Donn Esmonde pens a paean to protectionism today.
There are 650 workers at American Axle on Delavan Avenue. That is half as many as a year ago. A year from now, there may be none. Union leaders say the company told them the plant, which makes axles for a declining line of Chevy trucks, will by idled by year’s end.
It is an old story. Higher-wage American autoworkers are an endangered species. Jobs once monopolized by Americans now are done in low-wage, little regulation plants from Mexico to China.
The loss of those 650 jobs will be a huge blow to the local economy, but do you realize that in 23 years the GM Powertrain plant in Tonawanda has lost 8,400? Yes, and not one of those went to "little-regulation" plants from Mexico to China.
In 1984, the GM plant was Buffalo's largest employer with 10,000 workers on the assembly lines. Today, though the numbers seem to vary from one report to the next, it employs only about 1,600. Yet it manufactures more and better engines now than it did twenty years ago. Mechanization has made the difference.
And while it is true that some Buffalo jobs have been lost to overseas, the problem is not so much our high American wages as it is our high American taxes. Adding New York's corporate tax to the federal tax gives New York the honor of charging one of the highest corporate tax rates in the world. It costs too much to do business here. It's so bad that choosing between France and Buffalo as a profitable location to set up shop would be a real head-scratcher.
Esmonde knows that, too, but it wouldn't have made for a good tear-jerking end of week column.
[UPDATE:] Don Boudreaux with some evidence that labor unions have nothing at all to do with improving workers' economic conditions.