Culture wars nearly derail factory jobs
Even in a good economy, most governors would welcome plans by a Fortune 100 corporation to build a new factory in their state—and create more than 500 manufacturing jobs. Arizona Gov. Doug Ducey, however, was not so sure.
On July 1, shoe manufacturer Nike said it would invest $184.5 million to open a factory in Goodyear, AZ, a suburb of Phoenix.
To land the factory, Goodyear agreed to waive $1 million in fees, and reimburse Nike $4,000 for each job it created. The Arizona Commerce Authority would also chip in a $1 million grant. Nike, in turn, pledged to create at least 505 full-time jobs with an average salary of $48,514 per year. Nike also agreed to pay at least 65 percent of employee healthcare premiums.
Goodyear estimates the factory will generate $7.7 million in direct revenue for the city, and it values the plant’s overall economic impact at $483 million during its first five years.
Then, all hell broke loose. On July 2, Nike nixed plans to sell a limited edition sneaker featuring an early American flag after NFL star-turned-activist Colin Kaepernick told the company that he and others considered the symbol offensive. Nike created the Air Max 1 USA in celebration of the July Fourth holiday, and it was slated to go on sale that week. The heel of the shoe featured a U.S. flag with 13 white stars in a circle, a design created during the American Revolution and known as the Betsy Ross flag. Evidently, some white supremacist groups have adopted that flag as their symbol, because it harkens back to a time when slavery was legal and America was less diverse. Who knew?
Predictably, pundits and politicians nationwide tripped over each other to defend the flag and proclaim their patriotism. Gov. Ducey was irate and ordered the Commerce Authority to withdraw its grant.
“Words cannot express my disappointment at this terrible decision,” he said. “This country, our system of government and free enterprise have allowed [Nike] to prosper and flourish. Instead of celebrating American history…Nike has apparently decided that Betsy Ross is unworthy, and has bowed to the current onslaught of political correctness and historical revisionism. It is a shameful retreat for the company. American businesses should be proud of our country’s history, not abandoning it. Arizona’s economy is doing just fine without Nike. We don’t need to suck up to companies that consciously denigrate our nation’s history.”
But, when New Mexico Gov. Michelle Lujan Grisham invited Nike to set up shop in her state instead, Gov. Ducey changed his tune. The plant was now “good news for Arizona,” Ducey said a week later. “Arizona is open for business, and we welcome Nike to our state.”
Like so many “news” items in these days of social media, it was all a tempest in a teapot. Nike will build its factory in Arizona—though it still won’t get the commerce grant. And, proving P.T. Barnum’s adage that there’s no such thing as bad publicity, Nike’s stock hit $89.48 a share on July 15, a five-year high.