At the Progressive Governance Summit 2024, we debated and strategised on how to make an impactful contribution to shaping a comprehensive concept of progressive security. In this session, the panellists focused on industrial policy as a means of grappling the challenges in the industrial heartlands within the context of recent geoeconomic shifts.

At the Progressive Governance Summit organised by Das Progressive Zentrum on Friday 21 June, several of our project fellows participated in a panel discussion to debate strategies that empower the industrial heartland regions by creating positive narratives about their future. This roundtable discussion was organised as part of the Transatlantic Dialogue of the Industrial Heartlands project.

Four weeks prior to the US elections and together with the fellows of our Industrial Heartlands project, we toured crucial electoral battlegrounds in Pennsylvania, Ohio and Michigan. This synopsis highlights remarkable efforts to revitalise these once thriving centres of industrial manufacturing – and the remaining challenges that we saw.

Author: Kenneth S. Thompson MD, Pittsburgh

Several years ago I got a call from a friend. She was working in a town outside of Pittsburgh, where she was hoping to spark a renewal of its main street. Knowing I was a psychiatrist she called with a specific question: “I know you treat people with depression, but what do you do when the whole town is depressed?” I have been thinking about this ever since. Just a couple of days ago I got another call about another town outside Pittsburgh in the opposite direction. He asked me the same question and added an observation: “The only thing young people want to do here is leave.”

Election Day 2024 is just ahead and it appears much will depend on the actions of Pennsylvanians – especially those residing in our rural and de-industrialized regions. Arlie Hochschild, an acclaimed sociologist, has just published a book about a similar place located in the mountains of eastern Kentucky. The book, titled “Stolen Pride”, follows up on her previous book “Strangers in Their Own Land”. Together they constitute an ongoing effort to understand the deep links between historical developments and the collective emotions underlying political life.

 What’s left is unspoken shame and articulated anger

“Strangers in Their Own Land” examines how people living among the chemical plants of Louisiana felt about and dealt with the ongoing degradation and pollution of the land around them. “Stolen Pride” examines how people in eastern Kentucky are dealing with the collapse of the coal industry and their sense that they and their community have become invisible. It is explicitly focused on the factors driving people from being Democrats to increasingly right-wing Republicanism.

Given the historical, social, and geographic similarities across Appalachia, it is not too great a stretch to consider what Professor Hochschild learned in the context of Pennsylvania. Below see a comparison of key facts about Kentucky Congressional District 5, the focus of “Stolen Pride”, and Pennsylvania Congressional District 14, which includes Fayette, Indiana, Greene and Washington County.

Figure 1: Kentucky Congressional District 5

Distribution	– 76.49% rural[1] – 23.51% urban
Population (2023)	738,681[2]
Median household income	$44,175[3]
Ethnicity	– 93.7% White – 2.6% Two or more races – 1.5% Hispanic – 1.4% Black – 0.4% Asian – 0.3% other

Figure 2: Pennsylvania Congressional District 14

Distribution	99.78% rural ??? 0.22% urban ???
Population (2023)	753,602[1]
Median household income	$63,720
Ethnicity	– 90.4% White – 3.7% Two or more races – 3.3% Black – 1.6% Hispanic – 0.6% Asian – 0.4% other

In addition to the shared population statistics and mountainous terrain is the collective experience of a history of economic decline and subsequent societal dislocation. Communities have deteriorated, taking valued social roles, status, and pride with them in both Kentucky and Pennsylvania, as well as other parts of Appalachia and the “Rust Belt”. What’s left in these left behind places is often unspoken shame and articulated anger that expresses a sense of being mistreated and displaced with a desire for revenge and restoration-taking back what is felt to have been stolen. It is an economy of emotions exchanged between people in reaction to perceptions, not necessarily to facts. It might be called “emotional reality”.

Addressing the reality of painful emotions

It’s on this terrain that I became engaged with Professor Hochschild’s work. I am a psychiatrist who works in de-industrialized, left-behind communities in Pittsburgh and at the policy level in the Commonwealth and the nation. I have been particularly concerned with the epidemic of the „deaths of despair” (drug and alcohol related deaths and suicide) that have devastated the places I have worked and many others like them.

Addressing the reality of painful emotions is difficult. It’s far easier to run from them and to not discuss them – which helps explain the use of substances and alcohol. This is particularly true when shame is involved. It is much easier to display anger than it is to admit fear, loss and shame. No wonder these latter feelings are generally absent from the national conversation, going unacknowledged while they drive the nation’s emotional reality, a powerful current under our raging sea.

Where are the multitude of sacrifices memorialized?

Pennsylvanians have experienced their share of profound losses. Entire industries and the communities they created have become shadows of themselves. People could blame the powerful global forces that have been driving our economy. But our culture of individual responsibility doesn’t see it that way. So these losses are experienced as failures that are both personal and collective. Failure is experienced as deeply shameful. Because of difficulty talking about these feelings, our communities have not worked through mourning our myriad losses – we hardly acknowledge them.

Where are the monuments to those bygone days – other than the now useless rusting ruins? Where are the multitude of sacrifices memorialized? Who remembers that the Mon Valley made the steel that won World War II? Who cares how heroic coal miners were? Who are we? We don’t know and no one else does either. No wonder regional pride is at an ebb. No wonder young people just want to leave.

Somehow, the abuse has to stop

It’s not helpful that those in our society who are doing well are often scornful of the failures and the related emotional reactions. These attitudes both reinforce the shame and, in their lack of empathy, drive further disconnection. They further decrease the likelihood that painful feelings will be discussed and reinforce the idea that we can express anger instead. This locks us in a pattern of arrogant big city elites and ignorant residents of „Pennsyltucky” – unable to grasp each other, looking to our respective leaders to somehow to put the other in their place – „A basket of deplorables” and “Marxist Fascist Communists”. 

This election, built on the fulcrum of these emotions, is revealing what has all the earmarks of a mutually abusive toxic relationship. Each side is hoping to overwhelm the other. What if we don’t? What if we do? What will get us off this high stakes emotional roller coaster? We must find a way. The truth is that we are dependent on each other – we are each other. It’s a fantasy to imagine otherwise. Somehow the abuse has to stop. Somehow we all have to find a way to think again and not allow ourselves to repeat our usual pattern of emotional reactions.

Not giving up on reinvigorating the future, but giving the past its due

I am worried that, in their mutual desire to escape an intolerable sense of shame about the losses they have experienced, large numbers of people will identify with and vote for a candidate who articulates that rage – and nothing else. I understand the desire and the importance of sending a message of anger, but the desire for revenge has left many people extremely vulnerable to the siren call of a manifestly treasonous charlatan and bully who is invested in continuing the abusive relationship for his own gain. It is impossible to imagine that his call, if answered, won’t lead to much regret and even greater shame. Very strong emotions can lead to very poor choices that make things worse, not better.  

At the same time, I hope that Vice President Harris and Governor Walz continue to build on President Biden’s extensive efforts to engage left behind Americans in a new future. I hope they can address the losses, the shame and the anger that have long been neglected and initiate a process of societal mourning – remembering rural and industrial America and the people who made it. This is not to suggest that they give up on reinvigorating the future, but that they give the past its due. It and the people in it deserve to be recognized. They are never going away. We must reconcile with them. That’s what mourning is about-the future is built out of the past.  

As they mourn, the people in these areas need to be reassured that the societal collapse they experienced wasn’t their fault and that it was a terrible mistake to undervalue and ignore them – to shame them. They need to be shown that this time things will be different, that the success of the nation must and will include them as it does everyone else. It must be made clear that, without them, we are not wholly who we are, and we cannot become who we aspire to be. I hope the Democrats continue to throw themselves into this.

The people of America on both sides of this election have many positive attributes that, if

elicited, can overshadow the depression, shame, anger and arrogance described here. I hope this election becomes a path toward healing – one that moves beyond feelings of anger, revenge and arrogance in favor of the better angels of our nature: empathy, reason, compassion, love and hope, in a country where no one feels they have no future in their community.

Time is short. We have a lot of emotional work to do.

About Kenneth S. Thompson

Wahlkampf zwischen grünem Wandel und fossilen Rückschritten – Einblicke aus den Industrial Heartlands

Deutschlands Progressive könnten sich von Harris abgucken, wie man den Populisten Paroli bietet. Es braucht ein mehrheitsfähiges Politikangebot.

Progressive Industrial Policy: An Antidote for Troubled Times

Author: Miguel Costa Matos

These are hard times. People are struggling with the cost of living and, disillusioned with things as they are, they are turning in increasing numbers to the far right. Progressives need to go beyond redistribution. We need a ‘thick industrial policy’, with strategy, cooperation and conditionality to deliver a future-proof economy, resources to sustain the welfare state and green investment and, crucially, opportunity for our generation.

‘It’s the economy, stupid!’ James Carville’s timeless words were key to Bill Clinton’s 1992 presidential victory, after focusing his campaign on the deepening recession. This was probably the first of a new generation of progressive victories, ranging from Tony Blair in the UK to Wim Kok in the Netherlands and Gerhard Schröder in Germany. Their ‘Third Way’ project brought a different perspective on economic policy, arguing Social Democrats should accept the mechanics of the market and its political hegemony after the fall of the Berlin Wall. At most, we could be capitalists with a conscience, using social policy to redistribute the dividends of growth. But, often, it was our political family who implemented privatisations, labour market and financial market deregulation, as well as strict welfare reforms.

The success of this political movement was short-lived and had its shortcomings. Not only were governments underwhelming in their transformative impact, but crucially, they stopped winning. This happened for three key reasons. Our mission as Socialists is to improve the lot of working people. But, all too often, we took them for granted, leaving low-income voters to either stop voting, or turn to other political outfits. Thomas Picketty has described this poignantly with his concept of a ‘Brahmin Left’. Democracy was not, as Anthony Downs had suggested, an economic function where voter share was maximised as a ‘catch-all party’ teasing centre and centre-right voters. Between the original and the copy, voters preferred the real deal and voted for the right anyway. Last but not least, the 2008 economic crisis came along, putting into question the intellectual and moral authority of the market and its steadfast advocates, both on the left and the right. In W. B. Yeats’ famous image, ‘things fall apart, the centre cannot hold’. With no succeeding policy consensus, the economic crisis has been outlasted by a crisis of political ideas. As Antonio Gramsci noted, a ‘crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum a great variety of morbid symptoms appear.’ Among these morbid symptoms are the rise of the far-right across much of the Western world and the deepening of neoliberal governance with the socialisation of risk and privatisation of reward.

Presently, we are called upon to be midwives of Gramsci’s ‘new’. Beyond the political importance of winning the battle for ideas and pushing back the radicalisation of the right, we face pressing challenges in climate change, migration, ageing and the digital transition that require investment, on the one hand, and a rewiring of the economy, on the other. Redistribution and palliative measures are not enough. Rather, we need to usher in a new economy that is future-proof, sustainable and delivers for working people. A stronger economy is, of course, capable of achieving more resources for welfare and investment. More importantly, it can sustain better jobs that give our generation not only the freedom to move but the freedom to stay, as proposed by Enrico Letta, who is drafting the High-Level Report on the Future of the Single Market. 

‘What is to be done?’ we often hear, as if decades of ‘laissez-faire socialism’ made us forget how to intervene in the economy. Thankfully, there is hardly a need to reinvent the wheel. The policy instruments are much like those used in the present neoliberal paradigm. We, too, will use tax and financial incentives. We, too, will lower the cost of doing business through reform. Our policies will, however, come with a twist; rather than lowering taxes and wages across the board, we can direct incentives to firms that invest in R&D, decent wages and disadvantaged territories. Rather than reducing dismissal costs by embracing labour market flexibility, we can lower training costs and invest in skills. In short, we can deploy conditionality to ensure that there is socialisation not only of risk but also of rewards. 

Portugal has managed to multiply its annual economic growth tenfold, from an average of 0.2 per cent from 2000 to 2015, when the Socialists came to power, to an average of 2.1 per cent since. The country has outpaced other survivors of Eurocratic austerity not only by restoring confidence in the economy, but by resorting to this toolkit. In 2022, the government signed a pact with trade unions and employers’ confederations to increase wages by 20 per cent over the next four years. Chief among its policies was a 50 per cent tax credit on the costs of wage hikes above 5 per cent. This, however, did not come for free. Of course, the state won by subsiding permanent wage increases for a single year, but, crucially, this incentive only paid out if firms reduced wage disparity and had signed a collective bargaining agreement in the last three years. This agreement has led both to the highest rate of wage growth since the start of the millennium and a boom in collective bargaining.

This, of course, cannot be done without strategy. We are not indifferent to the kinds of industries we are supporting. By upgrading incumbent sectors and developing a comparative advantage in new products, we need to look to where we can compete through high value rather than low cost. This can be achieved both vertically, integrating industries upstream and downstream, and horizontally, in related industries. For instance, Portugal has today expanded from being a ‘simple’ car manufacturer to producing components for most car plants across Europe, hosting the R&D for many of these parts, developing the software that goes into our cars and, even, attracting related industries, such as the flourishing aviation sector.

This does not come without risks, chief among them is the danger we might pick losers rather than winners. The very process of picking is vulnerable to private interests, or at least the perception these might be at play. This can only be counteracted by a ‘thick industrial policy’. Thickness is needed at both ends. Projects ought to involve cooperation between firms within an economic cluster and also with the innovation ecosystem. Governments, too, need to mobilise experts to help choose which projects to support. By broadening the pool of people with stakes in the enterprise, we not only call upon a broader pool of resources to help the project succeed. We also filter out those that are not viable.

Over 30 years on, ‘it’s (still) the economy, stupid’. The economic troubles brought about by the Covid-19 pandemic and the war in Ukraine have mobilised an unprecedented level of corporate welfare. Progressives need to think out a strategy and build up policies that can foster sustainable and shared prosperity. Ultimately, this is about much more than growth. It is about offering the working class better living conditions and an alternative to democratic disillusion and far-right protest. It is about reclaiming a future for Social Democracy and our planet.

Miguel Costa Matos is a Member of Parliament in Portugal, the Vice-President of the Socialist Party Parliamentary Group and deputy spokesperson for budget and finance affairs.

© 01.02.2024 | Originally Published in The Progressive Post

Author: Sandra Rath

As part of Das Progressive Zentrum’s “Transatlantic Dialogue on the Industrial Heartlands” Project, a group of local decision makers from the US Midwest travelled through Belgium and Germany last November to strengthen transatlantic ties and exchange ideas on a common challenge: Fostering economic revival through climate neutral industries and fortifying liberal democracy in industrial heartland regions. During their visit to Brussels, Charleroi, Saarbrücken, Leipzig and Berlin, our delegation met with experts, civil society leaders and politicians on local and federal levels to learn how they approach issues ranging from trust in democracy and political institutions, transforming production towards climate neutrality, the role of science and innovation as well as financial instruments to fund local initiatives.

Meet the Delegation

The delegation was further accompanied by John Austin, Director of the Michigan Economic Center and Senior Fellow at Brookings Insitute and Wolfgang Mössinger, former German Consul General in Chicago as well as our project team with Florian Ranft, Axel Ruppert and Sandra Rath.

Key Takeaways

1. Local green transition projects must be rooted in the identity of the local population and workers, incorporate their needs and encourage their participation.
2. Local and municipal governments must be equipped with the necessary governance tools and funds to impliment bottom-up policies that foster local identification and ownership, thereby countering right-wing populist narratives.
3. To successfully communicate green transition measures, it is imperative to be sensitive towards “change fatigue” and past experiences of upheaval of the local population, especially in East Germany.
4. To rebuild trust in democratic institutions and decision-making, governments must communicate green transition policies transparently and create spaces for deliberation and participation.
5. Providing a local network to connect research and development (R&D) with businesses is crucial to fostering innovation and directly implementing green technology in the region.

In the final meeting of the day, the delegation learned from Saarland’s Minister of Finance, Jakob von Weizsäcker, about Saarland’s Transformation Fund, a fiscal instrument to allocate government funds to local green transition initiatives, underlining the all-of-government approach to the green transition in the Saarland. The meetings of the day emphasized the power of a united approach to green industrial policy that encompasses workers, company management and the political level.

(Fotos: Corinna Mehl)

In a last meeting of the day, our delegation met with Thomas Kralinksi, State Secretary in the Saxon Ministry of Economy, Labour and Transport and Sounding Board member of the Transatlantic Dialogue on the Industrial Heartlands Project. During the conversation, Kralinski spoke about the government’s strategy to attract chips production through the “Silicon Saxony” initiative, thus fosterting the creation of green jobs, and the “Future Sax” platform which aims to connect universities with small and medium sized enterprises around the state. Regarding the rise of right-wing populism in the state, Kralinksi reiterated the fear of change in East Germans rooted in the reunification experience and currently driven by the aftermath of the Covid pandemic, inflation, migration and the war in Ukraine.

(Fotos: Corinna Mehl)

In the afternoon, the delegation attended the official launch of the Transatlantic Dialogue on the Industrial Heartlands Project at Das Progressive Zentrum’s Innocracy Conference. They discussed the Project Fellows’ impulse papers and gave feedback and advice on what topics to focus on throughout the course of the fellowship. The day ended with an informal meeting with representatives of the Atlantikbrücke, rounding up a week of week of transatlantic peer learning on industrial heartland regions.

(Fotos: Fabian Melber)

A former mayor of Pittsburgh and a grandson of steelworkers makes the case for environmentally sustainable steel production.

Authors: Florian Ranft, Axel Ruppert, Sandra Rath

There is a growing convergence of interest and effort on both sides of the Atlantic to bridge geographic economic divides and reconnect residents of industrial heartland communities to economic opportunity. Where these communities continue to decline, residents feel disconnected and alienated from a rapidly changing global economy and polity, while polarizing, resentment-driven and populist political movements that undermine our democracies can grow from within. Where economic regeneration has been done successfully, it serves to return community pride and optimism about the future and reduces political discontent. 

In order to share transatlantic experience and promote effective strategies for investment in people living in industrial heartlands, the Conference on Transatlantic Work to Address “Geographies of Discontent” brings together leaders and economic change practitioners from across Europe, the UK and the US.

After a keynote address by Cathryn Clüver Ashbrook, Senior Advisor and Vice-President, Bertelsmann Foundation and Sounding Board Member of the Transatlantic Dialogue on the Industrial Heartlands Project, we will engage in discussions with:

• Peter Berkowitz, Director, European Commission Directorate-General for Regional and Urban Policy
• Dr. Raphael L’Hoest, German Deputy Director General, Structural and Regional Policy, Federal Ministry for Economic Affairs and Climate Action
• Missy Hughes, Secretary & CEO of the Wisconsin Economic Development Corporation
• Bill Peduto, Former Mayor of Pittsburgh, now heading Carnegie Mellon Institute
• Katie Rosenberg, Mayor of Wausau, Wisconsin.

Please note that there is a limited capacity for in-person attendance. We look forward to welcoming you at the convening and discussing the future of industrial heartlands with you.

This conference is organized within the context of a delegation trip of local decisionmakers from the United States to Germany and Europe. The trip’s goal is to engage in a transatlantic exchange on the challenges facing the industrial heartlands in Europe and the United States as well as best practices to tackle them. The delegation trip is organized within the Transatlantic Dialogue on the Industrial Heartlands Project.

On 17 November 2023, we held a workshop called “Democracy at the crossroads in the industrial heartlands – transatlantic perspectives for the future of the places that matter” as part of Das Progressive Zentrum’s Innocracy23 conference.

What are solutions for a better, greener and more democratic life in the “places that don’t matter”?

For a generation, people living in the traditional industrial heartlands all over the world have been buffeted by a technological and services revolution, the decline of manufacturing, and the rise of a borderless global digital economy. The result is deepening inequality, ongoing political support for right-wing populists and a hollowing out of the middle class. From the rise of Trumpism to the successes of the AfD, industrial heartlands lie at the crossroads to the future of our democracies. This is why we we’ve hosted an interactive workshop to discuss best practices, political strategies and policy solutions to foster democratic participation, trust and tangible future perspectives for those living in the places that matter. 

The workshop entailed an inspiring exchange with our 12 project fellows of the “Transatlantic Dialogue on the Industrial Heartlands” project as well as a delegation of seven decision-makers from the US Midwest. Join us for fresh, transatlantic takes on how to tackle the challenges of a just transformation while rebuilding trust in democracy. 

To combat this decline, Das Progressive Zentrum and its partner organizations from the United States have launched the three-year project “Transatlantic Dialogue on the Industrial Heartlands” with the goal of creating new opportunities in old industrial heartlands of both countries by forging a transatlantic dialogue, exchanging best practices, and developing political strategies  and policy solutions for a better, greener, and more democratic future in the “places that don’t matter.” As part of this project, 12 project fellows from the U.S. and Germany are working on the two thematic blocks “Perspectives for the Future, Respect and Participation” and “Climate, Work and Innovation” to demonstrate through their input how the living standards and opportunities for people in the industrial heartlands can be increased while working towards rebuilding trust in democracy in both countries.

As part of the workshop “Democracy at the crossroads in the industrial heartlands – transatlantic perspectives for the future of the places that matter”, we introduced the Industrial Heartlands project and the 12 project fellows presented their impulse papers as a starting point for their project work. Afterwards, participants exchanged ideas with you in four groups and discuss the topics of “Participation and Democracy”, the “Industrial Transformation”, “Bidenomics and the Green Deal – Local Implementation” and “Countering the Far Right”.