Wednesday, August 1, 2018

Rebuilding An Adirondack Middle Class

Peter Kiernan address the Lake Placid Institute’s RoundtableOn average workers born in 1942 earned as much or more over their careers than any worker born since, according to the National Bureau of Economic Research’s 2017 Niber Working Paper. From 1967, the Middle class’ share of income has dropped from 53.5 percent to about 45 percent today. Ninety percent of metro regions have seen a decline in the middle class while on average incomes in rural America has declined to a much greater degree.

Ever wonder why the middle class is declining in our country, what’s the ramifications, and what can be done about it on a national level and here in the Adirondacks? New York Times bestselling author Peter Kiernan asked the same question, and decided to delve into the issue, and report on what he learned in his new book American Mojo Lost and Found: Restoring our Middle Class. Thanks to the Lake Placid Institute, its board member Ellen McMillin, and her husband John, Kiernan was persuaded to present Saturday morning, July 14, at the Institute’s Adirondack Roundtable.

A young Chinese executive provoked Kiernan’s research when he asked why America’s leadership is letting the country’s middle class atrophy at a time when they and every other developing country is trying to build up their own. He wanted to know what’s our government’s reasoning and game plan? That question left McMillin dodging, sputtering, and tossing out platitudes as he had no good answer, nor had he looked at our shrinking middle class as the outcome of potential intentional action. He did understand that to an outsider, the tearing away of the underpinnings of our middle class certainly seemed deliberate.

One outcome of his research is that he learned that in a sense Marx was right, capitalism unchecked or unregulated will lead to a massive transfer of wealth and power to the few and leave a high percentage of others in poverty as we are currently experiencing. This is not to say that Kiernan advocates for a Communistic form of government or social engineering, far from it; rather he believes that there are actions we can take to expand and strengthen the middle class to the benefit of all who live in our society. Further, he believes that revitalizing our middle class is vital to our nation’s economic and social well being. He also passionately believes that we, everyday Americans, have the power and opportunity to initiate that change, and now’s the time to get cracking.

Kiernan provided frightening statistics about life for many in the United States. He said there are 45 million poor people in the United States and that just above that seam of the poverty line are another 50 million people who are lower middle class, or what he calls in his book “hovering poor,” just a twist away from a life’s knife and living in poverty. As an illustration of how tough it is for many in the United States he said if you combined the population of Los Angeles and Philadelphia, that’s how many people there are in this country between the ages of sixteen and twenty-five that are not in education, not in training, and not employed.

“I felt that the historical context Peter put the decline of the middle class into was very interesting,” said Cathy McGraw, president of the Institute. “He shared, this is what exists, this is how we got there, and what we do about it is up to us. He said we need to fix this problem because a strong middle class is the underpinning of our society. He spoke for a long time and you could hear a pin drop in the room. People were captivated.”

A thumbnail history

Kiernan began by reviewing the roots of the middle class in our society which surged following WWII as leaders in American business, banking, education, and government wanted to thank the 16 million returning veterans and the many women who stepped into the workforce while the men went off to war. Through the GI Bill and many other initiatives, they provided GIs with access to a good education while businessmen like the Levitt brothers made housing affordable. Our country quickly become the major center for manufacturing, food production, finance, advances in technology, education, and health care while much of the rest of the world lay in ruins.

Essentially as a means of creating a customer base for the products being produced, the U.S. government used the Marshall Plan to rebuild Europe and Japan, and established alliances like NATO to protect these investments from Soviet aggression and expansion. Our economy boomed. Men earned enough to be the sole breadwinner, wives managed the homes and educated the kids. All seemed to be going along well except for a problem, these benefits were not universally applied. People of color and other minorities were largely excluded. Soldiers of color, who had experienced greater freedom and respect abroad, returned home desiring the same benefits, and became angered when they were excluded and marginalized.

Their frustration of being left outside the economic boom helped galvanize the civil rights movement resulting in many violent confrontations, especially by those resisting Black Americans efforts to leverage legislative change. At the same time a vast amount of economic resources and political capital was being spent on the Vietnam War. Kiernan said that our economy began to falter as we could not fight the War in Vietnam and the War on Poverty at the same time, both hugely expensive and neither going well. Spending so much national treasure fighting an unpopular war and trying to address poverty led to what Kiernan described as the three uglies, double digit inflation, double digit interest rates, double digit unemployment.

Nixon’s response to addressing the economic malaise was to take us off the Gold Standard, which initially produced an economic boost, but led to catastrophic inflation and drastic drop in the value of the stock market. Fed Chairman Paul Volker, supported by then President Reagan, eventually checked rising inflation. The cure was painful with many businesses like Chrysler going bankrupt. Another outcome was that families could no longer survive on a single income.

At the same time those with wealth and power successfully lobbied for changes in the banking laws, opportunities to reduce the influence of unions, and ever-increasing reductions in graduated income taxes – an economic safety value that made affordable education, healthcare, and investments in infrastructure possible.

Where we are today

“There is not enough growth here in the United States to serve our desired middle class,” said Kiernan. “There is this Newtonian certainty that there will always be a middle class in the United States but that’s not the case. The only certainty is there will be some middle class, but that there will be a very large and growing group of poor, and group of people, from the standpoint of the one percent, that will benefit mightily. 76 people in the world own most of the global assets, they could fit in this room. Left unguided, unchecked, and without some thought on how we feed certain needy areas, and I’m not just talking about the poor, but the middle class, capitalism is the greatest concentrator of wealth ever devised and it’s up to us to manage that appropriately.”

Kiernan said that if you think of the top ten trading ports in the world, the United States has none, China has six, and the port of Shanghai is so big that the top four in the United States combined are not as big. There are 40 or 50 countries in the world that have as the center of their strategic plan building a strong and vibrant middle class and are taking pages from our playbook. The OECD says there will be a billion more members of the middle class outside our borders in the next ten years and the next ten years after that a billion more. 10 times our middle class will soon exists outside the U.S..

He pointed out that as an example the average South Korean works 1,000 hours more per year than the average American. They don’t do that because there’s more money in it, they do it because they believe by doing so their children will be better off than themselves. In China, just under 90 percent believe their children will be better off than themselves while we are at 40 percent and that number is in decline.

The number of kids who attend our public schools each year with no home to go to is larger than the population of Dallas, TX. They live in cars, tents, and shelters, or are crashing at someone else’s home. The average age of a homeless person in New York City is nine years old. Homeless children in New York City alone are enough to fill Lake Placid’s Herb Brooks (Miracle on Ice) Arena seven times over. Next fall 7,000 students will go to Harvard; meanwhile every day of the year, 7,000 kids will drop out of K-12 school each year.  Meanwhile, nationwide, only 39 percent of community college students graduate after six years.

Imagine the entire population of Los Angeles combined with the entire population of Philadelphia, that’s how many people there are in this country between the ages of sixteen and twenty-five that are what Peter Kiernan calls neat, they are not in education, not in training, and not employed. They’re doing nothing. Can there be anything more diminished than a twenty-year old who cannot read or do math at an eighth-grade level. There are millions of young Americans like that who represent a one hundred billion dollar per-year anchor on our future; it’s the ultimate teenage wasteland. A lot of these young people will end up incarcerated.

The US has five percent of the world’s population yet twenty-five percent of all the people in prison, be that in a federal, state, or county jail. No country on earth has more children in prison as an absolute number or percent than the United States. The three Ps, prison, parole, and probation include 7.5 million Americans; greater than the populations of Los Angeles and Chicago combined.

“It costs us $120,000 per year to incarcerate a young person in Riker’s Island; twice the cost of sending a person to Harvard including room & board,” said Kiernan. “Surely we can do better. These lost children are our nation’s seed corn and we are wasting several million of them per year.”

Kiernan also said that touting a national four percent unemployment rate is a false indicator of success because it leaves out the population that has given up looking for work and doesn’t segregate out the large number of middle class and our nation’s poor that are working two, three or more jobs in an attempt to meet their basic living expenses.

Rebuilding the Middle Class in the US and Adirondacks

Kiernan said that creating low-level, entry-level jobs will not solve our region’s unemployment and declining middle-class problems. He said his research has shown that raising the minimum wage results in businesses either outsourcing work, reducing their number of employees, or turning to automation to help fill jobs more cheaply. He said every time minimum wages have been raised soon thereafter relative inflation has eaten those gains. Better is to create jobs that enable people have a positive quality of life, recruit and train people to fill those jobs, reduce the costs of healthcare, higher education, and homes for middle and lower income families, and foster profit sharing and other incentives to distribute corporate income more fairly.

Kiernan with Cathy McGraw, President of the Lake Placid InstituteKiernan said a key to rebuilding the middle class is to create jobs that create other jobs. Every high-tech job creates 4.3 more jobs in other services sectors across all income groups, including lawyers, dentists, schoolteachers, cooks and retail clerks, among many others. In infrastructure, it’s close to two to one. The key is educating students for the jobs available; and to do that it requires education, business, and government to work together to identify the skills needed, schools to train the youth, and government to create the incentives and insure that the education is affordable – that the students don’t end up with a crushing debt.

He said, “Nation-wide there are four million fabulous middle class jobs, multiplier jobs. Future jobs. Career building jobs. They don’t need to be created, they exist; they need to be filled. If you doubt it, go to Microsoft, they have 10,000 jobs waiting to be filled. They will be filled. If we can’t fill these jobs in the United States, they’ll fill them overseas. Microsoft and other tech companies can’t stay in business, can’t continue to grow in a market like ours.”

Kiernan said that we graduate 40,000 computer science majors in the United States each year while we are creating 400,000 computer science job openings. These are multiplier jobs. Well-paying jobs. He asked why is it eight percent of the graduates in the United States are in STEM while thirty percent of the Chinese are in STEM? There is no connectivity. We are creating way more jobs in STEM then there are graduates to fill those jobs.

Kiernan feels another key is looking for markets outside one’s region and outside the country as that’s where products and services are needed. To be successful, this approach requires educational, business, environmental, health, agriculture, cultural, and government leaders work together to identify those potential markets and services and then market those services to meet those needs. In our region, in the past, we sold iron ore, lumber, and tanned leather.

Today we depend on prisons and tourism. We are not strategic in our thinking, we are not thinking creatively and broad enough, and the outcome is people, most especially young people, and young families moving out of the region to live elsewhere.

As an example, there are over two million cancer cases each year in China. Their healthcare facilities are not nearly as good as ours. How many of their patients would we need to attract each year put our lead hospitals in the black? Caring for people living with TB provided Saranac Lake on the surrounding communities an economic engine for over for fifty years. What are the health services that we can offer that would attract patients (and their families) here?

Wellness travel, a $500 billion plus industry, is the fastest growing segment of tourism worldwide increasing at a rate of ten percent a year. The Adirondacks used to be a major wellness destination in the United States, now it doesn’t make the top fifty in a Google Search, meanwhile the media is filled with articles about the healing benefits of nature and participating in creative activities. Kiernan would make rebuilding that brand a priority as our location is within a day’s drive of one quarter on the U.S. population, and our wilderness would be very attractive to Europeans, Asians and others.

We are experts in protecting the natural environments, while throughout the world many counties desperately need that expertise. Be the go-to place for people to learn the latest techniques for environmental and species protection.

He said start by identifying the multiplier jobs in one’s region and then matching those jobs with people who can fill them. If one doesn’t have enough skilled people in the region, train people to fill those jobs along with recruiting people to live here and fill them. What skills does the high tech and transportation industries in Plattsburgh need? Global Foundries near Saratoga? He urged the colleges and community colleges in and around the Adirondacks to increase the number of students they train in engineering and computer sciences, which in turn will encourage more high-tech businesses to locate in Plattsburgh and the university communities.

“Be like Houston,” said Kiernan. “Houston is the only city that brings these sectors together to educate their youth for the jobs that are being created by business, it’s called The Greater Houston Partnership. Their question was; how can we make this the easiest place in the country to start a business, get a job, train people, and then let the nation know that we’re doing that?”

“I’m thrilled that the Institute had a speaker to address the growing wealth gap because I think it is one of the most serious issues we face,” said Scott McGraw following Kiernan’s presentation. “I worry about the polarization that we have in this country will hamper our ability to confront any of these problems and that we could lose a generation.”

“I was awe struck by his observations,” said John McMillin. “The health and well-being of the middle class is something that everybody should think and talk about.”

Did he achieve that goal? The response has been a resounding yes.

“I was mesmerized, Peter really packed it in,” said Joan Gignoux. “He presented a lot of things that I had not put together and hadn’t thought of; some shocking things like the number of young people waiting for bail. That was a stunner, plus the number of men that are not even finishing high school. That’s huge. I walked out of the meeting very concerned. I believe he’s right that we have the talent and ability to tackle the income divide and rebuild the middle class, but the depressing thing is I don’t think we are figuring it out at all. We’re putting our focus in the wrong place. Whatever you think the focus should be it’s not there.”

The next Lake Placid Institute Adirondack Roundtable will be held at the Crown Plaza, August 4th at 8:30 am.

Photos, from above: Peter Kiernan address the Lake Placid Institute’s Roundtable and Kiernan with Cathy McGraw, President of the Lake Placid Institute provided.

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Naj Wikoff is an artist who founded Creative Healing Connections, the Lake Placid Institute, and co-founded the Adirondack Film Society-Lake Placid Film Forum.

A two-time Fulbright Senior Scholar, Wikoff has served as president of the Society for the Arts in Healthcare, director of arts and healing at the C. Everett Koop Institute, Dartmouth Medical School, and director of Arts and Productions for the Cathedral Church of St. John the Divine.

Wikoff also covers Adirondack community culture events for the Lake Placid News.




13 Responses

  1. Paul says:

    Interesting story.

    “a massive transfer of wealth and power to the few and leave a high percentage of others in poverty as we are currently experiencing”

    According to UC Davis, the data says the poverty rate in the US (after a steep decline following WW2) has fluctuated between 11 and 15 percent. Far too many people but not what you are describing in the above statement.

    https://poverty.ucdavis.edu/faq/what-current-poverty-rate-united-states

    • Bruce says:

      Paul

      It’s true that the percentage of folks at or below the poverty level has not changed markedly in the last few decades.

      In addition, a government-provided living { outside of prepaid insurance programs like social security for retirees} has not been working well in most places where it has been tried. I just saw where Canada backed off on their recent experiment with it.

      • Larry Roth says:

        If you are referring to an experiment to give people a garanteed basic income, I believe that’s not the whole story. A newly-elected conservative government ended it before it could produce meaningful results, not because it had failed.

        https://abcnews.go.com/International/wireStory/ontario-scraps-basic-income-experiment-56950129

        The idea is to put a floor under people to make sure they don’t fall into poverty, and it was intended to combine a patchwork of other programs into one more efficient whole, saving money and for greater effectiveness.

        The last time it was tried in Canada, a conservative government ended it then too, and did its best to bury the results. So you can’t say it failed – it’s more like some people are too afraid of what they might find out.

        What the program was intended to do was make it possible for people to do things like go back to school to train for better jobs, focus on careers that might not pay as well as some but still have value, remove food insecurity, allow parents to spend more time with families instead of having to hold multiple jobs, etc. etc.

        What the limited results from the first experiment found was that people worked and improved their lives – they didn’t sit around waiting for government checks. There were other gains as well. That first experiment was called Mincome.

        “… She found that only new mothers and teenagers worked substantially less. Mothers with newborns stopped working because they wanted to stay at home longer with their babies, and teenagers worked less because they weren’t under as much pressure to support their families, which resulted in more teenagers graduating. In addition, those who continued to work were given more opportunities to choose what type of work they did. Forget found that in the period that Mincome was administered, hospital visits dropped 8.5 percent, with fewer incidents of work-related injuries, and fewer emergency room visits from accidents and injuries.[11] Additionally, the period saw a reduction in rates of psychiatric hospitalization, and in the number of mental illness-related consultations with health professionals.”

        Sounds worth following up to me.

        https://en.m.wikipedia.org/wiki/Mincome

  2. Larry Roth says:

    This is an interesting article with a lot of information. I don’t necessarily agree with all of it, and have a few other suggestions that deserve some consideration.

    One factor in the current economic situation has been the consolidation of the economy into fewer and bigger players. Anti-trust action that only focuses on whether or not consumers pay higher prices ignores the other negative consequences. Mergers always lead to job losses through ‘efficiency’. Newly redundant facilities are closed – and towns lose jobs and tax revenue when that happens. Innovation drops – with only a few big players in a field, the need to come up with new/improved products becomes a lower priority.

    There are fewer alternatives for consumers whose needs are not being met. Workers have a much harder time negotiating for their fair share of the wealth their labor produces. Giant corporations suck money out of communities when all the profits go back to some remote corporate headquarters and anonymous shareholders. It becomes incredibly difficult to start up a new business or keep an established local business going against the competitive advantage of corporate giants. Those same giants have an unfair advantage in getting government ‘help’ – they can afford to lobby and gain access smaller players can’t.

    This is part of a bigger picture. Our economy has been turned into a wealth transfer machine, funneling more and more money into fewer hands. Less and less of the economy is about providing goods and services, and more about playing games with money to make more money. If you listen to certain politicians and the media that supports them, what you hear if you listen for the underlying message is the argument that the problem is rich people don’t have enough money, and the rest of us have too much.

    Other developed countries do a much better job giving their citizens a higher quality of life. Things like health care, a secure retirement, access to higher education and living wages make everyone better off. They may pay more in taxes – but they get more back – and the net cost is lower. Investing in the public good is not considered sinful. Anti-tax, anti-government hysteria deprives us of the use of government as a tool to promote the general welfare. Worship of market forces and belief the “invisible hand” will solve all our problems is not borne out by history. “Socialism” is denounced as evil and a failure – yet how many times has socialism crashed the global economy?

    Research by Richard G. Wilkinson and Kate Pickett finds that developed societies do better on just about all quality of life measures depending on the amount of inequality they have; the smaller the distance between the top and bottom, the better it is for everyone in that society.

    The discussion of how much of our economy is locked up maintaining prisons, dealing with crime, health problems, drug abuse, etc. is something Wilkinson and Pickett point out is driven in large part by inequality. Rather than treating them as separate problems, going right at bringing down inequality would be far more effective. Giant tax cuts for the wealthy are obviously not going to do anything to fix that. Nothing trickles down.

    A small country with fewer resources and a smaller population can still outperform a larger, wealthier one for its citizens IF it has lower inequality. Their work is backed up by huge amounts of research from around the world. You can find in it their book “The Spirit Level – Why Greater Equality Makes Societies Stronger” – a book the establishment and media is still largely ignoring.

    https://en.wikipedia.org/wiki/The_Spirit_Level_(book)

    Also missing from this discussion is a biggie: Climate Change. This is already reshaping the world in a multitude of ways: food production, water resources, environmental degradation, displacement of populations, increasing economic stress, failing political systems, and more. We continue to ignore it at our peril – and the reliance of the Adirondack economy on its natural wonders is a vulnerability.

    One more thing – that argument against raising minimum wages? That kind of thinking is one of the big things we get wrong talking about jobs and the economy.
    • Arguing that raising the minimum wage causes employers to cut workers and turn to automation ignores the fact that employers are ALWAYS trying to cut labor costs. Automation is creeping up the pay scale too.
    • Arguing that there’s no point in raising the minimum wage because inflation will eat up the gains ignores the fact that lately inflation has been pretty low – and it creeps up whether or not the minimum wage is raised. In fact, that’s what has been happening. If you adjust for inflation, the minimum wage peaked in 1968, and has been falling behind ever since.
    • People in minimum wage jobs put that money right back into the economy. What they get, they have to spend. If they get more, they’ll spend more creating more economic activity for everyone.
    • If a business has more customers than employees, raising the minimum wage doesn’t just give employees more money – customers have more to spend too. Higher wages can be offset by an increase in revenue – sometimes by a lot.
    • If someone can work two or more minimum wage jobs, typically without benefits and still can’t make ends meet, how do they make up the difference? With government assistance. Taxpayers are subsidizing the profits of employers by allowing them to underpay their workers. Most people getting assistance are not sitting back – the phrase is working poor, and it’s often darned hard work.
    • Minimum wage jobs are not ‘starter’ jobs for teenagers. A job at minimum wage is still a real job, and should be treated accordingly.

    Pew Research has info on all this. http://www.pewresearch.org/fact-tank/2017/01/04/5-facts-about-the-minimum-wage/

    As far as translating this into improving the Adirondack economy goes, there’s one thing to keep in mind: there is no magic bullet. It’s going to take a sustained effort and a lot of re-thinking of “what everyone knows” to move in the right direction. Some people now very well off will be less so; some now without will see gains. This will cause friction and much upsetting of apple carts.

    • Boreas says:

      Larry,

      Agree 100%.

      “Other developed countries do a much better job giving their citizens a higher quality of life.” At one time this was the reason behind forming a government. It seems now the US government is viewed simply as a tool to concentrate wealth. Citizens just get in the way.

  3. Zephyr says:

    Maybe we could start by having the state provide broadband to everyone, or at least those in areas without. This is a public need, like clean water and electricity, where the state needs to get involved to prevent companies like Charter/Spectrum from figuring out how to get the maximum financial gain while minimizing their costs–meaning many people don’t get served. Yes, big government can be inefficient, but without regulation and oversight you end up with $200 per month cable bills that provide you with hundreds of channels of garbage (advertising) and no service in many areas.

  4. Naj Wikoff says:

    I agree with Larry that there is no magic bullet, that it will take a sustained effort, and creative thinking. I like Houston’s approach of bringing leaders in health, education, business, the arts and government together; here leaders in the environment would be another key partner. I think an expanded Common Ground could be a good starting point. I agree with Zepher that government’s role is vital; the private sector cannot address these challenges as they are not inclined to bring services to those populations that cannot generate a profit such as our small hamlets re the internet.

    Good news is that the Lake Placid Institute holds forums to provide us the opportunity to sit down with people like Kiernan and start discussing the challenges we face.

  5. Zephyr says:

    A huge irony is that the Adirondacks, and other rural areas too, voted for Trump and they largely continue to support his ongoing attacks on basic middle class institutions like healthcare, Social Security, Medicare, unions, education, etc. His tax cuts, targeted at the rich and his own personal tax situation, are being used by Republicans in Congress to argue that we must cut social programs now due to the lack of tax revenue. An easy and quick start toward reviving the middle class in the Adirondacks and all over the country would be for voters to wake up and vote Democrats in who will impeach Trump or at least block his ongoing treason against the country.

    • Big Burly says:

      @Zephyr … the middle class existed long before the myriad gov’t programs you cite. My friends Naj and Larry have raised excellent points … don’t always agree with them. In the rethink they both espouse must be included a review of the huge number of regulations, local, state, and federal that seek to codify existing means of wealth creation AND or prevent entry to others. Capitalism is an engine that perforce requires renewal and inherent in that is moving on from the old ways of doing things. Common Ground has been hijacked by agencies of NYS — it is a far different enterprise than what was envisaged when it started, so a better umbrella needs to be found to provide cover and inspiration.

      • Zephyr says:

        Of course, big, bad NY State with all its regulations and taxes is far richer than almost every other state, with a higher median income, higher education levels, lower crime rates, etc. etc. For that matter, most people who live in the Adirondacks are far better off economically than they were at any time in the past. Can we do better? Of course, but that doesn’t mean that the average person living in the Adirondacks isn’t far better off than the average person living there 50 years ago. In fact, studies show that compared to other similar rural regions in other parts of the state and country, the Adirondacks out-performs. I’ve lived in a bunch of low-tax, low-service, high-crime, high-poverty, low-education states, and they aren’t places I would want to raise a family.

  6. John says:

    The true irony is that the more the state buys land that the general public will not set foot on, taking it out of timber management, the poorer we are. I agree the tourist economy is the largest in the Adk’s but the forest products was/is truly a means to making a living, There is no way, on a per acre basis, that tourism is better than forest products. Millions of acres of land that nobody walks through with exception of trails to specific desitinations while on a per acre basis, productive woodlands far exceed tourism (hikers, etc). Think of a 100 acre woodlot, producing 500 cords of pulp, that 500 cords becomes $50,000 when delivered to the destination mill. That $50,000 get split up between the logger (and logging crew), trucker, landowner and a person like me who marked the timber. All this occurs within 6-8 weeks, if not sooner. Nothing beats the generation of wealth as producing something. The barrier to this is government. I rarely have seen anything good when the govt gets involve din my line of work. Keep buying private land, people keep getting pooerer.

    • Marc Wanner says:

      Yeah, blame the big, bad state. Or maybe not…

      “Ninety percent of Maine is forested, and more than 93 percent of the state’s land is privately owned, mostly by large timber companies that sell trees to the wood-products industry. If private lands lead to prosperity and healthy landscapes, Maine should be the poster child for the country. And unlike the West, Maine, imposes minimal regulations on private landowners. There are also almost no listed endangered species in Maine to harry the timber industry.

      “Yet today, the forest-products industry in Maine is a shadow of its former self. In 1980, there were 25 pulp and paper mills in the state. Today, two-thirds of those mills are gone. Since 1990, the state has lost 13,000 of its approximately 17,000 paper-industry jobs, including more than 2,300 in the past five years. The decline continues. Associated wood products companies in Maine have also seen a decline – everything from wood furniture, wood flooring and clothespin producers have closed up shop…”

      More here: https://www.hcn.org/articles/why-is-logging-dying-blame-the-market

      • John says:

        I do, in part blame the big bad state, and..the seller. Buying more land to go to the preserve is akin to buying up productive farmland and letting it go fallow. I agree with you that it is the market which drives everything. In NYS, 20 years ago there were more pulp mills and more sawmills (Is it strange their are only 3 hardwood sawmills within the blue line?). For whatever reason they have mostly pulled out, as in Maine. (Note that pulpwood is ocasionally coming from Maine and NH into Glens Falls, to the chagrin of local producers) The forest products economy is regional, not confined by political boundaries. That said, large landholders continue to diversify and cut wood be it for pulp, whole tree chips, sawlogs and export veneer. My previous post related to the economic expansion of forest products. My example of a 500 cord harevst on 100 acres is reasonable, and likely conservative, as it does not account for sawlogs and veneer. Pulp, next to whole-tree chips, is the lowest valued product coming off any woodlot, and is key to managing a forest for future production (But I will not go into the silvicultural aspects in this posting). At one point this past January I had 8 logging operations on-going. Think of the weekly production and economic expansion….It had to be in the neighborhood of $50-60K pushed into the economy per week. I am one person, think of all the other operations going on with other loggers, foresters etc. Its truly amazing what happens when a private landowner chooses to separate trees from their property. To summarize, these logging operations support the “middle class” which I guess I assume, if we are to don labels, I am part of. A young fella or gal can invest $20-50K in purchasing a modest cable skidder and $1,000 for a good chansaw and if he/she is a good worker, develops a good reputation can find themselves in demand. As a side note, we havent had true capitalism in this country since 1913 with the Federal Reserve Act. A private bank manipulates the value of currency.

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