Deindustrialization

The ‘New GM’: Layoffs, Factory Closings, Offshoring

Nothing about the old way of doing business made sense, and it made a wreck of GM. After decades of closing factories, laying off workers and shifting production overseas, the company now finds itself with $172.8 billion in debt.

It would make sense to change course, radically.

But the Obama administration is not doing anything radical.

Rather, it wants to create a “New GM” that stays the course of the old GM.

If all goes according to plan, the “New GM” will close down as many as 20 factories in Michigan, Indiana, Ohio and Delaware. Additional plants in Tennessee and Michigan will be put on “standby,” for probable closing. At least 21,000 family-supporting jobs will be lost, as the corporation shifts production to new facilities in China and other foreign countries. Those cuts come on the heels of GM factory closings last year that cost tens of thousands of jobs and shattered communities across the Great Lakes states just as the downturn was developing into a deep recession.

This massive de-industrialization plan — with its rapid offshoring of work once done in the United States — will be paid for by the federal government.

It will cost US taxpayers a great deal to eliminate this many US jobs — Washington has already handed GM $20 billion and is expected to shift another $30 billion into the coffers of the corporation. “Whether that investment will ever be recovered is still an open question,” suggests the New York Times report.