JANESVILLE, WI - JUNE 03: (Photo by Scott Olson/Getty Images)

When the bottom falls out: a masterpiece on a town that died

Amy Goldstein wanted to know what happened to the ordinary people impacted by the GFC. Ahead of her Auckland Writers Festival appearance, chaired by Toby Manhire, she tells Duncan Greive about the extraordinary book she wrote about the fallout after GM shut its oldest manufacturing plant.

By June of 2008 the global financial crisis had been rolling in earnest for nine months, and evolved from a revelatory news event into a lens through which we viewed reality. Stories which would once have been shocking had become routine, like the firing of the CEO of Wachovia, then fourth-largest bank in the US, or all time record low UK mortgage approvals.

Two days after those announcements came a third: the impending closure of GM’s plant at Janesville in Wisconsin, which would result in the loss of 2700 jobs.

Set against numbers measuring in billions, sometimes trillions, 2700 barely registered. Manufacturing jobs had been flowing out of the US for decades; the GFC only accelerated the process. Yet for those 2700 people, this one news story was the biggest event in their lives. And as it was for them, so it went for Janesville – a city of 65,000 which was about to find out just how much it relied on those jobs.

The news cycle and US national media barely registered the story amongst the tumult. “A lot of what people thought was exciting was the macro-view,” says journalist Amy Goldstein. “The political disagreements over what the federal government’s economic policy should be. Whether the US government should bail out the banking industry or the auto industry.”

Goldstein is a Pulitzer-winning Washington Post reporter, and the gap between those big numbers and policy decisions and the reality of what they meant to people yawned in front of her. “I didn’t see much writing about what really happens to workers and to the texture of a community,” she says. “That was what I wanted to try to find a way to illuminate.”

The solution she found was Janesville, an extraordinary work of narrative non-fiction which chronicles what happened to the community after the jobs left town. It was constructed out of visits and interviews which spanned six years, and won the 2017 Financial Times/McKinsey business book of the year. This month it brings her to Auckland, where she will be interviewed by The Spinoff editor Toby Manhire as part of the Auckland Writers Festival. I caught her on the phone in Atlanta, during a round of speaking engagements for Janesville in March, and started by asking her what prompted her to write the book.

“During the great recession from late 2007 to mid 2009 I was covering a very eclectic social policy beat,” she says. “One of the things I did was start to get interested in what difference it made on the ground that the US economy was so bad.

“I did a story out of southwest Florida about people who were falling out of the middle class and onto the welfare rolls, and were just shell-shocked that they weren’t able to support themselves anymore. I hung out in the welfare office with people signing up for benefits to see who was there and why they were there. It was a story I worked on for a few days, but it was such a profound thing. It was not the trajectory that people in the United States expect of how things are going to go. I did a few different stories like that. About what happens when good work goes away.”

Janesville is an adroitly chosen subject, both for its rich history and the ways in which it doesn’t resemble the decaying rust belt cities we’ve finally paid attention to since they helped elect Trump. Goldstein she says she “thought about picking a place that could serve as a microcosm for what was going on in many places in the country,” and the city’s rise and struggle not to fall elegantly accomplishes that.

Janesville’s history really begins with George Parker founding the Parker Pen company – itself later sold and its jobs off-shored – the start of a reputation for precision manufacturing which clung to it for more than a century.

In 1919 GM bought the Janesville Machine Company and merged it with Samson Tractor to create the plant which would become the community’s economic engine. For nearly 90 years it turned out whatever the company needed, from sub-compact Chevrolet Cavaliers when gas prices were high, to giant SUVs when it was cheap. At its 70s peak the plant employed over 7,000 people, which still understates its role in the city, because of the way that money flowed on through subcontractors and out into all the city’s public and private entities.

Dianne Stretz inspects a Denali SUV as it rolls down the assembly line at a General Motors Assembly plant February 13, 2008 in Janesville, Wisconsin (Photo by Scott Olson/Getty Images)

“Because these jobs existed, supplier companies blew up in town and there were thousands of those jobs,” says Goldstein. “At the end General Motors was paying most of its unionised workers $28 an hour. Even though some people didn’t love working in an assembly line, they loved the life that GM wages could buy. The sense of security. This was the oldest operating assembly plant in all of General Motors when it shut down.”

GM had been in strife for years before the closure came, but Goldstein says many in the community had come to believe it was invulnerable to the forces buffeting its owner.

“The longer that the plant didn’t close, the less people could believe that it ever would,” she says. “When it happened people couldn’t believe it.

“For a long time there was a pretty pervasive denial, with people unable to fathom that these jobs weren’t eventually going to come back. That demonstrates the extent to which this plant was not only the centre of the economy but it was the centre of the community’s identity.”

While the book begins with the last Tahoe rolling off the line in 2008, it wasn’t until 2011 that Goldstein first visited Janesville with a book in mind. In conversation she scrupulously avoids uttering anything resembling an opinion, which sounds irritating but really isn’t when you hear it. The habit seems to stem from her listening in good faith to all different kinds of people over many years. “For my job at the Washington Post I’m often talking to people who have different vantage points about policy issues that I’m writing about,” she says. “That didn’t feel that different to arriving in a town and listening hard to people who were at different points in the community.”

Janesville is made up of over 50 chapters, mostly self-contained scenes from the lives of her core cast, either witnessed or re-constructed from interviews. There are dozens of characters vividly rendered, ranging from homeless high school kids sneaking ashamed to the school food cupboard, to Republican house speaker Paul Ryan, a Janesville son trying to reconcile his desire for fiscal prudence with his home town’s manifest need for state and federal assistance.

What form the latter would take is one of the most fascinating threads in the book, and helps explain the complete absence of detectable ideology in Janesville. Goldstein collaborated with some local economists to study the impact of job-training programs in the surrounding area, and the maddeningly inconclusive results form a thread throughout.

The desire to use education to help insulate workers from the impact of technology and trade-driven redundancy is an article of faith amongst many – notably in New Zealand, where it’s the basis of Labour’s push towards three years of free tertiary study. Yet Goldstein and the economists found those who re-trained had a lower employment rate than those who did not, and, more surprisingly, earned less too.

So if re-training didn’t work, what did? “People there were doing essentially all the things you could think of to try to recover. In terms of creating coalitions to try to rebuild the economy, in terms of working with many homegrown nonprofits to help people who had lost a lot. The community was being intelligent about applying for federal grant money for job retraining and other purposes.”

Janesville prides itself on resourcefulness, and, in the absence of many of the social safety nets – which are fraying but still exist – we take for granted in New Zealand, it became a city-wide push to try and hang together through the first few years. There are bank leaders pushing corporate visions of support and doctors running free clinics who have to turn away all but the most excruciatingly deprived. All are there, fighting to make it through. The overwhelming picture that emerges, though, is that figuring out how to respond to this kind of event is exceedingly complex.

“One of the things that I’ve learned through this work and trying to understand this community is that when a lot of jobs go away, particularly at a bad economic time, it’s really hard to figure out how to get things going again, even with a lot of tenacity and resilience.”

New Zealand weathered the GFC far more smoothly than the US, in part because our banks were far less exposed to subprime lending (though our finance companies ensured we had some bruises just the same).

Perhaps a more apt comparative episode locally would be a deliberate act – the economic shock treatment of the fourth Labour government, which was radically reformist and stripped out the tariffs and subsidies which much of the country had grown reliant on. The legacy was a collapse in manufacturing, and many smaller towns which lost major employers that never have recovered to the robust health they enjoyed beforehand. What Janesville seems to imply is that wishing you could do more to help is not necessarily the same as knowing what will be effective.

As the book wears on, the cumulative toll starts to weigh so heavily that some strands break. Most poignantly in the case of Kristi Beyer, a single mother who loses her job at Lear – a seat manufacturer whose fortunes were directly tied to GM’s. She seems like one of the fortunate ones, retraining and finding a new job, tellingly paid by the county, working at a local jail. Her pay is significantly lower at $16 an hour, and the job is terrifying – but it’s better than waiting out the end of unemployment insurance like many of her peers.

Her sad story ends in a relationship with an inmate, an inglorious exit and dying in a drug overdose while awaiting the outcome of an investigation into her conduct.

While hers is the saddest narrative, no one comes out of the closure better off. Some commute hundreds of miles to GM jobs in other states. Others have kids who work multiple jobs just to meet their parents’ mortgage repayments. The fact is that $28 an hour is near-impossible to replace – and the new, leaner and profitable GM is dependent on it not coming back. As part of its post-bankruptcy compact with the United Auto Workers, who feature heavily in Janesville, new workers were taken on at barely half that rate, while existing union employees took a decade-long pay freeze which is just coming to an end.

Janesville is in part about the true cost of the cheaper goods which have lifted billions out of poverty in some parts of the world, while shunting millions into it in others. It doesn’t pass judgement, but it doesn’t blink either.

On June 4 this year it will be a decade since the closure of the Janesville GM plant was announced. The site is just now being cleared; what will replace it remains stubbornly unclear. The city has, by some statistics, recovered – its unemployment rate sits at 2.9%, lower than both the national and state average. And yet the new jobs are lower paid, less reliable and thus unlikely to support the kind of middle class lifestyle GM did. (In this way, it remains a microcosm of what has happened to America, and to work). For Goldstein, the trauma of the plant closure and its lingering after-effects will take many more years to work through.

“I think that there’s an understandable eagerness for people to know ‘well, is the community recovering or not?’ Through getting to know the people in Janesville, one of the things I learned is the answer to that is very slow to come.”


Amy Goldstein appears at the Auckland Writers Festival on Friday, May 18 at 4pm, at the ASB Theatre Aotea Centre. Her book Janesville: An American Story (Simon & Schuster, $53) is available from Unity Books.

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