agement practices and how workers responded to them. Market studies showed that although total jean sales fell in the last five years, sales of women’s and girl’s jeans which the Tyler workers had produced in the past increased 18 percent. Overall, the study showed that establishing a workerowned jeans contracting company had the “potential for long-term profitabilty.” The group then faced three major tasks: recruiting a plant manager, securing work commitments, and raising enough capital to get the company started. Through a headhunting firm, the group hired Wayne Burnham, 40, a thoughtful, good-humored Southerner, as plant manager and chief executive officer. The match seems a good one. After chasing the needle trades for 18 years, from his native Arkansas to Louisiana to North Carolina to Virginia and back to North Carolina, Burnham had developed a reputation as a firstrate problem solver and manager. He worked the last dozen years for a stable, family-owned company that rewarded him well for his hard work. But it wasn’t enough. “Every move I made I was climbing the corporate ladder. But the money never was it for me,” Burnham said late one night at the end of a 15-hour day. “My friends used to tell me I was crazy, but I thought there had to be more to it.” After a four-hour initial meeting with Joan Suarez, in which both parties recognized that neither fit their stereotypically anointed roles, and after meeting the employees’ leadership committee in Tyler, Burnham signed on in October. The company’s lack of a building, work commitments and financing was no deterrent. On the contrary, Burnham says, “I saw this situation as one that would really challenge me and as a helluva opportunity to do some good for some people who really wanted to do some good for themselves. I recognized early on several key ingredients for success: one, a total commitment on Joan’s part; two, a commitment on the part of the leadership group to band together and suffer through whatever agonies they had to pull this off; and three, the faith the rest of the workers put in their leadership.” Next came the work commitments. For that, they turned to Levi Strauss. The results of the feasibility study helped persuade Levi to contract startup work to the company. And Levi also agreed to sell Colt much of its machinery from the Tyler plant at a bargain price. The contract to cut and sew Levi’s “902”-style women’s jeans and “505” men’s jeans should last about ten months. What happens then? Says Janet Miller, that’s the least of their problems. “There’s plenty of contract work out there, they just want to see you in production.” Which leaves the question of financing. Just how does an upstart workerowned business in East Texas raise the more than half a million dollars needed to open its corporate doors? It starts by securing $1,000 pledges out of the pockets of each its 120 worker-owners, it draws up a five-year business plan and submits it to two lending institutions: the National Co-op Bank and the Cooperative Assistance Fund, both based in Washington. “Then,” as one worker tells it, “we pray. And wait. And pray some more.” In early March, a few days after a site visit by both lenders, Colt’s prayers were answered provided the company had on hand the full 20 percent cash equity. It didn’t. With almost everyone still out of work since the Levi plant closed six months earlier, making good on the $1,000 pledges was no small feat. \(At least two employees were living out of their cars and sleeping nights in a park. Said one: “It’s not so bad. The Down to its final days before a selfimposed deadline for raising the capital, a local bank stepped forward to make individual loans to Colt workers unable to come up with the full amount of the pledge. “Given the contracts they have, we should be in pretty decent shape,” Dave Shindeldecker, president of First City National Bank of Tyler told a local newspaper reporter. Finally the deal was done. At 2:30 in the .afternoon of May 19, in a Washington office building, Joan Suarez and Wayne Burnham signed the last of a mountain of documents to close a fiveyear, $500,000 loan. Just nine months after the shock waves of the impending closing swept through their plant, the former Levi workers were set to go it alone. Suarez picked up the telephone and dialed Colt Enterprises, Inc. “Janet,” she said, before she broke into jubilant laughter. “Janet. We did it. We got the money .” RONNIE DUGGER RECENTLY urged in these pages that labor leaders raise their sights and go international by creating programs to assist unions and workers in other countries. This suggestion has merit, as it did when first advanced 139 years ago. But it is not an adequate approach to the problems he describes. Dugger is concerned, and rightly so, because labor organizations are being Fred Schmidt is a retired faculty member of the UCLA Graduate School of Management. He now lives in Fredericksburg. decimated in some instances by corporations that have closed plants in this country only to export jobs to low wage countries such as Taiwan, Hong Kong, South Korea and, most particularly, Mexico. He cites an estimate that there are about 250,000 Mexican workers employed in maquiladoras , those twin plants along the border that do laborintensive work for U.S. and Japanese corporations, such as assembling TV sets and videotape cassettes. These plants started proliferating three decades ago when someone deduced that custom laws did not require the payment of regular duties on unfinished products say, an electrical appliance put together in Mexico with the electric cord left unattached until the appliance came into this country. Variations on this original theme, such as free trade zones, have been introduced since then. However, the chances are that most of these plants \(now reported to exceed under union contracts, since the employees of companies that once operated in this country most likely never were unionized. So the notion that they represent a membership loss to the unions can only be the case in a limited sense. They are not there to escape unions nearly so much as to escape the wages, hours and working conditions that unions have brought about as the common expectations of all U.S. workers, whether union members or not. These wages, hours, and working conditions created the large U.S. middle class. Corporations never did consider the creation of a middle class as being Workers of the World … How to Help Foreign Labor and Save American Jobs By Fred Schmidt THE TEXAS OBSERVER 11
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