Payne: Obama’s non-union, right-to-work manufacturing model

Posted by hpayne on February 19, 2013

Obama visits non-union Linamar power-train plant in North Carolina.

Obama visits non-union Linamar power-train plant in North Carolina. (AP Photo)

On the eve of the Michigan Legislature’s historic right-to-work vote last December, President Obama came to a unionized Michigan diesel power-train plant to denounce right-to-work laws as a threat to America’s middle class that will “take away your rights to bargain for better wages and working conditions.”

Last Wednesday, the same president made a non-union, diesel power-train plant in right-to-work North Carolina the first stop in his post-State of the Union tour touting American manufacturing. Not surprisingly, the White House made no mention of these inconvenient facts.

Indeed, the Canadian-owned Linamar facility outside of Asheville contradicts the entire industrial policy that Obama has made the cornerstone of his second term.

“I believe we attract new jobs to America by investing in new sources of energy and new infrastructure and the next generation of high-wage, high-tech American manufacturing,” said the president, echoing his State of the Union themes to 160 workers. “And that’s why I wanted to come down here to Asheville, because there’s a good story to tell here.”

But Linamar didn’t open in an abandoned Volvo plant two years ago because of Obama’s policies. It opened here because North Carolina is a right-to-work state with low energy costs driven by traditional fuels like coal, nuclear, and natural gas.

That is, North Carolina is leading America’s resurgence in manufacturing for reasons that Obama and his union and green allies vehemently oppose. “The U.S. will have an export cost advantage of 5-25 percent” over its competitors, concluded Boston Consulting Group last year. “Among the biggest drivers of this advantage will be the costs of labor, natural gas, and electricity.”

Take right to work. Union-puppet Obama has not only fought this national trend in Michigan, but his National Labor Relations Board has opposed firms like Boeing from moving to right-to-work southern states. Linamar’s biggest customer is North Carolina-based, Big Labor-enemy #1 Caterpillar Corp. which has brought a steady parade of manufacturing jobs to the right-to-work south (part of a “southern strategy” that unions loath) — and away from Obama’s Big Labor Illinois. That should be a lesson not only to Washington but also to Michiganians who shy from marketing the advantages of their new right-to-work status.

“Right to work is something we talk about in our marketing,” says Ben Teague, a spokesman for the Asheville Chamber of Commerce who says both Caterpillar and Linamark find North Carolina’s labor climate attractive. “We feel it is a competitive edge. It means you get workers that want to work at a reasonable wage.”

The White House ignores this reality.

“Caterpillar, which I know you guys supply, they’re bringing jobs back from Japan,” the president told the Linamark crowd. “We’re seeing this trend of what we call insourcing, not just outsourcing. And the reason is because America has got outstanding workers.”

Another big factor driving insourcing is that manufacturing firms are fleeing Obama’s green, European energy model of high-cost alternatives for America’s more competitive energy prices driven by its vast reserves of coal and natural gas.

North Carolina, which gets over half its electricity from coal and another 34 percent from nuclear, has 8.6 cents per kilowatt hour electricity costs, which are more than four times cheaper than Germany. Michigan’s cost is 10.6 cents/kWh).

The president joked at his Asheville plant stop that he and Michelle may want to retire one day to its Smoky Mountain beauty. At least he understands North Carolina’s tourism attraction. But better understanding North Carolina’s attraction to industry is crucial for this country’s manufacturing future.

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