> business in the U.S. had the opportunity for a > long time to take advantage of the low costs labor pools of the Southern > part of the country. > A homogenization of the country did not begin in earnest until the minimum > wage laws and other New Deal legislation took hold. > Why was this process so slow? What does this tell us about globalization? > Michael Perelman As you indicate, the South's primary attraction was lower production costs made possible by non-union cheap labor (also raw materials). The major deterrent to industrial migration was the cost of moving and acquiring needed facilities. Mississippi's 1936 Balance Agriculture with Industry (BAWI) program served as the southern model of public subsidization aimed at attracting industries to the region. This pioneering role in state-supervised, publicly subsidized economic development policy stemmed from the fact influential Mississippians were irked that the state ranked near the bottom in every measure of industrial development. New South boosters and business progressives throughout the region committed public funds to advertising, workforce training, and relocation brokers. Governments provided tax exemptions and issued development bonds. Business and political leaders may have been defenders of limited government and private enterprise, but they followed in the foot steps of a long history of capitalists preaching free markets all the while formulating policies that bringing the private and public sectors into closer relationship. Heightened interstate competition after developed after WW2 as the use of municipal industrial development bonds spread throughout the South. Search for the "edge" needed to win industries away from competing communities and states facilitated the use of tax exemptions and inspired formation of local organizations committed to providing manufacturers with the capital needed to build facilities and begin operations. Many local development corporations offered interest- free loans and loan guarantees to both rapidly expanding and distressed firms as well as to companies willing to locate to rural areas. Free land , publicly constructed facilities, infrastructual development, and low rents, power, and water were commonly used enticements. Such incentives may have contributed to southern industrial growth, but they also reinforced the region's attraction to competitive, low-wage manufacturers as these firms were the most in need of subsidies and concessions. Racism left black labor the cheapest in the region and a large army of underemployed blacks helped to discipline white workers. On the other hand, such employment practices sustained general economic under- development. The emergence of civil rights issues created problems for image-conscious development leaders who worried about the impression that disturbances would make on potential northern investors. They moved, usually reluctantly, towards recognizing the necessity of desegregation. Their hope was that slow, peaceful, orderly transition would produce signs of social & economic progress, dispel tradition notions of the area, and lead the South into the nation's mainstream. Ultimately, the South's development "trigger" was the military-industrial complex. The rise of the "gunbelt" (Ann Markusen's word for the Sunbelt) was the result of the Pentagon, Congress (consider all the southern conservativrs with lots of seniority chairing relevant congressional committees) and military contracting firms favoring non-union states. And southern states aggressively recruited new aerospace and electronics companies. Freedom to exploit the region's resources and to pollute its air and water has spoiled vast sums of pristine natural habitat. The ability to attract and retain more affluent workers and consumers has led to congested metropolitan areas. many poor rural areas have not been touched by the growth & development of recent decades. When emphasis shifted to attracting more sophisticated, high-wages operations, boosters were saddled with the problems of earlier generations - poor infrastructure, low-skilled labor forces, weak consumer demand. While resistance to labor organizing has managed to suppress wage-levels, it has also invited labor organizing (clearly not always successful). Thus, long-term southern labor relations problems remain unresolved. Such is the character of the capitalist mode of production. Michael
