By DON McINTOSH, Associate Editor

2008 will be a year of global prominence for China. The 2008 Summer Olympics will focus the world’s attention on Beijing in August. But China’s rapid economic expansion has already forced the world to pay attention in recent years. In a very short time, China has emerged as contract factory to the world, and an economic superpower.

“If I had grandkids, I’d want them to learn Mandarin,” said Oregon State Rep. Jeff Barker, (D-Portland), who visited China in November as part of a two-week official delegation. Like most Western visitors, Barker came away wide-eyed at the newness and massiveness of China’s coastal cities.

Nowhere is China’s impact clearer than in its trade relationship with the United States. U.S. companies were already well on the way to outsourcing manufacturing to Third World countries when China became a member of the World Trade Organization in 2000. Joining the WTO was a signal to the West that China was serious about being a place to do business, and a pledge that it would play by the rules. Since then, China has become firmly established as the manufacturer of choice.

U.S. imports from China increased from $81 billion in 1999 to nearly $288 billion in 2006. U.S. exports to China also rose, from $13 billion to $55 billion. Hiding between those two statistics is America’s fastest-growing “export” — jobs. That’s because while the increased exports are mostly raw materials and capital goods, the increased imports are finished products and consumer goods. In other words, U.S. companies are outsourcing the “value-added” stage of industrial production to a country where labor is cheap, leaving most U.S. workers to do what remains: extract American raw materials, truck around imported finished goods and stand at the cash registers where they’re sold.

Portland’s maritime shipping stats tell the same story. Container ships brought in $1.2 billion worth of Chinese goods in 2006, mostly finished products, consumer goods like apparel, footwear and tires. Ships leaving Portland for China carried $294 million worth of goods, consisted overwhelmingly of raw materials like wheat, fertilizer, scrap metal and soda ash (used to make glass.)

Again, for the most part, American companies are selling raw materials and the machines to turn them into finished products to Chinese contractors, and Chinese contractors are selling finished products to American companies. Everything is being made in China, from the crucifixes in New York City cathedrals to the cowboy boots in Texas boot stores to scenery-filled 2008 Oregon calendars.

That’s a real problem for many American workers, like Michael Rivenes, who until Sept. 4 was a skilled machinist at Williams Controls in Tigard, Oregon, and chairperson of his United Auto Workers bargaining unit.

Rivenes spent 28 years at Williams, and in recent years operated a computerized milling and lathing machine. Rivenes and his co-workers made throttle controls for trucks. He earned a base salary of $38,500, not counting overtime and bonuses. The company also paid for health insurance for his family, and a pension benefit.

But in 2006, Williams announced it would shift production to China, and terminate most of its Tigard factory workers over a period of 18 months.

“When you’re a worker and your CEO starts to talk about ‘strategic realignment of operations’ you’d better cut up your credit cards and start stocking up on canned goods,” Rivenes told the NW Labor Press. Rivenes was in the last group to go. In effect, his pink slip had a “Made in China” sticker on it.

“I’m worried about America,” says Barker, the state representative. “Everything is going offshore, and that’s not good for American workers.”

At the Williams Controls plant in Tigard, which two years ago employed 120 production workers, just 48 hourly jobs will remain — shipping, receiving, packaging and assembling of parts made elsewhere.

Meanwhile, the laidoff workers qualify for a package of retraining and extended unemployment benefits, courtesy of the U.S. taxpayer.

Rivenes is optimistic about his future. He starts classes Jan. 7 at Chemeketa Community College in Salem, and hopes to work in human resources. Still, he liked his job at Williams.