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General Motors in South Africa

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In 1986, General Motors ended a 60-year tradition of South African auto manufacture. The corporation sold its Port Elizabeth plant to a local company. GM promised to license the plant and "provide certain critical components . . . in an effort to preserve the opportunities" in an area of high unemployment (Malone & Roberts, 1994, p. 87). The automaker attempted to put the most positive spin on the withdrawal.

Although the company avoided mentioning the fact, observers noted that recently introduced U.S. legislation proposed repealing South African income tax credits. This meant that GM was facing the double burden of income taxes in both the United States and South Africa. Negative public relations were also a factor. The costs of balancing the expectations of apartheid in South Africa and the anti-apartheid stance expected in the United States had simply become too high.

The U.S. anti-apartheid movement developed over a period of years. At its peak in the late 1980s, it was able to articulate and tap a rare sense of public unity about the use of corporate and government policy to promote change in a repressive outside government. The still-nascent struggle to define and enforce a sense of international business ethics is rarely so clear in its goals.

Legal and ethical experts still debate the moral obligations of corporations. That they must make a profit is clear. But do they have an obligation to maximize profits at any cost? What are their social obligations

. . .
ico, not the full cost of the product . . . U.S. companies moved unskilled jobs to Mexico during the 1980s. But now maquiladoras also exist in relatively high-wage, high-skill industries such as automobiles, chemicals and electronics. In low and high-skill occupations alike, Mexican workers only receive a small fraction of the wealth they create (Van Buren, 1995, p. 30). Reports on this movement in the United States focus on job loss to U.S. workers. But Mexican workers in these plants, although employed, also have to endure the costs of substandard wage, working conditions and environmental damage. "Horrific conditions" in 2,000 plants surveyed by a recent study led to lawsuits alleging that pollution caused brain damage to local infants. Union organizing efforts at a Nuevo Laredo Sony plant were blocked by police, and the company attempted to force employees to work weekend shifts. Workers at a Reynosa Zenith plant were fired after a positive pregnancy test (Van Buren, 1995, p. 30). Clearly, many U.S. companies are doing more than passively accepting the benefits of working in an economy with weak social protections for workers. They are actively fighting to preserve repressive working conditions that are no longer lega
. . .

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Approximate Word count = 1980
Approximate Pages = 8 (250 words per page)

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