A first-rate account of the complex social, political, and economic factors that turned an $8-an-hour Paterson, New Jersey, job into one that paid 65 cents an hour in Mexico.
In 1955, Mollie James began her three-decade stint on the assembly line at Universal Manufacturing. Specializing in producing ballasts (gadgets that regulate the flow of electricity in fluorescent lights) the firm was founded in 1947 by Archie Sergy, the enterprising son of Lithuanian immigrants and one-time convict. Affable and well-liked by his employees, Archie personally showed Mollie around the plant on her first day. Motivated in part by an ugly labor dispute (Universal had a sweetheart deal with the Teamsters, but the less management-friendly International Union of Electrical Workers almost won the shop), the firm opened another plant in Simpson County, Mississippi, in the early 1960s. Building on a longstanding commitment to increase industrialization (Mississippi began the “Balance Agriculture with Industry” program in the 1930s), the state lured Universal by offering to transfer the cost of building a new plant to the taxpayers through a bond act. Former sharecroppers and field hands made for an eager, relatively inexpensive work force. The move south was a preview of what was to happen in the 1980s when a leveraged buyout put the firm in new, more cost-conscious, hands. This time, the Mexican government made plant relocation attractive by offering tax-free zones, cheap labor, and a willingness to clamp down on union organizers (by force, if necessary). So low were local wages that plant managers were advised to buy beans and flour to distribute among their employees. And yet factories were being moved even within Mexico, following depressed wages to their lowest possible point.
A cautionary tale of free markets run amuck. Adler (Land of Opportunity, 1995) has produced an intelligent work of industrial history.