May 8, 2017
Small towns and rural America are being destroyed by lack of jobs and drug addiction. Brian Alexander’s new book Glass House: The 1% Economy and the Shattering of the All-American Town breaks down what has happened to one Ohio town.
A hundred-plus year history of manufacturing glass utensils – baking dishes, beer mugs, wine carafes – has gone on in Lancaster, Ohio, just south of Columbus. The town’s glass company is still called Anchor Hocking by locals. Officially, it is now called Oneida, having merged with the silverware company.
In the 1940s, Forbes praised Lancaster, Ohio as an “all-American town.” Executives of Anchor lived in town. Rich and poor residents knew each other. It was a situation of home town paternalistic capitalism.
For decades now, the glass company has been bought and sold by a series of vulture capitalists, each making millions by loading the company down with more and more debt.
The author traces Anchor Hocking’s decline to the 1970s. In 1975, Mitt Romney and other “consultants” arrived in town to identify “efficiencies” to make the company more profitable. In 1982, corporate raider Carl Icahn bought up Anchor stock and forced the company to pay three million dollars to prevent a leveraged buyout.
After that, the company was “stripped and flipped” more than once. Corporate offices got moved out of town. Different concessions got forced on workers, with huge job losses.
In 2004, Anchor Hocking was sold to Cerberus Capital. Cerberus loaded more debt onto the company. (It should also be noted that Stephen Feinberg, the head of Cerberus, is a key financial advisor to Donald Trump today.)
The book ties the stealing of wealth to the growing drug epidemic in the community. It shows how drug sales and drug addiction flow from the sinking wages, plummeting standard of living and the declining schools.
In 2016, an Anchor worker averages only $14.55 an hour with no retirement plan. The median income in town is only $37,494, compared to $51,849 for the entire U.S.
The school district was gutted when it lost money through tax breaks given to the corporate raiders – to “save jobs.” The schools lost more than $3 million in funding over the course of two years, leading to layoffs.
The drug epidemic has raged to the point that by 2014, three-fifths of women who came to the local hospital for pre-natal care screened positive for cocaine, opiates, meth, or Xanax. In a humane way, the author explores the lives of both dealers and users of drugs in the town.
By showing a clear example of how capitalism has destroyed one town, the destruction of human lives all across small-town America is exposed.
The author puts the blame squarely on corporate greed, on Wall Street, where it belongs. He says Lancaster, Ohio’s destruction “came from a thirty-five-year program of exploitation and value destruction in the service of returns.”