You know things are bad when you drive into a small Indiana town and the first thing you see is a billboard that says, “Make $240 a month selling plasma.” Whoa! I should have hit the brakes and taken a picture that I could post, but I had two kids in the car and we were on our way to a swimming pool on a hot summer day.
Many people who watch Late Night With David Letterman are familiar with Muncie because it is the home of Ball State, and Letterman often mentions his alma mater on the show. Letterman always gets a laugh by mentioning Ball State, probably because some folks in the audience are old enough to remember when “ball” was the slang du jour for sex.
I have friends who live in Muncie and work for the college. If you stay in the vicinity of the campus, you might imagine that everything is O.K., though there are quite a few homes for sale.
But drive to the country club, where there’s no one in the pool or on the golf course because few people can afford the modest fees to join the club, and you start to get the picture. Go to the mall and see the empty storefronts.
Or pick up a paper and read the panic-infused stories about the closing of a Borg-Warner plant that makes transfer cases for the Ford F-150 truck and Explorer sport-utility vehicle. The 500 or so jobs at the plant are being transferred to Mexico, which offers lower wages and has special trade privileges under the North American Free Trade Agreement (NAFTA).
I Googled Borg-Warner and learned that the company’s roots in Muncie date back to 1901, when its predecessor, the Warner Gear Co., was founded. This is not just a random factory closing; this shutdown strikes at the heart of Muncie’s industrial bedrock.
Where is Ross Perot when you need him? That “sucking sound” of jobs moving to Mexico that he talked about is louder than ever. As Bruce Springsteen wrote, “Those jobs are going boys and they ain’t coming back, to your hometown.”
Even before the subprime mortgage disaster, Indiana had one of the highest home foreclosure rates. The homes being lost are owned primarily by workers in the auto parts industry, one of Indiana’s leading employers. A lot of auto parts production has moved to China and Mexico because of lower wages.
I wonder when this country is going to figure out that there’s no such thing as “free trade.” I’m not a protectionist by any stretch of the imagination, but I think we need to move to a system of managed trade where the losers are compensated. We can’t afford to write off whole towns like Muncie. Meanwhile, farmers in Mexico are starving because NAFTA has brought them into direct competition with U.S. agribusiness, which enjoys big government subsidies.
For those free marketeers who believe Adam Smith’s “invisible hand” will take care of everything (not that any of them are reading an astrology blog), let’s recall that government helped prime the pump for those Ford Explorers whose parts were made in Muncie.
How? By giving tax breaks to small-business owners who bought SUVs and used them “exclusively” for business. I’d heard about the SUV tax breaks, but never believed it until I saw them with my own eyes when I started doing my taxes with TurboTax three years ago. (My husband’s Jeep Wrangler didn’t qualify for the deduction because it wasn’t heavy enough, by the way.)
Government has the power to influence consumer and corporate decision-making by offering incentives. Let’s say the local or state government in Gloucester, Mass., where there has been a surge in teen pregnancies, set up full college scholarships for high school girls who don’t have babies. This probably would be hard for government to do under laws that prohibit discrimination based on gender, but a private group might pull it off. Four years from now, the pregnancy rate will have fallen, I guarantee you.
Of course, students who have children shouldn’t be denied scholarships. I know that. But I’m trying to make a point here about the power of financial incentives to change lives. All the evidence shows that the more education a mother receives, the better the life of her child will be. Of course, if a woman spends the majority of her child-bearing years earning postgraduate degrees and working, she may run into fertility problems when she finally does decide to have kids, but that’s another post.
Human beings respond to economic rewards, whether it’s deductions for small-business SUVs, scholarships for at-risk students, or the tax breaks that California has enacted for zero emission vehicles (See “Tesla Motors: California’s Gain is New Mexico’s Loss”. It’s a fact.
Along those lines, how about setting up economic redevelopment zones in Indiana, Ohio, and Michigan? Would conservatives who happily spend $12 billion a month or more on the war in Iraq brand efforts to bring new jobs to the industrial Midwest as “socialism”?
I was talking to a friend whose husband is involved in the Beltway media business. She was telling me that in the early Eighties, when we were both in journalism school, she didn’t have a lot of sympathy for workers who were losing steel industry jobs. “I thought they should just move to another town, retrain, and get new jobs,” she admitted.
Now, as she’s watching neighbors and friends get laid off at the Washington Post (see “Wassup with the Washington Post?” ), she says she finally understands the economic pain that job loss inflicts on families. Maybe now that the chattering classes are being affected by downsizings, we’ll be hearing more in the media about the plight of displaced workers.
At the United Astrology Conference in May, astrologers were predicting that this final passage of Pluto through Sagittarius, which ends on Nov. 25, will coincide with the last wave of media cutbacks. And then the ax will fall in banking and financial services as Pluto, which governs restructuring, moves through financially-oriented Capricorn.
Question: How does an out-of-work journo retool? No, this isn’t a joke.