Despite many broken promises on development, optimism abounds for manufacturing hub

Published: Sun, August 26, 2012 @ 12:08 a.m.

By Jamison Cocklin

and Burton Speakman


After the steel mills collapsed in the late 1970s, Youngstown became a symbol of how easily political promises can be broken.

So 10 days ago, when President Barack Obama administration officials swept into town — against the backdrop of a precarious re-election campaign — to announce a $70 million investment aimed at establishing an advanced manufacturing hub, it wasn’t too hard for some to flash back to an earlier time.

In the years after Black Monday, Sept. 19, 1977, each administration has dangled hope for a Mahoning Valley economic rebound, beginning with President Jimmy Carter, who promised hundreds of millions of dollars in federal aid.

Candidates Ronald Reagan and Bill Clinton campaigned in the Mahoning Valley with much fanfare to promise their ideas would make things better for residents.

But after each election, little changed. Empty commitments eroded what faith many Valley residents had in the political establishment.

On Black Monday, Jennings R. Lambeth, president of the Youngstown Sheet & Tube Co., announced that its Campbell Works would be closed and the company headquarters would be moved to Chicago.

The decision threw 4,500 employees out of work.

In the days and months that followed, petitions were circulated demanding immediate federal aid from then-President Jimmy Carter and his administration. In the meantime, a group of ministers formed to launch a plan for workers to buy the Campbell Works and run it themselves.

In 1978, the Carter administration offered to create a $215 million revolving-loan guarantee fund, re-examine environmental regulations cutting into steel production, and allot $20 million in aid to communities hit hardest by the closures and layoffs.

Later that year, the commitment dwindled to a $100 million loan guarantee fund. The administration would not support the proposal for the employees to purchase Campbell works.

In March 1979, the Carter administration announced the $100 million was not available. By 1980, another 9,000 jobs had been lost and the once-dominant American manufacturing industry was faltering.

Carter lost his re-election bid to Reagan, who recorded the most votes of any Republican candidate in the Mahoning Valley in years.

“Reagan was able to exploit the fact the feds failed to act without promising any money,” said William Binning, professor emeritus of political science at Youngstown State University, who was active in the Republican Party in the 1980 election. “Reagan was going to reverse those loose trade laws and restrictive environmental regulations.”

During a 1980 campaign speech at the Campbell Works, which by then was empty, Reagan promised “to protect this industry and all industries” against dumping below-cost foreign steel in the U.S. market.

“We’ve got to get rid of those thousands of regulations that make it impossible for us to compete with Japanese and European producers,” Reagan told laid-off workers.

But Reagan’s presidency did little to allay the rapidly declining steel industry of the 1980s. After the 1982 recession, Pittsburgh’s steel industry laid off 153,000 workers.

The administration failed to counter Japanese dominance, and Reagan was long reluctant to give up his stance on free trade and find new policy solutions to reduce foreign imports. Youngstown’s steel industry only further eroded.

Between 1977 and 1982, the U.S. Economic Development Administration pumped more than $17 million into Youngstown, but it wasn’t enough.


Perhaps the biggest campaign disappointment for the area was the proposed Defense Finance and Accountability Service facility.

The plan started during the President George H.W. Bush administration and would have consolidated the Pentagon’s finance and accounting centers.

In 1992, when running for president against Bush, the Republican incumbent, Democrat Bill Clinton told a crowd of more than 8,000 at the Southern Park Mall in Boardman that he would support the Mahoning Valley’s attempt to land a DFAS “super center” that would have brought as many as 7,000 federal jobs downtown to Federal Street.

On Dec. 2, 1992, the Valley was named one of the finalists for one of what could have been four to seven of the facilities. But shortly thereafter, Youngstown was out of the running.

“We were told our proposal was the very best,” Binning said. “But Clinton came under so much political pressure from other congressmen that we lost it. We felt double-crossed.”

Lobbying by then-U.S. Sen. John Glenn on behalf of Cleveland and Columbus, which had DFAS facilities, killed the plan.

Instead, the area received $40 million in federal funding for improvements to Youngstown-Warren Regional Airport in Vienna and surrounding areas.

The money was used to expand the airport runway, used by the adjacent Youngstown Air Reserve Station, as well as to install a new electrical system and to improve roads, water and sewer systems at the airport and airbase.

Local officials said in 2005 that the federal funding to the airport and air base played a huge role in not having the base shut down as part of a federal military realignment and closure process that year.


Unlike the terse and direct promises of the past, the Aug. 16 announcement focuses on the tri-state “TechBelt” of Ohio, Pennsylvania and West Virginia.

Those working throughout the consortium, known as the National Additive Manufacturing Innovation Institute, will seek to increase the Gross Domestic Product by developing new cost-cutting technologies that will allow manufacturers to make products quickly and with fewer raw materials.

As American manufacturing scurries to catch up with competitors in Western Europe and Asia, the project’s goal was deemed a national priority even before Obama, a Democrat, came into office.

In January 2012, during his State of the Union address, Obama announced his plan to invest $1 billion to catalyze a national network of up to 15 manufacturing innovation institutes.

Given the significance of the Tech Belt consortium’s work, it is likely the $30 million federal commitment will be fulfilled, said Ralph Resnick, president and executive director of the National Center for Defense Manufacturing and Machining, which will manage the consortium and oversee its research and development efforts. And unlike a grant, the funding is dependent on the parameters of a contract the consortium must fulfill.


“There’s a large amount of national significance. This technology truly does have the opportunity to revolutionize manufacturing, just like the Internet revolutionized communication,” he said. “We have some serious catching up to do with places like Europe. They recognize the significance of this technology, and they’ve put a lot more than $30 million into it.”

In addition to the $30 million federal investment in the local consortium, 65 partners involved will contribute $40 million.

What’s more, Resnick said the consortium will be held accountable in demonstrating its success, which will be measured by the amount of job creation, commercial viability and progress it makes.

The amount of private and public groups involved in the project and the expectation to prove the efficiency of such a consortium will determine any future federal funding, he said.

“There’s an intent to fund us for three years, and the federal agencies that provide us with funding like the Department of Defense and NASA can include us in their budget,” Resnick said. “But ultimately Congress will have to approve those funds on a yearly basis — we’ll be holding our breath.”

The key to getting the Tech Belt project has been the increase in the cooperation among agencies. There has been a common vision and goal, combined with regional cooperation in the recent funding effort, said Benjamin Turner, director of the Trumbull County One-Stop office.

“With this newest development there were an awful lot of higher-education types involved, along with the Tech Belt and the [Youngstown Business] incubator,” Turner said. “It’s an important collaboration. There were a bunch of heavy hitters.”

Binning said the Obama administration’s efforts are “sincere.” He lauded the decision to bring the manufacturing hub to Youngstown, but he also warned of the political implications.

“Obama has to generate a big turnout here, this is where the food is ripest for him,” Binning said. “Youngstown is one of the best Democratic vote-getters in the state and balances Republican votes in southern Ohio.

“You can’t make out-year financial commitments,” he added. “You can’t make a commitment about something you’re going to do in five years because Congress has to appropriate this money on a yearly basis.”

The Valley now has few advantages compared to previous efforts. The magnitude of shale development has made the area more attractive along with the resurgence in local manufacturing, Turner said.


Previous efforts included ideas, but “there wasn’t a lot of steam behind them,” he said. “This time they’ve got hustle behind the muscle.”

Lawmakers will continue to be instrumental in the consortium’s efforts. If the president loses re-election, it could threaten the federal funding, but ultimately it will be up to Congress, Binning said.

“A federal lab is a real gemstone for any community,” said Jim Cossler, chief executive at the YBI, which will house the consortium’s research and development hub. “It’s a magnet for other companies to locate around.”

“This is just another part of Youngstown’s narrative — good things will definitely happen.”

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