Closing of GM Plant Reminds Us To Not Rely on Politicians
A little over a year ago President Trump assured the people of the Youngstown area that the jobs the rust belt region had lost would soon return. This week, another 1700 eliminated, with the mothballing of GM’s Cruze operations. The fact is, they aren’t coming back, and those who are banking on them need another strategy.
In July 2017, Trump alluded to the jobs Youngstown has hemorrhaged over the past two decades, and promised: “They’re all coming back.” He also offered some real estate advice to homeowners: “Don’t move. Don’t sell your homes.”
When the star of The Apprentice offers advice on land values, some find it ihard not to listen. The result? Homes with negative equity in the Youngstown area have reached 23 percent - about three times the national average.
It’s easy to see why people in the Youngstown area would pay attention to a president who promised jobs. GM’s closure of its plant in nearby Lordstown, a response to the decline in popularity of sedans in an era of low-cost energy, was seen as a final straw. What is hard to understand is why the people of Mahoning County thought such a simple and simplistic form of economic salvation was a serious possibility.
The region has been hit hard. Three decades ago, 1 in every 4 jobs in the region were in the manufacturing sector. Now, it is less than 1 in 8. Since the 2008 financial meltdown, real hourly earnings shrunk 8 percent, adjusted for inflation — even as they were rising 11 percent in the rest of the country.
The decline of manufacturing in Youngstown mirrors a national trend, especially regarding the auto industry. In the 1970s, GM had one of the biggest private-sector workforces in the United Stares - over 600,000 men and women. Now, it’s about one-sixth that level.
Fewer Americans have jobs making cars and trucks, and those who do are earning less for it. Over the past three decades, U.S auto workers’ wages have dropped by 18 percent, after inflation. In fact, less than 10 percent of vehicle factories offer pensions.
Why then, would anyone buy the notion that they should stay put, because the jobs are returning? Residents of rusted out towns and cities appear in many ways to be members of a cargo cult, waiting for magical flying machines to appear in the sky and drop cargos of goods in their laps. Residents have two rational choices: Either they can reinvent the economy of their region (as Pittsburgh did when it shifted from steel production to health and education as its economic backbone), or residents can simply go elsewhere where economic prospects are brighter.
Rather than listen to politicians trying to blow smoke, telling them their salvation will come where they happen to live now and that they can continue to make a living the way they always have, they should recognize that no one is going to be able to deliver manna from heaven, in the form of jobs that were only relevant decades ago. Maybe it is time to fish in a different way than they always have, or cut bait and go where the fish swim.
