I have to admit that I didn't know there was a Globalization Adjustment Fund in a piggy bank somewhere in Brussels. Well 512 workers formerly with NXP in Nijmegen are now set to benefit from it to the tune of about $4,500 each because they have been the victims of "globalization" in the semiconductor market.
At least that is the European Commission's justification for the pay out.
Interesting then that readers of EE Times seem to lay the blame at the door of the private equity consortium that paid Philips for an 80 percent stake in NXP and then loaded the newly-formed company with the billions of dollars of debt the consortium had incurred.
I have sympathy with the former NXP workers but don't agree with the European Commission's justification for putting up 1.8 million euros (about $2.3 million) of European tax payers' money to support the former NXP workers. The term globalization is anonymous, and while it may be a phenomenon it is not a real entity and should not be a trigger for pay outs. On the other hand U.S. private equity making a mess of things provides a real door to go to seek compensation. It is not that there was anything malicious about the screw up, it was just one of the many banking excesses that preceded the crisis of 2008.
Many people in the past and more in the future will lose employment due to "globalization" but will not get money from this fund, so I suppose we could say "good luck" to those from Nijmegen. But fundamentally the exodus of manufacturing from Europe is about the competition between policies in Europe and the East and free-market companies playing on that field.
The long-held concern has been that once manufacturing goes east it is only a matter of time before design follows. The historical record is not clear cut on this but it remains the prime argument of those that would encourage, protect and even subsidize domestic manufacturing.
The British let high tech manufacturing go in the 1980s and 1990s and are coming to regret the lack of such capability now. The word "re-industrialization" was being whispered by the outgoing Labour party government earlier this year. As Philips turns itself into a "life-style" company the Dutch are apparently going through the same cycle a decade or two later.
Germany may yet be an animal of a different stripe. It still has a lot of manufacturing in the automotive and industrial sectors that is does not want to lose. And so around Dresden it is encouraging companies to invest in manufacturing. It is not without mishap but is a different and a more positive use of tax-payers' money than pumping it into a fund to alleviate the problems of manufacturing redundancies.