Acton Institute Powerblog

‘American Factory’ manufactures a lemon

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(Feb. 12, 2020) Update: American Factory wins an Oscar for best feature documentary. In accepting the award, co-director Julia Reichert told attendees at the awards ceremony, “We believe that things will get better when workers of the world unite.” Where have we heard that before? Meanwhile, things are not getting better for the UAW. The Flint Journal reported yesterday that, “Former Flint UAW boss used bribes to buy homes, relative’s plastic surgery, feds say.” The newspaper cited a federal sentencing memorandum in reporting that, “a former UAW executive who started his career working at a General Motors plant in Flint used more than $1.5 million in bribes and kickbacks to purchase property, houses and cosmetic surgery for a relative.” There’s more than a little irony here. Flint is the site of Walter Reuther’s 1936-37 Sit-Down Strike, which is a landmark in U.S. organized labor history. But that was then. Now, it’s about union executives living a “lavish” lifestyle paid for by union dues. Maybe the American Factory producers can do a sequel on union corruption. I know, not very likely.

(Feb. 7, 2020) Back when I was covering the labor beat for newspapers, I used to hear the adage: “If your company has a union, it probably deserved one.”

That line kept coming back to me as I watched American Factory, the Netflix documentary up for an Oscar on Sunday. The film was produced by Participant Media and Higher Ground, the new production company launched by Barack and Michelle Obama. With all of that progressive cultural heft behind the project, you know what’s coming when they tell you that the film wants to “drive efforts to tackle how we shape a more equitable future of work.”

The film looks at what happens when a Chinese company named Fuyao Glass Industry Group Co. Ltd. renovates a shuttered General Motors assembly plant near Dayton, Ohio, to supply glass to automakers. GM closed the plant in 2008, cutting 2,400 people adrift. Instead of hearing yet again about good American manufacturing jobs being shipped to low-wage China, now we get the story of a Chinese company bringing low-wage jobs to Ohio.

American Factory was created as a soft pitch for unionization – no surprise considering who produced it. Participant and Higher Ground picked the perfect company to make their case for union organizing. But that narrative goes horribly wrong, and you won’t learn why from the producers.

The case for unionization begins with the working conditions imported to the Ohio plant in 2014 by Fuyao Glass America — conditions you’d expect in China but maybe not in Ohio. At several points in the story, you’re left wondering where the workplace safety authorities have run off to. The factory floor is crowded, hot, and tempered glass has a habit of shattering unexpectedly. (Finally, last summer, the Dayton Daily News reported that Fuyao was hit with $724,000 in fines for federal workplace violations affecting its 2,300 workers.)

It is tough to watch former GM employees sit through hiring orientation sessions. Despite their chronic unemployment and radically constrained options, they are literally watching their standard of living drop off a cliff as they listen to the Fuyao sales pitch. It doesn’t take a lot of guessing to figure out what they might be thinking of economic globalization after their exposure to the new terms of employment.

The culture clash between the Chinese managers at Fuyao and its American managers and workers is acute. Over time, the Chinese grow increasingly disparaging of the Americans’ willingness to put in the same kind of hours they do. “American workers are not efficient, and output is low,” muses Fuyao Chairman Cao, as he stares out the window of his private jet. The Americans are unmanageable and they’re talking about voting a union in. So, as the documentary unfolds, you see troublesome and “inefficient” American managers and hourly employees fired at the drop of a hat. And agitating for a union at Fuyao will really dim your prospects.

The pervasive Chinese nationalism at Fuyao is everywhere on display, heightened with workplace regimentation and happy clappy company songs. On a visit to company operations in China, the Americans visit the Fuyao Workers Union and Communist Party Headquarters which, unlike the labor organizations they’re familiar with in Ohio, seems to spend most of its time talking up the glories of Fuyao. On a tour of his office,  the union chief (brother in law of the Fuyao chairman) shows off a sort of  iconographic altar piece of five Chinese dictators from Chairman Mao to the current tyrant, Xi Jinping. Everyone at Fuyao is happy, he assures his visitors.

There are moments when the humanity shared by Chinese and American workers shines through an otherwise grim story. They go carp fishing together, and there’s a humorous exchange about the best sort of bait (Wheaties cereal works pretty good). They shoot pistols at one outing, and the American who hosts the Chinese observes that “they’re not allowed to have guns” back home.

American Factory is an accomplished work of film craft and there are good reasons to watch it. If you want to see how global manufacturing is done in the 21st century, the film offers a visceral picture of what life in a factory – with all of the high technology, massive capital investment, and dangerous physical labor – looks like.

Despite what you see in the documentary, not everyone has soured on Fuyao. In January, Ohio Gov. Mike DeWine applauded the latest expansion at the Fuyao plant and said the company’s total $600 million investment since 2014 is the largest in Ohio by a Chinese company.

But there’s a tragic irony at the core of it. The American workers eventually hold an election to form a local union at the plant under – incredible to think it — the auspices of the United Auto Workers union, now mired in a long running corruption scandal.

American Factory won’t tell  you about pervasive corruption in the UAW, but you will see excitable Fuyao employees in bright yellow UAW T-shirts rallying for a unionization vote. A union organizer tells an assembly that they need the protection of the UAW. Either he’s completely cynical or he’s in the dark too. Outside the plant, union enthusiasts sing the trade union anthem, “Solidarity Forever.” They ultimately fail, and maybe they didn’t know how lucky they were.

In fact, UAW leaders have conducted themselves of late as the very picture of cigar smoking, fat cat selfishness with which they so often have characterized American corporate culture. Maybe the union hasn’t always been wrong about that, but get a load of these revelations:

From the Detroit Free Press:

The embattled UAW is in for more indictments and more scandal, sources say, as scores of tips about corrupt labor leaders continue to pour in — all of which could end in a federal takeover of the nation’s sixth largest labor union.

U.S. Attorney Matthew Schneider said Thursday that once the criminal case is over — and it’s far from over — there’s a possibility that the federal government will step in and oversee the UAW.

From CNBC:

Based on the number of unnamed union official co-conspirators, Henning said federal officials likely have “other people in their crosshairs.”

Pearson’s arrest came as the union negotiates new contracts with the Big Three Detroit automakers. It also falls two weeks after FBI, IRS and DOL agents raided union facilities as well as the homes of Pearson, Williams and Jones. As president, Jones is actively involved in the contract talks.

During the raids, agents “seized hundreds of high-end liquor bottles, hundreds of golf shirts, multiple sets of golf clubs, a large quantity of cigars and related items, humidors and tens of thousands of dollars in cash,” Donohue said in the complaint.

Pearson, who succeeded Jones as regional director, is the first active UAW leader to be arrested and charged as part of the four-year investigation, which has led to convictions of nine union officials or company executives affiliated with Fiat Chrysler.

These guys had expensive tastes, funded by dues from union members:

All told, the union paid the resort more than $1 million between 2014 and 2017, prosecutors said. More than $600,000 of that money was used to pay other businesses in Palm Springs, including vacation home rental companies, local restaurants and the Indian Canyons Golf Resort. Between 2014 and 2018, the resort paid more than $60,000 on the UAW’s behalf to the Tinder Box cigar shop.

And, at the risk of piling on, here’s a photo essay from the Detroit News: “13 UAW and Fiat Chrysler officials charged so far in scandal.”

Apart from the Oscars nomination, the producers say American Factory was named the “#1 Film of the Year” by The Washington Post, “Best Documentary of 2019” by both the Los Angeles Film Critics Association and Entertainment Weekly, and also received the International Documentary Association Award for Best Director. Don’t be surprised if American Factory picks up an Oscar on Sunday. The media buzz around the film is huge and the involvement by the Obamas is no small part of that.

At the very least watch the opening scene. American Factory begins with a prayer by a group of employees and Dayton residents who have gathered at the GM plant at its closing in 2008. That’s a scene that has been played out all over the country in recent decades. It’s a desperate scene and what creative destruction looks like for people whose livelihoods have just been destroyed. They didn’t know then that ahead of them lies Fuyao and the UAW. False hope and more desperation. All they have is a prayer.

So watch American Factory. And maybe for reasons the producers forgot to tell us about.

Home page image: General Motors Moraine Assembly plant in 2012, before conversion to Fuyao Glass. Creative Commons.

John Couretas

is Editor-at-Large for the Acton Institute.