Oh-hi-woe
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by clicking on the link at the top of the adjoining column
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Is there any good news for Ohio? The German Company DHL, the successor to Airborne Express, is closing down its hub in Wilmington, Ohio, with a loss of 8,000 jobs. It is hiring UPS for its package handling, and using the UPS Kentucky hub in place of Wilmington. DHL purchased Airborne in 2003 using John McCain's current campaign advisor as its lobbyist to get the enabling legislation through Congress. The advisor has had no association with DHL since 2005.
This month’s edition of Forbes Magazine lists four Ohio cities in the top ten list of dying cities in the United States. Included on the list, in addition to Youngstown, are Dayton, Cleveland, and Canton/Massillon. Although they are not ranked in any particular order, a cursory review of lost population puts Youngstown close, if not at, the top of the list. I have always taken these lists with a grain of salt. If one just looks at the city, it is clear that Youngstown lost population as the suburbs expanded. But this list is different. It looks at the SMSA (Standard Metropolitan Statistical Area) which includes Trumbull, Mahoning and Mercer Counties. No matter how you dress this pig up, you can’t make it look any better than it is.
This is more than a Youngstown issue, however. It is an Ohio issue. Back in the 1960’s, Ohio was one of the wealthiest states in the union. Its salaries were among the nation’s highest, along with its real estate values…and pretty much everything else. Now, it is rapidly falling into the bottom ½ states. It’s salaries are 8% below the national average, and its real estate values are 25% below the national average.
This is an election year, and people are looking to point the finger at someone to blame for our problems. According to the Democratic party, NAFTA is the bogey man. On the other hand, as far as exports go, Ohio is one of the top 5 states in the nation to benefit from exports. Even the Youngstown SMSA is ranked as 99th in the nation for exports, with $1.5 billion this year. Given we are at the bottom of every other list, that is fairly impressive. Does anyone know what we export?
The fact of the matter is that we have reaped the harvest of our own folly. Environmentalism was the original catalyst causing loss of jobs in the Youngstown area. No steel manufacturer in its right mind was going to pump billions of dollars into 70 year old mills to bring them up to the environmental requirements for both air and water that were implemented in the 1960’s. Couple that with labor unions that continued to strike even as the mills shut were shutting down, it's a wonder that we were able to keep what little remained.
This is more than a Youngstown issue, however. It is an Ohio issue. Back in the 1960’s, Ohio was one of the wealthiest states in the union. Its salaries were among the nation’s highest, along with its real estate values…and pretty much everything else. Now, it is rapidly falling into the bottom ½ states. It’s salaries are 8% below the national average, and its real estate values are 25% below the national average.
This is an election year, and people are looking to point the finger at someone to blame for our problems. According to the Democratic party, NAFTA is the bogey man. On the other hand, as far as exports go, Ohio is one of the top 5 states in the nation to benefit from exports. Even the Youngstown SMSA is ranked as 99th in the nation for exports, with $1.5 billion this year. Given we are at the bottom of every other list, that is fairly impressive. Does anyone know what we export?
The fact of the matter is that we have reaped the harvest of our own folly. Environmentalism was the original catalyst causing loss of jobs in the Youngstown area. No steel manufacturer in its right mind was going to pump billions of dollars into 70 year old mills to bring them up to the environmental requirements for both air and water that were implemented in the 1960’s. Couple that with labor unions that continued to strike even as the mills shut were shutting down, it's a wonder that we were able to keep what little remained.
As unions and the EPA forced manufacturing out of northeast Ohio, services had to be cut back. But not wanting to do that, taxes started to go up. In the 1960’s, Ohio was close to the bottom of the list in total taxes paid: local, state, and federal. Now, Ohio, as a percentage of its income, is the 3rd highest taxed state in the country. That’s right. The THIRD highest taxed state in total taxes paid.
Not only that, Ohio put most of its “investment” (translate: spending) into Central Ohio and the Columbus area, while the areas around the edges of the state were left to rot slowly. Somebody had to pay for those lit arches over High Street in the Columbus Short North neighborhood. Meanwhile, have you been to Ashtabula lately? One of the most depressing cities I have seen.
The last nail in the coffin is our inefficient government structure. Our local political sub-divisions were built to serve an industrial base as existed in 1900. It doesn’t work now. Which is why as our population dwindles by 10%, the cost of our local government has increased by 75%. AS an example, Struthers and Campbell do not need their own police forces, mayors, city prosecutors, and the like. In Mahoning County, the government entities serve primarily as employment agencies for locals based in political patronage. Do you know how many itty bitty school systems there are in our county? How many superintendents, at $100,000.00 per, does this county need?
There is no doubt that a portion of job loss is due to international competition and bad federal policy. Delphi moved jobs to Mexico. Bush’s refusal to enforce fair trade practices with China, even after the World Court said we were right and China was wrong, was an insult to Wheatland Tube.
On the other hand, much of our problem is rooted in the poor performance of our local elected officials to properly represent us in Columbus and Washington, in Ohio’s absurd tax policy, and its rapture with the Columbus area while the rest of the state goes to hell in a hand basket.
Look at our taxes and structure. What company would want to move to Ohio, let alone Youngstown, when they can go to states like Mississippi, Alabama, Georgia, Florida, and Nevada, with no unions, only moderate regulation, and pay less tax??
Ohio, and particularly northern Ohio, has one thing going for it: Water. I hope that as we move forward as a state and as a community, we are able to get our act together and do some serious self examination as to how we do business. Otherwise, we will certainly end up like Appalachia, a relic of another time and place.
Not only that, Ohio put most of its “investment” (translate: spending) into Central Ohio and the Columbus area, while the areas around the edges of the state were left to rot slowly. Somebody had to pay for those lit arches over High Street in the Columbus Short North neighborhood. Meanwhile, have you been to Ashtabula lately? One of the most depressing cities I have seen.
The last nail in the coffin is our inefficient government structure. Our local political sub-divisions were built to serve an industrial base as existed in 1900. It doesn’t work now. Which is why as our population dwindles by 10%, the cost of our local government has increased by 75%. AS an example, Struthers and Campbell do not need their own police forces, mayors, city prosecutors, and the like. In Mahoning County, the government entities serve primarily as employment agencies for locals based in political patronage. Do you know how many itty bitty school systems there are in our county? How many superintendents, at $100,000.00 per, does this county need?
There is no doubt that a portion of job loss is due to international competition and bad federal policy. Delphi moved jobs to Mexico. Bush’s refusal to enforce fair trade practices with China, even after the World Court said we were right and China was wrong, was an insult to Wheatland Tube.
On the other hand, much of our problem is rooted in the poor performance of our local elected officials to properly represent us in Columbus and Washington, in Ohio’s absurd tax policy, and its rapture with the Columbus area while the rest of the state goes to hell in a hand basket.
Look at our taxes and structure. What company would want to move to Ohio, let alone Youngstown, when they can go to states like Mississippi, Alabama, Georgia, Florida, and Nevada, with no unions, only moderate regulation, and pay less tax??
Ohio, and particularly northern Ohio, has one thing going for it: Water. I hope that as we move forward as a state and as a community, we are able to get our act together and do some serious self examination as to how we do business. Otherwise, we will certainly end up like Appalachia, a relic of another time and place.
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