Michael D. Roberts was a reporter for The Plain Dealer in the 1960s and covered many of the events in that decade including the Vietnam War. He later edited Cleveland Magazine for 17 years.
Cleveland in the 1980s
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While the 1980s gave promise that Northeastern Ohio was reviving, there were historical and contemporary forces at work that would thwart any serious comeback. There was no reversal to the population exodus from the Cleveland. For the first time, the census showed a decline in Cuyahoga County. The biggest problem was a shrinking job market.
The Great Depression of the 1930s is generally regarded as a critical and devastating turning point in Cleveland’s history. By 1980, one could argue that no region in America was so permanently scarred by the Depression than the Cleveland area.
Now, another devastating economic force was descending upon the region. This time it was global in nature and it compounded the damage of the awful economic impact of the Depression. It was the globalization of industry and it was growing at a time when Cleveland was optimistically looking forward to a new decade
To understand the economic gyrations that the region faced in the 1980s, one has to reflect on the turn of the 20th century when Cleveland found itself on the cutting edge of what is known as the Second Industrial Revolution. An entrepreneurial spirit flourished here as rarely seen in America.
In the early 1900s a diverse economy was emerging in the city as inventors and investors found their places in steel, machine tools, electricity, paint, automobiles, shipping and manufacturing. Entrepreneurs were attracted to the city and were welcomed by fellow inventors and industrialists.
Seventy fledging automobile companies were located in Cleveland. Alexander G. Winton made the first commercial auto sales in the country here.
Technological spinoffs created new businesses at an astounding rate. For instance, the Brush Electric Company, founded in 1880, was directly responsible for the establishment of such blue chip companies as Union Carbide, Lincoln Electric, and Reliant Electric simply through the technological transfer of former employees.
Key to the success of these aspiring enterprises was the ability to attract financial capital through which they could develop and market their innovations. The need for capital, in turn, created financial institutions attuned to the spirit of enterprise that permeated the community.
At one time, prior to the Depression, the city hosted 38 banks and a stock market that carried more relative industrial stocks than its much larger counterpart in New York.
Cleveland inventors were among the top producers of patents in the country, resulting in the creation of many small businesses which thrived because of the local financial markets. It was the maturity of these companies that created the wealth that drove Cleveland.
The Depression destroyed many of the city’s financial institutions and with their demise went the availability of capital. The small, entrepreneurial business that had spun off the innovation that created great companies withered and died.
When the country recovered, the financial markets of the East Coast came to dominate. Even into the 1980s local business innovators complained in a common refrain that Cleveland banks were too conservative. The memory of the Depression lingered indelibly in bank ledgers.
Years later a senior partner at Baker Hostetler, one of the city’s prestigious law firms, would explain that the reason the firm originally opened offices in other cities was to keep their wealthy clients who fled the city in the wake of the Depression.
The loss of a vibrant financial market cost the city’s economy the self reliance that had attracted so much innovation and success in the past. The city’s business culture changed from spirited entrepreneurs to conservative bureaucrats who shunned the risk that created wealth and who merely managed the large companies that had survived the Depression.
The other factor that had a long- range effect upon the region was its reliance on manufacturing jobs with limited knowledge requirements, but decent pay. This work did not need to be supported by higher education
World War II and the Korean War helped revive the regional economy, but postwar global forces were already at work that would be as powerful in its negative impact as the Depression. In fact, it could be argued that the Depression rendered the region unable to cope with the global events a half century later.
The global economy began with the recovery of foreign nations from World War II and the emergence of cheap labor and a new wave of technology. It was most evident in the 1970s as foreign automobiles, the Japanese being most prevalent, began to challenge American manufacturers.
By 1980, with the vast federal highway system completed in the region and school busing an emotional city issue, the suburbs held more allure than urban life for those who could afford it. The population in Cleveland dropped 177,000 in the last decade to 573, 822. Worse yet, Cuyahoga County experienced its first decline since 1810 with a 12.9% decrease to 1,498,400.
The loss was not all in the city. Parma, once the largest suburb in the state, dropped below 100,000, losing 7.7% of its population in the last decade.
Even the most casual observer could notice a change in the population shift by simply reading the high school football scores in the newspaper. Schools that had been remote and on the edges of the county were developing better teams, and becoming more competitive with those closer to the city. Schools like Aurora, Avon, Kenston, and others were more and more prominent in the sports news.
Added to the local issues, globalization was making its impact on the way people lived. In retrospect, the post war era in the region had been consumed by issues wrought by parochial politics and the reverberation of civil rights. At first, business and political leadership seemed impervious to the impact of world industrialization on the region.
State and local governments in the region did not react to the new world view because they were neither positioned nor prepared to do so. In Cuyahoga County alone there were 56 different governmental entities, and in reaction to the economic ill fortune they began to offer inducements to businesses in the form of tax cuts.
These inducements were made to attract or maintain companies, but they affected the tax base of communities. These cuts would be a first and inadequate response to the shifting marketplace.
The 1980s brought a new realization that local government had to change to a more regional concept if the area was to make its way in the changing world. The realization that we were no longer competing with an adjoining state, but with vast overseas markets brought with it a need to alter traditional economic and political thought.
While regional or a county government had been proposed, discussed and even put on the ballot in the 1950s, it was not a compelling issue for the ordinary voter. The ethnic nature of politics and the growing emergence of minorities distracted from regional issues.
Yet, economic necessities were forcing certain aspects of regionalism to be implemented. In 1968, the City of Cleveland found itself unable to maintain its port and was forced to merge with the county. Financial and political exigencies created the Northeast Ohio Regional Sewer District in 1972. The city turned over some of its parks to a regional system when it could no longer afford upkeep. In 1974, the city merged its bus system into the Greater Cleveland Regional Transit Authority.
One regional opportunity that eluded Cleveland was the failure to annex suburbs that wanted to purchase city water. The government in Columbus, Ohio, grew its municipal boundaries by annexing in return for water and thrived.
The unwillingness and the unpreparedness of community leaders to work for a regional government both pre and post World War 2 created a growing economic separation from the rest of the world. It would be a problem that plagued Cleveland and Northeast Ohio into the modern era.
The Northeastern Ohio area could claim the development and manufacture of the automobile since its inception. Generally regarded as the second most important automotive center in the nation, the impact of the global economy began to have a negative impact as imported cars rose in popularity with the American public.
Most noticeable though was the impact of globalization on the steel industry. Following World War II, American companies produced two-thirds of the world’s steel. It was a euphoric time as the industry continued to rely on aging technology to bolster profit margins.
The region’s steel mills were important contributors to this boom, but early in the 1970s it was evident that foreign competitors using new technology and cheaper labor were able to undercut the price of the product.
As double-digit inflation lay waste to the American economy in the early 1980s, adding to the steel industry’s travail, companies merged and unemployment spread. In Ohio in 1975 there were 20 steel companies operating 47 mills. Ten years later only 14 companies operating 23 mills remained. Employment and production had fallen to nearly half of what it had been in the decade before.
Other companies began to be effected by foreign markets and new technology. The venerated Warner & Swasey, one of Cleveland’s oldest companies known for optics and machine tools, was sold in 1980 and slowly dismantled, falling victim to the increasing computerization of industry.
The dwindling steel production saw more job loss in the Great Lakes shipping industry, causing unemployment on boats, on the docks and in related industries.
Having been weaned on manufacturing and heavy industry, the region fell behind in preparation and education for the oncoming knowledge-based technologies. Because universities near Silicon Valley, Boston and Pittsburgh had been the springboard of new technologies, those areas flourished as the 1980s progressed. Cleveland lagged and lost ground.
But there were glimmers of enlightenment in the region. Kent State University began to do research with liquid crystals and Akron University was developing polymers which hopefully would replace a decimated rubber industry in that part of the region. The Cleveland Clinic was growing faster, on its way to becoming not only a preeminent hospital, but a place of medical discovery.
Cleveland State University, late in coming on line, was nevertheless growing and beginning to have an impact on the community. Case Institute of Technology and Western Reserve University, which had merged in 1967, was trying to create a new identity to meet the challenges of a new world. The truth was that the region had failed to devote the needed resources to higher education decades before and was now in a race to catch up with the rest of the world.
Thus, the global economy had a far-reaching effect on the daily lives in Northeast Ohio at almost every level. Things would never be the same.