Democratic Senator's family business uses Mexican labor

Posted

INDIANAPOLIS (AP) - An Indiana senator railed against Carrier Corp. for moving manufacturing jobs to Mexico last year, even as he profited from a family business that relies on Mexican labor to produce dye for ink pads, according to records reviewed by The Associated Press.

Joe Donnelly, considered one of the nation's most vulnerable Democratic senators up for re-election next year, has long blasted free-trade policies for killing American jobs.

He accused Carrier, an air conditioner and furnace maker, of exploiting $3-an-hour workers when it announced plans to wind down operations in Indiana and move to Mexico.

However, an arts and crafts business Donnelly's family has owned for generations is capitalizing on some of the very trade policies - and low-paid foreign labor - the senator has denounced.

For more than a year, Stewart Superior Corp. and its subsidiaries have been shipping thousands of pounds of raw materials to Mexico, where the company has a factory that produces ink pads and other supplies, according to customs records from Panjiva Inc., which tracks American imports and exports. The finished products are then transported back to a company facility in California, the records show.

Stewart Superior, which also has an operation in LaPorte, Indiana, says on its website that the company's Mexican factory "brings economical, cost competitive manufacturing and product development to our valued customers."

Although Donnelly's brother runs the company, the senator previously served as a corporate officer and its general counsel before he was first elected to Congress in 2006. In a financial disclosure form he filed in May, Donnelly reported owning as much as $50,000 in company stock and earning between $15,001 and $50,000 in dividends on it in 2016 alone.

Alejandro Ruelas-Gossi, a Latin American trade expert, said Donnelly's stake in the company amounts to "hypocrisy" in light of his outspoken campaign rhetoric against the North American Free Trade Agreement and similar deals.

"What you are creating is poverty, because the jobs they are creating are very poor jobs. You have very poor salaries. You have poor quality of life. It's not good for America and it's not good for Mexico," said Ruelas-Gossi, a critic of these types of policies who has taught at the University of Miami School of Business and has written about Latin trade issues for Harvard Business Review.