What Is Ailing America's Working Class?


I live in Janesville, Wisconsin, on the same block where I grew up. Janesville's big employer until 2009 was General Motors (GM). GM sustained the town for nearly 90 years, and many of the people I went to high school with went to work at GM after we graduated. You could get a good job in the plant and do very well and have a good life — and your kids could do the same.

But then in 2009, it ended. We lost the plant — just like that. Janesville used to make Tahoes and Suburbans. Now they're made in Texas. And there wasn't really anything to replace those jobs. Some of the guys I went to high school with had enough seniority in the union that they could move within the GM system — get a job in Saint Louis or Kokomo, Indiana, or somewhere else where the company is still making cars. But lots of others didn't have that option.

That's House Speaker Paul Ryan writing in a new book described local barriers to free enterprise in his hometown. Ryan recently shepherded the largest federal tax reform bill in U.S. history, a response to what he said he was seeing along America's Rust Belt — a tax code that was holding back corporations from investing at home and preventing individuals from getting opportunities to move up the socioeconomic ladder.

Ryan wrote that he watched as a friend of his went from a six-figure salary with great benefits to being a night manager at a gas station convenience store.

It’s been nearly a decade since the move, but many Janesville workers who were laid off still have not found work commensurate with their expertise prior to the plant's move.

Things may be looking up, however.

According to the Milwaukee Journal Sentinel, a firm that specializes in redeveloping abandoned industrial sites has bought the Janesville GM plant for $9.6 million.

Commercial Development Co. Inc. announced last month that it had purchased the idled GM plant and site.

Tuesday [January 23], the price became public as the deed transferring the 265-acre property was recorded with the State of Wisconsin.

Commercial Development has said the site holds potential for manufacturing, warehousing, and logistics-related activity.

Since 1990, the company has bought and redeveloped or sold more than 200 pieces of problem real estate, including shuttered factories, power plants, quarries and chemical plants. The Janesville purchase marks at least the fifth former General Motors plant Commercial Development has acquired.

City Manager Mark Freitag says that Commercial Development is the perfect fit for what the town needs.

“We’re very confident in their past practice, what they’ve achieved and how that will essentially play out here in Janesville,” he said. “It’s an exciting time for the community.”

Optimism in Janesville is on the rise again because of the purchase of the property. One of the factors that bodes in its favor is the new corporate tax rate, which was slashed from 39 percent to 21 percent. With more of their own capital at their disposal, companies can invest more in development and in paying their workforce higher wages.

GM probably will not return to Janesville, and it is unclear what may replace the old plant, but one thing that has returned is hope.