Down And Out In Elkhart, Again

Remember Elkhart, Indiana?  I've talked about the RV Capital of the World before, where many of the nation's recreational vehicles are manufactured.  President Obama went there to kick off his stimulus package and the people of Indiana rewarded him with "economic anxiety".

Mr. Obama, whose four trips here during 2008 and 2009 tracked the area’s decline, is expected to return for the first time in coming weeks, both to showcase its recovery and to warn against going back to Republican economic policies. Yet where is Mr. Neufeldt leaning in this presidential election year? He may keep a photograph of himself and Mr. Obama on a desk at the medical office he cleans nightly, but he is considering Donald J. Trump. 

“I like the way he just won’t take nothing off of nobody,” Mr. Neufeldt said, though days later he allowed: “He scares me sometimes.” 

Billboards proclaim, “Hiring: Welders. Up to $23/hour,” but for all the progress, many people here — like Americans elsewhere — harbor unshakable anxiety about stagnant wages, their economic future and the erosion of the middle class generally. 

Antigovernment resentments over past bank bailouts linger, stoked by candidates in both parties (though taxpayers got their money back, with dividends). And social issues such as abortion, gun rights, same-sex marriage, the Affordable Care Act and immigration loom larger than any other for some voters. 

The enduring wounds of the Great Recession, together with discouraging economic trends that long predated it, have fueled anger on the left but especially on the right, thanks to Mr. Trump, the maverick Republican front-runner. Mr. Obama is not getting the recognition historically accorded a president who presides over economic revival, but then again, neither are divided Republicans seen as offering a positive alternative.

Obama's policies got Elkhart's unemployment from over 20% in 2009 to under 5% in 2016.  The RV business came roaring back. But Elkhart Indiana picked Trump, along with enough of the country to put him in power, because "economic anxiety".  But last summer, things started to get dicey thanks to Trump's stupid tariffs.

Shipments of motor homes were down 18.7 percent in June compared with a year ago, and shipments of smaller trailers and campers were down 10.5 percent, according to the RV Industry Association. Motor home shipments were down 6.5 percent in July, but overall shipments were up 10 percent compared with the same month last year. Some companies have cut back to four-day workweeks. Amid strong job gains nationally, hints of rising wages and solid overall economic growth, Elkhart’s health is decidedly ambiguous. 

“I think it’s a yellow light,” said Richard Curtin, a University of Michigan economist who is a consultant to the R.V. industry. “Depending on how things evolve in six months, it could be a red light, getting to the end of the expansion.”

Well guess what Trump's tariffs have done to the place three years later?

Shipments of recreational vehicles to dealers have fallen about 20% so far this year, after a 4.1% drop last year, according to data from the RV Industry Association. Multiyear drops in shipments have preceded the last three recessions. “The RV industry is better at calling recessions than economists are,” said Michael Hicks, an economist at Ball State University, in Muncie, Ind. Mr. Hicks says softening consumer demand for RVs coupled with rising vehicle prices due to tariffs suggests the economy is either in a recession or soon headed for one.

Yep.  You wanted Trump, Elkhart, and boy howdy, did you get Trump.

RVs can range in price from about $12,000 for a folding camping trailer to $212,000 for a high-end motor home, according to average retail prices collected by the RV Industry Association. The prices have been sensitive to the U.S. tariffs imposed on some Chinese goods. The industry estimates that as many as 523 items could be hit by the tariffs, everything from the toilet-seat covers that go into RV bathrooms and cow hides for leather furniture to the aluminum or steel used throughout the vehicles. 

Divya Brown, the president of Houston.-based TAXA Outdoors, a small RV manufacturer, said her company bought most of its parts from Elkhart. Her suppliers are raising their prices to account for the hit they are taking from imported goods such as aluminum and steel. Ms. Brown said the company saw a 22% jump in the cost of steel and a 9% jump in the cost of aluminum.

It was bad for Elkhart last year.  This yeah it's a bloodbath.  The yellow light is now flashing red and the signal poles are on fire.  In the last seven days we've seen an inverted yield curve and now Elkhart's economy is starting to crumble.

Do you think Donald Trump is going to get us out of this coming shitstorm?