Outlasting Outsourcing - Part I

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1996 was a year many Campbellsville residents remember all too well. But it is one they'd rather not relive. Hundreds of jobs were cut at the local Fruit of the Loom plant as a result of global competition. The news was devastating and the future looked bleak.

"Campbellsville will blow off the map and all the surrounding counties will, too. I mean this is where everybody works. If Fruit of the Loom is gone, Campbellsville has nothing."

"Unless something moves in to take its place, we'll be out in the cold."

"This is what NAFTA got us into. It's running American people out of work."

Since the early 90s, heavy manufacturing jobs have gone to other countries by the tens of thousands.

"Many families around the nation have suffered because of the mass number of mostly lower paying jobs leaving for the attraction of low wages."

This is in part because of the North American Free Trade Agreement.

In 1994, the U.S., Mexico and Canada signed a multilateral trade and investment agreement. NAFTA rules eliminated many of the existing government restrictions on how and where companies can operate. When the agreement was formed, NAFTA eliminated tariffs and other import controls on goods moving between the three countries.
This meant suppliers could send products to be assembled in Mexico where labor is cheap, environmental protections weak, and taxes low, then send the finished product back home to sell at prices far cheaper.

Despite these advantages, the effects of the trade policy continue to be controversial.

"When you can pay $.50 an hour or $1 or $2 an hour and don't have to worry about the environment, how's it ever going to be a level playing field?" said Butler County Judge Executive Hugh Evans.

Warren County Judge Executive Mike Buchanon agreed.

"It's certainly not a level playing field at this point. I think in the long run it will be, but in the short run it's been devastating to many, many people."

The 1996 closing of Fruit of the Loom hurt Campbellsville, but it wasn't devastating. The community has bounced back in a big way with a rise in population and an overall increase in the number of residents who now have jobs.

The community has since attracted 12 new companies, and nine of them are still in operation.

Outsourcing is the movement of jobs from the U.S. to countries where wages, benefits and the cost of living are much lower.