Isn’t it ironic that the jobs report before the Labor Day holiday posted a goose egg? As I told a friend who posted a 0.0 in college during his first semester, “nice work that had to be your goal, because that is awfully hard to do and you accomplished it.” Zero, nothing, nil, naught, zip, zilch (Yes, I hit the synonym button for zero.) Give me a break. According to an MSNBC article, this is the first time the government has reported zero, since 1945. Yes, we had job losses in the past, but for our government to report zero is ridiculous. I am going on record to say when the jobs number is revised we will have negative job growth. Why won’t the government tell you this?
Why is this shocking? We have been laying the framework for decreasing jobs for years. Please understand that as we have imported goods from China and other parts of the world we have exported our middle class. China’s growth right now centers on a boom in the middle class created by goods that we buy.
My Background
One of my paternal grandfather’s goals in life was to make sure that each of his children received an education, so they could have opportunities that he did not have. He was the manager of a tannery. I never met him. He passed away when my father was in college, but from the stories I hear he was a hard worker, instilled discipline, and loved sports.
My maternal grandfather was one of the kindest men I knew. He loved to take pictures and play games. From the time I knew him his health was an issue, but he had a caring for people and family. He also had a very competitive streak, when it came to dominos or monopoly. He caught me keeping my finger on the double five as we mixed them up and told me right then that he had seen me do it twice and not only was I cheating him, but myself as well.
(Not trying to slight them, but both of my grandmothers were caring women who loved to spoil me and could cook anything. One worked in a school kitchen and the other worked in a shoe factory.)
Both my parents graduated from Middle Tennessee State University. My father had plans on going back to work at the tannery, however he was newly married and could not come to an agreement on compensation with the owner. My father took a job with Genesco. In 1973, Genesco transferred my father to their Gamaliel, Kentucky apparel plant to be the assistant plant manager. He told my mother that they would be there two years at max; however he became plant manager and continued well past two years. My mother was a teacher, the most important occupation in our country.
In 1982, my father heard a gentleman in town was going to close his jean factory in Fountain Run, Kentucky. The gentleman had other successful businesses and the plant was losing money. My father convinced him to sell it to him and the gentleman also financed it. In discussing this with my mother, he told her if it did not work, “they could live off her teacher’s salary.” This had to be scary, if you saw how my brother, Brandon, and I ate.
This factory had 30-40 people in a facility that had a floor that would sag when people walked across it. The cutting room was in the basement of the grocery store next door. There were nights that my father would come home with a truck full of jeans, eat supper with us or watch our games and then go to Hermitage Springs, Tennessee to wash the jeans at a laundry facility. As production picked up, he bought a cattle truck, cleaned it out, and lined it with plywood. This was not our third vehicle. It was his daily vehicle. Luckily Brandon and I were young and we thought it was cool. Also note, Gamaliel really had no homeowner associations to worry about.
In 1984, dad was joined by a partner and formed Kentucky Apparel. They had worked together at Genesco and they had a great working relationship. The partner knew everything about washing jeans. If there was something to change the look of a jean you can bet he tried it. He also brought some new customers. Between 1984 and 1987, the company grew and they were named Kentucky Small Business Persons of the Year. From 1987 to 1993, they kept growing and actually began buying factories of Genesco and other companies who were getting out of the jean business. In 1993, we had factories in Fountain Run, KY, Gamaliel, KY, Tompkinsville, KY, Summershade, KY, Holland, KY, Burkesville, KY, Bowling Green, KY, Glasgow, KY, Scottsville, KY and Jamestown, TN. Most of these places are very rural. You would not be able to find some of these on a national map 15 years ago, but I suggest you Google them.
What does this have to do with jobs?
Starting in 1993, my father began writing all congressmen and senators in Kentucky and Tennessee about the North American Free Trade Agreement (NAFTA) and the impact that it would have on the apparel industry in the United States. As we know, NAFTA was passed in 1994 and my dad said his only shock was the speed in which the jobs moved. Luckily, having enough foresight, KY Apparel formed a joint venture with a Mexican family as most all our customers began demanding the goods made by the cheaper labor. I think if you asked them the next five years would be described as chaos.
For the company, we had tremendous number of orders as we were taking business from Central and South America; however with the partners in Mexico in charge of the increasing production; quality, on-time deliveries, and organization became big issues. These are things we never experienced in the United States. KY Apparel was known throughout the industry for creating a quality product, having hard workers, and delivering it when they said they would. (This is a trait of most hard working Monroe Countians.) So, how did companies in Mexico make money? The peso devalued. Labor became even cheaper in terms of U.S. dollars.
In 1996, I walked into one of my last public speaking classes for my undergraduate degree and was given 10 minutes notice that I would need to give an impromptu speech. I had just travelled with my father to Mexico that summer and began seeing the difficulties in my home county, Monroe, which has the cities of Fountain Run, Gamaliel, and Tompkinsville. We had shut a few of our other plants that were listed above in other areas however we saw OshKosh, Red Cap and other factories in our area begin to lay-off workers. I titled my speech NAFTA: How it Helped My Family, but Hurt Friendships. I was a 21 year old college kid with 10 minutes. The reasons I gave it helped my family was that the Mexican partners bought into our business and the increase in sales. On the other side, I had friends that worked for KY Apparel and were in danger of losing their jobs.
As I was driving back from a board meeting the other day, I began thinking about the recession, the lack of jobs and the shrinking middle class. I realized my speech was happening on a grander scale not just Monroe County and other rural areas. I would contend Monroe County has been in a recession since the mid-1990s. Look at the last census data, the population has declined as other rural areas. I look around and see doctors, dentists, entrepreneurs, engineers, accountants, lawyers, and teachers that I went to school with that cannot go back to their hometown due to lack of jobs. These jobs were exported out of Monroe County to bigger towns. Now that is happening to America in general.
At this time all of your politicians on both sides of the aisle were talking about NAFTA being a success. Of course, they promised laid-off workers a minimum of 18 months unemployment and re-training. This was great for some, but not all. These jobs were good second income jobs for a lot of families.
Ultimately, in 1999, my father and his business partner had enough. They decided they were going to get full control back of KY Apparel or be purchased out of the business by their partners in Mexico. The Mexican partners bought us out of the business. I can tell you at the time we (I began working in 1997) were announcing to the employees remaining that we were getting out of the business I had seen my father cry very few times. These people were like family and we knew the jobs would not be staying long term.
As the 90’s ended, even Alan Greenspan finally got something correct calling it “Irrational Exuberance,” there was no worry about the decreasing manufacturing base. We were making all kinds of paper profits and trading them back and forth. The government had a budget surplus from increase in capital gain tax revenue. There was no reason to worry about Monroe County or other rural areas that were losing jobs.
However, that bubble burst and Mr. Greenspan lowered rates to fuel the great real estate boom/speculation. During this period the loss of manufacturing jobs were covered up by the gains in residential construction, again no reason to worry about Monroe County.
What I contend is that we should have been worrying about Monroe County and other rural areas, because it is happening to all of the United States fifteen years later. These construction jobs will not come back for a long time and we cannot be just a service economy. We must get manufacturing back to the United States. There are a lot of great theories that these free trade agreements work, however I have never been able eat a theory or put a theory over my head at night (some went over my head). I tend to base my observations in the real world. I see another jobs initiative (stimulus) being launched and a quasi QE3 (they won’t call it QE3 for fear of mutiny). Unfortunately, none of this will work.
The importing of goods has been the exporting of the middle class. My grandparents were hardworking middle class that gave my parents the work ethic and belief to strive for the American Dream. If we lose the middle class, we lose the American Dream.
Why is this shocking? We have been laying the framework for decreasing jobs for years. Please understand that as we have imported goods from China and other parts of the world we have exported our middle class. China’s growth right now centers on a boom in the middle class created by goods that we buy.
My Background
One of my paternal grandfather’s goals in life was to make sure that each of his children received an education, so they could have opportunities that he did not have. He was the manager of a tannery. I never met him. He passed away when my father was in college, but from the stories I hear he was a hard worker, instilled discipline, and loved sports.
My maternal grandfather was one of the kindest men I knew. He loved to take pictures and play games. From the time I knew him his health was an issue, but he had a caring for people and family. He also had a very competitive streak, when it came to dominos or monopoly. He caught me keeping my finger on the double five as we mixed them up and told me right then that he had seen me do it twice and not only was I cheating him, but myself as well.
(Not trying to slight them, but both of my grandmothers were caring women who loved to spoil me and could cook anything. One worked in a school kitchen and the other worked in a shoe factory.)
Both my parents graduated from Middle Tennessee State University. My father had plans on going back to work at the tannery, however he was newly married and could not come to an agreement on compensation with the owner. My father took a job with Genesco. In 1973, Genesco transferred my father to their Gamaliel, Kentucky apparel plant to be the assistant plant manager. He told my mother that they would be there two years at max; however he became plant manager and continued well past two years. My mother was a teacher, the most important occupation in our country.
In 1982, my father heard a gentleman in town was going to close his jean factory in Fountain Run, Kentucky. The gentleman had other successful businesses and the plant was losing money. My father convinced him to sell it to him and the gentleman also financed it. In discussing this with my mother, he told her if it did not work, “they could live off her teacher’s salary.” This had to be scary, if you saw how my brother, Brandon, and I ate.
This factory had 30-40 people in a facility that had a floor that would sag when people walked across it. The cutting room was in the basement of the grocery store next door. There were nights that my father would come home with a truck full of jeans, eat supper with us or watch our games and then go to Hermitage Springs, Tennessee to wash the jeans at a laundry facility. As production picked up, he bought a cattle truck, cleaned it out, and lined it with plywood. This was not our third vehicle. It was his daily vehicle. Luckily Brandon and I were young and we thought it was cool. Also note, Gamaliel really had no homeowner associations to worry about.
In 1984, dad was joined by a partner and formed Kentucky Apparel. They had worked together at Genesco and they had a great working relationship. The partner knew everything about washing jeans. If there was something to change the look of a jean you can bet he tried it. He also brought some new customers. Between 1984 and 1987, the company grew and they were named Kentucky Small Business Persons of the Year. From 1987 to 1993, they kept growing and actually began buying factories of Genesco and other companies who were getting out of the jean business. In 1993, we had factories in Fountain Run, KY, Gamaliel, KY, Tompkinsville, KY, Summershade, KY, Holland, KY, Burkesville, KY, Bowling Green, KY, Glasgow, KY, Scottsville, KY and Jamestown, TN. Most of these places are very rural. You would not be able to find some of these on a national map 15 years ago, but I suggest you Google them.
What does this have to do with jobs?
Starting in 1993, my father began writing all congressmen and senators in Kentucky and Tennessee about the North American Free Trade Agreement (NAFTA) and the impact that it would have on the apparel industry in the United States. As we know, NAFTA was passed in 1994 and my dad said his only shock was the speed in which the jobs moved. Luckily, having enough foresight, KY Apparel formed a joint venture with a Mexican family as most all our customers began demanding the goods made by the cheaper labor. I think if you asked them the next five years would be described as chaos.
For the company, we had tremendous number of orders as we were taking business from Central and South America; however with the partners in Mexico in charge of the increasing production; quality, on-time deliveries, and organization became big issues. These are things we never experienced in the United States. KY Apparel was known throughout the industry for creating a quality product, having hard workers, and delivering it when they said they would. (This is a trait of most hard working Monroe Countians.) So, how did companies in Mexico make money? The peso devalued. Labor became even cheaper in terms of U.S. dollars.
In 1996, I walked into one of my last public speaking classes for my undergraduate degree and was given 10 minutes notice that I would need to give an impromptu speech. I had just travelled with my father to Mexico that summer and began seeing the difficulties in my home county, Monroe, which has the cities of Fountain Run, Gamaliel, and Tompkinsville. We had shut a few of our other plants that were listed above in other areas however we saw OshKosh, Red Cap and other factories in our area begin to lay-off workers. I titled my speech NAFTA: How it Helped My Family, but Hurt Friendships. I was a 21 year old college kid with 10 minutes. The reasons I gave it helped my family was that the Mexican partners bought into our business and the increase in sales. On the other side, I had friends that worked for KY Apparel and were in danger of losing their jobs.
As I was driving back from a board meeting the other day, I began thinking about the recession, the lack of jobs and the shrinking middle class. I realized my speech was happening on a grander scale not just Monroe County and other rural areas. I would contend Monroe County has been in a recession since the mid-1990s. Look at the last census data, the population has declined as other rural areas. I look around and see doctors, dentists, entrepreneurs, engineers, accountants, lawyers, and teachers that I went to school with that cannot go back to their hometown due to lack of jobs. These jobs were exported out of Monroe County to bigger towns. Now that is happening to America in general.
At this time all of your politicians on both sides of the aisle were talking about NAFTA being a success. Of course, they promised laid-off workers a minimum of 18 months unemployment and re-training. This was great for some, but not all. These jobs were good second income jobs for a lot of families.
Ultimately, in 1999, my father and his business partner had enough. They decided they were going to get full control back of KY Apparel or be purchased out of the business by their partners in Mexico. The Mexican partners bought us out of the business. I can tell you at the time we (I began working in 1997) were announcing to the employees remaining that we were getting out of the business I had seen my father cry very few times. These people were like family and we knew the jobs would not be staying long term.
As the 90’s ended, even Alan Greenspan finally got something correct calling it “Irrational Exuberance,” there was no worry about the decreasing manufacturing base. We were making all kinds of paper profits and trading them back and forth. The government had a budget surplus from increase in capital gain tax revenue. There was no reason to worry about Monroe County or other rural areas that were losing jobs.
However, that bubble burst and Mr. Greenspan lowered rates to fuel the great real estate boom/speculation. During this period the loss of manufacturing jobs were covered up by the gains in residential construction, again no reason to worry about Monroe County.
What I contend is that we should have been worrying about Monroe County and other rural areas, because it is happening to all of the United States fifteen years later. These construction jobs will not come back for a long time and we cannot be just a service economy. We must get manufacturing back to the United States. There are a lot of great theories that these free trade agreements work, however I have never been able eat a theory or put a theory over my head at night (some went over my head). I tend to base my observations in the real world. I see another jobs initiative (stimulus) being launched and a quasi QE3 (they won’t call it QE3 for fear of mutiny). Unfortunately, none of this will work.
The importing of goods has been the exporting of the middle class. My grandparents were hardworking middle class that gave my parents the work ethic and belief to strive for the American Dream. If we lose the middle class, we lose the American Dream.
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