Former steelworkers have doubts about Trump bringing jobs back
Dave Misel the onetime American steelworker was supposed to be retired by now.
He’s 62 and still laboring — an ironworker — bundled against an 11-degree wind chill because of the misfortunes of U.S. manufacturing jobs that broke the backs of mighty factories like Kansas City’s Armco steel mill, and lit Donald Trump’s victorious election cry to bring back American jobs.
Actually, Misel says, he feels lucky to have been able to start over as an ironworker. But that meant having to be an apprentice again at age 46 after the closing of the mill, then run by GST Steel Co., slashed his pension and wiped out his health coverage.
It’s freezing. The helpless sun pales against the wind ripping through his current worksite at the Board of Public Utilities’ Nearman power plant in Kansas City, Kan.
But he knows friends who fell on hard times, who couldn’t work or who took low-wage janitorial jobs — their health plans also lost, their pensions wounded, their retirement plans scrapped.
He knows the industrial landscape was fertile ground for Trump — for better or worse.
“I talked to a lot of people, and they told me they wanted change,” he said.
“He put the fear of God in them,” says Steve Morrow, another former steelworker with 30 years in the Armco/GST steel mill, and the president of the union local when it closed.
They liked the pitch in Trump’s campaign, the condemnation of manufacturing jobs lost, the rise of a forceful, bullish America in foreign trade.
“Most had voted Democratic,” Morrow said. “But some never did. A lot of them didn’t like Trump but voted for him anyway.”
Now American workers watch like everyone else, wondering, will a Trump administration spark trade wars? Will the U.S. break off agreements and stand on the outside while China instead deals with the world?
Maybe workers will get a stronger, more intimidating America, said Raj Bhala, a University of Kansas School of Law professor in international trade.
But maybe, he warns, they’ll see a dangerously isolating America as well.
Both campaigns unloaded brutally simplified messages on foreign trade that lost sight of the perilous complexities awaiting the Trump administration.
“The candidates galvanized anger in many Americans who felt cheated by foreign trade,” Bhala said. “(But) it was a misleading focal point.
“The idea that protective barriers (like tariffs and restructured trade deals) will bring back jobs is a myth.”
Trade is married to the economies and politics of nations, Bhala said. Stability breeds peace. Missteps threaten national security.
But the former steelworkers know their own struggles, Randy McKinney said.
McKinney, who spent three decades at GST, found work burying phone lines for several years. He was unloading furniture for $9 an hour for Kirkland’s not long ago, just to do something.
So many workers have long believed the playing field has not been equal, he said. “It drove old Democrats to him.”
McKinney on Trump? “I didn’t trust the guy,” he said.
But he knows this: “We’re sick and tired of politics.”
‘Amazing levels of complexity’
Next time you cross the old GST wasteland on the Independence Avenue bridge going east, look to the south.
You’ll see relics they couldn’t knock down. A row of square concrete bunkers.
They are the transformer houses that fired the giant furnaces. Their walls, more than 2 feet thick, could contain any explosion. Indestructible.
Donnie Box, 66, with a Churchill cigar pinched between two fingers, always looks.
And then he remembers the glowing evening sky of his childhood in Kansas City’s Northeast area neighborhood when Armco’s furnaces were in full fire.
He remembers sneaking down with buddies to peer through the big, open doors and see the explosion of sparks over shining, molten steel.
Those stubborn concrete blocks remind him of his 30 years of work with “the best people I know, the best times I ever had where I was busting my ass.”
“They are monuments to the steel industry in Kansas City,” he says.
Because everything else he sees “is depressing as hell. How could Trump bring this back?”
The deal the president-elect leveraged with Carrier in Indiana highlights the complications ahead.
The company, known for air conditioners, agreed to keep 1,000 jobs in Indiana out of the 2,000 it intended to send to Mexico in 2017. But the deal came with $7 million in state economic incentives for Carrier.
And the jobs saved are the assembly line kinds that are being replaced by robotics.
Trump’s decision to break diplomatic protocol with China and talk with the president of Taiwan also sparked wide-ranging speculation on what lies ahead.
China is “the 400-pound gorilla in the room,” said Mark Johnson, a global trade specialist with the Dentons law firm in Kansas City.
Trump may be sending “a wake-up call” intended to alert China and other nations not to take U.S. consent for granted, Johnson said. And there is potential strength in U.S. demands if nations sense a greater possibility that America might pull out.
But pulling out or setting off a trade war with tariffs risks isolating the U.S., Johnson said.
“Tariffs deter economic activity,” he said. “We buy less. We sell less. We have fewer jobs…It’s easy to point at foreign competition and get people revved up about it, but the effects of trade are messy. There are amazing levels of complexity.”
NAFTA and TPP were the anti-trade deal symbols in the campaign — the longstanding North American Free Trade Agreement between the U.S., Mexico and Canada, and the still under negotiation Trans-Pacific Partnership potentially linking the U.S. and 11 other Pacific Rim nations.
But Trump will be hard pressed to take NAFTA down, or even restructure it in any significant way.
An average of 40 percent of the value of every good from Mexico is American made, Bhala said. The supply chains between the countries are deeply intertwined, and the bulk of the business community would oppose damaging NAFTA.
Once the U.S. gets past the fiery election, pressure favoring TPP may gather up again, he said.
One thing to watch is that Trump is stocking many Cabinet and leadership positions with military generals, Bhala said, and “they get it. I think they’re going to impress on Trump the national security benefits.”
Going alone is dangerous, he said. The more that nations trade with each other, the stronger their economies are and the more interconnected they become — and that breeds peace.
Congress and the Trump administration are aware that China is working on its own trade deals with some of the same Pacific Rim nations as the U.S., and even with Russia.
“Imagine if China is able to seal a pan-Asian trade deal that we walked away from,” Bhala said. “That would be a Sputnik moment to Americans.”
GST’s last generation of workers came through the final years of the Vietnam War.
Many were veterans, believers in the civil rights movement, “worried about going to ’Nam and getting killed,” Box said.
They stepped into the blasting heat of a 24-hour-a-day steel operation employing some 5,000 workers, joining the old guard World War II and Korean War veterans.
“The (older veterans) were like: Been there, done that (expletive),” Box said. “Whatever issues they had (with war trauma), ghosts and stuff, they dealt with it hanging around at the VA hall or the corner tavern. The mentality was liquor. The plant was OK with it. Just get to work on time.”
It seemed like the perfect setup for McKinney, lucky to land a job in 1970.
The clerk producing his employment documents mentioned the magic 30-year threshold for full pension. “You’ll get it in 2000,” McKinney remembers being told. “That was the first I ever heard someone say ‘2000.’ ”
Anger laces their accounts of how those years passed.
Barely 500 workers remained when 2000 came, a downfall the former steelworkers blame on slow counter-punches when mills in Russia, China or Brazil dumped cheap steel into the market.
Dumping steel — forcing out competition by subsidizing steel and selling it on foreign soil more cheaply than it is being sold at home — would warrant punitive fees on the imports. But by the time an illicit importer was repelled, “88 guys had lost their job,” Box said.
Mini-mills also sprung up, “greenfield mills” with non-union shops paying low wages.
The workers had no patience for NAFTA in the early 1990s as many production lines went to Mexico.
“They shoved it down our throats,” Box said.
It didn’t help Hillary Clinton with the ex-manufacturing workers that NAFTA was supported by President Bill Clinton and passed by Congress under his watch.
The former GST workers know that other forces weighed against U.S. manufacturers in the loss of millions of blue-collar jobs over the years.
Bhala argues that research shows 80 percent of the job loss and income loss since NAFTA in 1994 was not due to trade. The dominant culprits were an increasingly automated industry and weaknesses in U.S. schools in gearing the workforce to changing markets.
“The debates on trade should have focused on education, technology and national security,” Bhala said.
Even so, many things about GST’s closing in 2001 “left a bad taste in the mouth,” McKinney said.
Mitt Romney’s Bain Capital took over as the major shareholder in 1993. Bain profited on the deal, but GST rolled on downward to its demise.
“They paid guys millions to close us down,” McKinney said.
Pensions were cut by as much as $400 a month and the workers were sent off without health coverage. Retirement plans had to wait.
McKinney was part of the union leadership. “To tell our membership they had to go out and get health insurance on their own was a hard pill to swallow.”
While Trump will need congressional action in most instances to alter trade agreements, the president does have power to raise trade barriers if he sees unfair trade practices or threats to national security.
Trump’s Cabinet choices suggest a hawkish approach, with his pick to head the U.S. Treasury, Steven Mnuchin, and his pick for commerce secretary, Wilbur Ross, both expressing a need to overhaul America’s foreign trade agreements.
But Ross, in an interview with CNBC, expects no rush into trade barriers.
“Everybody talks about tariffs as the first thing. Tariffs are the last thing,” he said. “Tariffs are part of the negotiation. The real trick is going to be increasing American exports.”
Johnson, the trade specialist, hopes for patience and persistence.
“What’s real is that they’ve lost jobs,” he said. “One of the difficulties of trade is that the benefits take so long. They are difficult to point to. You can’t say, ‘We gained these jobs and lost those jobs.’
“To simplify it is very, very misleading.”
Jobs: highs and lows
Manufacturing jobs in the U.S. peaked at nearly 19.7 million jobs in 1979, according to U.S. Bureau of Labor statistics, then fell to a low of 11.3 million jobs in early 2010. This year they’re up to 12.3 million.
Kansas City area data, available from 1990, fell from a high of nearly 97,000 manufacturing jobs in 1998 to 66,500 in 2013, and back to 75,500 in September.