Nov 8, 2017 - Economy

What happens when you fall out of the middle class

By next week, a St. Louis property developer called Commercial Development Company must decide whether it will buy a shuttered, 94-year-old GM assembly plant in Janesville, Wisconsin. Whatever happens, the plant's prominence — and that of Janesville itself — in U.S. industrial history is past, vanquished by the same forces that have unraveled the fabric of so many storied manufacturing towns in and outside the U.S., and with it shaken up politics fundamentally.

On Tuesday evening, the Washington Post's Amy Goldstein won the FT/McKinsey Business Book of 2017 for Janesville: An American Story, her incredibly well-timed account — the result of six years of immersive research — of what happened when one company town went south. Janesville is and isn't the story of Donald Trump's ascendance: its middle class has been rent by the loss of well-paying manufacturing jobs, and their replacement by lesser employment in a distribution center that the town paid millions of dollars in incentives to attract. Yet, though Democrats stayed away in droves, the town voted for Hillary Clinton last year.

When we chatted yesterday, I asked Amy for her main takeaways after months of speaking about the book.

  • "Falling out of the middle class is very different from being poor all along," she said. "There's a real trauma to it." Even when everyone around you is in the same circumstance, and you are a part of the worst economy since the Great Recession, humiliation is deeply felt. "Losing a job feels very painful and personal," Goldstein said.
  • Job retraining is not the panacea Democrats, Republicans, economists and everyone in between make it out to be. In Janesville, a lot of people turned to upskilling and college degrees, and for some of them, that worked. But others ended up in lesser circumstances than people who simply found other work. And even when you are better skilled, it did not necessarily mean you could stay in Janesville — many people had to move away for work.
  • Janesville is demonstrably the experience of towns across the country. In one call-in radio show, Goldstein heard from a caller in a former shoe-making town in Massachusetts, an ex-seafood producing town in Florida, and a former steelmaking town in the midwest. "The story of lost jobs in one community applies around the country," she said.
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