers on both sides of the U.S.–Mexico border.

“Mondélez-Nabisco has come to treat its workers just the same way
they would the other commodities that go into Oreos, such as cocoa,
sugar, flour, and so on,” Laura Barrett, executive director of
Interfaith Worker Justice, says in the report. Shifting production of
Oreos from Chicago to Mexico reflects “a trend of exporting from the
United States production lines that baked and packed Nabisco’s
so-called Power Brands – those with greater, steady sales, such as
Oreo, Chips Ahoy, Honey Grahams, and Ritz Crackers,” the report
states.

The company has said that it hopes to produce all its Power Brands in
Mexico by 2018, which could mean hundreds of more jobs moved out of
the U.S.

The threat of future layoffs and plant shutdowns looms large for
Nabisco’s U.S. workforce, creating a constant sense of
insecurity. “The fear is always there,” Lamar Kennedy, a baker in
Portland, says in the report. “There’s always the possibility that
everything will go to Mexico. So every day you go into work, you think
that today could be the last.”

Another worker explains: “Supervisors were telling people, ‘you
need to work harder because we’ve got to keep this place open.’ So
it’s like a veiled threat. I think the workforce thinks that a
shutdown is not a matter of if it will happen, but when it will
happen.”

Compounding such problems, Trump, once in office, has fallen short on
his campaign promises to crack down on companies that ship jobs
abroad. Both Carrier and Rexnord, both companies based in Indiana,
have continued to ship jobs to Mexico despite weeks of media attention
after Trump promised to protect their American workers’ jobs.
Trump’s shaming of Carrier appeared to cement Trump’s campaign
image  as “a blue-collar billionaire who would stand with workers,
not CEOs,” Chuck Jones, the former president of the United
Steelworkers local representing Carrier workers in
Indianapolis, recently wrote
[https://www.washingtonpost.com/news/posteverything/wp/2017/11/29/a-year-ago-trump-promised-carrier-workers-help-were-still-waiting/?utm_term=.1940d63a9b4f].
But Trump’s initial action, Jones continued, has been followed by a
year of inaction. “A year later, we feel betrayed. ... Beyond
Indiana, workers across the country feel like they too are victims of
a false Trumpian bargain, in which they were invited to trade their
votes to keep their jobs.”

The administration has started talks with Canada and Mexico to
renegotiate the North American Free Trade Agreement (NAFTA), and labor
advocates are holding out hope that a new deal will stop the outflow
of American jobs to Mexico. But those following the negotiations
remain skeptical that the Trump administration is willing to loosen
the stranglehold that corporations have on U.S. trade policy.

Meanwhile, the Republican tax plan that Trump has sold as a tremendous
deal for the middle class might actually encourage companies to move
their domestic operations—and jobs—abroad. One provision in the
tax plan would establish a “territorial” system
[http://prospect.org/article/republicans-want-make-corporate-tax-avoidance-even-easier] for
taxing foreign profits, which would make it much easier for
corporations to avoid international taxation and could actually spur
companies to move operations abroad.

Kimberly Clausing, an economics professor at Reed College, writes
[http://fortune.com/2017/11/20/gop-tax-plan-donald-trump-america-first/]:
“Unlike the present system, which taxes companies on their foreign
income once it is repatriated to the United States, a territorial tax
system _exempts_ foreign income from U.S. taxation. This tilts the
playing field even further toward doing business abroad rather than at
home, since there will always be countries with lower rates. A
territorial system makes explicit, and permanent, the preference for
foreign income over domestic income. It also accelerates the profit
shifting behind our corporate tax base erosion problem. That is hardly
an ‘America first’ policy.”

Detroit-based auto giant Ford announced just last week
[http://wnep.com/2017/12/07/ford-to-build-electric-cars-in-mexico-rather-than-michigan/] that
it will build its new electric car in Mexico, reneging on its promise
in January to launch production in Michigan—which it called at the
time a “vote of confidence” for President Trump. That’s no
coincidence, says Leo Gerard, president of the United Steelworkers
union. “Ford and other giant corporations got what they wanted out
of Republicans on taxes, dramatically lower levies on domestic profits
and total elimination on foreign profits,” Gerard recently wrote
[https://www.alternet.org/labor/trump-and-gop-tax-cut-handing-corporations-ford-giant-incentive-move-offshore].
“That makes Mexico an even more attractive manufacturing site for
them than NAFTA did.”

In the meantime, Mondelez has left thousands of frightened or
abandoned workers in its wake. “We don’t expect to live in the
same world, because this world does change,” says Stan Milewski, who
has worked as a Nabisco baker in Fair Lawn for 38 years. “But ever
since Mondélez took over [in 2012], they are fast-tracking these
changes. They just don’t have the interest of the workers at heart.
The executives just want to line their pockets.”

Indeed, Mondélez-Nabisco CEO Irene Rosenfeld was rewarded handsomely
for trimming labor costs, pulling in more than $185 million in pay
over the last nine years. When she recently left her post (to take
over as board chair), she took with her a $35 million personal
pension, $50 million in severance, and more than $70 in stock options,
the report says. The company’s new CEO, Dirk Van de Put, could
make more than $55 million
[http://www.chicagotribune.com/business/ct-oreo-mondelez-ceo-pay-0804-biz-20170803-story.html] in
his first year.

And it remains to be seen whether Trump fulfills either campaign
promise: to crack down on companies that offshore jobs, or never to
eat an Oreo cookie again.

As _The Washington Post _reported in its preview
[https://www.washingtonpost.com/politics/trumps-campaign-big-macs-screaming-fits-and-constant-rivalries/2017/12/02/18bcfa30-d6bd-11e7-b62d-d9345ced896d_story.html] of
the book _Let Trump Be Trump_, by former Trump campaign officials
Corey Lewandowski and David Bossie, the cupboards of Trump’s plane
during the campaign “were stacked with Vienna Fingers, potato chips,
pretzels and many packages of Oreos because Trump, a renowned
germaphobe, would not eat from a previously opened package.”

The White House did not respond to requests for comment on whether the
president has eaten an Oreo cookie since first pledging to boycott
them, or to charges that his vaunted tax plan could spark even more
Oreo-esque layoffs. 

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