The August Review

By Richard McCormack
Editor, Manufacturing & Technology News

Politicians Don't Understand: Textile Maker Copland Industries Says Multinationals Are Killing The U.S. Economy 

The federal government no longer represents the interest of U.S. manufacturing companies and their workers, instead siding with the Communist Chinese government that is putting hundreds of thousands of Americans out of good paying jobs, according to James Copland, chairman of Copland Industries/Copland Fabrics of Burlington, N.C. "The U.S. government's policy is creating millions of jobs all right, but it is creating them in the People's Republic of China and Vietnam at the expense of hardworking Americans here at home," Copland told a congressional hearing. "Our country should be ashamed -- totally ashamed - of what our government has done to working people in America."

The U.S. government recognized problems with the communist Soviet Union, "but for some reason it fails to see it with China," Copland told a hearing of the House Science Committee's subcommittee on oversight and investigations on May 22. U.S. government free trade and manufacturing policies are the reason for the current economic slump and the gloomy attitude Americans have about their economic prospects. U.S. manufacturing "is in the midst of a crisis unprecedented since the Great Depression," Copland said.

"Deeply flawed U.S. trade policy toward domestic manufacturing is the single most important root cause of the illness. Every American deserves the right to provide for his family, to own a home and to educate his kids, but our flawed manufacturing and trade policies are taking this away," Copland told members of Congress. "Our Constitutional preamble says 'a government of the people, by the people and for the people.' We have forgotten about the words 'for the people.' "

Copland's company is competing against Chinese companies that don't have to pay workman's comp or provide workers with unemployment insurance; that don't have to deal with EPA or OSHA regulations; that pay no overtime, provide few benefits and abide by no child labor laws; and that receive untold government subsidies and benefit from a currency that is at least 30 percent undervalued. "This is an impossible task," said Copland. "No manufacturer can compete when your competition is a foreign government determined to spend whatever it takes to force you out of the market, and the U.S. government does nothing about it."

While Congress and the Bush administration rattle on about the importance of free trade agreements and refuse to adopt anything resembling a pro-American manufacturing policy, millions of Americans' lives are in economic turmoil. "Their jobs are being moved overseas and they can't get other jobs," said Copland. "Don't think there are high-tech jobs available for those folks, because there aren't. They are being shipped to China and India too. If those who were laid off are lucky, they have landed jobs flipping hamburgers or as a greeter at some retail store. People are angry now, and when they connect the dots -- and they are going to connect them -- they are going to know where to focus their anger."

Copland Industries/Copland Fabrics makes man-made fiber curtains, draperies and blinds. Since 2001, U.S. imports of these products from China have increased by 6,912 percent, from 845,000 kilograms to 59 million kilograms in 2007. This surge of Chinese imports "has been like a nightmare [that] we have had to face," said Copland.

China accounted for almost 107 percent of the total U.S. growth in imports for curtains and draperies between 2001 and 2007, "meaning the rest of the world actually lost U.S. import market share," Copland noted. China now holds 90 percent of the U.S. market for man-made curtains compared to 7.8 percent market share in 2001. "The total market today is 98 percent offshore goods," Copland said. "A flood of imports from China in products like the ones for which we used to make fabric is one of the main reasons why my home town of Burlington has lost nearly 40 percent of its manufacturing jobs since 2001." Chinese finished curtain prices sold in the United States are less than Copland Industries' cost of materials.

Copland Industries has stayed in business by "picking up the pieces when our competition goes out of business," said Copland. "We pick up a piece and, believe you me, just as soon as you get into it, here come the Chinese again. We look constantly for something that the Chinese are not doing, that they haven't focused on yet. We are looking constantly for something that may have some natural barrier to them coming over here, but remember, everybody in our industry is doing the same thing, everybody. There have been 550,000 jobs lost in my industry since 2001 alone." Copland Industries has reduced employment from 1,000 to less than 300.

Hundreds of mills have been closed in the Carolinas due to the surge of imports from China. "There are small towns where stores are closed with weeds growing up around them," said Copland. "But you know it is really bad when you see the churches closing. Someone needs to think about the hard working people and what is happening to them. The big multinational companies, the importers and big retailers have exactly what they want. They couldn't have written a book and had it more perfect for their world: buy at the China price, sell at the U.S. price and don't worry about whether the average American has a job or he or she can make ends meet. Their world is not what is good for America.

"I will tell you that if this thing doesn't stop there will be no survivors. We will not have any manufacturing in the United States. When these plants are closed down, they are closed. If you don't run the equipment and keep it up, it deteriorates to nothing, but the equipment is being sold. Pakistan is buying the equipment. People are selling it for five cents on the dollar. Nobody wants it. And let me tell you what is happening to the buildings themselves. I was just down in Joanna, South Carolina, a huge mill down there has been closed for five years. They are tearing down the mills. Why? Because they are going to sell the bricks, guys. They are going to sell the beams. So don't think that you are going to be able to say, 'Oh, boy, as soon as this thing is over, here we come back, it is going to be regeneration.' "

Copland told the politicians that they don't understand how profoundly the economy is being impacted by Chinese imports. Politicians talk about the sagging U.S. economy and home foreclosures, "but what they haven't realized yet is that people don't have any money," said Copland. "The reason they don't have any money is because they have lost their jobs or they now have jobs making a fraction of what their pay was before their jobs were exported. If people had their manufacturing jobs, they wouldn't have the economic problems and financial problems we now have."

Fifty million Americans are without health insurance because so many good jobs that provide health care have been exported due to "our flawed trade agreements," Copland told the subcommittee. As long as the federal government refuses to adopt a manufacturing policy, "the United States will have much more difficulty ameliorating the pain an economic recession will inflict on its citizenry in a timely manner."

U.S. government officials talk glowingly about the Central America Free Trade Agreement (CAFTA), but CAFTA is causing the loss of thousands of U.S. jobs, Copland told the Congress. "It sounded like a good idea, everybody is going to be okay, but they left a loophole -- and it's the loopholes that get us so many times. The negotiators don't even know that the loopholes are there because they are some political appointee that hasn't done it but for about three or six months or they have been out of college for about a year, and they don't even know the loopholes are there. If they do know, woe be to them. Let me tell you something" Copland said: "They had a deal in [CAFTA] to where they could take the pocketing for trousers -- that doesn't sound like much. But pocketing is a 180-million-yard business in the United States. They had it in the agreement and then said, 'Well, you know, we are going to make an exception on pocketing and we are going to let these Central American countries make this stuff out of Chinese cloth.' The Dominican Republic wanted that. They gave it to them. We pointed it out and said, 'Look, you are going to destroy the industry.' 'Oh, no, don't worry, we are going to fix it, we are going to fix it.' That was three-plus years ago, folks. It hasn't been fixed. There has been nothing done. Let me tell you the end result of that thing. Eighty percent of the market is gone, and it is gone folks. Haines Finishing Company in Winston-Salem closed down 75 percent of its business. Allis Manufacturing Company closed down four plants in South Carolina. Mount Vernon lost 70 million yards worth of business and closed plants in Rome, Georgia, and in Texas.

"We have got to start paying attention to what we are doing with these trade agreements. We have to get some people who know what they are doing with these trade agreements. We are being out negotiated. We better start paying attention to what we are doing because let me tell you something, we are exporting the wealth of this country as fast as we can export it. It is going offshore. We are going to pay one tremendous price in this country."

©  Manufacturing & Technology News, reprinted with permission

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Richard McCormack is editor and publisher of Manufacturing & Technology News, a 15-year-old journal based in Washington, D.C. He has covered science, technology, industry and government for the past 25 years. He was editor of The Energy Daily and founding editor of New Technology Week and High Performance Computing and Communications Week.

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