Harley Subsidies Underscore Reality of Supercharged Corporate Power

Roger Bybee

Motorcycle manufacturer Harley-Davidson continued last week to illustrate the remarkable extent of corporate dominance in contemporary America. Just days after extorting massive concessions in a 7-year contract and freezing wages for its Wisconsin workforce by threatening to relocate 1,400 jobs, the profitable corporation continued to flex its muscles. It accepted millions in state subsidies and walked away from a plan for new office buildings at a Milwaukee site, which the city had spent on millions on preparing.

$25 MILLION IN NEW SUBSIDIES

Harley will be pocketing $25 million in subsidies from the state of Wisconsin, which has apparently become the new normal in Wisconsin. Just as at Mercury Marine, even after the corporation has won wrenching concessions from the workers and considerably lowered community spending power, it gets a packet of state incentives to help nail down the deal. For public officials, such subsidies show they at least made some effort at retaining jobs.

Throwing subsidies at profitable companies has become an unquestioned alternative to raising questions about economic justice or challenging the vastly destructive and wasteful interstate competition for jobs, which costs states about $50 billion annually, according to Greg LeRoy, writing in The Great American Jobs Scam. 

Harley hardly needs the money, but corporations are always willing to accept subsidies as a form of tribute to their thrones. Harley-Davidson has returned to profitability with $104 million in profits thus far in 2010 after a downturn in 2008, which had followed 15 consecutive years of at least $100 million in profits.

Harley has mastered the art of profiting by squeezing more work out of its workers and cutting back its workforce.

ABANDONING PLANS AFTER PUSHING OUT ANOTHER PROJECT

Harley-Davidson announced that it is abandoning plans for a new set of office buildings that were part of the planned development next to Harley’s museum. Harley’s choice of a site in Milwaukee’s Industrial Valley necessitated a public expenditure of $24.9 million to move a city public-works facility.

The plans for the nearby office buildings trumped proposals by community activists for preserving the space for higher-paying industrial jobs than the mostly low-paying work that would be offered in the new office development.

To get out of its obligation, Harley will pay the city $550,000 and its direct city subsidy for the Harley Museum project and related developments will be cut slightly, from $7 million to $5.77 million.

Considering the subsidy granted to Harley and the public outlays that were forced by the corporation’s choice of the site and the elimination of the jobs it promised to generate — thereby apparently foreclosing another development on the same spot — Harley got off very lightly.

The company’s power to extort concessions from workers, ring up subsidies from the state, and break job-creation commitments to the city reflects the virtually unchecked power that corporations now wield.

GAMES STACKED AGAINST WORKERS, PUBLIC

Members of the Steelworkers and Machinists unions at Harley faced a situation where just 7% of the private-sector workforce is now unionized nationally, down from 35% among all workers in the mid-1950s. The loss of unionized jobs (80% of Milwaukee’s industrial base since 1977), many of which were drained to the fiercely anti-union South and repressive nations like Mexico and China, has thinned the ranks of potential allies.

Moreover, it has also weakened labor’s ability to effectively advocate and push for a very different kind of global economy that serves human needs.

Given the blackmail power that corporations wield over both workers and governments to pull up stakes and move elsewhere, the needs of workers, communities and the environment are subordinated to the demands of corporations for maximum profit.

The ongoing race to the bottom” – where corporations seek ever-lower wages, weaker environmental protections, and more pliable governments – now appears to many to be a natural force like gravity dragging down the conditions of life across the globe.

ORIGINAL TEA PARTY WAS BLOW AGAINST GLOBAL CORPORATION

Ironically, the formation of the United States was heavily shaped by colonists seeing the harm wrought to small tea importers by the East India Tea Company. The East India Tea Company was the quintessential arrogant and greed-driven transnational corporation, inspiring the anti-corporate guerilla action now known as the Boston Tea Party of 1773.

In 1816, Thomas Jefferson wrote, as quoted by Thom Hartmann in Unequal Protection: The Rise of Corporate Dominance and the Theft of Human Rights:

I hope we shall crush in its birth the aristocracy of our moneyed corporations which dare already to challenge our government in a trial of strength, and bid defiance to the laws of our country. 

But perversely, the Tea Party’s meaning has been twisted by Tea Party leaders like Dick Armey to symbolize action to free today’s corporations — Harley, BP, General Electric, and all the rest — of any constraints on their profit-seeking conduct and to fully subordinate our government to serving the super-rich.

Meanwhile, the U.S. Supreme Court’s January Citizens United decision enshrined and expanded the notion of corporate personhood” and opened the floodgates for a torrent of corporate campaign contributions directly from their treasuries.

However, the notion of profit-fixated corporations having the same rights as living, breathing people with consciences is rejected by 86% of the American people, as progressive populist commentator Jim Hightower noted.

Many Americans remain profoundly disoriented by the deeply unsettling changes in the economy, and have yet to consolidate as an active force challenging corporations’ increasing dominance. Hopefully, the Oct. 2 One Nation” rally in Washington, D.C., will mark the launching of such a campaign.

And perhaps President Teddy Roosevelt’s prescient warning from a century ago about the threat to democracy posed by ever-increasing corporate power may finally add momentum to a revived movement for real economic and social democracy:

There was a time when the limitation of governmental power meant increasing liberty for the people. In the present day, the limitation of governmental power, of governmental action, means the enslavement of the people by the great corporations.

Roger Bybee is a Milwaukee-based freelance writer and University of Illinois visiting professor in Labor Education.Roger’s work has appeared in numerous national publications, including Z magazine, Dollars & Sense, The Progressive, Progressive Populist, Huffington Post, The American Prospect, Yes! and Foreign Policy in Focus.More of his work can be found at zcom​mu​ni​ca​tions​.org/​z​s​p​a​c​e​/​r​o​g​e​r​d​bybee.
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