Trumping Globalisation

In the wake of Donald Trump’s election victory, I expressed my concerns over his economic policies. His economic plan, above all else, is his most far fetched idea. During his campaign trail, Trump visited the Rust Belt. The Rust Belt is an area in the North-Eastern quarter of the US, including places such as Western New York, Pennsylvania, Ohio, Indiana, Illinois, Iowa, Michigan and Wisconsin. These states once referred to as the Steel Belt due to the large scale manufacturing that occurred there.

The Steel Belt was the world’s leading producer of steel throughout the late 19th century and early to mid 20th century. There was no real competition for the many steel mills and factories that existed across the belt. After World War Two, the manufacturing boom that had existed before and during the war slowed; the US had started to develop trade agreements with other countries, where they discovered that they could purchase steel, rubber and other manufactured goods for a much cheaper price. The recession in the 1980’s was the final nail in the coffin for the Steel Belt. Many factories and steel mills closed in the 1980’s due to their inability to compete with foreign companies. Technology had also caught up with the Steel Belt, as new, foreign factories boasted the latest technological advancements to produce high quality products in a quicker time than American factories- making the foreign products cheaper. The US steel mills had been active for a very long time, and they faced a huge overhaul and upgrade to keep competitive in the global market. The cost of upgrading the factories proved too much, so everywhere closed up and business went to the foreign markets, where the goods were, and are, cheaper.

The immense industrial power that the Rust Belt once carried ultimately led to its downfall. Major cities that relied heavily on industrial manufacturing failed to adapt to globalisation, leaving many workers unemployed and heading to poverty; a prime example is Gary, Indiana. Once a symbol of economic prosperity and optimism, it is now seen to be crumbling from top to bottom- it has even been dubbed as ghost town by locals. Most towns and cities have struggled to embrace the changing culture and changing economy- otherwise known as globalisation. However, there a few cities and towns that have adapted to globalisation, such as Pittsburgh, Pennsylvania; Pittsburgh has used the ever improving technology available to create alternative methods of manufacturing, like nanotechnology.

 

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The ghost town of Gary, Indiana.

 

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A rejuvenated Pittsburgh, Pennsylvania.  

For over 20 years, politicians have tried to find a solution to reinvigorate the Rust Belt; however, no policy has truly worked to bring back economic prosperity. The result from years of declining population, poverty and rotting infrastructure has led to the Rust Belt becoming disenchanted with Washington and the political establishment. The Rust Belt remains a significant target for presidential candidates due to the swing states of Pennsylvania, Ohio and Michigan. Many of its cities need rebuilding and new infrastructure needs implementing to attract investors back to the area. From 2000-2015, many citizens were so fed up of the economic climate that they fled to pastures new; Gary, Indiana, had a population of 102,746 in 2000. Now, the population of the “ghost town” stands at 77,156- down 24.9% from 2000. Detroit, Michigan has suffered the biggest population decrease, with the 2015 number coming in at 677,116- down 28.8% from the 2000 figure of 951,270. The area can be rebuilt, but it will take a lot of money and a long term plan to bring back manufacturing jobs to the area.

Last year, Trump rode the momentum and publicity he was building on his campaign. He spent a lot of time on the Rust Belt, especially in Ohio and Michigan. Working class voters, with a chunk of them being former Democrats, have been promised a return to prosperity by Trump. His promise to bring prosperity is a high stakes gamble; he has already reaped the rewards with key victories in Ohio, Michigan, Wisconsin and Pennsylvania. Trump now has to deliver on his promises, and it is looking like a tough feat to accomplish. He has promised the working class that he will take care of American jobs first and foremost, going against the world trend of globalisation. In his election campaign, Trump said that he wouldn’t sign any trade deals that take away or harm American job prospects. The Donald also promised to reel in the jobs that had gone over the border to countries such as Mexico.

 

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High risk, high reward: Trump has promised to bring back all the lost jobs of the Rust Belt, but will he be able to deliver?

To bring back jobs from countries like Mexico will be hard. To reenergise and reinvigorate the Rust Belt, there needs to be significant public investment in infrastructure. Potential investors from abroad will likely see cities such as Cleveland and Detroit as unappealing destinations- workers abroad, in places like Mexico and China, will be cheaper to employ. Also, the leader of many products, including steel, is China. The manufacturing landscape has drastically shifted east since the 1980’s recession. Even though Trump is promising major tax cuts for businesses and the public, it is unlikely to be enough to tempt them back to the crumbling Rust Belt.

America is a world leader in the economic market, and there would be many consequences, economically as well as politically, if the US pulled out of or failed to uphold their duties in any trade relationships. Trump also promised to bring back coal digging to maximize America’s energy production and to bring back jobs. There are many problems with Trump’s proposal to bring back the coal industry on a larger scale; coal is a fossil fuel, and will eventually run out one day, meaning that this industry is limited. Also, the advancement in renewable energy sources will surely be limited during Trump’s presidency; this comes at a time when global warming is becoming an even bigger threat to humanity.

There are a plethora of challenges for Trump to overcome if he is to succeed in his economic plan and retreat from globalisation. He needs to put significant amounts of money into the Rust Belt, once the driving force of the American economy, to re-establish it as a global force in the manufacturing industry. Trump’s low tax policy for businesses promotes growth for small and home grown businesses, which should thrive under his stewardship. Big American businesses who haven’t already moved their factories abroad should be able to expand into job- needy cities such as Detroit; Ford have already announced that they will be investing in a new plant in Michigan. Even though Trump is promising to bring back many jobs to the Rust Belt, it does not seem like a quick fix project will work. With his Reagan style tax cuts, the question on my mind is where will the money come from? Trump has to spend money on the infamous wall and a new medical insurance that will eventually repeal Obamacare (if he eventually decides to repeal it), so I do not see enough money being poured into the Rust Belt to improve and rebuild the desolate cities such as Cleveland. I fear that the people of North Eastern America will be left disappointed by Trump’s inability to deliver on his gigantic promise to galvanise the Rust Belt.

 

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The tragic Rust Belt

The Rust Belt can be remodelled into the driving force that it once was- look at Pittsburgh, Pennsylvania; the city has not been dragged into poverty like its counterparts, it has stayed on the ball and up to date with modern technology, with nanotechnology and the polymer industry becoming major employers in the area. To become relevant again and to drag itself out of poverty and despair,  the Rust Belt must look towards alternative manufacturing.

Trump won’t defeat globalisation to go backwards and bring back the old industries, he risks leaving America lagging behind the rest of the world. For him to succeed and bring back all those jobs he promised, he must look towards alternative manufacturing methods.

 

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Dead since the 80’s: the Rust Belt left to crumble.

 

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