Today, Ontario PC Leader Tim Hudak is telling Ontarians that if industries like Caterpillar are leaving, they should stop blaming Caterpillar and the federal government and look no further than the policies of the McGuinty Liberal government. The message is loud and clear: Ontario is closed to business and investment. As the Toronto Sun’s Jonathan Jenkins writes:
“Hudak said he expects ‘the argument from the left’ in advance of the provincial budget to be that Ontario has done enough to lower its corporate tax rates and the province can afford to hold them where they are in the face of a hefty deficit and ungrateful multinationals such as Caterpillar. But that would be a mistake, the Tory leader said, arguing lowering taxes and regulatory burdens are the only way to attract job-creating investment.”
Right on! During the 1995-1999 period, the Mike Harris government provided precisely the conditions Hudak is talking about, a period when 700,000 full-time good paying jobs were created.
However, it is even more important to be flexible in today’s global economy. Refusing to consider taking a salary cut of 50% (for some of the Caterpillar jobs although not all) in Ontario is being looked upon as a potential blessing for Muncie, Indiana. For example, read the final paragraph in this Huffington Post article from January 19th, 2012:
“In Muncie, where the official unemployment rate is around 10 percent and the unofficial rate hovers near 20, the jobs would be welcomed, even if they came with low wages and slim benefits, according to the city’s mayor. Formerly an industrial center, Muncie has lost over 10,000 manufacturing jobs in the past 15 years.
‘I sympathize with everything that’s going on with the workers in Canada and support their struggles for inequality,’ said Mayor Dennis Tyler. ‘But the truth of the matter is that it is the corporations, at the end of the day, that are going to make the decision. And we’ve got over 4,000 abandoned homes here and people that need to go to work.'”
Truth is, Caterpillar has not only been cutting back salaries for hourly workers in Ontario. Check out this piece from 2008 when Caterpillar was cutting white-collar salaries in Washington by — wait for it — 50%. The reality is, as the mayor of Muncie says, private corporations have to do what they have to do — which is to make a profit.
And, let’s not forget, even non-profits make a profit. They simply deal with their profits differently by putting their profits back into the organization through salary increases, more services, embarking on capital projects, whatever. In other words, a pay check is every worker’s profit. In other words, profit is not a dirty word.
Anyway, back to Ontario. A google search will find McGuinty (and the Toronto Star) blaming the federal government for the Caterpiller closure, ostensibly because the federal government gave tax breaks that Caterpillar might have benefited from — which some feel they should have to pay back. And, McGuinty apparently feels foreign investment laws are not tough enough.
Well, as Paul says at the CAW Worker: “Tim Harper [at the Star] thinks Caterpillar should pay back tax breaks, all the while being too stupid to realize the tax incentives went to companies purchasing rail machinery, like CN, and were anounced in 2008, two years before Caterpillar bought EMD.” Paul also wonders, rightly,why did the Star not complain about similar breaks for Bombardier under former Liberal PMs Jean Chretien and Paul Martin?
Look, no one likes the idea that several hundred workers in London are now out of jobs. But, why did the CAW not give their members a vote? Maybe some workers would have preferred $16.00 an hour over $0 dollars an hour. In time, if production increased, there likely would have been increases. Then, there is the issue of what Caterpillar management has had to deal with regarding unions in the past. Read, for example, what CAW Worker has to say about that topic — as well as Bill M. at the MiltonConservative blog.
One thing is clear: Caterpillar is only the beginning. You can’t be in a global economy and expect wages and benefits to stay the same. Ask the citizens of many European countries about that.
So, Hudak is right on. The McGuinty government needs to put policies in place that create the conditions so that businesses will invest in Ontario — as opposed to making laws that discourage such investment. And private sector unions need to do more to help them stay in Ontario once they are here even if that means making significant concessions.
And, having the CAW consider “occupying” the Caterpillar factory is certainly not going to be helpful either. Civil disobedience? Confrontation? Making entitlement demands?
Sheesh! Greece anyone?
Note: Paragraph 7 revised shortly after publishing, for clarification purposes, to include quote from CAW Worker’s blog.