Of all people, Virginia Gov. Glenn Youngkin surely understands that the United States and Virginia must operate in the global economy to prosper. Youngkin was a co-CEO of the Carlyle Group, one of America’s major money management firms. Such firms work with international investments all the time. So Youngkin’s reluctance to put a Ford Motor Company battery plant in poor, rural Pittsylvania County because it is a partnership between Ford and a Chinese company stinks of personal politics.
Republican politicians, especially those who hope to run for president, love to criticize Communist China. What they are loath to admit is that the success of American capitalism depends heavily on selling U.S. products into China’s massive markets. If you want to understand how critical doing business with China is, ask a grain farmer or someone who raises pigs for a living. Sales to China put food on the table of Americans in the agricultural sector.
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The long and short of it is we need good business relations with China, and the Chinese need good business relations with us. Otherwise, it is a race to the bottom.
At some level we have to do business with the Chinese.
Youngkin and members of his administration found a politically expedient bogeyman in the fact that Ford would work with CATL, a Chinese battery maker and technology company that is one of the best in the world. Youngkin and his people hinted at national security issues, perhaps even a communist “front,” but conveniently never really fleshed out those allegations.
Youngkin’s objections to a Ford Plant in Pittsylvania are particularly cruel. The county, as well as the nearby city of Danville, desperately need economic development. A battery plant that could produce a couple of thousand jobs would be nothing short of a god-send. Tobacco farms that once drove the area economy became moribund after smoking was finally recognized for the public health plague it always was.
The per-person average income for the U.S. is roughly $37,000 per year. The per-person income in Pittsylvania is roughly $27,000 per year. In Danville, where nearly one in four residents live in poverty, it is just $24,500.
The ugliest part of this story is that Youngkin might have needed an excuse for failing to land the plant. According to an auto production analyst interviewed by the Associated Press, the Pittsylvania battery plant would have been far from other Ford production facilities.
Having word of the plant leak, then not getting it, could have put a dent in the governor’s breast-beating and unctuously self-congratulatory praise for his development success.
In fairness, Youngkin has done well in bringing businesses to Virginia and expanding those that were already here.
The Ford plant saga, on the other hand, would have been an amazing plum that could have revived a depressed part of the state. Dashing those hopes based on some isolationist blather does not pass the smell test for the governor, a man with an eight-figure net worth and a Master’s degree from Harvard Business School. It might, however, make sense as a sour grapes strategy.
Or perhaps it is just what the governor claims—an opportunity to get a better project with a greater chance of success.
The facts are murky in Virginia, but a couple of things can be said of other states that have landed battery plants. The first is that those states offered incentives worth hundreds of millions of dollars to draw Ford instead of complaining about foreign partners. The second is that auto plant workers make $25 to $32 an hour (roughly $52,000 to $66,000 per year without overtime) and battery engineers make salaries of $90,000 a year or more, according to websites that gather such data.
Last week, Youngkin told reporters that he never submitted an incentive package for the Pittsylvania project. He said he worried the plant might conflict with the Inflation Reduction Act federal funding bill. This was an interesting twist because so many members of his party voted against the bill in Congress.
“I stopped the submission of a proposal into [the battery plant] from the very beginning,” Youngkin said, according to the Associated Press.
That’s nothing to brag about if you don’t come up with something better.