Ed Wallace

American Factory

There has always been a great duality to the American mindset throughout our history. As kids, the Baby Boomers protested the Vietnam War in the late Sixties and eagerly celebrated the First Earth Day in 1970; then when we grew up, we purchased the largest SUVs we could afford … and cheered on every American conflict overseas. And yes, we are the nation that both created the Peace Corps and devastated Southeast Asia — in the same decade.

And it continues to this day. Most intelligent citizens believe the president has a legitimate complaint with China’s style of international mercantilism; yet they’ll rush to go shopping this weekend at Walmart and other discount stores, where they’ll purchase products priced low because they’re made in China. Maybe their next ad campaign targeting our duality should be, Quit Protesting Your Savings. And here’s a small irony for you: In a poll last month almost 70 percent said they have no problem with American workers being part of a union; just over a decade ago, a large number of very vocal citizens called union members the most overpaid workers in the country.

For as long as I can remember presidents have been harping about bringing manufacturing jobs back to America or forcing foreign competitors to build more factories here. And though the foreign manufacturers have arrived, most of the American firms haven’t come home. However, even when the foreigners show up, it’s often not the same jobs that once offered a middle class life in the Rust Belt. The new Netflix documentary, American Factory, makes that point particularly well; when it’s over, you understand how futile it is to believe in a future for manufacturing unless you know how to work on robots.

Even before the Financial Meltdown in 2008, General Motors announced that its Moraine, Ohio, factory, then responsible for midsized SUVs such as the GMC Envoy, would be shuttered. That factory’s end days were the subject of the documentary The Last Truck: Closing of a GM Plant, by filmmakers Steven Bognar and Julia Reichert the following year. Moraine is a suburb of Dayton and has a long connection with General Motors. Charles Kettering, GM’s in-house genius and then owner of Delco, invented the first electric car starter in that city. Many never knew that DELCO stood for Dayton Engineering Laboratories Company.

The Dark Side of an Upturn

When that GM factory closed, thousands of workers lost their jobs during a period when the economy’s downturn made moving to another GM factory nearly impossible. Many lost their homes and were forced to declare bankruptcy. One former GM worker, who did lose her house, shows off her bedroom in the basement of her sister’s home.

Years later some hope returned, as China’s Fuyao purchased part of that plant to reopen for the manufacturing of glass. This event would be the subject of Bognar and Reichert’s newest documentary, American Factory. It’s the story you don’t know about what happens in the fifth stage of American manufacturing in so many places desperate for decent blue-collar jobs.

First, Fuyao sends over 200 Chinese to supervise the glass manufacturing. Apparently it’s not a job you volunteer for — years in America without one’s family. For the American workforce it’s a chance to return to work, but instead of the old GM pay of nearly $30 an hour with benefits, it’s $12.90. Adjusted for inflation, the Fuyao wage is just $1.22 higher than the minimum wage in 1968. But it does represent something the good people of Moraine badly needed: some small glimmer of hope for a future better than the previous six years that plant remained empty.

In spite of the language difference, there is a form of bonding between the two groups, and the depth and intimacy of filming that Fuyao allowed is fascinating. Would you like to know how the Chinese really see Americans? The film shows them holding an open discussion with their staff on Americans and what makes us tick. Some will watch that segment and angrily reject their characterization of us; others will be forced to question or admit if their perceptions of Americans are accurate.

One new worker takes his Chinese supervisor out to his country home. Fixes him a big dinner with his family, lets him shoot his guns knowing they are outlawed in China for individuals, and for the most part talks about how close he feels to his Chinese work partner. Others will argue with them. But for the most part, the first 30 minutes of the film resembles a more serious version of the 1986 movie Gung Ho, with Michael Keaton; in that story a Japanese car company comes to America and reopens a closed auto factory, where the cultural battles begin. That particular movie wasn’t all that funny, and this documentary is even less so. In both films the problems start almost from day one.

Senator Sherrod Brown, speaker at the grand opening of the plant, talks about the long history of labor, unions, and manufacturing in Ohio, sending up the blood pressure of Fuyao’s management; it’s evident that they do not want a union plant under any conditions. One executive even tells his Chinese counterpart he’d like to cut Brown’s head off for going off script at the ceremony.

As the documentary makes clear, the job is tough, and the Chinese are forced to deal with the fact that Americans don’t work at the same speed people do back home. They marvel that we work only eight hours a day and get two days a week off, when Fuyao’s Chinese workforce labor in 12-hour shifts and get only two days a month off.

Spoiler alert: People get hurt, because glass production can at times be dangerous. There is a constant push to increase the speeds on the line, much as there was in the earliest days of the automobile industry. Ford’s turnover in the first year it used the moving assembly line — 400 percent — only slowed when Henry Ford stunned industry by coming out with the $5 workday. And even then, many in Detroit refused to work at Ford because the job was so punishing. The film shows meetings in which the Fuyao bosses talk about how to keep the union out, even bringing up firing those promoting it. That’s illegal, but the Chinese don’t know that. And in the end it doesn’t matter; when the union vote comes it’s knocked down by a huge margin.

But this is not to say the Chinese are the bad guys here. Nor are the Americans. They wonder why we are so entitled and refuse to work the hours at speeds they know are possible. The Americans wonder why the Chinese won’t listen to them. As one arbitrator said after a dust up, they’re both wrong. Still, while you feel great sympathy for the workers trying to make this new, incredibly low-paying job work because they have no other options in their hometown, you also feel for the Chinese workers in Ohio who sit at night longing for their families and kids back home and wondering if they are failing at their jobs.

Even the Chinese billionaire and owner of Fuyao, Cao Dewang, gets sympathy at the end. Filmed riding in his limo he discusses his youth in China, long before the country’s modern industrialization. He says he felt great joy as a boy, even when he had nothing, and now is caught up in what China’s industrial revolution has become. He wonders aloud if his contributions are a good thing or if he is just another sinner.

At the end of the film a two-person job loading glass is downsized to a one-person job … before the first robot is moved in to take over. The Chinese marvel at the improvement in speed. With that the handwriting is on the wall. That Fuyao factory lost money for four years, and it’s now claimed to be turning a profit finally. The filmmakers state the new starting wage is now $14 an hour, but a quick website search for jobs at Fuyao still shows the same $12.90 wage offered in 2014. The gentleman who felt such a kinship with his Chinese partner and invited him to his home for dinner and target practice ended up getting fired because he took too long to find something in a computer one day. But the final bit of the film is the perfect epilogue. It claims that by 2030 factory automation will cost hundreds of millions their jobs. Oxford Economics, less pessimistic, pegs the figure as a more likely 20 million jobs lost.

Years ago in this column we wrote about Anderson, Indiana, devastated by the closure of many automobile factories. Maybe the worst hit city outside of Youngstown, Ohio, when that city lost all of its steel mills. Finally, Nestle’s Coffeemate came in and took over a closed GM plant; at least there the starting wage was $18 an hour. In the end, I can’t get this new documentary out of my mind. It’s haunting in the same way as watching a car wreck in slow motion. You can see it coming from the other lane; the factory workers can’t.

Ed Wallace is a recipient of the Gerald R. Loeb Award for business journalism, bestowed by the Anderson School of Business at UCLA, and hosts the top-rated talk show, Wheels, 8:00 to 1:00 Saturdays on 570 KLIF AM. Email: edwallace570@gmail.com