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Topics: Labor Unions

Detroit downsizes as Japan builds plants in the right-to-work South

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Sean Higgins,Labor unions,Labor,Detroit,Corruption,Analysis,Michigan labor special series,Japan

Third installment of a five-part series, "Working Man's Blues: Michigan's journey from Big Labor fortress to right-to-work state." See the entire series, with previous installments and multimedia, at this link.

Vincent Chin was enjoying his bachelor party in the all-American manner: His friends took him to a strip club in Michigan's Highland Park. The fun ended abruptly when they started home and two men attacked them.

"Because of you m----- f------, we're out of a job!" Ronald Ebens shouted. His stepson, Michael Nitz, held Chin down while Ebens beat Chin's head with a baseball bat until his skull cracked. Chin died four days later on June 23, 1982.

Ebens, a former Chrysler plant supervisor, mistakenly thought Chin was Japanese. In fact, his parents were Chinese, he had lived in the U.S. since age six and was an autoworker just like them.

Chin's assailants were convicted of manslaughter and received suspended sentences. A sympathetic judge said: "These weren't the kind of men you send to jail."

The incident exposed the seething anger sparked in Michigan by the rise of the Japanese auto industry in the 1970s.

After decades of virtually no foreign competition as Germany and Japan rebuilt after World War II, the Big Three automakers suddenly found their home market share under attack.

The Japanese invasion was accompanied by a deep recession and rising gas prices. There were fewer car buyers, and many of them sought something Detroit didn't have - more compact, fuel-efficient vehicles.

The Big Three were caught flat-footed. Japanese imports doubled to two million by 1980, the same year Big Three sales plummeted 30 percent below 1978 levels.

Ford and Chrysler suffered the biggest annual losses in U.S. corporate history. President Jimmy Carter bailed out faltering Chrysler with federal loan guarantees. Only its European profits saved Ford from bankruptcy.

GM closed 11 plants by 1983 as industry layoffs reached half a million, and the United Auto Workers lost more than 40 percent of its members.

Working Man's Blues: Michigan's journey from Big Labor fortress to right-to-work state
A five-part special series by the Washington Examiner
 
Monday: Big Labor and one-party government drove Detroit into the ditch
Tuesday: Even Detroit's boom years had to end
Wednesday: Detroit downsizes as Japan builds in the right-to-work South
Thursday: The Bush and Obama bailouts "save" the UAW
Friday: How the UAW made Michigan a right-to-work state
 
See the complete series, along with video and related media, at this link.

Bruce Springsteen's albums filled with songs about the workers' plight. The closure of GM's Flint, Mich., factory spurred liberal journalist Michael Moore to a career making politicized documentaries.

Detroit labor leaders became so desperate they encouraged Japanese automakers to build U.S. factories, but they weren't interested in working under U.S. labor laws, which heavily favored the UAW and other big unions.

The Republican Party decided to hold its 1980 convention in Detroit as a way to underscore the country's decline under Carter. In his nomination speech, Ronald Reagan warned: "They say that the United States has had its day in the sun; that our nation has passed its zenith... I reject that."

Once elected, Reagan talked the Japanese into voluntarily restraining imports to avoid import quotas, causing import sticker prices to spike. Some 26,000 UAW jobs were saved, but it cost new-car buyers an estimated $4.3 billion.

The Big Three used the breathing room to retool and improve their products. By the mid-1980s, the recession was past, gas prices were falling Detroit regained profitability. Chrysler even repaid its federal loans.

But neither the Big Three, nor the UAW would ever be the same. The Japanese reversed their opposition to building U.S. facilities when they realized building cars in America with U.S. workers was the best way to stave off import restrictions.

Japan was also adept at keeping unions at bay. The UAW found it all but impossible to organize the new plants, most of which were in "right-to-work" states like Tennessee and South Carolina.

Competition kept the Big Three lean. GM would be forced to undergo downsizing in 1986, 1990 and 1991. The days when working for the Big Three meant automatic job security were long gone.

COMING THURSDAY: The Bush and Obama bailouts "save" the UAW.

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