Business: MEADVILLE V. THE U.S.

Up & down U.S. industry this week a new economic paradox was in the making. Government economists talked about the “priorities unemployment problem.” But for a lot of people who would soon be out of jobs, out of victuals, out at the seat of the pants, it might just as well be called plain depression.

At this month’s beginning, only 2% of non-defense manufacturers responding to a U.S. Chamber of Commerce survey reported that they had felt the pinch of priorities. But at last week’s end new answers raised the average to 10-15%. Nine out of ten others expected drastic curtailment within the next six months. This meant non-defense plants darkened in one part of a town while defense industries worked round the clock in another, whole cities knocked out while other cities boomed, depression and prosperity side-by-side.

Started this week by OPM’s labor division was a survey of five cities where the effect of priorities was closest at hand and likely to hurt the most: Meadville, Pa. (zippers); Mansfield, Ohio (refrigerators and electrical appliances) ; Evansville, Ind. (refrigerators and automotive appliances) ; Quincy, Ill. (stove foundries); Newton, Iowa (washing machines). After the survey, OPM hoped to give these areas new defense work*— using the power it obtained last month to write compulsory subcontracting, plus special treatment for blighted communities, into Army & Navy contracts. Question was whether enough could be done, or whether it could be done in time.

The Case of Meadville. To most of Meadville’s 18,919 people the priorities cloud last week looked no bigger than a man’s hand. They knew that Talon, Inc. (zipper manufacturers) had been unable to buy any metal since Aug. 1, had laid off 800 of its 5,219 Meadville workers, had only enough inventories to keep going until next month. But Meadville has led a charmed life. Thanks to Talon’s spectacular growth and a new American Viscose Corp. rayon plant, it scarcely felt the de pression of the ‘305. None of its three banks failed; its population rose; newspapers as far away as Manhattan publicized it as a “depression-proof city” whose “streets were paved with gold.”

Hence Meadville was slow to believe that depression could strike while the whole nation boomed in ’41. The layoff of Talon’s first 800 was hardly noticed; they were boys and girls fresh out of high school, mostly from neighboring towns and farms. Some of them found jobs at the Viscose plant across French Creek, some quietly went back home. The State Employment Service was busier with the seasonal layoff of cooks and waitresses in nearby resort hotels than with Meadville’s first priorities casualties. To many a citizen, the “priorities problem” meant the serious difficulty up at Allegheny College (725 students), which could not get enough locks for the doors of its new girls’ dormitory.

Meadville was still boom, not ghost town. Farmers backed their trucks into the market square, did a brisk business in tomatoes, pale green roasting ears, cucumbers, cantaloupes, bright yellow squash. On Saturday there was no parking space to be found in front of the clothing stores and banks on Chestnut Street. Young factory workers jitterbugged until 2 a.m. in juke-box honky-tonks. Lights burned all night in Talon’s plants; change of shifts at 2:30 p.m., 11 p.m. and 6 a.m. involved a major traffic problem.

But unless Washington grants a reprieve, Meadville’s boom is doomed. Talon, which furnishes 5,219 of the city’s 9,000 industrial jobs, means as much to Meadville as auto plants to Detroit. Talon’s payroll for the first six months this year was $4,008,085—at the rate of about $1,500 a year for every one of Meadville’s families. Its union contract (A.F. of L.) provides a 50¢an-hour minimum for beginners; its women employes averaged $29.40 a week last year. Many a western Pennsylvania schoolteacher has become a Talon factory hand because it pays better. Talon employes have always been good for a bank loan; about two-thirds of them have mortgages on homes or automobiles.

On a hill at the eastern edge of town stand 202 neat white frame houses, with red, green or blue shutters, which the Chamber of Commerce got built in 1937. The town put up $167,000, borrowed $800,000 through the Federal Housing Administration. So far the project has paid its way. In four years $81,000 has been paid on the mortgage out of operating profit—$12,000 more than the amortization plan called for. But 93 of the tenants work for Talon.

If Talon does not get its metal, Meadville will get—and get good—what it escaped in 1932. Said white-haired Chamber of Commerce Secretary M. Ward Williams last week: “Meadville’s never thought it was bigger than Uncle Sam, and if he tells us we’ve got to take it we will. But we’ll think it’s unfair as hell.”

The Business. Talon Inc. began with the harebrained idea of Inventor Whitcomb L. Judson, who had trouble lacing his shoes and decided that there must be an easier way. It grew up under Colonel Lewis Walker, who wore Judson’s invention on his high-topped shoes and gave up law at the age of 60 to devote his full time and fortune to making Judson’s “clasp locker and unlocker” a success.

Formed in 1894, Walker’s company had plenty of trouble at the start. The first machines built to mass-produce its fastener wouldn’t work. When it got better machines, it found that the fasteners didn’t work very well either. Not until 1914 did the company turn out a really successful product. In 1920 it still had only 42 employes. But in 1923 Goodrich gave it a big contract to make zippers for galoshes, and Colonel Walker’s company jumped into the big money. It has now outgrown and abandoned its first three plants, has three new ones in Meadville and one in nearby Erie.

Argument for Priorities. Last month William C. Arthur, Talon’s president since 1939, went to Washington to present the zipper industry’s plea for survival to OPM-OPACS. Because slide fasteners have tiny parts with precision fittings, the industry had to use an easily workable copper base. Talon made its fasteners of either nickel silver (65% copper, 18% nickel, 17% zinc) or gilding metal (85% copper, 15% zinc). But to operate at the last twelve months’ rate (440,000,000 fasteners), the industry needed just 6,300 tons of copper a year (.6% of U.S. production), 1,600 tons of zinc (.2% of production), 700 tons of nickel (1% of U.S. consumption).

For every dollar’s worth of copper it got, the industry would pay out $10.80 in payrolls, add $20.37 of value. Moreover, its fasteners went to 100 other industries (clothing, footwear, luggage, etc.), to 20,000manufacturers with 250,000 employes.

Some of these manufacturers have got rid of their button-sewing machines, would have to retool if slide fasteners were cut off. Some of them make products (like trick keycases, children’s snowsuits, etc.) to which slide fasteners were a sine qua non. To replace all fasteners would, Talon estimates, take 1,300,000,000 buttons a year—and on Arthur’s desk were orders from companies he had never heard of before, which wanted fasteners because they were already having trouble getting enough buttons.

Talon’s machines, which stamp zipper teeth out of metal tape and fasten them in a row on fabric, would be useless for anything else. Its workers (like those of other industries) would have to be retrained before they could work on defense orders. But its efficient tool shop (which has developed and made the company’s own precision machinery) could go to town on orders for small items such as cartridge cases, instrument parts, bomb & shell fuses. Already the company had filled some defense orders for gauges (as well as for fasteners on Army uniforms and sleeping bags).

Washington was sympathetic. To make Meadville a ghost town for lack of 6,300 tons of copper seemed like junking an automobile for lack of a spark plug. That is sometimes necessary on the battlefield. Between armaments and slide fasteners, Washington could make only one choice. This week it was busy with inventory surveys, subcontracting plans, conservation drives (see p. 75), but it was not giving any priorities to Talon.

Cloudburst? Whatever is done for towns like Meadville, plants like Talon, must be done quickly, and nobody expected it to be done in time to save all from hardship. At Batavia, N.Y., Doehler Die Casting Co. expected to lay off 200 of its 700 employes soon; Massey-Harris Co. (farm implements) would have to lay off 500 of its 900 within two months unless it got more pig iron; E. N. Rowell Co. (paper boxes; 350 workers) would have to shut down altogether unless it got more paperboard. In Muskegon, Mich., a big Norge Refrigerator plant with 3,400 employes would have to drop 350 within two months unless it got materials. Aluminum Goods Manufacturing Co. at Manitowoc, Wis. had already laid off a fourth of its 2,000 men. Dayton, Ohio faced unemployment of 5,000 if General Motors’ Frigidaire plant closed.

Even from the Washington economists who called it “priorities unemployment” came an estimate much uglier than their phrase. They believed that some 2,000.000 people would lose their jobs this winter because of shortages. The layoffs started spottily, like a summer shower, two months ago. Last week they were a grey drizzle. The cloudburst, if not headed off, is scheduled for Christmas time.

*Last week Newton’s $9,200,000 Maytag Co. got a $1,500,000 subcontract from Glenn Martin for bomber parts.