Workers type out Mexican blues as Smith Corona heads to border

THE BALTIMORE SUN

CORTLAND, N.Y. -- On Tuesday, the early-shift workers of Smith Corona Corp. got up before the sun as they always do, driving through the green valley of dairy farms and tree-lined towns to go build the only portable typewriters still made in America. But by 9 a.m. they were marching to the company cafeteria, where an executive in a suit was waiting to tell them adios.

Adios to 875 jobs. Adios to the made-in-America label on machines that had been pecked on for generations by college students and would-be novelists. Smith Corona was moving its factory to Mexico, joining a growing procession of U.S. companies lured south by a work force that does not expect medical insurance or safety standards -- or anything much beyond a dollar an hour in wages.

To line worker Suzette Caulkins, this recurring note of the recessionary blues was beginning to sound like a country and western lament. So at lunch Wednesday she sat down at one of the new portables ready for packaging and typed out some verses suitable for twangy crooning and a wailing steel guitar:

We've worked from 5:30 in the morn 'til three in the day.

Now everything we've worked for will be taken away.

Our cars, our homes and our children's video games,

to make a product cheaper through foreign names.

Her song might well be the theme for thousands of other Americans left jobless in the wake of corporate border crossings. It is a trend thwarting economic recovery, analysts say, and it could accelerate if the proposed Mexico Free Trade Agreement stays in its current form.

For the jilted workers of Cortland in upstate New York, as they collect their wits and wonder what to do next, the Smith Corona move is yet another reason to point fingers of blame at Washington and Wall Street.

"The government knows what's going on, but they don't care," said Darlene Redmond, 41, who will lose her job along with husband, Bud, as the company pulls up stakes during the next 15 months. "They give so much to other countries, but they seem to be against the American people."

The government's failure, as cited by Smith Corona executives, is its inability to protect the company from predatory pricing by its chief Japanese competitor, Brother Corp. The Federal Trade Commission has ruled several times in favor of Smith Corona complaints, but the company says the commission has never levied penalties that were severe enough.

As for the culpability of the company and its stockholders, Ms. Caulkins said, "They made $22 million in profit this year, and now they're spending $15 million to move because these people [in ** Mexico] will work for peanuts."

When something like this happens in a community as small as Cortland County, population 49,000, the effects can be devastating.

For now there are no hardship stories from among the employees, only hints of ones to come when the company's severance package of salary and health insurance runs dry. But aftershocks of the Tuesday announcement are already rumbling through town.

On the wooded hillside overlooking the factory, developer Tom Barden has halted the bulldozers and backhoes at Walden Oaks, an upscale neighborhood being built around a new golf course.

"We were digging a 'spec' house two days ago and curtailed it because of the news," he said. On the day after the announcement, a pending sale of a $180,000 Walden Oaks duplex to a Smith Corona employee went down the tubes.

"Most everybody's going to be affected one way or another," said Dick Elliot, the county's economic development chief. "The county is not going to dry up, because this isn't a one-industry county, but it is going to be very painful."

Part of the pain is psychological. Smith Corona has been a part of the area for more than a century, since the day four brothers named Smith first tinkered around and came up with something called a "visible writing machine" in Syracuse, 35 miles north of Cortland.

In 1926, their forebears merged with their chief competitors, the creators of a portable typewriter called the Corona, and from there business grew. Even with typewriter sales declining as more people buy personal computers, Smith Corona has persevered, partly by coming up with a personal word processor and some computer printers. Domestic competitors have fallen by the wayside. Now only IBM Corp. also makes typewriters in the United States, and its machines aren't portables. (Brother Corp. assembles typewriters from Japanese parts at a Tennessee plant).

But it hasn't been easy. With the competition from Brother Corp. helping drive down prices, Smith Corona has made one round of layoffs after another, and the Cortland plant that once employed 4,200 people is now down to 1,250. About 375 of those jobs will remain in town, to keep the company's distribution, repair and administrative service divisions going.

And Mexico has become more alluring all the time, especially after the Richard Nixon administration began trying to stimulate manufacturing in poorer nations with more lenient trade policies. U.S. companies began setting up twin factories in Mexico, known as "maquiladoras," or border assembly plants, and in recent years some companies have begun moving all their manufacturing functions south of the border.

Under the pending free trade agreement, that trend would accelerate, according to a study by four university economists, who estimated that 290,000 to 490,000 additional U.S. jobs would be lost across the border by the end of the century.

Even amid the gloom of the recession, prospects had seemed to be looking better around Cortland until Tuesday's announcement. Company executives had made upbeat comments about Smith Corona's future during interviews last winter, and the employees felt good about new product lines.

Even when the employees were summoned to the cafeteria Tuesday, longtime employee Martin Luther said he figured at worst the news would be a temporary shutdown.

Instead, there was the company president, William D. Henderson, to tell them it was all over.

"We can't remain competitive and grow the company in the future by remaining in Cortland," Mr. Henderson said later. "It's a sad day for Cortland itself, for Smith Corona and, frankly, for the ,, country."

"It came as a total shock," Mr. Luther said.

But through their shock many employees seemed to sympathize with the company's decision.

"Corona fought 'em [foreign competitors] as long as they could," Mr. Redmond said.

Others said they were too scared to criticize until they had found out exactly how much severance pay they would get and how many days they had left to work.

But the overriding fear for most is of re-entering a job market where manufacturing jobs become more scarce by the day.

Ms. Caulkins suggested in her song:

We might have to pack up our families and move on,

to Mexico, Malaysia, or old Hong Kong.

For they have taken our products and jobs along.

But it's doubtful they'd want to follow the company south even if they could. Mexican factory workers often live in homes with no ** electricity, toilets or running water. Smith Corona officials figure that the labor costs per employee -- including wages, benefits and overhead -- will come to $3 an hour in Mexico, compared with $18 an hour in Cortland.

Those who leave Cortland will leave behind a town where even a line worker after enough years on the job can afford a comfortable home with a back yard big enough for a dog and a family barbecue.

And in an age of malls and strip development, Cortland has managed to hold on to an archetypal small-town beauty, with its picturesque downtown of brick buildings and Victorian homes, its trim courthouse green, where the bag-lunch crowds gather, rTC and its playgrounds that come alive at dusk with slow-pitch leagues and summertime basketball.

But such intangibles may fade in value as savings accounts shrink, mortgage payments come due, and job inquiries go unanswered.

As Mr. Luther said, "I've lived in Cortland all my life, so I'll stay in the area. But it's hard to make it around here anymore."

Smith Corona stockholders, meanwhile, should soon see their fortunes headed in the other direction. Merrill Lynch securities analyst Carol Neves applauded the move, saying that despite the moving costs, "We believe that this provides stability and improved earning potential."

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