The Wall Street Journal - 21.10.2019

THE WALL STREET JOURNAL. Monday, October 21, 2019 |A

U.S. NEWS

The financial impact is rising for states such as Michigan and Indiana, where General Motors has a concentration of unionized workers.

JEREMY HOGAN/SOPA IMAGES/ZUMA PRESS

October, but with a tentative

deal in place, auto production

should rebound in November

and December,” said Gus Fau-

cher, chief economist at PNC

Financial Services Group.

Striking GM workers also are

pulling back on spending, hav-

ing now lost a month’s worth of

company paychecks. Many are

trying to get by on $275 a

week, the strike pay offered by

the UAW to provide some fi-

nancial assistance. That figure

is a fraction of their regular

pay, which ranges from $630 to

$1,200 for a 40-hour week.

For veteran workers earning

the top wage, the strike has re-

sulted in more than $4,000 in

lost pay, analysts at Bank of

America estimate. If GM work-

ers ratify the proposed con-

tract, they would get a hefty

signing-bonus payout—$11,

for full-time workers and

$4,500 for temporary employ-

ees—that would help offset lost

wages. But there is no guaran-

tee members will back the deal.

Jason Kirkpatrick, who

works at a GM factory in Flint,

Mich., but is on strike, said his

family has held off on big pur-

chases, as well as more minor

spending, such as splurging on

his daughter’s 14th birthday.

“We can’t make any big de-

cisions right now,” said the

46-year-old Mr. Kirkpatrick.

“Normally, we would have had

a party and brought some kids

over, but we just don’t have

that extra money right now.”

Other workers say missed

wages have led to canceled va-

cations, missed bill payments

and delayed purchases.

Auto-parts suppliers are

also taking a big hit. With no

cars coming off assembly

lines, many suppliers produc-

ing parts and materials for GM

vehicles had little recourse but

to stop production themselves.

As a result, 120 of GM’s di-

rect suppliers furloughed

some 17,000 workers in the

U.S. during the strike, said the

Original Equipment Suppliers

Association, a trade group.

That count doesn’t include

layoffs further down in the

supply chain, the group said,

and some analysts have esti-

mated that as many as 60,

more jobs have been affected.

The financial repercussions

are starting to show up in

third-quarter earnings. On

Thursday, Faurecia SA, a French

maker of automotive seats and

other components, reported the

strike had dented third-quarter

earnings by about $25.6 million.

A spokeswoman for the

Michigan Department of Labor

and Economic Opportunity

said the agency has received

7,900 new unemployment

claims from workers at auto-

parts suppliers through Oct. 12

that it attributes to the strike.

—Sarah Chaney

contributed to this article.

dispute with China.

U.S. factory activity overall

hit a 10-year low in September

after contracting for a second

straight month, according to

the manufacturing index pub-

lished by the Institute for Sup-

ply Management. “The trade

war has already done a lot of

damage, and this is just add-

ing insult to injury,” said Mark

Zandi, principal economist at

Moody’s Analytics.

The strike has idled more

than 30 GM factories across

the U.S., suspended work at

two dozen company-owned

parts warehouses and distri-

bution centers and led to tem-

porary layoffs of nearly 10,

GM factory workers not repre-

sented by the UAW in the U.S.,

Canada and Mexico but still

affected by the walkout.

GM already has lost the pro-

duction of more than 300,

vehicles because of the idled

factories, according to re-

search firm IHS Markit, and

analysts say the Detroit auto

maker will struggle to make it

up before the year’s end, likely

putting a more than $2 billion

dent in second-half earnings.

The Federal Reserve said

Thursday the strike contrib-

uted to a drop in factory out-

put last month, accounting for

a 0.7% fall in production of du-

rable, or long-lasting, goods.

That included a steep 4.2% de-

cline in auto production.

“The GM strike is likely to

weigh on production again in

With the strike at General
Motors Co. stretching into a
second month, the impact is
intensifying across the Mid-
west economy, hitting more
businesses and auto-parts sup-
pliers reliant on GM’s U.S. fac-
tories for work.
The United Auto Workers
struck a tentative labor agree-
ment with GM last week, but
union leaders decided Thurs-
day to continue picketing until
workers approve the deal.
The move likely extends the
nationwide walkout, already
the company’s longest in de-
cades, through Friday as UAW
leaders turn their attention to
educating workers about the
proposed contract terms and
as voting begins on whether to
ratify the agreement.
Meanwhile, the financial
toll is mounting for both the
company and states—such as
Michigan and Indiana—where
GM has a concentration of
unionized workers. Econo-
mists say the cascading effect
of lost wages, production and
employment will likely linger
even if the strike ends, weigh-
ing on regional economies al-
ready straining from the tariff

BYBENFOLDY

For Midwest,

GM Walkout

Inflicts Pain

Lost wages, output,

employment weigh

on regional economies

as strike’s toll mounts

They have also said that

refugees rely on public assis-

tance at higher rates than

other U.S. taxpayers and are a

drain on government re-

sources. But studies have

shown that the taxes refugees

pay are a net benefit to the

government.

The moves are also part of

the administration’s strategy to

curb legal immigration to the

U.S. Several courts this month

temporarily blocked an admin-

istration policy, known as the

public-charge rule, that would

have barred entry or green

cards for many legal immigrants

who have used government as-

sistance programs or are

deemed likely to in the future.

Mr. Trump also signed a

proclamation this month re-

quiring most legal immigrants

entering the country begin-

ning in November to demon-

strate they will have health in-

surance—a requirement that

immigrant advocates have

called an income test.

Advocates for the refugee

program point out that people

who move to the U.S. under

the program go through more

extensive security checks than

any other class of immigrants.

“The president has mischar-

acterized this program and

used it as a political wedge is-

sue in a thoroughly irresponsi-

ble manner,” said Eric

Schwartz, president of advo-

cacy group Refugees Interna-

tional and former head of ref-

ugee admissions at the State

Department under the Obama

administration.

The cuts also come at a

time when the number of refu-

gees around the world has

risen to more than 70 million,

according to the U.N. High

Commissioner for Refugees, a

total not seen since World

War II. The U.S., long the

leader in admitting refugees,

lost that title to Canada for

the first time in 2018.

The State Department’s

ending acceptance of most

new refugees into the pipeline

will make it particularly diffi-

cult for any future administra-

tion to reverse course quickly,

since there wouldn’t be

enough people vetted and

ready to come.

WASHINGTON—The Trump

administration’s decision to

reduce this year’s refugee cap

to a record-low 18,000 people

is just one step in its broader

plan to shrink the program

and make it harder for any fu-

ture administration to quickly

resume accepting refugees.

The government has in-

creased vetting of most refu-

gees, slowing the arrival of

people who were previously

approved. It also said last

month that it would stop ac-

cepting most new referrals

from the United Nations

agency that coordinates

world-wide refugee resettle-

ment, meaning almost no new

applicants will enter the

yearslong process required for

resettlement in the U.S.

The administration also this

year introduced a new system

of setting caps for special cat-

egories of refugees, including

Iraqis who aided the U.S. mili-

tary and people fleeing reli-

gious persecution, within its

larger cap of 18,000. As a re-

sult of other steps it has taken

to slow their processing, the

real number of refugees admit-

ted to the U.S. this year could

fall well beneath that target.

President Trump hasn’t fi-

nalized the 18,000-person cap,

though the fiscal year began

Oct. 1, and the State Depart-

ment has canceled refugee

flights through Oct. 28.

Acting U.S. Citizenship and

Immigration Services Director

Ken Cuccinelli, who oversees

refugee vetting, said the slow-

down is partly caused by the

large number of migrants cross-

ing the U.S.-Mexico border to

seek asylum, for which people

fleeing persecution and violence

can apply once they are already

on U.S. soil. Mr. Cuccinelli said

resources are being put toward

processing those cases.

The administration has

taken separate steps to curtail

asylum applications, particu-

larly from Central American

migrants, who made up the

majority of the nearly one mil-

lion people crossing the border

last year, including requiring

those migrants to apply for hu-

manitarian protection in other

Central American countries.

President Trump and immi-

gration officials in his adminis-

tration say the more restric-

tive refugee policy is necessary

to protect national security.

Officials add that the cost of

bringing refugees to the U.S.

far exceeds that of helping a

greater number of refugees re-

settle closer to home.

BYMICHELLEHACKMAN

Refugee Program Cuts

Are Designed to Last

Government moves

mean almost no new

applicants will enter

the long process.

cases per judgeship during the

same period was 125.

Meanwhile, the number of

federal immigration misde-

meanor cases in New Mexico

jumped to 4,570 last calendar

year from 2,526 in 2017, ac-

cording to federal prosecutors.

As of late September, there

had been 3,636 such cases in

2019. Crossing the border ille-
      gally for the first time is gen-
      erally a misdemeanor, whereas
      subsequent crossings are typi-
      cally prosecuted as felonies.
      The state’s 10 federal magis-
      trate judges who oversee mis-
      demeanor cases are also being
      overtaxed by immigration
      cases, judges said in inter-
      views, despite New Mexico
      having a full slate of those
      judges. Magistrate judges are
      hired by the court and don’t

require congressional approval.

Because of the overwhelm-

ing caseload, 16 outside fed-

eral judges, some from as far

away as New York and New

Hampshire, have been called

in to help.

“It’s not an unusual day in

New Mexico where I am doing

30 to 40 sentencings, when I

might not do 30 sentencings

in a year in Kansas,” said Se-

nior Judge J. Thomas Marten,

who normally sits in Wichita

but spends a few weeks in

New Mexico every year.

Another impact: Because

immigration cases are criminal

and take precedence, civil

cases are also facing significant

delays given the vacancies.

In one ongoing lawsuit be-

tween environmental groups

and the Bureau of Land Man-

agement over drilling, Judge

Johnson denied a motion for an

emergency hearing, citing both

his high caseload driven by the

border situation and New Mex-

ico’s vacancies. In an August or-

der, he wrote that he didn’t have

the time to review thousands of

exhibits during the time frame

the plaintiffs wanted.

Barbara Mandel, the top fed-

eral public defender in Las Cru-

ces, said the situation isn’t only

delaying non-immigration and

civil cases, but leading to lon-

ger stays in jail for some mi-

grants awaiting their hearings.

Relief may not come soon.

One Trump administration

nominee to the New Mexico

bench is waiting for her vote

to be scheduled in the Senate.

Another is being vetted by the

state’s Democratic senators,

Tom Udall and Martin Hein-

rich. The senators were still

interviewing candidates for

the third vacancy.

“The backlog facing New

Mexico courts needs to be ad-

dressed to ensure that our jus-

tice system operates how it is

supposed to—with speedy and

fair trials,” the senators said in

a statement. They said they

were trying to get the vacancies

filled as quickly as possible.

In a recent criminal case,

U.S. District Judge Martha

Vázquez decided to postpone a

sentencing because she hadn’t

had enough time to review the

case because of her over-

loaded docket. “You worry you

might miss something,” she

said. “The consequences are

not a few months. The conse-

quences are years and years

and years of someone’s life.”

LAS CRUCES, N.M.—With
threeofNewMexico’sseven
federal district judgeships cur-
rently vacant, the U.S. court
system here was already in
danger of being overwhelmed.
At the same time, hundreds of
migrants facing charges of
crossing into the U.S. illegally
are crowding into courtrooms
daily and pushing the system
to the breaking point, accord-
ing to judges and attorneys.
While many migrants are
being cycled in and out of
court in a matter of minutes,
other civil and criminal cases
face delays and judges say
they worry they don’t have the
bandwidth to properly con-
sider complex decisions.
“When you combine the
heavy caseloads with the va-
cancies, it’s crushing,” said New
Mexico Chief District Judge
William Johnson.
The mass prosecution of
migrants caught crossing the
border illegally here is part of
a Trump administration effort
to reduce illegal immigration,
as a record number of asylum-
seeking families and unaccom-
panied children have been try-
ing to enter the U.S.
But because New Mexico has
the highest judicial vacancy rate
among all border states, it is
feeling the rise in immigration
prosecutions more acutely than
Texas, Arizona and California.
In the Las Cruces courtroom
of U.S. Magistrate Judge
Stephan M. Vidmar earlier this
month, shackled migrants
filled two benches in the public
seating section and the jury
box. The migrants, mostly men
from Mexico, appeared before
the judge for just a minute or
two in most cases, answering
basic questions about their
name, whether they under-
stood what was happening, and
for some entering a guilty plea.
Judge Vidmar said in an in-
terview that the court is try-
ing to balance speed and effi-
ciency for the mammoth
caseload while ensuring every-
one is afforded due process.
“The pace we’re at really is
unsustainable. At some point
something’s got to give,” he
said.
The surge in such cases is
affecting an already busy fed-
eral docket in New Mexico
filled with non-border criminal
and civil cases.
According to court data, the
average number of felony
cases per judgeship in New
Mexico amounted to roughly
983 for each of the four cur-
rent district judges between
June 2018 and June 2019. The
national average for felony

BYALICIAA.CALDWELL

ANDDANFROSCH

Migrants, Vacancies Strain Courts

New Mexico Chief District Judge William Johnson and U.S. District Judge Martha Vázquez

RAMSAY DE GIVE FOR THE WALL STREET JOURNAL

Increasingimmigrationcaseloadandjudgevacancies

aretaxinganalreadybusycourtdocket.

Federalimmigration

misdemeanoroffenses

inNewMexico*

Federaljudgeships

inborderjurisdictions

*2019 figure through Sept. 23

Source: U.S. Attorney's office (misdemeanors); U.S. Courts (judgeships)

5,

0

1,

2,

3,

4,

misdemeanors judgeships

2015 ’16 ’17 ’18 ’

20

0

4

8

12

16

N.M. Calif. Ariz. South

Texas

West

Texas

Vacant Occupied

 Heard on the Street: Focus

turns to GM’s plans............. B