Politics

Obama’s Misguided Victory Lap

President seeks to take credit for city's recovery, but Elkhart, Indiana, actually saved itself

One of Barack Obama’s first campaign stops was Elkhart, Indiana. Once elected, he returned — for his first official presidential trip, in fact.

The only problem is, Elkhart is not exactly the pinnacle of economic wonder.

On that Feb. 9, 2009, visit, he once again lamented the bad economy he had inherited from George W. Bush, and added: “I promised you back then that, if elected, I’d do everything I could to help this community recover, and that’s why I came back today, because I intend to keep my promise.”

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Seven years later, Obama returned on Wednesday to tout what he says is a miraculous comeback for an economy that had suffered the worst downfall since the Depression.

[lz_table title=”Manufacturing Production” source=”Bureau of Economic Analysis”]Elkhart has boomed while nation has treated water
|Year,Elkhart,All metros
2007,$6.5B,$1.7T
2008,$5.2B,$1.6T
2009,$3.3B,$1.5T
2010,$5.6B,$1.6T
2011,$5.7B,$1.6T
2012,$6.3B,$1.6T
2013,$6.8B,$1.6T
2014,$7.2B,$1.7T
[/lz_table]

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The only problem is, Elkhart is not exactly the pinnacle of economic wonder. The per capita income is $17,957, while the U.S. per capita is $28,051. Household income in Elkhart is $34,616, while nationally it’s $53,046. And median family income is roughly half that of the national median, $37,692 versus $64,585. On all three measures, Elkhart remains below the marks in 2010, while the nation as a whole has surpassed them.

According to U.S. census data, two-thirds of city residents make $50,000 or less. Nationally, that number is less than half, 46 percent. And some 39 percent work in the production, transportation and “material moving” field. Nationwide, that number is just 12 percent. But there’s good reason why.

Elkhart is the recreational vehicle capital of the United States. According to Bureau of Economic Analysis, manufacturing production accounted for 55.66 percent of the economy in the Elkhart metropolitan area in December 2007. Statistics from the Bureau of Labor Statistics show that manufacturing jobs in the region accounted for 46.02 percent of all non-farm jobs in April.

“It’s very cleverly chosen by Obama, because it’s enjoyed such a strong manufacturing recovery,” said Alan Tonelson, an economic analyst who writes a blog called RealityChek. “But it’s very atypical … of manufacturing cities.”

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[lz_table title=”April Manufacturing Output” source=”Federal Reserve Board”]Production has increased but remains below 2007 levels.
|Year,Change from Prior April
2008,-1.59%
2009,-17.5%
2010,6.64%
2011,3.41%
2012,3.9%
2013,.73%
2014,1.1%
2015,1.46%
2016,.54%
[/lz_table]

But critics say Obama had next to nothing to do with Elkhart’s revival. “President Obama has visited Indiana a few times, but this doesn’t mean he can claim the achievements made by Hoosiers. He’s made our comeback from the recession more difficult by raising the costs of family health care and saddling local job creators with crushing regulations,” said Indiana State Republican Committee Chairman Jeff Cardwell.

It’s true that Elkhart residents lifted themselves out of their economic woes. While Obama, on a return trip in August 2009, announced a $39.2 million federal grant for a company called Navistar that was supposed to build electric vehicles in Elkhart County, the plant opened but then quickly closed.

“That just simply was not as advantageous as it was touted to be,” Elkhart Mayor Tim Neese told LifeZette. “It was marketed as something that was supposed to be very unique … but it was not positive and helpful as we hoped it would be.”

Certainly, Elkhart’s story was a different when Obama came in February 2009. High gas prices and the recession had cut demand for RVs, and the motor vehicle industry was generallyon the ropes. The unemployment rate was on its way to 20 percent. Kyle Hannon, president of the Greater Elkhart Chamber of Commerce, said those were desperate times.

“It’s a very different atmosphere from the last time he came,” he said.

[lz_related_box id=”140285″]

In addition to making 80 percent of the nation’s RVs, the region 110 miles east of Chicago also produces pontoon boats, Hannon said. Both are “high-ticket, nonessential” items that people forego during tough economic times.

Despite the fact that Elkhart is “one of the most productive areas of the country,” Hannon said local folks see little connection between the revival and Obama’s policies.

“Not a lot of people in this community give the president any credit for the rebound, and I can see why,” he said. “It’\’s hard to connect the dots … If it takes an economist to explain it, I would say the argument is lost.”

Mark Landis, a senior supervisor for Siemens Healthineers USA, told The Indianapolis Star that the president’s visit would be good for the area. But he added, “I can’t say I believe he’s truly responsible for the recovery.”

Neese said federal stimulus funds paid for retraining programs that helped the area. But he said the program did not work as well as intended and, ultimately, had little to do with the recovery.

“We have to give a lot of credit to the private sector,” he said. “We have people who are willing to take calculated risks.”

 

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