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Navigating The Global Economy

Readers Report


Your article "The global economy: Who gets hurt" (Cover Story, Aug. 10) didn't mention the benefit that comes to both halves of the work force--the lower cost of items imported from abroad, lower than if produced locally. This saving should act to improve the standard of living; or does this saving get dissipated by our surfeit of regulation and litigation?

Alfred L. Hunt

Solvang, Calif.

I hope the prediction that the U.S. economy will eventually need more college graduates comes true fast. As a recent college graduate with a business degree, I have found plenty of $5-per-hour jobs or sales positions on straight commission. I certainly did not need to go to college to qualify for these jobs or work for $5 per hour.

William Crittenden

St. Charles, Mo.

Business needs to realize that whenit exports jobs it also removes customers. It is ignorant to believe we can wage economic warfare on our employees and still retain them as viablecustomers.

Robert H. Holmes III

Mellen, Wis.

I bet lots of your readers--white, professional, educated, content--looked at the photos of the blue-collar Fields and McAmis families and said "Who cares?" That's a big mistake. Factory workers aren't some alien creatures. We are all Americans. We need a strong middle class, a solid manufacturing-based economy, not more urban riots. No job is really safe anyway, even for people in suits. The current recession proves that even "professionals" can lose their jobs. If Mexican wages remain so far below ours, don't you think white-collar jobs eventually will move south, also?

American citizens can keep factory jobs here no matter how many free trade agreements nations sign. Start by buying only U.S.-made goods. Demand that companies stop moving jobs to Mexico, or any other country. Call for a federal labeling law so companies have to state how much of their products are made here.

Bill Bregar

Akron, Ohio

It's true that we need some better system for making the transition to a global economy to protect workers with low skills. However, your article fails to address the issue of individual responsibility for dealing with this problem. It is abundantly clear that low-skill jobs are vulnerable and yet people in those jobs, on average, make little effort to improve their job skills.

Another issue: the great inequities that the unions, steel and auto industry management, and politicians have created among low-skill workers. Chrysler Corp. production workers' total compensation, for example, averages about $29 an hour, over twice that of the average production worker in the U.S. And yet, when auto industry workers were offered an opportunity to save jobs by accepting a wage cut, they rejected the proposal, resulting in the loss of tens of thousands of their union "brothers' " jobs. Worse yet, Congress has helped to perpetuate these inequities by restricting the importation of lower-cost foreign cars. This means that the U.S. auto and steel industries force the average production worker earning a total compensation of less than $15 an hour to pay more for a car produced by workers making twice as much. This injustice is preserved by the very legislators he has elected to represent his interests and promote a just society.

Gary D. Jones

Belvidere, Ill.

There is a different answer, that is, opportunity. When American manufacturers have clear need for better workers, they will seek them out, training them themselves if necessary. And when workers see opportunities for better pay they will seek those jobs out on their own along with the necessary training. Opportunity arises like magic with economic growth. Getting the economy to grow needs no "programs" and wouldn't cost the government a penny. It can be done with the introduction of new incentives similar to those of the early '80s, which so miraculously generated thousands of new startup businesses and 19 million new jobs. And this, of course, is what George Bush ought to be doing, stumping the country and explaining it to the people, in opposition to Clinton's plan for expensive governmentintervention.

Jake Rankin

Kirkland, Wash.

To cite an example of just how challenging global economics can be, your cover story states, "Foreign countries . . . set up shop and create jobs in the U.S., as the Japanese and Germans are doing." You could add the Dutch to that list, since we're owned by Philips Electronics, a multinational corporation based in the Netherlands. And, since Philips is not an American-based company, it was confusing to us that the article further stated, " . . . the mere threat of exporting jobs keeps pay down. In June, Philips wrung concessions from its employees."

Please understand, Philips, operating in 670 countries, has chosen to "set up shop" in the U.S. That does not mean we simply assemble foreign-made components here to enable us to slap a "Made in the USA" sticker on our television sets. Over the past 17 years, Philips has created the most vertically integrated color TV operation in the U.S. At our Knoxville (Tenn.) headquarters, 300 persons are involved in research, engineering, and design of the sets made in our Greeneville (Tenn.) manufacturing facility. Roughly 80% of the sales dollar per set made in Greeneville is of local or American-made content.

Philips wants to keep this kind of integrated production system based in the U.S., and we do not want to lower the living standard of our work force, yet we must produce television sets at a competitive cost. That's why, when it came time to negotiate a new labor agreement with the International Union of Electronic, Electrical, Salaried, Machine & Furniture Workers (IUE), which represents a portion of the work force in Greeneville, we did not ask for wage concessions from our full-time employees. Instead, the IUE agreed to establish a uniform wage for all part-time, seasonal employees. If these part-time employees work for 18 consecutive months, they automatically receive wages and benefits accorded to full-time employees. This is just one element of the agreement, which also calls for an employee gain-sharing program providing an opportunity for workers to earn more with the achievement of production and quality benchmarks.

To stay competitive with facilities in other countries, we have instituted just-in-time manufacturing control, total quality management, and teamwork systems. We have a number of training programs in place as well. As an example, during the past three years we have been upgrading the skills of our repair people, who will shortly complete a course that is the equivalent of a two-year degree in electronics.

Donald F. Johnstone

President & CEO

Philips Consumer Electronics Co.

Knoxville, Tenn.

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