From the July-August 2018 issue of News & Letters
Kansas City, Mo.—Trump and Speaker Paul Ryan had guaranteed last December that the newly rammed through Republican tax cuts, slashing corporate taxes from 35% to 21%, would at least mean higher wages and more job security. If there were any workers at the Kansas City Harley-Davidson plant who believed it, by January those expectations were dashed.
Milwaukee-based Harley-Davidson almost simultaneously announced an increase in their shareholders’ dividend and a corporate buyback of $700 million of their own stock—and their plans to close their Kansas City plant altogether next year. Those jobs will go to workers already at the York, Pa., factory.
TAX CUTS HELP DISAPPEAR JOBS
That was how Harley-Davidson, like corporation after corporation, had used their tax windfall—on stock buybacks and job cuts, not on the fantasy of raising the wages of U.S. workers. But the 800 workers here in Kansas City had reason to expect their jobs were secure enough to work until retirement.
The factory was just over 20 years old. It had been built in 1997 with millions of dollars in subsidies, from both grants and tax forgiveness, from Kansas City. The city strove to find some replacements for its disappearing industrial base of shuttered packing plants and soap factories.
By March Trump had given Harley-Davidson an incentive to move jobs, not just to Pennsylvania but overseas, when heavy tariffs on steel and aluminum added $2,000 to the production cost of each motorcycle. Trump named Canada as a national security threat in order to evade Congressional authority over tariffs.
UNION BUREAUCRAT BACKS TRUMP
Embarrassingly, for a united labor movement, Steelworkers president Leo Gerard willingly offered Trump and his anti-worker regime a cloak of legitimacy. Gerard not only heaped praise for the tariffs on this anti-worker occupier of the White House, but he also spoke in the name of union members by promising that steelworkers would not forget Trump at the ballot box in future elections.
By the end of May, as Trump courted a full-blown trade war, the tariffs that China and the EU in particular imposed on motorcycles, among other U.S. products, gave Harley-Davidson the cover it needed to step up the timetable on its planned move of production to a new factory in Thailand.
Workers expect not only that their jobs will disappear, but that the factory itself will be dismantled and shipped to Thailand. Harley-Davidson is following the capitalist law of value, pay workers the minimum and extract from them the maximum. Harley-Davidson’s moves have, however, been hastened by the guy in the White House famous for not paying the workers he has hired.
—Retired Kansas City worker