28.8: Deindustrialization and Rise of the Sunbelt

Figure \(\PageIndex{1}\): Abandoned Youngstown factory. Stuart Spivack, via Flickr.

American workers had made substantial material gains throughout the 1940s and 1950s. During the so-called Great Compression, Americans of all classes benefited from postwar prosperity. Segregation and discrimination perpetuated racial and gender inequalities, but unemployment continually fell and a highly progressive tax system and powerful unions lowered general income inequality as working-class standards of living nearly doubled between 1947 and 1973.

But general prosperity masked deeper vulnerabilities. Perhaps no case better illustrates the decline of American industry and the creation of an intractable urban crisis than Detroit. Detroit boomed during World War II. When auto manufacturers like Ford and General Motors converted their assembly lines to build machines for the American war effort, observers dubbed the city the “arsenal of democracy.”

After the war, however, automobile firms began closing urban factories and moving to outlying suburbs. Several factors fueled the process. Some cities partly deindustrialized themselves. Municipal governments in San Francisco, St. Louis, and Philadelphia banished light industry to make room for high-rise apartments and office buildings. Mechanization also contributed to the decline of American labor. A manager at a newly automated Ford engine plant in postwar Cleveland captured the interconnections between these concerns when he glibly noted to United Automobile Workers (UAW) president Walter Reuther, “You are going to have trouble collecting union dues from all of these machines.”³³ More importantly, however, manufacturing firms sought to reduce labor costs by automating, downsizing, and relocating to areas with “business friendly” policies like low tax rates, anti-union right-to-work laws, and low wages.

Detroit began to bleed industrial jobs. Between 1950 and 1958, Chrysler, which actually kept more jobs in Detroit than either Ford or General Motors, cut its Detroit production workforce in half. In the years between 1953 and 1960, East Detroit lost ten plants and over seventy-one thousand jobs.³⁴ Because Detroit was a single-industry city, decisions made by the Big Three automakers reverberated across the city’s industrial landscape. When auto companies mechanized or moved their operations, ancillary suppliers like machine tool companies were cut out of the supply chain and likewise forced to cut their own workforce. Between 1947 and 1977, the number of manufacturing firms in the city dropped from over three thousand to fewer than two thousand. The labor force was gutted. Manufacturing jobs fell from 338,400 to 153,000 over the same three decades.³⁵

Industrial restructuring decimated all workers, but deindustrialization fell heaviest on the city’s African Americans. Although many middle-class black Detroiters managed to move out of the city’s ghettos, by 1960, 19.7 percent of black autoworkers in Detroit were unemployed, compared to just 5.8 percent of whites.³⁶ Overt discrimination in housing and employment had for decades confined African Americans to segregated neighborhoods where they were forced to pay exorbitant rents for slum housing. Subject to residential intimidation and cut off from traditional sources of credit, few could afford to follow industry as it left the city for the suburbs and other parts of the country, especially the South. Segregation and discrimination kept them stuck where there were fewer and fewer jobs. Over time, Detroit devolved into a mass of unemployment, crime, and crippled municipal resources. When riots rocked Detroit in 1967, 25 to 30 percent of black residents between ages eighteen and twenty-four were unemployed.³⁷

Deindustrialization in Detroit and elsewhere also went hand in hand with the long assault on unionization that began in the aftermath of World War II. Lacking the political support they had enjoyed during the New Deal years, labor organizations such as the CIO and the UAW shifted tactics and accepted labor-management accords in which cooperation, not agitation, was the strategic objective.

This accord held mixed results for workers. On the one hand, management encouraged employee loyalty through privatized welfare systems that offered workers health benefits and pensions. Grievance arbitration and collective bargaining also provided workers official channels through which to criticize policies and push for better conditions. At the same time, bureaucracy and corruption increasingly weighed down unions and alienated them from workers and the general public. Union management came to hold primary influence in what was ostensibly a “pluralistic” power relationship. Workers—though still willing to protest—by necessity pursued a more moderate agenda compared to the union workers of the 1930s and 1940s. Conservative politicians meanwhile seized on popular suspicions of Big Labor, stepping up their criticism of union leadership and positioning themselves as workers’ true ally.

While conservative critiques of union centralization did much to undermine the labor movement, labor’s decline also coincided with ideological changes within American liberalism. Labor and its political concerns undergirded Roosevelt’s New Deal coalition, but by the 1960s, many liberals had forsaken working-class politics. More and more saw poverty as stemming not from structural flaws in the national economy, but from the failure of individuals to take full advantage of the American system. Roosevelt’s New Deal might have attempted to rectify unemployment with government jobs, but Johnson’s Great Society and its imitators funded government-sponsored job training, even in places without available jobs. Union leaders in the 1950s and 1960s typically supported such programs and philosophies.

Internal racism also weakened the labor movement. While national CIO leaders encouraged black unionization in the 1930s, white workers on the ground often opposed the integrated shop. In Detroit and elsewhere after World War II, white workers participated in “hate strikes” where they walked off the job rather than work with African Americans. White workers similarly opposed residential integration, fearing, among other things, that black newcomers would lower property values.³⁸

By the mid-1970s, widely shared postwar prosperity leveled off and began to retreat. Growing international competition, technological inefficiency, and declining productivity gains stunted working- and middle-class wages. As the country entered recession, wages decreased and the pay gap between workers and management expanded, reversing three decades of postwar contraction. At the same time, dramatic increases in mass incarceration coincided with the deregulation of prison labor to allow more private companies access to cheaper inmate labor, a process that, whatever its aggregate impact, impacted local communities where free jobs were moved into prisons. The tax code became less progressive and labor lost its foothold in the marketplace. Unions represented a third of the workforce in the 1950s, but only one in ten workers belonged to one as of 2015.³⁹

Geography dictated much of labor’s fall, as American firms fled pro-labor states in the 1970s and 1980s. Some went overseas in the wake of new trade treaties to exploit low-wage foreign workers, but others turned to anti-union states in the South and West stretching from Virginia to Texas to Southern California. Factories shuttered in the North and Midwest, leading commentators by the 1980s to dub America’s former industrial heartland the Rust Belt. With this, they contrasted the prosperous and dynamic Sun Belt.”

Figure \(\PageIndex{2}\): Urban decay confronted Americans of the 1960s and 1970s. As the economy sagged and deindustrialization hit much of the country, Americans increasingly associated major cities with poverty and crime. In this 1973 photo, two subway riders sit amid a graffitied subway car in New York City. National Archives (8464439).

Coined by journalist Kevin Phillips in 1969, the term Sun Belt refers to the swath of southern and western states that saw unprecedented economic, industrial, and demographic growth after World War II.⁴⁰ During the New Deal, President Franklin D. Roosevelt declared the American South “the nation’s No. 1 economic problem” and injected massive federal subsidies, investments, and military spending into the region. During the Cold War, Sun Belt politicians lobbied hard for military installations and government contracts for their states.⁴¹

Meanwhile, southern states’ hostility toward organized labor beckoned corporate leaders. The Taft-Hartley Act in 1947 facilitated southern states’ frontal assault on unions. Thereafter, cheap, nonunionized labor, low wages, and lax regulations pulled northern industries away from the Rust Belt. Skilled northern workers followed the new jobs southward and westward, lured by cheap housing and a warm climate slowly made more tolerable by modern air conditioning.

The South attracted business but struggled to share their profits. Middle-class whites grew prosperous, but often these were recent transplants, not native southerners. As the cotton economy shed farmers and laborers, poor white and black southerners found themselves mostly excluded from the fruits of the Sun Belt. Public investments were scarce. White southern politicians channeled federal funding away from primary and secondary public education and toward high-tech industry and university-level research. The Sun Belt inverted Rust Belt realities: the South and West had growing numbers of high-skill, high-wage jobs but lacked the social and educational infrastructure needed to train native poor and middle-class workers for those jobs.

Regardless, more jobs meant more people, and by 1972, southern and western Sun Belt states had more electoral votes than the Northeast and Midwest. This gap continues to grow.⁴² Though the region’s economic and political ascendance was a product of massive federal spending, New Right politicians who constructed an identity centered on “small government” found their most loyal support in the Sun Belt. These business-friendly politicians successfully synthesized conservative Protestantism and free market ideology, creating a potent new political force. Housewives organized reading groups in their homes, and from those reading groups sprouted new organized political activities. Prosperous and mobile, old and new suburbanites gravitated toward an individualistic vision of free enterprise espoused by the Republican Party. Some, especially those most vocally anticommunist, joined groups like the Young Americans for Freedom and the John Birch Society. Less radical suburban voters, however, still gravitated toward the more moderate brand of conservatism promoted by Richard Nixon.