Pennsylvania: Stitches in Time

Well we're living here in Allentown
And they're closing all the factories down
Out in Bethlehem they're killing time
Filling out forms
Standing in line
...Well we're waiting here in Allentown
For the Pennsylvania we never found

Billy Joel, "Allentown"

When I went on an economic development tour of Pennsylvania last year, nearly everyone who spoke to our group--politicians, academics, entrepreneurs, PR flacks, tour guides, maybe even the waiters and janitors--everyone brought up the Billy Joel song "Allentown," that elegy for misbegotten promises, betrayal, and aimless lives. They all brought it up to say how much they hated it, how it referred to a past that no longer existed, how its persistence belied the changes that the people of Pennsylvania were bringing about in their state, how they wished folks just wouldn't listen to it any more. I had somehow missed hearing the song myself, during my many years of listening to pop music, but they mentioned it so often and so persistently that I went and looked it up and lent it an ear. It's a good song, and while I can understand the resentment Pennsylvanians might feel at listening to Billy belt out that paean to hometown hopelessness before packing up to go home to his Hollywood Hills cottage and his supermodel, the very sorrows that the tune propounds carry a warning that the good folks of the Keystone State might still take to heart. For while Pennsylvania is no longer bound to the steel business as it was in the days of the song, it is still in danger of remaking itself as a one-industry town, and becoming simply a cleaner version of its former self, but with its former habits unabated.

In the old days it was steel, steel, steel. Yes, there was some publishing, there was a modest music industry, but steel brought in the money, steel made the jobs. The smokestacks lined up above the hulking factories, dark towers against a smoky sky; and generations of men lined up at the gates to the furnace rooms to pour coal into fireboxes, to pour the molten steel into the molds, to pour their lives into the darkness and the heat and noise. They marched into those metal rooms in a sort of voluntary holocaust, giving their bodies to the wilting heat in exchange for a promise of comfort in a home they could own themselves, in exchange for pride in the might of an industry that never knew their names. They reveled in the strength of their arms; they took pride in the craft of their hands; they had faith that they were the best in the world at what they did, and that no one could ever do it better. They expected to be appreciated. And they never were.

The story of steel is the story of labor unions. Every dollar, every comfort that they gained through their labor was wrested from the industrialists through the power of labor solidarity. Nothing was given to them out of love for them, nor for admiration for their strength and craft. Only strikes and the threat of strikes brought the prosperity that elevated the whole economy of the state for so many years; only unions made it possible for working stiffs to buy their houses, cars, and boats, and so create a market for the very goods they made. You see this even today, in places such as York, where our tour visited two very different factories: the Pfalzgraff ceramics plant, where non-union workers grind out plate after cup after plate for maybe nine dollars an hour, after ten years, if they're lucky, and where the tour guide, a retired manager of that same plant, scoffs at them in front of his guests; and the Harley-Davidson motorcycle factory, unionized, where wages start at sixteen dollars an hour, where the employees have anything but a cowed and browbeaten expression as they stand tall at their state-of-the-art machinery, and where the parking lot is filled with rows of shiny American motorcycles and cars--most of them made with Japanese or Brazilian steel. Because steel is gone, except for a few specialty manufacturers addressing niche markets. Long gone from Pennsylvania.

What will take its place, as Pennsylvania attempts to stitch its past to its future and repair its economic fabric? This is what they told us on our tour: high technology (especially biotechnology) and tourism.

Pennsylvania's efforts to increase employment in high technology businesses cleverly starts at the bottom: rather than trying to tempt existing companies away from other states with tax breaks and such, it subsidizes the first few years of new businesses established by local residents, using a couple of methodologies: the "business incubator," and university partnerships. The business incubator is generally a state or state-funded company that maintains office and lab space which are rented at below-market rates to new technology companies. This way, new companies can devote their resources to developing an actual product rather than to acquiring workspace. This allows them to build technical and commercial momentum much faster than they otherwise could, and may very well mean success where a standalone effort would fail. Abating a company's taxes for up to twelve years also helps, with benefit presumably returning to the commonwealth as the company's sales and employee count grow. The university partnerships encourage alliances between university research departments and commercial entities, generally established companies, in an effort to track advanced students into jobs with local tech firms. Similar subsidies of office and lab space support these generally off-campus environments. Oftentimes students and professors will form companies that grow out of advanced research projects, in effect serving two masters, science and commerce. (This has some troubling implications, given the growing evidence that pharmaceutical companies in particular, and many others in tech fields, have tended to repress research that is not favorable to their commercial activities.)

However, though there is a certain diversity in these efforts--including companies devoted to educational software as well as to materials development and other hybrids of high tech and heavy manufacturing that draw on the region's historical affinities for both fields (this is, after all, the state where Benjamin Franklin researched electrical phenomena in the 1780s), the phrase we repeatedly heard all week was "biotech, biotech, biotech." The reasoning was that the presence of several large pharmaceutical companies in the region made for a ready market for biotech-oriented products, be they material or intellectual properties.

The saving grace in this is that the majority of the companies this process is generating are small, flexible, and engaged in a variety of projects; they are not subject to the often-blind whims of a centralized corporate bureaucracy. The problem is that if their major market consists of a few large companies subject to the blind whims of their own corporate bureaucracies, are their economic positions really secure? What's to stop an already transnational company such as Schering-Plough (headquartered the next state over in New Jersey) from finding its software solutions in India next week, if Indian programmers are just as good and a quarter the price? What's to stop them from moving drug research efforts to long-established facilities in France or Germany or California, or manufacturing to prefab clean rooms parachuted into Third World countries, as has already begun to happen with computer manufacturing? What's to stop the Japanese, who need some more diversification in their own industrial sector, from deciding to do to medical research and manufacturing what they've already done to cars--and what they did to steel?

The problem is that Pennsylvania may simply be replicating its dependence not on steel itself, but on steel buyers, with a dependence on biotech buyers. The biotech companies will not buy American, let alone Pennsylvanian, for sentimental reasons only. They will buy quality for price. And unless American workers--blue collar, white-collar, or lab coated though they be--are willing to labor for the same effective wages as Laotians or Indians, they may find themselves singing along with Billy Joel again, bemoaning the diploma on the wall and the promise that it never kept.

Pennsylvania still makes steel. The mills that survive are smaller ones making highly specialized steels that big companies cannot effectively produce at a profit. Those who need these boutique steels pay a premium for them, and Pennsylvania still makes steel. Perhaps, instead simply hoping for a steady market in a few big pharmaceutical mass-market companies with no loyalty to anyone anywhere, Pennsylvania can encourage research to uncover specialized needs in an intentional diversity of fields that big companies cannot afford to address. After all, Prozac may be the paradigm for the treatment of depression today, but tomorrow it may well be cognitive therapy, which works as well for many patients today and has no side effects…and doesn't come in a bottle. What will an entrepreneurial culture that knows only hardware and production do if that happens? Is there anyone who is looking at mental health the way, for example, Carnegie Learning Institute in Pittsburgh is looking at education, developing software that can help psychologists and their patients in non-drug-based treatments? The potential is there to create a market.

Address the market as you know it today, and you are as doomed tomorrow as Big Steel was yesterday. Address the problems of the world at their roots, and the market will find you. If you let it know you're there. It's not as easy, but there's no shortage or marketing skill in America…and when you do this you no longer have to depend on the kindness of boardrooms.

As far as possible from high technology in many ways in the tourist trade, and Pennsylvania is making efforts in that direction as well. Philadelphia is a beautiful city, one that I'd visit often, and Pittsburgh, though parts of its outskirts look like Los Angeles suburbs without the charm, has a lively and invigorating downtown. Most of the state's efforts have been in marketing and public relations, which is fine for getting tourists in to eat in Philly's downtown restaurants and visit its museums and historic sites, to drop in on Pittsburgh's Golden Triangle, to canter horseback across the silent grasses of the Gettysburg battlefield, to bicycle through the woods and along the many rivers. But what tourist-oriented employment facilities are the various levels of government encouraging? It appears to come down primarily to two things: stadiums and resort hotels.

Stadiums are a waste of money. If they're such a good deal, why aren't the owners willing to invest in them themselves? And how can they "stimulate the local economy" when all they do is take up huge tracts of land with the facilities themselves and their parking lots, disrupt neighborhoods with vast blank spaces, and provide low wage jobs once a week for a few months out of the year? If you're going to let someone build a stadium, let them pay for it too. And if you're going to let them build it in the city, make them integrate a variety of normal retail establishments into the ground floor--stores, restaurants, clubs, things that people will go to every day or every night. And put the parking underground, or don't have any at all: just run light rail lines in from the various neighborhoods--transit that will benefit the city anyway, twenty-four hours a day, 365 days a year. The retail face of the stadium will then be right on the street. In that case, a stadium works--because the stadium part is irrelevant anyway, except when there's a game on.

It would be possible to retrofit the new Pittsburgh stadiums this way. This would awaken the neighborhoods around them and do more to make jobs and liven up the city than a dozen high tech business incubators could.

Resort hotels were the Next Big Thing I heard about in Ohiopyle, a little town near the Nemacolin Woodlands in the center of the state. This was to be the answer to chronic underemployment in the region, this was to "stimulate the local economy" with outside dollars and steady work. But, judging from the forlorn and often dazed expressions on the faces of the help at the grandiose resort where we stayed for that segment of the journey, a maids-and-clerks economy may not be the best solution for the poor folks of the hills and valleys in the heartland of the commonwealth. What is the point of basing your economic improvement program on a bunch of no-skill dead-end jobs? Can the people of Central Pennsylvania aspire to nothing more than changing the bedsheets of golfbag-toting entrepreneurs relaxing from another hard round of meetings with the Eli Lilly buyer? Riding a bike along a converted rail-trail with my guide, Eric Martin, who was explaining the tourism development program the local governments are working on, I began to think of alternatives to making the population of these lovely forests over into servants shuffling the beige-walled warrens of a few megacorporate resorts…institutions whose owners would take the vast majority of those tourist dollars right back out of the region, after all. And I began to remember the music my ex-wife collects, and the instruments and toys she loves that come from the hill country in a state not far from Pennsylvania, and a backwoods culture not too far different, and I began to think there was another paradigm the state and its towns could choose to encourage with their hard-earned tax dollars, one that would allow the poor folk of the region to build their own future, bring in their own tourist trade, and keep more of the money it would bring.

There is a long tradition of music and crafts in those hills, a long-standing culture that has retained its accents and many of its ways even in the face of corporate commercialism and the all-enblanding force of television. Why not dig up the old coots who still know how to make hammer dulcimers and wooden toys and hand-carved pipes and furniture that needs no nails and lasts two hundred years; why not look for the old grannies who remember the classic unwritten recipes, who've sewn their own clothes for the last eighty or ninety years; why not listen for the nasal singers and illiterate poets that inspired the Carl Sandburgs and Woody Guthries and Bob Dylans who made their verses famous in the cities? Why not set up a dozen little Academies of Hill Folk Culture where the coots and grannies can take on apprentices, pass on their skills, their styles, their graces; and why not subsidize, instead of more resorts just like all the other resorts in this country, a thousand little bed-and-breakfast places, featuring folk furniture and folk cooking and folk concerts and surrounded by shops selling idiomatic goods that you could never find in Macy's or Sears? And market it from coast to coast, so folks would have a better reason to visit there than just another golf course with a funny name, and market it on the internet as well, so the shops would have some sales in winter too.

The people would own their own shops, their own small factories, their own cottage resorts, their own lives. They'd be making their money doing something interesting, expressing their own culture, employing their neighbors and their neighbors' children, and building a real future--and a real present--for themselves.

It's not "business as usual." But it's business as usual that got Pennsylvania into trouble in the past.

To avoid the mistakes of its past, to avoid the mistakes of Silicon Valley's present, Pennsylvania will have to diversify not only the variety of jobs it offers its people, not only the products and services its companies offer; it will have to diversify the customers to whom it offers its people and products. Low-tech or hi-tech doesn't matter. But if Pennsylvania wants to stitch up the tear in its economic fabric, if it wants to weave its brilliant past to a brighter future, it will have to select the thread it uses very carefully. Sometimes, homespun is stronger.

Richard Risemberg

Return to Top