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Halifax County IDA requests $2 million tobacco grant for small motor manufacturer
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SoVaNow.com / May 28, 2014Let’s scrape the grease off the grill and see what the post-Memorial Day news caravan has cooking:
In the words of Ronald Reagan, “there he goes again:” Frank Ruff has a column out in today’s Sun in which our state senator just can’t resist the urge to build a strawman in a pathetic attempt to justify his opposition to expanding the state’s Medicaid program. In his very first paragraph Ruff writes, “Virginia would not need to expand Medicaid if we could get everyone focused on the need to train workers for the skills employers need for today’s jobs.” Uh-huh. The rest of Ruff’s column is devoted to the Virginia Tobacco Commission’s latest initiative to improve job training opportunities in Southside. Which raises the question: Frank Ruff has been a member of the Tobacco Commission for more than a decade. Why, then, has it taken him so long to “focus on the need to train workers for the skills” that “employers need for today’s jobs”?
There’s probably a good deal of merit to this latest idea by the Tobacco Commission — more on that in a second — but the lameness of Ruff’’s latest offering is almost beyond belief. Does anyone think for a moment that yet another continuing education/skills training initiative will erase poverty in Southside Virginia? If Ford Motors or Boeing decided tomorrow to open a production facility in Danville or Emporia or wherever, there still would be low-income people in the region for years and decades to come. Many are poor despite the fact they do indeed work for a living. Where else would Wal-Mart and McDonald’s turn to for staff if not for these folks?
The assertion by Ruff that a low-skill workforce is holding back the region would be offensive if such rhetoric were not ubiquitous. Unfortunately, the “skills gap” argument is flogged by an impressively bipartisan lineup. (Our U.S. senators, Mark Warner and Tim Kaine, both Democrats, are among its champions.) Yes, it is very important to have a well-trained workforce. No, there’s no evidence, aside from anecdotes of questionable value and maybe some localized labor shortages, that U.S. employers are going begging for skilled help. Dean Baker of the Center for Economic and Policy Research, whose “Beat The Press” blog I highly recommend (http://www.cepr.net/beat-the-press), has been all over this nonsense for years now. As Baker has frequently observed, if there were shortages for welders, pipefitters, computer programmers, medical technicians and other individuals equipped with skills high, medium and low, then you’d expect to see rising wages in these occupations as companies competed for personnel out of a tight labor pool. Yet, there has been no such upward march in wages, at least not according to data compiled by the U.S. Bureau of Labor Statistics.
As Baker drily notes: “Yes, we have a mismatch of jobs and skills. The problem is that it seems to be on the side of the managers who can’t seem to figure out how to get good help.”
In other words, it’s the economy, stupid. Wages rise when labor demand grows, and training more workers in skilled occupations — unto itself a good thing — is not enough to create such growth. Palliatives are not solutions. So how do we create jobs without the use of a magic wand? A strong infrastructure push would be ideal right about now, but unfortunately such ideas are destined to die in a Republican-controlled House of Representatives that can’t even cough up a transportation bill. (Similarly, it took forever for Congress to pass the Farm Bill, which used to be about as sweaty a task as lounging on the sofa while watching bowling on TV.) To be fair, Ruff doesn’t operate at a level that would allow him to exert much influence over the economy, but judging from his past utterances, it’s not like America should feel robbed by this turn of fate.
Just to get back to our original point, there’s a wonderful way to create jobs in Southside Virginia, with no extra cost burden being placed on citizens of the region: Expand Medicaid! The expansion will be underwritten 100 percent by the federal government for the first three years, and no less than 90 percent after that. Once the state covers its 10 percent share, there’s still an excellent chance Virginia will come out ahead with its budget as other expenses borne solely by the state (health care for prison inmates, for instance) are folded into the expanded program. The kicker, of course, is that up to 30,000 new jobs are anticipated in the health care sector if Virginia goes forward with Medicaid. Probably a few thousand would crop up in Southside. So explain to me again: Why is Frank Ruff so eager to train people for jobs in the health care field when he is actively trying to kill jobs in the health care field?
Scott Burnette, president/CEO of Community Memorial Healthcenter in South Hill, has penned an excellent letter on the proposed Medicaid expansion and its potential impact in Southside that we’re broken out on the facing page. Way down in the piece, referring to action by the Republican-controlled House of Delegates to block passage of a state budget with a Medicaid-funded “Marketplace Virginia” option, Burnette asks:
“Since the House of Delegates has failed to produce any alternative plan to help provide basic healthcare services to low income uninsured Virginians, can that be interpreted to mean that they are content in knowing that, even though they have the means to have a positive impact on the quality of life for hundreds of thousands of people, they are declaring that those people don’t matter?”
May I suggest a simple answer to this simple question?
w Today’s front page features two stories with a common thread: welding. This week, the Virginia Tobacco Commission voted to spend millions of dollars to establish three “Centers of Excellence” — in South Boston, Martinsville and Southwest Virginia — where workers can turn to acquire advanced manufacturing skills in fields such as welding. The other piece looks at the fractious relationship between Mecklenburg County and American Industrial Heat Transfer, which is rumbling about pulling out its La Crosse location and returning to its former home in the Chicago area.
AIHT is a welding-intensive manufacturing operation that pretty much embodies everything the Tobacco Commission professes to want for the Southside region: good company, providing good jobs, with an advanced manufacturing focus. The Centers of Excellence represent a strategy to recruit more such industries; let’s just hope it works. The initiative does have the virtue of representing an investment in people, rather than a continuation of the Tobacco Commission’s usual practice of throwing subsidies at supplicant firms in search of corporate welfare.
The AIHT story does suggest, however, that reaping a return on investment in the Centers of Excellence won’t be nearly as easy as hiring a consulting firm to explain how it all should be done. AIHT and local government officials have many disagreements, but one is the availability of skilled welders in the local workforce. Southside Virginia Community College offers a program in South Hill to teach the welding trades, and local officials say the labor pool should be plenty large to meet AIHT’s needs, but the company still says it’s having a hard time finding qualified workers. A paradox, or a cautionary tale? One former employee who spoke on background for the story said a big part of the problem is the low wages that AIHT pays. Whether this explanation is valid, or not, probably depends on one’s point of view.
Still, haven’t we heard this story before?