November 20, 2009
Compiled by Marty Mulcahy
There are no less than six proposals to build new coal-burning power plants in Michigan, and getting any one of them to start moving dirt would be a virtual lock to employ hundreds or thousands of construction workers for months on end.
But substantial construction on any of those plants is years away if they ever happen. The delay is due primarily to the administration of Michigan Gov. Jennifer Granholm, whose Department of Environmental Quality has major concerns about the polluting effects of coal burning, and has questioned the need for the construction of two of the plants that are farthest along in the permit process.
An Oct. 6 rally brought 2,500 to 3,000 building trades workers to the steps of the State Capitol Building in Lansing, in an effort to push the Granholm Administration approve air quality permits so the process of constructing two of the plants can go forward. “So far, we have heard nothing from the Granholm Administration about the status of the permits,” said Michigan Building and Construction Trades Council Secretary-Treasurer Patrick Devlin. “Constructing these plants could have been our own economic stimulus, but the governor obviously has other opinions.”
Granholm is turning the ship of state into the direction of greener alternatives like solar power and windmills, in the hopes that use of those energy sources and luring production of associated hardware in those industries will be the economic panacea Michigan needs.
On Nov. 4, at an American Wind Energy Association conference in Detroit, Granholm said: “Today, as our nation faces the challenges of combating climate change and reducing our dependence on foreign oil, Michigan again is ready to serve. We are ready to be the arsenal of clean energy for the United States and the world.”
The governor said Michigan has more than 70 companies involved in wind manufacturing, and “is well-positioned to be a leader in wind energy manufacturing given the state’s manufacturing talent and infrastructure and its geographical location which enables wind products to be shipped via the Great Lakes.” She added that the state is helping the wind industry in areas such as capital acquisition, job-training, and research. “Wind companies looking for a great place to invest need to come to Michigan,” she said.
Granholm is gambling that the promise of windmills and solar production will somehow supplement the guaranteed jobs that would be made available by coal-based power plant construction and the increased permanent workforce that would follow. But elsewhere, the early returns on the economic impact of the domestic production of wind-related hardware aren’t promising.
In Michigan, while there are no guarantees, importing an out-of-state workforce for the anticipated 17 million man-hours at the proposed new $2 billion powerhouse at Consumers Energy’s Karn Weadock site near Bay City is highly unlikely. Consumers has a history of hiring Michigan tradespeople, and has pledged to do so in the future.
The owners proposing to build the $1 billion Wolverine Power Cooperative coal-burner in Rogers City have similarly pledged to hire local workers.
But elsewhere it’s a different story with wind power. Three separate reports on wind-related production, jobs, and economic policy were published in recent weeks, and it all adds up to some major question marks about how our tax money is being spent and whether the promise of jobs in the promising wind industry isn’t just a lot of hot air. In any event, at the moment, it doesn’t seem to matter who is in charge in Washington when it comes to outsourcing jobs.
So far, when it comes to wind power production, federal stimulus money is mostly stimulating the Chinese.
On Oct. 30, the Wall Street Journal reported the news that a Chinese firm will be the exclusive supplier to one of the largest wind-farm developments in the U.S. and that the developer of the project would be seeking U.S. taxpayer assistance. The 36,000-acre West Texas development announced that it would purchase 240 2.5-megawatt wind turbines from Shenyang Power Group, a five-month-old alliance with operations in China.
“But while the U.S. has poured money into renewable energy through tax credits and other subsidies, China has positioned itself to reap many of the benefits by ramping up its export machine,” The Journal report said.
Alliance for American Manufacturing Executive Director Scott Paul wrote in a Nov. 2 letter to President Obama: I am deeply concerned that if not done properly, our efforts to rejuvenate our manufacturing base in this country could be unseated by subsidized imports from countries seeking to capitalize on new demand for clean energy products in the United States, such as wind turbines and solar panels.
He continued: “I was shocked to learn of the massive 36,000-acre West Texas wind farm development that will rely solely on wind turbines manufactured in China. The developer will be seeking federal tax credits and support from the Stimulus package. According to an Oct. 30, 2009, article in the Wall Street Journal, “the project should create 2,800 jobs of which 15% would be in the U.S. The rest would flow to China, where Shenyang employs 800 people.”
Paul continued: “This story is a clear sign that our current approach to building a new sustainable clean energy manufacturing base in this country is completely inadequate. The American people support investments in infrastructure and clean energy that will pave the way to a new economy and the creation of American jobs.
“Furthermore, 84 percent of Americans backed a strong Buy America requirement in the American Recovery and Reinvestment Act. With this in mind, it is an outrage to read that our efforts to create jobs here at home are instead resulting in the creation of jobs in China and elsewhere. Put simply, if this project seeks federal assistance, the wind turbines should be manufactured in the United States.”
Agreed, said Natasha Chart, of the AFL-CIO-backed OurFuture.org. “Wind energy is supposed to be able to create thousands of manufacturing jobs, but unfortunately the early wind energy manufacturing jobs financed by U.S. stimulus money have all gone to overseas manufacturers,” she said.
Chart added: “The U.S. needs to support its own industries, particularly those with significant environmental benefits, without apology. The U.S. government has a bad attitude towards manufacturing and has favored the making of money over the making of things for a long time, the more complicated the scheme, the better.”
Spain and China were cited as countries that are well ahead of the U.S. in windmill manufacturing. In Spain’s case, their government supports windmill manufacturing through the use of mandates for customers paying higher rates for renewable energy.
One area where the U.S. and the rest of the world will have to move gently with China is the manufacture of so-called rare earth elements. China accounts for 93 percent of the world’s output of two of these elements, dysprosium and terbium, which are vital in the manufacture of magnets for wind turbines. Chart said the Chinese government won't allow the materials to be sold on the open market like other commodities allowing them to corner the market on the production of windmills which has prompted a pending U.S. complaint before the World Trade Organization.
Steelworkers Union President Leo Gerard summed things up, although his job estimates are a little different.
“Taking candy from a baby: A consortium of Chinese and American companies goes to Washington and announces plans to build a $1.5 billion windmill farm in West Texas using $450 million in U.S. stimulus funds, which will create 2,330 jobs 2,000 of them in China.
“The baby Washington doesn't cry or whine or spit in the consortium's face. That's what's really wrong with this story.
“So accustomed to being bought and sold, Washington simply begins processing forms so it can hand over your tax dollars to create jobs in a turbine factory in the city of Shenyang, China at a subsidy of $193,133 each.
“It's like these bureaucrats live in Wonderland. Or an America where the unemployment rate isn't 10.2 percent. Or where 40,000 American manufacturing facilities didn't disappear in the past decade. Or where banks didn't repossess nearly a quarter million American homes in the past three months.
“We've got a message for Washington: ‘Hell no!’ We're not giving tax dollars to China. What's wrong with these businesses and our government? It is the $787 billion American Recovery and Reinvestment Act of 2009. It's not the Chinese Recovery and Reinvestment Act.
“It's bad enough that we've off-shored our factories and technology and jobs over the past 20 years. We're not off-shoring our Stimulus cash too. In fact, we're tired of serving as the schoolyard wimp of the world. We need our own industrial policy so we can stand up and compete in the world market manufacturing the likes of wind turbines. And we need it now.”
By Rich Trumka
To our nation’s peril, the free trade orthodoxy continues to ignore a fundamental economic fact: It matters where things are made.
Over the past decade the U.S. industrial base has suffered an unprecedented decline. The loss of more than 5 million manufacturing jobs and the closure of more than 50,000 manufacturing facilities have undermined our nation’s technical capacity to innovate and to make things, while at the same time decimating our middle class.
Flawed trade and tax policies and a financial system focused on short-term profits drove good jobs offshore, led to record trade deficits, and left the economy in ruins. With the manufacturing share of gross domestic product withering to 12 percent (from 15.9 percent in 1995) and the financial sector growing to 22 percent, the structure of the U.S. economy looks more like Monaco than Germany.
This growth model of asset bubbles, low wages, credit pyramids, toxic assets and unregulated out-of-control global capital has been a recipe for disaster. There is a reason every other developed and advanced developing nation has a manufacturing strategy. Most governments see manufacturing as key to long-term growth, and they target investment in industries and technology. In contrast, our government abandoned strategy to market forces and left workers and communities hanging without a safety net.
There was a time this nation thought big investing in its people, infrastructure, technology and manufacturing. We must do so again, but we need to recognize that the world has changed. For example, the rest of the world leads in mass transit technology and the U.S. is home to only two of the 10 largest solar photovoltaic producers, one of the top 10 advanced battery manufacturers and two of the top 10 wind turbine producers. If we want to be world leaders in clean technology and have transportation systems to match then we must think strategically and at scale.
Over the next decade our nation is poised to invest $2 trillion in health care, infrastructure and a greener economy. The nation must take tough and strategic steps to create good jobs, fix our trade and tax laws and rebuild our productive capacity. Governments must restructure and regulate financial systems so that long-term investment is rewarded and gambling is not subsidized. We must use our financial resources to develop and deploy domestically produced technology and, if there is better technology overseas, use our financial leverage to get those production systems located here. We must think strategically and regionally about industry development so that we utilize existing pools of displaced skilled workers, engineering talent and idled plants.And, finally, we must never again lose sight of the fact that it matters where things are made.
LANSING Unless there’s a sharp U-turn in Michigan’s economic fortunes, the state’s roads and bridges are course for further deterioration and that’s a job-killer for the building trades.
On Nov. 9 the Michigan Infrastructure and Transportation Association (MITA) issued a list of the state’s worst roads in conjunction with a report by the Michigan Asset Management Council Annual Report of Roads & Bridges.
Citing the Michigan Asset report, MITA said Michigan’s roads “are deteriorating rapidly.” Said Mike Nystrom, vice president president of government and public relations for MITA: “This isn’t a case of road agencies not doing their jobs. Michigan’s local road systems are collapsing because funding continues to plummet.”
An economic model completed in August by the University of Michigan concludes that Michigan will lose an estimated 25,000 jobs from 2006-2014 due to declining MDOT road and bridge program. “Largely due to the front-loading of (American Resource and Recovery Act) funds in 2009, there is a considerable drop-off in the economic effects of the program post-2009,” said the University of Michigan report, prepared by the Economic Development Research Group and the Institute for Research on Labor, Employment, and the Economy at the U-M.
The U of M study said that in 2006, MDOT’s investment in Michigan’s highway infrastructure created 30,824 jobs across all sectors of the economy. However, those jobs will drop by nearly 24,000 jobs to only 5,944 total jobs by 2014, due to plummeting state revenues. More than 7,000 jobs will be lost in 2010 alone and another 9,000 more will be lost in 2011, when the state is scheduled to lose almost $600 million in federal aid, according to further analysis by MDOT.
The Michigan Asset report found that over the course of a single year, the percentage of Michigan roads in “poor” condition increased from 25 percent in 2007 to 32 percent in 2008. The latest figure represents more than 17,378 lane miles of federal-aid-eligible roads. Federal aid roads are those eligible for at least some federal dollars in addition to state dollars. They are often considered the best-maintained roads because of their high traffic volumes.
In 2009, the Michigan Department of Transportation will spend $1.1 billion on the state’s Highway Program. But the program was bolstered with the infusion of $490 million in stimulus money from the American Recovery and Reinvestment Act.
In 2010, based on its anticipated revenues, MDOT announced there would be a $1.44 billion investment in the state’s 2010 Highway Program. Part of that number includes $148 million in stimulus money.
In 2011 and beyond, the funding situation grows much more dire for the state’s roads. MDOT said it is “conservatively” projecting annual shortfalls of $600 million in the Highway Program starting in 2011 as a result of anticipated declines in state transportation revenues. Those falling revenues the vast majority of much of which come from the state gas tax and vehicle registration fees mean that the state loses out on matching funds from the federal government.
A year ago, the 13-member Michigan Transportation Funding Task Force a bipartisan group appointed by the governor and legislature that included labor, political and business representatives reviewed the state of the state’s transportation system for 10 months and concluded that if current funding levels continue, “The financial and practical impacts of this inadequate level of investment are so profound that this is clearly not an option for Michigan.”
Apparently, the status quo is an option. Michigan’s per-gallon motor fuel taxes (19 cents per gallon for gasoline and 15 cents for diesel fuel) currently provide about half the revenue to the state Transportation Fund. Michigan’s per-gallon motor fuel taxes have not increased in 11 years, and were not increased for ten years prior. “This helps explain why under-investment in transportation is an ongoing problem in Michigan,” the group said.
Road construction spending generally increased through this decade, after motorists’ outcries in the 1990s about the state’s horrible roads led to greater spending.
Following are the rankings of the conditions of local roads by Michigan Asset Management Council Annual Report of Roads & Bridges.
Federal aid roads are those eligible for at least some federal dollars in addition to state dollars. They are often considered the best maintained roads because of their high traffic volumes.
The report rated each road on a scale of 1-10, with 1 being the worst. It analyzed the municipalities with the most roads rating a 4 or lower. Roads in this condition are considered “poor” and require a complete structural overhaul, usually costing four to five times as much as the cost of routine maintenance.
WASHINGTON (PAI) As the threat of swine flu outbreaks forcing workers to stay home, unpaid, for long periods of time, the Obama administration is openly endorsing paid family and medical leave for workers.
Deputy Labor Secretary Seth Harris told the Senate Health, Education, Labor and Pensions Committee on Nov. 10 that “while much has been done to help prepare for a national health emergency like 2009 H1N1” the official name for swine flu “more is needed to help protect the economic security of working families who must choose between a pay check and their health and the health of their families.
“That is why the administration supports the Healthy Families Act and other proposals that advance workplace flexibility and protect the income and security of workers,” Harris stated.
The Healthy Families Act would build on current unpaid family leave, which many families can’t afford to take, said its key drafters and advocates, Rep. Rosa DeLauro, D-Conn., and Debra Ness of the National Partnership of Women and Families. DeLauro also advocated an emergency paid sick leave bill just to cover families hit with swine flu.
Paid sick leave would mandate that workers at firms that employ at least 15 people each get seven paid sick days per year to take care of themselves or family members. The problem with present, unpaid leave is that many workers can’t afford to take time off -- even if they’re sick DeLauro said. FMLA covers 60% of the workforce, as businesses with fewer than 50 workers are exempt.
“As such, right now 57 million Americans cannot take time off work when they are sick, or when they need to stay home to care for an ailing child or elderly relative. In fact, almost half of all private sector workers and 79% of low-income workers do not have a single paid day off,” the Connecticut congresswoman added.
“The numbers are particularly galling in the food service industry: Only 15% of workers have paid sick days. Suffice to say, food service is not an industry where we want employees showing up to work with contagious viral infections,” DeLauro deadpanned.
“All of these workers are forced to put their jobs on the line every time they take a day off. According to a 2008 study, one in six workers report they or a family member had been fired, suspended, punished or threatened with firing for taking time off due to personal illness or to care for a sick relative.”
The swine flu outbreak has only made the problem worse, testified Desiree Rosado, a special ed assistant in the Groton, Conn., school system. That’s not because the parents get sick; the kids do.
Rosado had to miss two weeks of work to take care of her three children, suffering from bronchitis or the flu, this fall.
“I get no sick pay, so my paycheck for that period was almost nothing. That caused tremendous hardship for my family. My husband and I live paycheck-to-paycheck right now. We have no choice…It’s a hard road. And it’s made immeasurably harder because whenever we get sick or our children get sick, we have to decide whether to stay home without pay, or to disregard doctor’s orders and risk getting sicker and infecting others by going to work or school.”
Putting families through such a financial wringer due to swine flu or any other illness is wrong, and uneconomic, DeLauro and Ness testified. DeLauro even pointed out that sick workers forced to show up on the job because otherwise they wouldn’t get paid are less-than-100% productive, and studies show a $180 billion loss from that.Business, represented by the Society for Human Resources Management, opposed paid sick leave. Its witness said most workers have paid leave vacation.
EAST LANSING The building trades moved tons of earth out of the way, and then cleaned things up nicely in the effort to create a pair of railroad overpasses on Farm Lane on the Michigan State University campus.
A ribbon-cutting was held on Oct. 16, about two weeks after the Farm Lane and Service Road were opened to traffic. They had been closed since March 2008. The project lowered Farm Lane under two railroad crossings, widened and realigned the road, improved drainage, and added sidewalks and bike paths. The project was a joint partnership between MSU and the Michigan Department of Transportation.
“The Farm Lane underpass project presented a unique opportunity for MDOT to partner with MSU both in construction and design," said State Transportation Director Kirk T. Steudle. “Everyone was able to work together to create a safer, more efficient roadway that will serve the MSU and East Lansing community long into the future.”
Farm Lane is one the of university’s busiest roads. One underpass is located north of Service Road at the Canadian National (CN) Railroad and the other south of Incinerator Road at the CSX Railroad. When the project was approved in 2007, more than 60 trains passed through the campus every day. The grade separations will end many traffic disruptions and make it easier for emergency vehicles to get around.“Safety and emergency response concerns were critical considerations for this project,” said MSU Board of Trustees member Colleen M. McNamara. “We also looked at ways in which we could improve the economic vitality of our business communities. With the new Farm Lane there are regional east-west business traffic flow improvements, as well as better access to I-496 and the interstate highway system.”
WASHINGTON (PAI) With unemployment expected to stay high at least through the first part of 2010, the Democratic-run Congress again extended jobless benefits. President Barack Obama signed the legislation on Nov. 6.
Senate Republicans delayed the benefits extension for a month by trying to attach unrelated proposals to it. In the end, they failed, and the bill passed 98-0 in the Senate and with only a handful of GOP foes in the House. The vote there was 403-12.
The legislation provides an additional 14 weeks of benefits to unemployed workers in all states and an additional six weeks for jobless workers in states (like Michigan) with an unemployment rate of 8.5 percent or higher. It means long-term jobless workers could get combined state and federal benefits totaling up to 99 weeks.
The House first passed a UI extension Sept. 23. But it wasn’t until Nov. 4 that Republicans dropped their fight against the bill and allowed a vote. The House passed the Senate’s version the following day.
In a statement announcing the signing, the White House says the bill “builds on the successes of the American Recovery and Reinvestment Act to help spur job creation and help struggling workers (and) strengthens the safety net for workers who cannot find jobs immediately helping 700,000 people and eventually helping over a million.”
Republicans, had held up the legislation, Democrats charged, by wanting to tack on unrelated amendments to the jobless benefits extension. Republicans were seeking to offer amendments to stop federal aid to the controversial community activist group ACORN, and requiring people who receive jobless benefits to be processed through and electronic verification system so that employers could check on the immigration status of new hires.
Construction may gain after a rough ‘09
Next year will probably be a better year for U.S. construction but that’s only because it’s compared to a sickly building market in 2009.So says the Engineering News Record, which reported that a consensus of construction forecasts calls it an industry “unable to sustain much forward momentum.” They reported that McGraw-Hill Construction is forecasting the dollar value of total U.S. construction starts in 2010 will climb 11% but that follows an estimated 25% decline in 2009.