When President Barack Obama first visited Elkhart, Indiana, in March 2009, the county’s unemployment rate had just spiked to 18.9 percent—the highest in the country.
Pointing to those numbers at the time, Obama urged Congress to pass an $800 billion economic stimulus package to keep the nation from slipping further into a recession “we may be unable to reverse.”
Seven years later, the town and surrounding county “look considerably better,” says Elkhart’s new mayor Tim Neese, a Republican. Unemployment has dropped to around 4 percent, manufacturing has returned, and help wanted signs are everywhere, he said.
On Wednesday, Obama will return to the rejuvenated district to highlight what he considers one of his administration’s greatest success stories. “The story of Elkhart’s recovery is the story of America’s recovery,” the president said in a statement.
But some Hoosier business leaders, local lawmakers, and analysts tell The Daily Signal that the state did the majority of the heavy lifting.
In advance of the president’s visit on Tuesday, Sen. Dan Coats, R-Ind., cautioned that the visit “shouldn’t be about glad-handing, but should instead be a celebration of Elkhart’s strong work ethic and renewed economic success.”
In a statement to The Daily Signal, Coats said he hopes that Obama “also acknowledges the pro-growth policies pursued by the state of Indiana, which have made our state one of the nation’s economic success stories.”
The leader of Indiana’s state Senate put the situation in starker terms.
“What’s happening in Elkhart isn’t because of the federal government, it’s despite it,” said Sen. David Long, the ranking Republican in the state Senate who represents the neighboring Fort Wayne area.
The recreational vehicle industry “dominates” the Elkhart economy, explained Jerry Conover, director of the Indiana Business Research Center at Indiana University. The professor said that more than half of area jobs, about 60,000, come from the industry.
Known as the “RV Capital of the World,” reliance on that business makes Elkhart subject to dramatic swings and shifts in the market, Conover explains. In 2009, when the economy started to slump, unemployment spiked.
In response, the Obama administration pushed Elkhart to diversify its industry and promised millions of dollars of grants to jumpstart an electric car industry specifically. With a $39.2 million federal grant, officials at Navistar Inc. predicted they could create 700 jobs.
“That was not nearly as successful as we had hoped,” Neese noted: Navistar Inc. and similar electric car ventures came to a halt shortly afterward.
“The only thing [Obama] promised was to come in and transform a lot of these jobs into electrical vehicle jobs and they were going to reinvent the Elkhart economy,” Long said. “There’s nothing to show for it.”
Asked about other attempts to spur growth, Conover said he couldn’t “really recall anything specific to the RV industry” from the federal stimulus. He did note that more general infrastructure projects probably created jobs and put some “money in local cash registers.”
Now that the town has turned around though, Obama credits the revival to “the choices we made as a nation.” But Republicans argue that slashing corporate and individual income taxes along with streamlining regulation made the change possible.
Under Gov. Mike Pence, a Republican, tax rates fell by half a percentage point in 2016 for the fourth consecutive year from 7 percent to 6.5 percent, in order to create an attractive tax environment for companies.
Mark Dobson, the president of the Economic Development Corporation of Elkhart County, credits the revival to coordination between state lawmakers and the local business community.
In the Indianapolis capital, Hoosier lawmakers are “excelling by setting a table in a very favorable fashion for growth,” he said. And in the manufacturing district in Elkhart, leaders and workers united to “do a phenomenal job returning from the downturn.”.