Do Crime and Meth addiction have to rise in Geelong?

Economically, the end of aluminium smelting and car-making in Geelong makes sense.
Both are low-wage, dead-end industries propped up by government subsidies. They subtract from our net welfare, as a nation. That’s the meta view. The view from space.

You don’t need to be a social scientist to know that when industries close down, disadvantage gets concentrated. I wrote about this recently in the context of another Australian city, in this post: Detroitelaide.

Economists cover this issue in the term “transition costs”, but that doesn’t really tease out how painful they are

Bruce Springsteen’s whole career is built on reflecting the suffering of the US rustbelt, where manufacturing’s long decline has hurt generation after generation.

From his 1983 song My Hometown:

“Now main street is whitewashed windows and vacant stores
Seems like there aint nobody wants to come down here no more
They’re closing down the textile mill across the railroad tracks
Foreman says these jobs are going boys and they aint coming back to
Your hometown, your hometown, your hometown, your hometown”

to his 2012 song “Death to My Hometown

“Now, no shells ripped the evening sky
No cities burning down
No army stormed the shores for which we’d die
No dictators were crowned.
I awoke on a quiet night, I never heard a sound
The marauders raided in the dark
And brought death to my hometown
They brought death to my hometown
They destroyed our families, factories
And they took our homes
They left our bodies on the plains
The vultures picked our bones”

Bruce’s songs resonate because these stories are real.

I have Springsteen on the brain but you don’t need to look as far as New Jersey to find pockets of suffering due to declining employment.

Victoria’s Latrobe Valley suffered a huge decline in employment in the 1990s when the State Electricity Commission was privatised. Towns out there are still setting records for socio-economic disadvantage:

So the citizens of Geelong must be worried. To lose Ford in 2017 was going to be hard enough. Will the 800 jobs at Alcoa prove critical? Luckily, Geelong is a much bigger city than any of the towns in the Latrobe Valley.

It has a university, a football team, an airport and a burgeoning market for tourism. The Government is likely to tip in money. There is a Geelong Investment and Innovation fund worth $25 million. Labor is agitating for that to increase to $100 million.

But even with that money Geelong will need to work very very hard or else its major export might end up being suffering. And singer-songwriters playing poignant minor-key rock anthems about it.

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Thomas the Think Engine is the blog of a trained economist. It comes to you from Melbourne Australia.

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