I knew a number of things about J. Irwin Miller, the former Cummins Engine CEO who financed Columbus, Indiana’s world-renowned collection of modernist architectural masterpieces. But when I read Nancy’s Kriplen’s recent short biography of him, I learned a lot I’d never suspected. Clearly one of the most distinguished Hoosiers of all time, among other things, Esquire magazine put him on its cover in 1967 saying that he should be the next President of the United States. That was a pipe dream, of course. Even had Nixon not been the Republican nominee, Nelson Rockefeller would have been the first choice of the traditional WASP liberal wing of the Republican Party. But it shows the regard in which he was held and his national stature. And it’s hard not to think he would have been a far better President than either Nixon or Rockefeller.
Kriplen’s book helps flesh out the Miller Model of civic leadership. I may share some additional material from it in a future post. But for now, I have a piece in the Atlantic examining Miller and Columbus as the small Rust Belt manufacturing city that never rusted. Here’s an excerpt:
A Rockefeller Republican, Miller was also a social progressive with national impact. He served on the boards of MoMA, the Ford Foundation, and Yale. A lifelong member of the Disciples of Christ, he was a key ally of Lyndon B. Johnson in getting the Civil Rights Act passed while serving as president of the National Council of Churches. Closer to home, he used his clout to get anti-discrimination ordinances passed in Columbus. Miller was globally minded but also deeply rooted in his community, a combination that steered the local conservative culture in a more moderate direction.
That moderation also helped Cummins and Columbus avoid the labor strife of other Midwest cities. When national unions attempted to organize Cummins, the employees instead elected to form their own, independent Diesel Workers Union, over the objections of the United Automobile Workers. The relationship between the Diesel Workers Union and firm was much warmer than usual, with Miller given honorary union membership. As he put it, “Unions are management’s mirror. They tell you things your own people won’t admit.”
The results speak for themselves. Cummins has remained a successful global enterprise. And Columbus has prospered, never experiencing a major period of decline. Today it’s still growing in population and adding jobs faster than the nation as a whole. It’s more educated than the country at large and boasts a GDP per capita higher than Portland, Minneapolis, and Houston.
Click through to read the whole thing.
Read Nancy Kriplen’s J. Irwin Miller: The Shaping of an American Town
It’s interesting to see how cities thrive or suffer depending on the way their local companies treat them–as partners or nuisances. I was reminded of Racine, Wisconsin, where family-owned S.C. Johnson has done a lot to keep the town livable, in part because they don’t face shareholder pressure to relocate or game government incentives for tax benefits.
A good counterexample might be Lancaster, Ohio. The book Glass House (by Brian Alexander) shows how that town’s fortunes decayed as their big local employer, the glassware producer Anchor Hocking, suffered from corporate raiding and private equity takeovers starting in the early ’80s. It’s a little unusual since the fragility of glassware means glass production s a harder manufacturing industry to successfully outsource, but that just goes to show how much of the decline of American industry is due to a focus on returning value to stockholders above all other goals, independent of globalization.
“Returning value to stockholders” is code for stripping out real estate, cash, and pension assets, then loading a corporate shell with debt it can’t repay, all to pay out excess returns to private equity while driving the operation into bankruptcy and further acquisition/merger cycles.
Sure, the last public shareholders get a little bump above (depressed) market price for their stock, but nothing like what the raiders make.
Alexander documents this process as it happened at Anchor Hocking very well, and I read the book at Aaron’s recommendation several years ago.
(Nearly 50 years ago a cousin worked for a time at the factory described in the book, and his family still lives in the vicinity.)
I second Benjamin Recchie book recommendation Glass Houses. Although the author does short shift changing markets and globalization. You could argue Germany’s system, has retarded (but not stopped) the Ruhr turning into a rust belt. The German system is more paternalistic and heavy handed but something of a cousin to the approach of the Rockefeller Republicans.
Upfront disclaimer: I have both lived and worked in Columbus, as have friends and family members.
Part of the Columbus story was aggressive courting of foreign direct investment starting in the late 70s. This led to numerous new manufacturing plants in the 80s and 90s, mostly owned by Japanese multinationals.
Of course, the architectural reputation of the city is international and probably helped reinforce the economic development recruiting activities. How many US cities of 35-40,000 (population at the time) have that kind of international reputation?
Also helping was the history of Columbus with first tier automotive and truck suppliers (Cummins and Arvin), and the establishment of “transplant” auto assembly factories nearby in Ohio, Kentucky, Michigan, and Indiana.
Toyota Industrial (lift trucks) and NTN Driveshaft are the two big “foreign” manufacturers that continue to grow and thrive in Columbus.
—
An aside re the Miller family: J Irwin’s son William presided over the rapid expansion of real estate lending by the family bank in the early 2000s. The bank failed during the recession, and I suspect that failure is part of the reason the Miller family is no longer prominent in Columbus.
Is Columbus, IN really the “Rust Belt”? The Rust Belt is centered on Pittsburgh, Akron, Cleveland, Toledo, Detroit, Gary, IN, ‘old’ Chicago, Milwaukee. Columbus is at some distance from that Rust Belt core. The dynamics of comprehensively industrialized regional economies and the attendant political and class structures (labor unions expressing their power through democratic party politics) weakened the further you move from the core of the Rust Belt. Columbus is far enough away from the Rust Belt to have modulated it’s engagement with it, engaging in some ways and not in others. Geography matters.
I would strongly encourage we consider nearby peer communities in Central Indiana for confirmation on whether the Rust Belt extends this far South. Certainly Anderson (+/- 80 miles from Columbus) and Muncie (+/- 95 miles from Columbus) exhibit the hallmarks of Rust Belt communities. In fact, one of the pivotal points in the labor movement was when martial law was declared during the sit down strike in Anderson in 1936-37.
Most regional cultural models make important distinctions between northern and southern Indiana. Their histories are certainly distinct from each other. Mere distance does not explain regional differences. If concentrated wealth and poverty can exist within sight of each other in NYC, Chicago, and San Francisco, then significantly different societies can exist within 80 miles of each other.
https://www.chronicle.com/article/The-11-Rival-Regional-Cultures/132391
wordwizard.com/phpbb3/viewtopic.php?t=24824
Aaron, this piece is timely and very well done. I wonder if any other Midwestern cities have replicated the Columbus success story in some form? None that I know of but I have been involved in planning projects in which the creation of public / private economic development partnerships has been mentioned with Columbus serving as a model.
Certainly, the Lilly Endowment has had a huge impact in Indianapolis, especially after — if my memory is correct — some changes in tax law that essentially required it to start giving out a lot more money. (A lot of Indianapolis’ initial investment into amateur sports was financed with Lilly Endowment money.) If you have a civic foundation or leadership dedicated to your community, then this model is great. But if you don’t, or it fades (as others have mentioned about Glass House), then you’re in serious trouble. And with large companies thinking globally, rather than focusing on their hometowns, and with the pressure to return proceeds to shareholders, is this really a model?
What really has lasting impact — the whims of billionaires and/or business leaders, or a tax system that doesn’t offload the burden (percentage-wise) off of the richest people and corporations? Not to get all Bernie Sanders here, but it feels like right now we have the worst of both worlds — a leadership class that’s not community focused, AND a tax (and spend) system that isn’t responsive to community needs.
Aaron has commented on the fact that “business leaders” now no longer are the merchants and manufacturers and other business owners in a city, but instead its transactionally-oriented FIRE professionals.
To the extent that the Lilly Endowment is the largest single shareholder in Eli Lilly & Co., they perform the old-time function of the Lilly family in Indianapolis.
And yes, I believe it was one of the tax reform acts in the Reagan era that forced charitable endowments to pay out more of their assets. However, that has not stopped the Endowment from remaining hugely invested in Lilly stock…which has once again made them the second-largest philanthropic foundation (after Gates)…and it has increased their investment in Indiana communities.
Carl, Grand Rapids? It was long manufacturing dependent but I’m not sure if that’s still true. They get a lot of press for their quality of life initiatives, and there seems to still be a leadership class.
I don’t know if they exactly have replicated Columbus, IN success story, but Minneapolis springs to mind as a Midwestern city that successfully transformed its metro economy from a manufacturing oriented economy to one focused on knowledge work. Cities on the East Coast like Boston and NYC did the same, although they had a big headstart due to the presence of lots of banks and lots of universities.
I think that any city not already established as a hub of some particular knowledge work industry is going well to have an uphill climb, no matter how well governed. The logic of moving to a city with lots of employers and employees in your field is just too strong to overcome, and puts Northern cities at a distinct disadvantage even if they arguably offer a better quality of life than Coastal or southern knowledge work hubs.
I suspect that it also helps that Columbus is within commuting distance of Indianapolis. I suspect it’s position in the global economy would be much harder to maintain if it were more remote.
WAS Minneapolis a manufacturing oriented economy? My impression is that agricultural logistics and processing alone with other services for the northern plains have always driven Minneapolis, not steel mills or assembly plants.
Yes, flour was their product. In the late 1800s the city counted for almost all the world’s flour supply. As the mills decentralized (moved out) in the mid 1900s the management stayed local.
Food markets are different from markets in steel, cars, or machinery.