Today’s Jobs at Yesterday’s Wages: GM’s Saturn Auto Plant Arrives in Spring Hill, Tennessee
By Carter Garber and Verna Fausey
Vol. 8, No. 4, 1986, pp. 16-24
Spring Hill Mayor George Jones says he learned the same time you did, if you were watching television on July 30, 1985, that General Motors planned to build the world’s most expensive manufacturing plant in his middle Tennessee community, population 1,275. By that point GM’s Saturn plant had been the object of a seven-month industrial recruiting contest involving a thousand sites in thirty-six states, a parade of governors bearing gifts, and impassioned pleas from chambers of commerce, local citizens and schoolchildren. But Saturn didn’t go to New York, which offered the billion-dollar bargain of one hundred megawatts of free electricity for twenty years, or to Minnesota, which pledged tax concessions and other prizes worth $1.3 billion, or even to Kentucky, which legislated a $306 millon educational aid package after word got out that GM considered the Bluegrass State’s school system inadequate.
Instead, Saturn came to a sleepy town off I-65 thirty miles south of Nashville. At the moment Mayor Jones watched GM’s announcement on his television set, Spring Hill had not even a single full-time police officer, fireman, or physician. The announcement, said Jones, was like something “falling from the sky.”
Spring Hill’s experience raises many questions about corporate power in the U.S., about industrial recruiting as practiced by most state governments, about the role of organized labor in a rapidly shifting economy, and about the ability of localities to control their own destinies.
Were They Just Lucky or What?
In effect, Tennessee won a national lottery for a promised 6,000 industrial jobs and a huge addition to the tax base. After the amazement wore off, one of the first questions asked in Spring Hill was, why us? The answer may be that GM was less interested in what Spring Hill had than in what it did not have: the area decidedly lacked experience in negotiating with large companies, other prospects for economic development, county-wide planning or zoning, organized citizen groups which might have opposed GM’s plans or at least have complicated matters, and the history of labor-management antagonism that characterizes many of the locales of other auto plants.
Spring Hill residents are minor actors, if not pawns, in a grand auto industry manuever. General Motors’ plans for Saturn represent the company’s main effort to
face down Japanese car competition. GM created the Saturn Corporation as a subsidiary–with its own executives, engineers, dealer network–and a “special” labor contract. The Saturn plant will use computer and robot technology to produce half a million subcompact Saturn cars a year with about one-third of the workforce that would be needed at other GM facilities. Board Chairman Roger Smith touts Saturn as the key to the giant corporation’s survival and competitiveness as a domestic producer.
Construction of the Spring Hill plant will require four thousand construction workers for two-and-a-half years. Limited production is expected to begin in late 1989. When the plant reaches full capacity (some years later), GM claims that it will provide six thousand direct jobs and twelve thousand to fourteen thousand indirect jobs among suppliers, service firms, groceries, eating places and motels.
In choosing Middle Tennessee, GM joined a Southbound migration for automakers, including a Nissan plant at Smyrna, Tenn., just thirty miles from Spring Hill, and Kentucky’s planned Toyota facility. Michigan has gone to extraordinary lengths to preserve its hold on the industry, but the mid-South has become the location of choice for both U.S. and Japanese carmakers.
In addition to presumably docile labor, Spring Hill was chosen because it lies within five-hundred miles of three-fourths of the U.S. domestic market. The area had a railroad, interstates, and could provide four million gallons of water daily. Geographically it is a flat site about two square miles in size. In the rural setting, there were a small number of landowners from whom to acquire land.
“The final ingredients were simple but of the right combination,” according to Jan White of Landauer Associates. This New York firm which researched the sites for GM never revealed the nature of that secret combination. For seven months, Landauer employees visited potential locations, examined tax structures and school systems, went to parks, and read back editions of local newspapers to determine how each community solved their problems.
With so many suitors, GM could take its time. The national media provided millions of dollars of free advertising for the future car. A GM-commissioned poll showed that Saturn had 49 percent name recognition without building a plant or even designing a product. This public relations triumph, achieved largely because of U.S. desperation for jobs, is proudly heralded by Saturn’s executives.
By early February 1985, GM had information about every realistic location “already on the computer,” according to Stan Hall, a Saturn spokesperson. Peter Laerman of the United Auto Workers (UAW) chastised the corporation for encouraging a waste of public resources. “In cases where GM knows perfectly well those sites will not be chosen, they should make that clear before any more money is spent.” But GM kept up the “search” for another five months as desperate hamlets bid higher for the prize.
The site GM chose is in Maury County, just a few miles from its border with Williamson County. The latter is Tennessee’s richest and fastest growing county with an unemployment rate of 3.1 percent in July of 1986. Williamson County Executive Robert Ring says of Saturn, “It’s definitely not good for our county. I wish they had gone somewhere else.” Williamson County residents are concerned about the rapid changes in their county which is evolving from an agricultural to a bedroom community feeding metro Nashville’s booming “office parks.” The result is a controversial growth management plan that is unprecedented in laissez-faire Tennessee.
In Maury County, with 9.6 percent unemployment, the planning infrastructure was non-existent. Judy Langston, a county native who was hired when the planning office was finally set up three months after the Saturn announcement, explains: “Maury County government did not have any land use controls, policies or plan. We did not have any zoning or subdivision controls at all and there was not a planning commission as such.” Langston and the commission have worked quickly “to get the county ready to start dealing with the growth that’s coming.” But while this unpreparedness worked to GM’s advantage in many ways, it led to the defeat of an attempt by Saturn to head off an unsightly commercial strip next to its “campus-style plant.” Even though Saturn hired the Vanderbilt Law School Dean to work with the county to develop a scenic parkway, the old neighbors quickly let their new neighbor and politicians know that it would be a long time before they would tolerate that much “governmental interference.”
What Did Tennessee Offer?
Governor Lamar Alexander trumpeted his state’s victory in full-page newspaper ads published around the country. The considerable prize was said to be the largest one-time investment in U.S. history, and Saturn thus took on mythical dimensions and qualities far beyond the jobs and related industries it will bring to Middle Tennessee. To Tennessee’s Republican administrators, Saturn testified to the state’s attractiveness to manufacturing investors and to their own competitive ability in the politically prime arena of industrial recruitment.
Alexander and former Senate Majority Leader Howard Baker had lauded Tennessee’s right-to-work law, its “pro-business climate and its hardworking labor force” to GM Chairman Smith in early 1985. These same factors were among the reasons the Southern Labor Institute ranked Tennessee as the fourth-worst climate for workers in the nation, but they made the state look good to GM and other companies. The governor and senator may not have actually mentioned it, but Smith’s computers would have told him Tennessee was in the bottom twenty percent of states in terms of maximum benefits for disability and unemployment, and statutory protections for workers. Nor would the wage demands be likely to be great from citizens of a state ranked forty-second in the incidence of working poor and near the bottom in manufacturing wages and income distribution. Since Tennessee is projected to have higher than national unemployment at least through the 1990s, this would be a state which would appreciate GM, whatever its pay and benefits, for a long time to come.
Tennessee also was promoted as a state whose tax structure has been tailored for big business: a one percent investment tax credit for industrial machinery, no sales tax on industrial and pollution control machinery, a tax exemption on finished goods, low worker’s compensation insurance rate, and no personal income tax. Over forty-nine percent of the state’s regressive tax revenue comes from high sales taxes, including a tax on food.
Tennessee’s industrial recruiting ads say, “Grow with a pro-business tax structure. Only four states have a lower state and local tax burden than Tennessee. Tennessee does not offer large tax concessions to attract business to the state–the tax structure is already attractive for business!”
With the nation watching and his 1988 Vice Presidential aspirations perhaps in mind, Tennessee’s governor eagerly courted the industrialists. Alexander had won one such prize in 1982-the Nissan plant- and wanted another. (Nissan made the largest U.S. industrial investment by a Japanese company in a highly automated truck assembly plant in Smyrna, thirty miles from Spring Hill.) The earlier success may have helped guarantee the second win. If GM wanted to prove it could compete with the Japanese, why not on the same turf? And the UAW, GM’s partner in Saturn, may have desired to locate nearby in hopes that Saturn’s union influence would rub off on non-union Nissan.
Greasing GM’s Wheels
In a less than candid statement, Alexander contended, “New York offered $1.2 billion. We didn’t offer a penny.”
But Tennessee’s General Assembly rushed to provide housewarming gifts to the new corporate arrival. In early 1986 Maury County legislators introduced a bill to put a $500,000 cap on the realty transfer tax and another cap on mortgage fees. Written to benefit very large plants “such as Saturn,” the bill was the result of a prior agreement among legislators, Saturn officials and the governor. The state lost a one time payment of $2.5 million to $3 million while local governments lost $75,000. Alexander also pushed through the Legislature a seat belt law wanted by GM to help forestall national air bag legislation.
In addition to the usual benevolence to large corporations, the governor has promised Saturn $50 million worth of roads, including a new I-65 exit and a new five-mile connecting “Saturn parkway” (much like that built for Nissan). Saturn will get its cars to market faster with a proposed $135 million expressway loop south of Nashville. Spring Hill is getting a bypass, two stop lights, state-paid planners and engineers. Tennessee pays for water quality and regional impact studies. Saturn will receive and control $20 million worth of job training, with no requirement that Tennesseans will be trained.
Justifying all this is Revenue Commissioner Don Jackson, who optimistically predicts that Tennessee may get ten dollars in tax revenues for every dollar it spends on support facilities for Saturn. The state’s sales tax revenues will increase when Saturn begins to meet its $200-million-a-year payroll four years from now, but several more years will pass before the state realizes other tax dollars. Business tax income was not coming in from the Nissan plant by 1985, even though Nissan began production in 1983. Moreover, while the state
government may eventually experience a return on its investment in Saturn, Saturn’s neighbors fear that the bulk of the costs will be borne by the taxpayers of the counties and municipalities.
Meanwhile, many Maury County citizens wonder just who will act in their best interest. Many feel that their local officials failed to represent all of Maury County when negotiating the in-lieu-of-tax agreement with GM. Many more, including many local officials, wonder whose side the state is on when it comes to the negotiating with Saturn and to the planning for the trauma of its arrival.
Will Tennesseans Get the Jobs?
Much of the intense courting of Saturn was inspired by the lure of thousands of new jobs.
In November 1985, four months after Saturn’s site selection, a copy of the secret labor agreement between GM and the United Auto workers was leaked to the Spring Hill Area Concerned Citizens Group. It revealed that aa majority of the full initial complement of operating and skilled technicians in Saturn will come from GM-UAW units throughout the United States.” The document concludes that “because of the qualifications and experience of the current GM-UAW workforce, they will be a primary source for the initial complement, up to full capacity of operating and skilled trades technicians. The parties will actively recruit GM-UAW employees.”
This news stunned Maury County officials, who had made large tax concessions expecting the majority of jobs for area residents. The Citizens Group leaders had been asking since early September for eighty percent of the Saturn workforce to come from the county and the state. GM says it made no promises.
Not surprisingly, UAW Vice President Donald Ephlin has reported that union members all over the country are interested in the Saturn jobs. “We don’t need applications. Every day I get letters inquiring about employment,” he said. Ephlin predicts that of the estimated six thousand jobs about five thousand will be in the UAW bargaining unit. These could be filled ten times over by the fifty-four thousand UAW members now laid off, not to mention the forty-one thousand GM says it may soon lay off or the current GM workers who may want to move when Saturn begins hiring.
Many local people resent outsiders’ having a lock on the majority of Saturn’s jobs. GM has quietly let its Saturn partner, the union, be played off against the local communities so that the UAW is faulted by many as having taken the jobs Maury County residents thought were to be their main benefit from Saturn.
Spring Hill resident and fiberglass manufacturer Jim Miller said, “the governor kept talking about at least three thousand jobs.” But, “once we read the agreement we knew we could not get any jobs out of the project.” He added, “the governor and GM ‘foxed’ people on jobs.” Miller asked the governor why no Tennesseans were guaranteed jobs and “Dear old Alexander said that if not one Tennessean gets a job at Saturn, it will still be good for Tennessee. Now that may be good for Tennessee, but what about Maury County?”
GM Unwilling to Pay Full Property Tax
Tennessee helped Saturn choose a county with lower property rates than surrounding areas. Saturn then hammered Maury County governmental officials into an unprecedented forty year in-lieu-of-tax agreement. According to county budget director, A. C. Howell, “the forty-year term was the toughest part and the part that the county disliked most about the deal. We really didn’t want a forty-year deal. It was a GM idea and they took pretty much a hard line on it.” GM’s leverage was that its choice of this county was “tentative” until it got the deal it sought. By withholding the labor agreement from the public and county officials, GM had a further advantage in negotiations.
Maury County’s industrial board agreed to hold title to the site so Saturn is not burdened with real and personal property taxes, the county’s primary revenue source. The first year Saturn agreed to pay $7.5 million; in 1987 and 1988, $3.5 million each year; from 1989 to 1995, $3 million each year; and from 1996 to 2025, the rate rises from twenty-five percent to forty percent of the standard property tax rate. The county was pleased at being able to negotiate the larger amounts of funds up front since normally the property tax would not show up in significant amounts until the plant was fully built. “The plan of action is to use the front end money to handle the initial impacts. Then we’ll have to develop some mechanisms to make sure future developers have to pay their own way,” said Howell.
Local residents and officials were skeptical of the deal since most “high growth” counties find it impossible to make developers cover all the costs of new services. If Saturn doesn’t pay for expanded services and if the developers who follow Saturn to Maury County don’t pay, who will? The residents of Maury County, who currently enjoy a low two percent property tax rate, expect that they will have to pick up the tab.
Despite being spelled out in an official agreement there are still different estimates of just how much the county has given away to GM. Auto industry watcher Ralph Nader has estimated that the in-lieu-of-tax deal will cost Maury County almost $57 million during the first ten years. Budget director Howell figures that if the plant as proposed is built “the full tax value would have been $14 million” annually, a figure less than half the $32.9 million detailed in published reports elsewhere. Even if Howell is accurate, this means that after construction GM will pay $77 million less than the normal county tax rate during the seven year period from 1989-1995.
Nader staffer Jim Musselman said Maury County officials failed to compare what GM said it was willing to pay in property tax with what it was already paying at its facilities in Michigan and Ohio. GM wasn’t about to volunteer that it pays almost twice as much tax on smaller plants. Howell said county officials talked to officials in few other places during the six to eight weeks of negotiations, but he wishes there had been more time for research. While GM clearly benefited from the pressure of time it applied, Howell says the greatest urgency came from state officials who wanted an agreement to be reached but nevertheless offered very little assistance.
On February 28, 1986, Saturn ceremoniously made its first payment of $2 million. Its next checks were delivered in late May and September to the Maury County Industrial Development Board. Posing in front of the enlarged check, Howell wondered whether he should smile or frown. It probably is not the best deal in the world but when you go to buy a car you don’t get the deal you want. I can’t tell whether it was a good deal or not. I think it was as good a deal as we could have gotten… History will tell.”
Maury County found that, once the negotiations on an overall amount from Saturn were concluded, the wrangling had just begun. Separate agreements had to be made to divide its new revenues with the incorporated towns of Spring Hill, Columbia, and Mount Pleasant. The various county departments openly squabbled over the remainder. The School Board has even threatened to sue to get its standard forty-seven percent of county taxes.
Even with its own discounted rate Saturn has become Maury County’s largest taxpayer; its nearest contender pays less than a third of GM’s amount. Saturn’s employees will double the county’s 1985 manufacturing labor force, giving the new constituents tremendous political clout in a county which was projected to have only 25,375 households in 1990.
Further, GM’s actions in other parts of the nation suggest that Maury County will be asked in the future for more tax cuts. GM has demanded real property tax reductions of up to eighty percent in eighteen Michigan locations and has threatened to move its plants if the cuts are not forthcoming. Four Michigan towns have
already given in. “For GM the Saturn plant represents another step in its ongoing experiment to discover just how far it can lower its tax obligations,” concludes labor writer Anthony Borden in The Nation (June 21,1986).
Will the Town Get its Fair Share?
“More and more it looks like GM came to this rural area of Tennessee looking for a colony to exploit instead of a community to respect,” said Ralph Nader. “The Volunteer State better start volunteering more citizen and governmental oversight and get the free-loading GM off welfare.”
“Let’s be honest. The plant is going to affect us the most,” Spring Hill Mayor Jones exclaimed in late August 1985. “We’re the ones who are going to be dealing with the traffic and having our roads and our land and our homes torn apart. Nobody seems to be interested in Spring Hill.”
Martha Torrence, a school teacher who moved from Nashville to retire in Spring Hill and is secretary of the Spring Hill Citizen’s Group, said of Saturn’s first year, “We just can’t understand why we’ve been ignored, they forgot about us, just like we were dust to be moved around.”
For several weeks, the state officials, Saturn and the UAW ignored the mayor’s letters and requests for a meeting with the townspeople to explain what was going on and to answer citizen’s questions. Only in September 1985, when Mayor Jones warned that he might oppose zoning changes needed for initial construction, did the three agree to the town meeting.
Spring Hill’s annual property tax revenue was around $21,000 before any GM payments. A recent property reappraisal had the effect of a major tax hike and Mayor Jones did not want to raise taxes so soon to pay for new facilities. When the mayor’s efforts to get a financial commitment from the county and GM failed, the city council began the procedure to annex the Saturn site, just two miles outside the city limits. This would have brought the town an estimated $8.5 million annually, instead of the $11.5 million over a forty-year period to which they eventually agreed.
Upon learning about the annexation plan, Saturn’s general counsel threatened that GM would leave the Spring Hill area before the company had turned one shovel of dirt. “I don’t know if I’d call it blackmail,” Mayor Jones told the Flint (Mich.) Journal. “I have heard accusations before that if we don’t do this or that Saturn will pull out.” Jones reports that during this period he received a number of death threats from developers who were panicked they would lose anticipated substantial profits if GM did not come.
Spring Hill’s threat to annex Saturn’s property, followed by Saturn’s threat to leave, is credited with giving the town enough leverage with Maury County to get a large part of the in-lieu-of-tax money. For $250,000 annually, Spring Hill committed itself in writing not to annex the Saturn site. Mayor Jones is adamant that the annexation proposal is merely tabled and will be activated if the county fails to pay.
“We didn’t have any real estate offices in Spring Hill before Saturn hit. The next day we had five,” says Joan W. Jackson, the manager of the only branch bank in town. “Land speculators blew into town with money in hand, bought land, and flipped it.” Two months after the announcement, land values had risen from $1,000 to $2,000 per acre to $5,000 to $10,000 per acre, with some acreage selling as high as $35,000. Activity tripled at the county’s Register of Deeds, which collected more than a million dollars in recording fees and transfer taxes.
During the early “gold rush fever,” the mayor distributed signs “My home is not for sale. Compliments of George Jones, Mayor.” He explained, Y want my neighbors to know I want to keep them.”
By Spring 1986 real estate activity had slowed to a trickle. Many local people only made money as the outsiders let their options expire. Real estate agents and bankers predict a second boom as soon as the town’s bypass location is announced and when Saturn plant
As the unemployed began to come to the boomtown, Mayor Jones and the Board of Aldermen bought them one-way tickets to Columbia or Nashville. The bus doesn’t stop in Spring Hill, but a policeman takes the indigent newcomers to Main Street and flags it down. Legal Services personnel worry that the bus trip may await some local people as well. After Nissan was built local people with low incomes became homeless as the property values rose.
“The rental situation here is already deplorable,” says Bill Haley, Legal Services director in Maury County. “The trailer parks, which will be the primary places available for the transient construction workers, have outrageous lease provisions, which allow landlords to seize the personal possessions of the tenants if they don’t pay up. We’re going to see local people evicted, as the landlords jack up rents to lease to outsiders. Every county in the area has a long waiting list for low-income housing now. With the tremendous real estate pressures, homelessness is going to be an overwhelming problem and the counties are doing little to address it.”
The arrival of the county’s largest taxpayer frightens local residents who wonder whether they can afford to stay. Rising land values will increase taxes at the same time as the demand for new services calls for increased county revenues. While the mayor is proud of his negotiations with the county, he feels the negotiations between the county and Saturn “were very poorly handled.” Mayor Jones, a contractor, draws an analogy with his trade. “A lot of people underbid just to get the job. But when you’ve got to pay a dollar and a quarter to get a one dollar job, you’re talking one step backwards and it’s not good business. If it’s going to cost us more to have them here than we’re going to get in return, then I think we’re making a big mistake.”
“It will be the people on fixed income who will suffer,” says Mayor Jones. Citizen’s group leader Martha Torrence agrees: “We who are trying to continue here might have to move out of the area because of taxes.”
Homeowners are not the only victims. Randy Lockridge, who farms a thousand acres, declares that Saturn, named for the Roman god of agriculture, “will ruin farming in Spring Hill and have a negative effect on farming in all of Maury County.”
Dairy equipment supplier John Campbell, president of the Citizens Group, agrees that “farming’s a thing of the past in Spring Hill.” The town’s farm implement dealership is already closed, and the rapidly rising land prices seem to affirm his conclusion.
“Many people in the community who were in favor of the project have now turned against it after seeing the way GM operates,” said Campbell.
In the wake of recent elections, Jim Cathey, a landowner, said, “We really should be voting on getting that plant here.”
Cathey’s words echo the thoughts of thousands of Southerners who suddenly are faced with the rapid changes and unintended results of development decisions made secretively by a few state or local officials in pressured negotiating sessions with outside giant corporations. There are no mechanisms for public participation, much less approval.
State Needed to Manage Growth
Governor Alexander has used the Nissan and Saturn catches to catapult himself into the National Governor’s Association Chairmanship and to national political prominence great enough to cause talk about an Alexander role in the White House. Alexander has 90 tied his image to the Saturn project that he quips: “If it’s shelved, they’ll shelve me right along with it.” More than $460,000 of state funds have been spent on Saturn-oriented public relations in which media professionals have crafted Alexander’s positive, concerned image. Yet near the plant site, among officials and citizens alike, few are Alexander boosters.
“We don’t understand the governor letting such a thing come into our state. We think he should have said, “Okay, but give us so many jobs,” complains Martha Torrence. Mayor Jones’s struggles to get the governor’s attention are well known. Alexander committed the state to paying for the town’s planning, abut every time a bill comes up they want to give a run around getting it paid.” Adds County official Howell, “We really feel like they should have helped us more in planning. The city of Columbia and the county are entitled to the same thing Spring Hill was. I think they gave more to Spring Hill to hold down the press situation. We weren’t making that much noise so they didn’t have to do anything to quiet us down.”
The Saturn mishandling by the state led to a fundamental questioning of the state’s conduct of industrial recruitment by representatives of other localities, including the Tennessee Municipal Bond Fund vice president, Ed Young.
“What role should the state play in helping local governments deal with a mushrooming situation like this involving a major international corporation, the Tennessee Valley Authority, some seven or eight municipalities, several counties, a couple of development districts, at least a dozen state departments and agencies, and numerous other entities such as school and utility districts?” Young asks. Recruiting success is just the first step in a process-not the final one.”
“There were a number of task forces the governor appointed in the Spring Hill situation. They had one on transportation, one on water and sewer, but there was not the overall coordination of these functions. Only the governor can provide that,” said Young. “State officials must begin to develop an institutionalized memory and expertise regarding growth management so that the right things are done by the right people at the right time and the mistakes of the past are avoided.”
Making Modern Mythology
The Saturn myth is far more important than the Saturn reality to all concerned. This is why, what in reality is one more branch plant locating in the rural South, has captured the national imagination.
To the company, the Saturn myth represents a
resurgence in thirty-eight states of the time-worn notion that “what’s good for GM is good for the country.” GM has found that even corporate giants can be given the aid and comfort Americans usually reserve for underdogs in the nationalistic crusade to beat the foreign competition (some of which is owned by GM).
The legendary dimensions of Saturn have built political careers and justified raids on public treasuries from the county’s to the nation’s. Even in the latest tax “reform” bill, the deficit-ridden Congress showed its support by writing in a special $60 million tax-break specifically for Saturn.
For the union and the industry the Saturn myth has come to symbolize the “pattern for the Twenty-first Century industrial operation.” No matter that eighty percent of it is already in practice. The union is willing to forego hard-fought contract elements like seniority and grievance systems for a chance to be a partner in this undertaking of mythic proportions.
Saturn’s shiny, state-of-the-art features mesh with the public’s desire to believe in reindustrialization–that the glories of Henry Ford’s revolution can come back in a high-tech form.
For Tennessee and Maury County Saturn’s myth is that the industrial recruitment lottery can be won. There is now hope that young people will not have to leave their rural homes to find jobs. There is the illusion that our local and state officials are in charge even as they carry out decisions made in distant corporate boardrooms.
Despite the tremendous odds against them, communities across America have gone into a period of self-flagellation and blame that GM did not choose them. Most have learned nothing from the massive expenditures of time and money. They have fallen back on the losers dictim: “Try harder next time.”
The desperate desire to win justifies all public actions on the basis of what they will do for industrial recruitment. In the wake of the Saturn success, the governor’s State of the State speech instilled fear in the legislature that, if they don’t pass his three billion dollar roads program–“jobs corridors”–they would lose the Saturn suppliers to one of the eleven other states within two hundred-fifty miles of the new plant site. Similarly, better schools, higher sales taxes, and a myriad of other unrelated governmental items are justified to Americans by industrial recruitment.
Why are Americans so vulnerable to such mythology? There simply are not enough jobs to go around. Saturn has proven that states, and even unions, are willing to do most anything for jobs. A relative few is all Saturn will really provide. While the optimistic twenty thousand eventual plant and related jobs sounds impressive, Governor Alexander in more candid moments indicates that two hundred thousand jobs, or ten percent of the state’s workforce, are lost annually to plant closings, bankruptcies and shutdowns. Saturn’s total job impact-ten percent of what is lost annually in one state-is thus miniscule.
Few will bother to look beyond the comforting myths at the reality when industrial recruitment succeeds. Maury County now is a living example-and the real effects will not be known for years.
What is known is that the three reasons for industrial recruitment–jobs for locals, a better tax
base, and community improvement and an era of progress for those who reside there – have not materialized. Many long-term residents have little hope that they ever will.
“Tomorrow’s Jobs, Yesterday’s Values” is the new Tennessee state slogan. At eighty percent of the industry standard pay, Saturn will surely bring yesterday’s wages. A tax rate less than a third of normal promises a reprise of yesteryear’s company town scenario. Which of yesterday’s values are being preserved?
Saturn is preserving yesterday’s elements that corporations value–a docile, concession-prone workforce located in a community already nervous by every rumor that its corporate benefactor may leave or is having financial woes.
In self-appreciation festivals in each of Tennessee’s ninety-five counties, citizens are gathering to learn about and celebrate their past as part of Homecoming 1986. Despite the attempted parallels between the early pioneers and those charting the frontiers of Saturn, there is a real awareness that something is being forgotten, something irretrievably lost in Tennessee.
What about the values of self reliance, of community-building. of democratic local decision-making, of charting one’s own economic destiny? Tennesseans may remember that their foreparents came here to escape their economic dependence on the Saturns of yesteryear.
Amidst the booths demonstrating barnraisings, furnituremaking, spinning, and even moonshining, Tennesseans may get in touch with the real values needed to put all our unemployed citizens and resources back to work. While this may at first seem naive, economists say the majority of new jobs are being produced by small businesses, not by large corporations. Tennessee’s Economic and Community Development Department, despite its almost exclusive emphasis on industrial recruitment, documents that over a five-year period almost seventy percent of the state’s new manufacturing jobs were from Tennessee firms expanding or starting up.
As the 999 sites which didn’t get Saturn ponder Maury County’s situation, maybe they should be grateful. If they can wean themselves from the Saturn myth, they have a chance to proactively develop their economy rather than reactively awaiting the next announcement from a far-off corporate boardroom.
The states, counties, and cities have shown they are willing to subsidize every step of a company’s business -build the roads, provide all the social and physical services, do the planning and growth management, subsidize the utilities, provide job training, waive the taxes, own the factory and land, and sometimes pay the initial wages – taking all the risks. It’s time public entities use these resources to support locally-generated forms of economic development which will hire local people, complement the ways of life of current residents, and build a stable local tax base and economy.
Carter Garber is the founder of Southern Neighborhoods Network, a regional organization providing training and assistance to community economic development groups. Verna Fausey is editor of the regional bimonthly Southern Neighborhoods, and the founder of Public Interest Research. Garber and Fausey co-edit the Community Economic Reporter, a bimonthly o’ economic issues in Tennessee. The authors wish to thank Paul Elwood, a member of their editorial board, who assisted with interviewing, research, and editing. Research funding was provided by National Rural Coalition as well as SNN’s Economic Development Policy Project.