Harley-Davidson has branded itself as a Milwaukee icon, drawing on the city’s blue-collar, rough-and-tumble image to establish “authenticity” for its retro-looking motorcycles. Harleys are widely viewed as macho products made by macho guys and gals.
While other Milwaukee-born corporations have off-shored most of their employment to Mexico, Harley Davidson stands out from the rest. Johnson Controls, Rockwell, Briggs & Stratton, Master Lock, Badger Meter, and AO Smith all employ more workers in low-wage Mexican plants than in the Milwaukee factories where their original fortunes were generated through generations of workers’ toil.
But now Harley has decided to join in the extortion game, threatening to move 1,400 of Harley’s 1,500 manufacturing jobs to another U.S. site unless Milwaukee workers concede to $54 million worth of wage and/or benefit cuts.
WHOSE HANDS ARE ON THE DETONATOR?
But as has become customary among sophisticated corporations in Wisconsin (e.g., Mercury Marine last year), Harley has worked hard to persuade the public that it is the workers and the United Steelworkers — not company management — who have their hands on the detonator. The workers, not the corporate executives, will supposedly determine the fate of the Milwaukee operation.
Thus, if Harley pulls the 1,400 jobs out of Milwaukee, it will be perceived as the direct consequence of the union’s stubborn and short-sighted “intransigence.”
If Harley’s PR strategy works properly, the workers will face enormous pressure from elected officials, neighbors and perhaps even family members to make enormous concessions in the name of preserving jobs in Milwaukee. That’s precisely what occurred at Mercury Marine in Fond du Lac, Wis. last year.
Harley also wins — provided they can keep dominating the message war — if USW Local 2.2209 turns down the demand for concessions. Corporate officials will then say that the union senselessly pushed down on the detonator and blew up the company’s hopes for staying in Milwaukee.
Wearing pained, regretful looks, Harley executives will point to the corporation’s long and deep roots in the community, its charitable activities, and the local Harley museum which is a big tourist attraction (financed with the help of at least $7 million in public funding).
Since Harleys are an expensive (prices range from about $7,000 to $35,000) discretionary product with demand dependent on economic conditions, sales have of course fallen during the downturn. Harley has taken small losses over the past couple years, amounting to $55.1 million on $4.8 billion in sales in 2009.
SALES DROP IN BIG DOWNTURN: WHAT A SHOCK!
In response, Harley took drastic action in early 2009 by closing two factories, a distribution center, and the planned elimination of nearly 25% of its total workforce — roughly 3,500 employees.
But with an economic upturn, Harley will undoubtedly return to major profits. In fact, first quarter results from 2010 show Harley back in profitable territory, with $68.7 million in profits.
While Harley has made extensive layoffs in response to the downturn, the pain has clearly not been felt by CEO Keith Wandell. According to CEO Paywatch, “In 2009, Keith E. Wandell received $6,363,579 in total compensation. By comparison, the average worker made $32,048 in 2009. Keith E. Wandell made 198 times the average worker’s pay.”
However, media coverage in Milwaukee of the Harley situation has been a fact-free zone. There is little about Harley’s condition in the context of a severe recession, no talk of how relatively low Harley wages are, nor any talk about the massive pay of the CEO.
Nor has there been any significant discussion of Harley’s obligation to the community, based on taxpayer subsidies it has received, ardent support from the Milwaukee area, or the union’s historic willingness to cooperate with management.
Virtually the entire discussion has been framed in terms seemingly crafted by Harley: Are the workers willing to be sensible and provide the $54 million that Harley needs to “remain completive? Or are they intent on committing suicide and bringing down Milwaukee with them?”
HARLEY’S FRAME: WORKERS VS. COMMUNITY
This systematic kind of “framing” issues in the public mind — pitting “selfish” union members against the community — actually dates back at least to the late 1930s. That’s when corporations based in New York’s Mohawk Valley, led by Remington Rand, recognized that they needed allies in the community if they were to turn back the rising tide of labor organizing.
The corporations employed what came to be known as the “Mohawk Valley Formula” which means, fundamentally, “employer mobilization of the public,” as explained in Alex Carey’s classic book Taking the Risk Out of Democracy: Corporate Propaganda versus Freedom and Liberty.”
Following the formula, the public was to be mobilized through systematic repetition of anti-union messages via every medium available: radio shows, billboard ads, planted news articles, films, and speakers’ bureaus. Through these various media, corporate leaders worked at painting unions as an alien, intrusive, and obstructive force in community life..
The propaganda was specifically aimed at turning the sentiment of the general public and community “influentials” — elected officials, the clergy, leaders of charitable groups — against unions.
While World War II interrupted the anti-union backlash, it soon resumed immediately afterward with a new urgency and vastly more corporate spending. The big scare for business: much of the working class was rejecting “the business definition of the American way” in favor of “equal rights, industrial democracy, economic equality, and social justice,” as Elizabeth Fines-Wolf wrote in Selling Free Enterprise: The Business Assault on Labor and Liberalism 1945 – 60.
LESSON: IF LABOR DOESN’T LINE UP ALLIES, CORPORATIONS WILL
Flash forward to Milwaukee in 2010, and we again see the same strategy of “employer mobilization of the public” at work. The lesson for labor should be very clear.
If the labor movement fails to enlist the public on our side in support of economic justice, we can definitely count on corporations working to convince the public that unions are somehow responsible whenever corporations decide to abandon the workers and community that made them prosper.