The Plant

By now it has become apparent that GM is unyielding in its plans to close the plant in Oshawa as it shuts down this and some US facilities in order to move production to Mexico.

The response of our provincial government has been to shrug its shoulders and say “whatevs”. The response from the federal government has been silence. The response from the progressive left has been protest and (on the part of the union) strikes.

At least the left is doing something, which is more than can be said of our governments. But none of this is likely to be effective. We need to rethink this.

A country’s investment in manufacturing and industry is sometimes referred to as its ‘plant’. And as a result of this and similar shutdowns in the past, the plant in Canada is shrinking. We are led to believe that this is inevitable, as companies will always seek lower wages and less stringent labour and environmental regulations elsewhere.

But if this were simply true, then manufacturing in places like Germany and Japan would be shrinking as well. What is it about these nations that protects their industries?

There are many factors, but I want to highlight one: the close involvement of employees in the determination of corporate policy. In Germany this is called ‘codetermination‘ and you can see the impact in everything from education to industrial policy. In Japan, there is separation of ownership and control, boards selected from within the company, and a process of decision-making by consensus.

This is a stark-contrast to the North American model where – as we have seen with the GM example – decisions are made at the senior leadership level, where the interests of shareholders are prioritized over all else, and are imposed on the company without pretense of democracy or consensus.

The result is that these companies have no loyalty to their employees, and they feel free to shut down plants, close companies (and eliminate pensions), and take other actions that are injurious to the communities in which they are located. And as we have seen, the result has been the overall reduction of the plant in Canada.

And it’s not just old-economy sectors like manufacturing and retail. Even the high-tech sector has been hit hard. And we have lost significant capacity in the failures of companies like Nortel, Backberry and Corel (some of which exist, but are shadows of their former selves). The list of defunct Canadian companies is long and includes every economic sector.

So, when faced with something like the GM shutdown, what should we be doing instead?

Let’s be clear, first of all, about the fact that GM is creating a cost to the economy as a whole, both in the reduction in Canada’s plant, and in the accommodations that need to be made in the communities that depend on that plant. This cost is all the greater when we consider the investment the Canadian public made, via corporate subsidies, to keep GM operational in the past.

Second, we should take the position that it is unacceptable to simply shut down effective and reliable plant infrastructure in Canada. The plant is a part of social infrastructure, and while it is operated by GM, it belongs in a certain sense to the community as a whole.

If GM is not willing to continue operating the plant, then the community and the nation should be prepared to step in to keep the plant operational, if not as a part of GM, then as something else (which could include being a competitor to GM).

We should take over and convert plant that is being abandoned into plant that is organized for, and run by, employees and members of the community. It should not be an option for GM to simply close it and sell it for parts. The cost of closing a plant in Canada should include the cost of replacing it with an equally viable plant under new management.

As a part of a progressive industrial policy, we should be looking to convert Canadian production from an industrial model to a cooperative model, from a model based on wealth and power to one based on community and consensus.

And we should be investing in these strategically.

For example, imagine what could have been done had Doug Ford not painted himself into a doctrinaire corner on environmental issues. Imagine the positive response that would have resulted had he announced that carbon tax money would be invested in saving the GM plant and investing in environmentally-friendly transportation technology.

An entire plant with equipment, infrastructure, and thousands of skilled employees is already at our disposal to make a significant impact in both protecting Canadian industry and acting as responsible environmental stewards. But Ford can’t fix this without admitting that maybe he was wrong.

So instead he shrugs his shoulders and says “meh”, and meanwhile, thousands lose their jobs and a key piece of Canada’s economy, Oshawa’s industrial capacity, is crippled.

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