Southwest Virginia Population decline 2021.
Fig. 1 Southwest Virginia loses another 8% of its population from 2010-2020.

Social Apartheid Bristol, Virginia-Tennessee 2022

by Lewis Loflin

Congratulations to our local politicians for spending 100s of millions in public money to create jobs! Southwest Virginia now has a population of 313,499, a loss of about 29,000 since 2010. Perhaps over 40,000 since 2000.

How could they spend millions on jobs and economic development and lose almost another 29,000 residents?

What is social apartheid? What does that have to do with Bristol, Virginia-Tennessee? Or Appalachia in general?

Some define this as "Social apartheid is de facto segregation on the basis of class or economic status, in which an underclass is forced to exist separated from the rest of the population."

This is covered up as race elsewhere, but here the population is 90% plus white. For that reason the working class in the Bristol region faces hostility from Democrats for race-class, and from Republicans' rabid pro-business anti-worker attitudes plus class warfare.

Millions flow in from government grants, etc. but the general public is barred from the input process, locked out of government meetings. They are bypassed when money is handed out, often from secret backroom deals.

The Bristol Herald-Courier August 21, 2021, notes the following report from our Chamber of Commerce, paid for by a $81,000 Government grant:

BRISTOL, VA. -- The Bristol Chamber of Commerce on Wednesday released a report detailing the Twin Cities' biggest challenges and opportunities for economic growth... The report cited an aging population, the "brain drain" effect of talented workers "moving away to seek better employment opportunities" and low wages as some of the area's top barriers to economic development...

Darn they dare mention low wages, something they have fought to maintain for years!

No kidding, the very things I documented here for over 20 years without a government grant to waste.

Note that Bristol is cut in two by the Virginia-Tennessee state line. Bristol Tennessee reside in Sullivan County, Tennessee, Bristol, Virginia, resides in Washington County Virginia.

Often referred to as Tri-Cities centered around Kingsport, Johnson City, and Bristol. It often includes Scott and Washington Counties Virginia.

Fig. 3 Poverty rates Southwest Virginia.

Relocating Companies is not Job Creation

VCEDA is the Virginia Coalfield Economic Development Authority

Here is another all too often example of the government taking an active part in destroying American jobs and working to lower wages. Transferring jobs to another state is not job creation.

I will be clear VCEDA deserves praise for its efforts. And these companies are doing what is in their best interest.

Everything here is legal, but we must call into question a broken economic system that leaves poor communities scrambling to buy jobs in a labor-hostile, low-wage job culture.

Over thirty years of the same failed policies, now facing the third recession in thirty years, something must change.

Federal policies undermine their reasonable faith efforts. Spending millions in incentives and making business another branch of the government can't continue.

Note with following I have changed company names and other identifying information. This serves as an example, but is true. That is not true of eHealth below.

AJ Hubcaps, formally known as Pegasus Metals, fired its 42 workers in Pennsylvania May 20, 2022. They opened in Southwest Virginia June 14, 2022. Getting over $5 million new building, etc.

AJ Hubcaps according to VCEDA, "the company has grown to 41 full-time employees with an average annual full-time wage of $36,000." I don't believe that and want proof of the claim.

In the past their claims have proven overly optimistic, throwing in weasel words such as "projected", etc. Even if true it is still on the bottom end in the state even after paying $125,000 in corporate welfare (incentives) per job. That is just on the building alone.

Salary.com says,

"How much does a Production Worker make in Virginia? The average Production Worker salary in Virginia is $39,906 as of October 27, 2022, but the range typically falls between $35,784 and $45,168. Salary ranges can vary widely depending on the city and many other important factors, including education, certifications, additional skills, the number of years you have spent in your profession."

According to Zach Jackson, Virginia Tech Office of Economic Development, "The average full time worker in SWVA is paid $14,164/yr. less that the average full time worker in Virginia and $9,162/yr. less than the average full time worker in the United States." I'll go with $26,000 "annual full-time wage" until I get verifiable proof otherwise.

Because many of these giveaways last 36 months, they paid their salaries of the company workers, at public expense, for three years. These figures are based on a similar deal with another company got part of a new building for $100 per month for three years.

VCEDA awarded nearly 100 "small businesses" an average of $10,000 each for no good reason. When I asked if VCEDA going to take credit for "job creation" they never answered the question. These names have not been changed.

Important job creators funded by VCEDA are The Happy Goat; Affordable Quality Lawn Care LLC; Ethic Hair Care; Far Fetched Grooming LLC; Sweet Links LLC; Lavish Hair Designs; Elite Motion Dance Company Inc.; Whistle Pig Country Store LLC; Huff Daddy BBQ LLC; 404 Cafe and Creamery LLC; The Coffee Station LLC; Engine 343 Brick Oven Pizza LLC; Big Stone Gap Miniature Golf LLC; Snuckle Butter LLC; Breads by Marla LLC; Weeping Willow Cafe Inc.; American Muscle Detailing LLC; Black Bear BBQ LLC; Craft Connection LLC; and it gets worse and worse.

And that was just part of page 4 of the list.

Some consulting firm named CHMURA claims VCEDA started in 1988 and as of Dec. 2018 "initiated 291 business attraction and expansion projects...VCEDA efforts helped attract a total of 23,052 jobs." I'll get to what "helped" means below.

This is nonsense. There is no evidence many of those jobs ever materialized.

A list of those companies they sent me circa 2012 most of the firms failed, few if any ever hired the workers promised. We find this out after the closing make it into the press. They clearly stated these were merely job projections and they DO NOT TRACK number of jobs or wages paid, which was supposed to pay at least $2 above minimum wage.

So how did CHMURA make these claims when under Virginia Law the State Employment Commission is barred from releasing this data? Even VCEDA has no access to this information. Nearly every company they partnered with that I checked on went out of business, a few within months. They still claim they "created" jobs.

Travelocity was one of their bigger fiascos that made nationwide press. They moved in at least 3-4 call centers into the same facility claiming the creation of nearly 1,500 jobs. There were never more than 200 jobs at any one time. The last time I checked they got a 100 jobs with a government contractor SI International.

When I asked in 2022 who was in the facility, they didn't answer.

VCEDA claims of those 23,052 "jobs" (as of 2018), 11,865 were manufacturing, 7,700 were call center jobs. 886 were government jobs. They claim "investment" in these projects was $2.8 billion.

They claim to have created 292 information jobs, but information related jobs across the region fell 45% from 2010-2020. Earlier claims (or the usual projections) of 700-1000 hi-tech information related jobs in Lebanon, Russell County, (Northrop-Grumman) was false.

Grumman received a $9 million local incentive package at least partly funded by VCEDA, so assuming all the information jobs were in Lebanon, was $31,000 per job just on that.

When I spoke to the Russell County IDA two years ago, they stated Grumman was down to ~20 jobs, never hired more than a few hundred at best. Those were mainly a customer service call center desk paying less than the local AT&T call center. Those were really not information jobs.

But as I read down the CHMURA report they wrote "economic impact" assumes the jobs are permanent, then stated "However, firm-specific data are not available to confirm if such is the case."

I know for a fact most of these deals have failed, some many decades ago. The entire CHMURA report is worthless. VCEDA was honest with my earlier inquiries these were merely "projected" not actual jobs.

It was mainly virtual job creation. Or high hopes. Stop claiming job "creation" when one doesn't know. I blame the press that doesn't look into these claims or asking the right questions.

Another study they sent me was, "Economic Impact Analysis of the VCEDA Seed Capital Matching Fund" or the small business seed program. This is from Virginia Tech dated February, 2021. I believe this is the $10,000 grants to these cookie shops and BBQ shacks.

The study is worthless because on page 17 again "Number of employees projected." This does take into account their present employees full and part time. When I inquired if VCEDA was taking credit for present and future employees, they gave no answer.

If Dubuggles Lawn Care, with two employees goes out of business, will they still claim credit for creating two jobs? No answer.

In addition weasel terms such as "average full time wages" can't be confirmed because the Commonwealth of Virginia only releases state wide averages.

On page 19 the VT report states, "Note that we did not model the impacts of the one-time monetary investments of up to $10,000..."

Again note the weasel term "modeling." Computer modeling proves nothing. These reports without verified specifics are computer model garbage. Their only purpose is to leverage State and Federal money. If one can't prove it, don't make claims as fact.

As CHMURA noted VCEDA "helped" generate over 23,000 mostly (my opinion) virtual jobs. They are one of five other similar state economic development agencies all over lapping each other. This is in addition to each county having its own individual industrial development authority.

Industrial-economic development in itself is an industry. This shocking but honest statement from Washington County, Virginia states the real goal is outside money:

"Economic development does not necessarily mean growth, although the growth of both population and revenue may be a result. Economic development means strengthening the community's economic base or the part of the local economy that brings in money from outside the county."

In one case ~$5.5 million in grants created three jobs. At least those three jobs are still here after 10 years.

VCEDA covers the following counties: Buchanan, Dickenson, Lee, Scott, Russell, Tazewell, Wise, and the City of Norton. These are among the most destitute counties in the state.

LENOWISCO covers Lee, Wise, and Scott Counties and City of Norton.

Virginia Tobacco Commission covers the same counties as above plus all of Southwest and Southside Virginia. They have spent ~$800 million in the same way VCEDA has, producing little.

Sorry I don't consider public funding of horse camps or hiking trails a job development.

Two newest economic development whatever are "Go Virginia!" and InvestSWVA. Let's throw in the money "invested" from the Virginia Governor Opportunity Fund.

These are the most popular pages on this site as of November 2022.

Return to Main Menu

Myself in the news:

Update September 3, 2019. Based on data from Dr. Steb Hipple economist at East Tennessee State University (retired), his data goes to the 3rd. quarter of 2016. The level of job losses is Tri-Cities is staggering.

The Tri-Cities Consolidated Statistical Area is composed of the Kingsport, Bristol, Johnson City, and surrounding counties.

The Bristol Virginia-Tennessee, Kingsport, and Johnson City Urbanized Area Labor Market lost thousands of jobs shrinking the labor force that shrank unemployment rates. The above table shows a decline in the labor force by almost 18,000.

Since 1990, the labor force may have dropped by 50,000. It may have recovered some since 2016 except for the China Covid pandemic.

The Chamber of Commerce that owns local politicians fights hard to keep pay low, unions and worker protection out.

Politicians fight anything that benefits workers, but can't pull out the public checkbook fast enough to fund corporate welfare and waste.

Poverty and low pay are seen as a business asset and something to be proud of. It is related to statements such as this from local politicians:

"high unemployment actually can be an advantage because it increases the number of available workers...Our labor force is a huge advantage since the county unemployment rate is twice the state average, and regionally, the unemployment rates range from 3.5 percent to 15 percent..."

Or this statement from a man whose company received $10-$20 million in public subsidies to create 120 jobs, then filed for bankruptcy and left:

"It's a little-known fact that roughly 20 percent of the children in Southwest Virginia live below the poverty line and go hungry every night."

Kevin Crutchfield, President Alpha Natural Resources, January 15, 2009 in Abingdon, VA. See the following:

Alpha Building Fiasco 2022.

How could the expenditure of billions of dollars in government grants, economic development, etc. result in so little public good?

How can spending millions in transportation, other economic development funds for an abandoned train station be rational? No trains run today, 15 years later the building is still empty.

What does horse trails and a horse camps facilitate transportation? Spending transportation funds on this is either irrational or simply fraud?

Washington County Virginia says this in relation to economic development which isn't about jobs for those that live here:

Economic development does not necessarily mean growth, although growth of both population and revenue may be a result. Economic development means strengthening of the economic base of the community or the part of the local economy that brings in money from outside the county.

In reality the money goes to the "haves" that control where it goes and who benefits.

Spending over $100 million on 4-6 clean energy "research" result in empty buildings? Great for consultants, contractors, and their friends.

Taxpayer waste $8 million Bristol Virginia Energy Research Center another empty building producing nothing. See Green Energy Boondoggle in Bristol Virginia and Biofuel Scams Wastes Millions in Virginia.

Yes we have broadband and spent millions.

A look at 2 decades of cable ready socialism in our region:
Cable Ready Socialism
How CGI-AMS and Northrop Grumman Failed Russell County
How Cable Ready Socialism Failed Southwest Virginia
Sprint Jumps State Line Collects Millions
U.S. Solutions Dumps Bristol Virginia for Bristol Tennessee
Travelocity Fails Dickenson County

Social apartheid drives political corruption. To quote Larry Sabato, director of the University of Virginia's Center for Governmental Studies:

"The most corrupt region is Southwest Virginia - more indictments for political and public office corruption have happened in this region than all other parts of the state combined."

To quote Rex Todd of Winston-Salem, N.C.-based The Landmark Group, "Rather than have the working-class people sequestered on one side of town and the rich on the other side of town, the idea is to integrate people..."

To quote former Washington County supervisor Paul Price, "The rich get richer, and the poor never catch up."

Creating real jobs or raising the standard of living for workers, the priority is the opposite.

In fact, a so-called "futurist" came to Tri-Cities at the behest of business leaders to sell the idea. He gave a speech in Kingsport. Ed Barlow of "Creating the Future"

Quoting March 4, 2004, Kingsport Times-News:

"A significant component of your economic future in Sullivan County is recruiting Hispanics, making sure they get highly educated and integrated into the community. ... They can fill all of the various job categories you have. The future economic vitality model is based on the back of a well-educated, ethnically diverse work force..."

Comment: what in the heck do illiterate, unskilled Hispanics have to do with "well-educated" working minimum wage jobs? They imported thousands of illegal alien Hispanics into nearby Morristown and Hamblan County, Tennessee, with double-digit poverty rates. More here...

Exide Fires Bristol Workers - Received $34 Million in Stimulus Funds

In 2009 Exide announced the firing of 567 workers at its Bristol battery plant. That was 70 percent of its workforce.

Opened in 1994, Exide's Bristol plant is a manufacturing and distribution center for lead-acid batteries used in the automotive, marine and specialty industries.

They had 817 employees at the time. They did some rehires that were proclaimed "new jobs."

Sprint Back-Stabs Bristol Virginia

"We didn't see it coming" says confused Bristol, Virginia leaders.

Here is another example of one low-wage community trying to outbid the neighboring low-wage community at taxpayer expense for low-paying jobs.

Sprint has turned down a lucrative corporate welfare package from Bristol, Virginia, and will jump the state line to Sullivan County.

See Sprint Moves to Sullivan County.

Crony Capitalism Comes to Wise County, Virginia

Lieutenant Governor Bolling along with local economic development hacks are having a pork party in Wise County.

Republicans scream about government waste with President Obama and his failed stimulus plan.

They call it waste, but do the very same thing.

In this case, three private sector startups got almost $9 million in corporate welfare, largely repeating earlier failed efforts at the same thing.

Nothing is known to have come of this deal.