The Rust Belt.
What is the Rust Belt? Ever since the hotly contested 2016 election, we have been hearing about this Rust Belt extensively across the media. The term can conjure in our minds vast regions of America scattered with industrial wasteland and abandoned warehouses full of aging, rusty metal parts. And in many ways, that is an accurate assessment of what the Rust Belt is today.
The Rust Belt is a region spanning parts of the Northeast and Midwest of the United States, containing the cities of Baltimore, Buffalo, Cincinnati, Cleveland, Detroit, Milwaukee, Pittsburgh, as well as New York City, encompassing many of the rural towns around those urban centers. Culturally, residents of these regions pride themselves on their versatility, independence, work ethic and blue collar tradition.
Around the middle of the 20th century, America’s economy was booming due in large part to manufacturing in the Rust Belt of everything from steel and rubber to automobiles and radios. In 1950, nearly half of all U.S. jobs were based in the Rust Belt, and two of the biggest companies in the world, U.S. Steel and General Motors, were headquartered in the region. In those days, American industry dominated world markets, and its high-quality products were exported all over the world. This high demand for American products, combined with an abundance of high-paying, union manufacturing jobs in the region drove an economic boom that played an integral role in creating the American middle class and the realization of the American Dream.
Beginning in 1950, however, things in the Rust Belt began to change. Technological innovation decreased the demand for labor. Certain jobs on assembly lines became automated (picture those big robot arms in car factories—those robots do jobs that people used to). Some companies also began moving manufacturing operations to other states where the cost of labor was cheaper. Other countries, most notably Japan, also began to produce quality products that were cheaper, and the U.S. began importing these foreign-made products.
In the 1970s, changes in American trade policy allowed American companies to move to other countries. Many Rust Belt factories and refineries shuttered their doors—some companies decided to move production overseas to take advantage of the much cheaper labor in other countries (think a few cents per hour, compared to American wages of a few dollars per hour). Others just couldn’t keep up with the competition and were forced to go out of business or get bought out.
The exodus of manufacturing jobs from the Rust Belt was nothing short of devastating, though some areas recovered by adapting to new industries. In New York, for example, a number of industries emerged in the 1980s and 1990s—including finance (banks) and service—that allowed the city to recover from the lost manufacturing jobs. However, other cities such as Cleveland, Detroit and Pittsburgh have never recovered. As a result, the region has become known for sky-high unemployment, population losses as people moved to other parts of the country, crippling poverty and high rates of drug use. Rust Belters, frustrated at an economic and political system that seems to have left them behind, are demanding change.
The Rust Belt faces significant challenges. American industrial manufacturing’s glory days likely will never return to the region. However, recent years there have brought some signs of economic revitalization. In Detroit, for example, cheap real estate and business-friendly policies have opened the door for a number of startup manufacturing firms to set up shop in the city. This trend is beginning to echo in other Rust Belt cities as well. To heal the wounds that the region suffered in the 20th century, local leaders and innovators must continue to step up and lead. And policymakers must pay attention to the needs of this great, proud swath of the American heartland.