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Economy Weighs on Minds of Pittsburgh Voters

April 21, 2008 at 6:15 PM EST
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As part of the Big Picture election series focusing on Pittsburgh, Ray Suarez examines how the economy and other issues are weighing on the minds of voters in Steel City as the region works to reinvent itself from an industrial-based economy.
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TRANSCRIPT

GWEN IFILL: Like many American cities in the old Rust Belt, Pittsburgh is in the process of reinventing itself from the old Steel City of decades ago to something modern and sustainable. Ray Suarez gauges its progress.

RAY SUAREZ: In 1950, Pittsburgh was home to almost 700,000 people. It was pouring hot metal and pouring black smoke into the air, but paying good union wages.

Almost 60 years later, the smokestacks are gone and so are the jobs, but the air is clean. And like many American cities, Pittsburgh had to figure out what to do for a second act.

This is part of Pittsburgh’s Act II, the new economy: manufacturing high-tech circuit boards for radio-controlled mining equipment.

These non-union jobs pay only $9 to $19 an hour, though workers are making high-value electronics using multimillion-dollar machines. LaBarge and other modern companies inhabit an old Westinghouse plant that once turned out massive turbine engines.

AUDREY RUSSO, CEO, Pittsburgh Technology Council: There’s been quite a transformation.

RAY SUAREZ: Pittsburgh’s high-tech firms have organized a council led by Audrey Russo.

AUDREY RUSSO: We have a strong information technology base, but we also have an amazing emergence of biotechnology, which includes fuel, energy. We have medical equipment. We’ve got tissue re-engineering. You know, I could go on and on.

RAY SUAREZ: Audrey Russo’s office sits on what was once industrial land on the Monongahela River, land that’s been reclaimed for office parks, new apartments, shopping malls, and a high-tech sports medicine center big enough for professional and college football teams to practice indoors.

New industry in an old town

RAY SUAREZ: What they've built is a post-industrial waterfront. Construction workers scramble over the vast site of a new riverfront casino next to the science center, the football stadium, and PNC Park, where a sellout crowd flocked to the Pirates' home opener.

Fans cheered what they love about the area...

PITTSBURGH RESIDENT: It's the most livable city for a reason. It's wonderful here. Our sports teams are great. There is a good nightlife. There is a lot for young people to do.

PITTSBURGH RESIDENT: It's a big city with a small-town feel. And that's what we always say. It's a great town.

RAY SUAREZ: ... and confronted their hometown's problems.

PITTSBURGH RESIDENT: We've got a workforce, but no industry. We just can't keep pushing paper around and expect our economy to pick up. We need industry, lots of it.

PITTSBURGH RESIDENT: The new economy is education and health care primarily. The city does face a real test, because so many people have moved to the suburbs and the new economy -- education and health care -- can't really be taxed like the old big industries, steel and glass and manufacturing.

RAY SUAREZ: Barges still ply the rivers, hauling coals from the mines of Pennsylvania and West Virginia to factories and power plants downstream and into neighboring Ohio.

United States Steel's Edgar Thomson Works is still in business. Upgraded and modernized, U.S. Steel led the region in earnings last year with $16.8 billion.

Manufacturing remains the area's largest economic sector, accounting for one of every seven dollars in employment earnings.

There's wide agreement health care, financial services, and specialty manufacturing will provide the jobs of the future. The University of Pittsburgh Medical Center is the second-largest employer in the entire state, with 44,000 workers.

Helping drive health care to prominence is a population that aged in place and needs the advanced treatments modern medicine developed in the last 30 years.

Education is another economic engine. The University of Pittsburgh and Carnegie Mellon University employ thousands in the instruction, care and feeding of students. But half of Pitt's grads don't stay in Pittsburgh after graduation; almost 9 out of 10 Carnegie Mellon grads leave town.

STUDENT: The biggest problem is young people, like myself, not being able to find jobs, and graduating from college, and then leaving the area, and not coming back until they're much older and are more established. It would be great if it were affordable for people to live here and find work in their 20s.

RAY SUAREZ: The 27-year-old mayor, Luke Ravenstahl, in office for just a year-and-a-half, sees his well-educated young constituents leaving town as a loss to the city.

MAYOR LUKE RAVENSTAHL, Pittsburgh: So if an idea is generated in a lab at Carnegie Mellon University or the University of Pittsburgh, shame on us if we can't find a way to transform that idea into a start-up company that starts with the half-dozen employees and grows to a dozen, two dozen, and then hundreds of employees. To keep that knowledge base and talent base here, that's something that we have to work hard to achieve.

Communities reflect city's health

RAY SUAREZ: Ravenstahl is working to stabilize the city's finances. At the moment, the state of Pennsylvania oversees Pittsburgh's books because the city has had trouble paying its bills.

But back in the late 19th century, when the city made legendary fortunes, the steel, coal and banking barons created foundations and endowments, leaving a rich inheritance of museums, concert halls, and schools.

The philanthropies distributed nearly $500 million last year. Now comes the Pittsburgh promise. The University of Pittsburgh Medical Center has put up $100 million, to be matched by $150 million in other private funds, to promise every graduate of the public high schools $10,000 a year for college.

Mark Roosevelt left the Massachusetts legislature to run the city's schools. He says the Pittsburgh promise is a powerful incentive to current students to stay in school and to new families to come to the city.

MARK ROOSEVELT, Superintendent, Pittsburgh Public Schools: I don't think it will change the city's demographic destiny overnight, but I do think it will affect people's decision-making, in terms of where they will live, the suburbs or the city.

More than that, I think it will change the life trajectories of a lot of our kids who now see college as a very realistic part of their future.

RAY SUAREZ: It's hard to see Pittsburgh's promise in Homewood, on the city's east end, where Jawad Salaam and Frederick Germany play checkers on a warm afternoon. Salaam says the area needs basic commerce to recover from its long decline.

JAWAD SALAAM, Store Owner: In every community, before you can call it a community, they've got the old grocery stores, they've got the old bakeries, they had their own meat markets. We've got two little stores here. I'm selling used furniture. The brother over there is selling used furniture. That's supposed to make a community?

RAY SUAREZ: Salaam says his neighbors need to stay and rebuild, especially if they've acquired an education. His checkers partner disagrees.

FREDERICK GERMANY, Homewood Resident: I'm glad to see them leave Pittsburgh, to be honest with you. If you've got an education, get out. Get out of Pittsburgh.

JAWAD SALAAM: I disagree with him, because if everybody adopts that attitude, the ones that become educated, they pull out and leave, and the community is just going to continue to die...

FREDERICK GERMANY: There has to be something here for them.

JAWAD SALAAM: Because nobody here is here to stay and fight. We've still got to stay and fight.

RAY SUAREZ: The Reverend Ricky Burgess stayed. He's Homewood's new city councilman. He says African-Americans in Pittsburgh have some of the highest unemployment and crime rates and the lowest percentage of home ownership among the 50 largest cities in the nation. Nearly 40 percent live below the poverty level.

REV. RICKY BURGESS, Councilmember, Pittsburgh City Council: As I walk through the streets of the community, because I live five blocks from where I was born and raised, I still see -- I see just a hopelessness and a nihilism that I don't know if I've experienced before. Part of that is what drove me to seek elected office.

PENNSYLVANIA RESIDENT: I was born and raised here and I'm 79 years old. That's how long I'm here.

PENNSYLVANIA RESIDENT: I've been here 80 years.

Demographic challenges remain

RAY SUAREZ: In southwestern Pennsylvania, mobility is not prized. To a degree unusual in American cities, Pittsburghers still live in the communities and even in the homes where they were born. And now they're retired and aging.

The region is second only to Florida in its percentage of elderly residents and not attracting newcomers.

Chris Briem is a regional economist at the University of Pittsburgh.

CHRIS BRIEM, University of Pittsburgh: We became an old region when we lost that big chunk of younger workers 25 years ago. I mean, this is not a retirement destination. It's not Florida. People are not moving here. So that's when we became old.

The population that remained, we say, you know, has aged in place. And that's had an awful lot of implications here.

Pittsburgh is sort of where the nation is going to be down the road, 10 or 20, 30 years down the road. They will only then be reaching where we are at.

RAY SUAREZ: While America is increasingly racially diverse, southwestern Pennsylvania is home to tiny numbers of Latinos and Asians. Immigrants once poured in from Europe. That the newest Americans are not coming is not lost on the mayor.

MAYOR LUKE RAVENSTAHL: The diversity here is not strong enough. We do not have and we do not embrace diversity. So perhaps that's a reason that others have chosen not to come here, but it is a real issue that we have to deal with and try to get better at.

RAY SUAREZ: Pittsburgh is a 250-year-old city on a powerful watershed that sometimes overwhelms the antiquated sewer system; 600 to 700 bridges cross rivers, valleys, and rails, so there are major infrastructure costs on top of the other economic woes.

Pittsburgh is surrounded by a jurisdictional patchwork of 130 smaller municipalities and wants more help paying the bills. Ravenstahl and the Allegheny County executive propose merging their two governments.

MAYOR LUKE RAVENSTAHL: We, as a region, would start thinking like a region. And we all live in Pittsburgh; we all live in western Pennsylvania. And whether it's the city that does well or a suburban community that does well, we're all in this together. And that's really what we need to start thinking about.

RAY SUAREZ: And back at PNC Park? The Pirates came from seven runs behind to tie the Cubs at 8-8, only to lose 10-8 in extra innings. A tough defeat, but it's a long season in a tough town determined to pull out victory.