A Foundry Closes in San Jose

Every now and then, something
happens that epitomizes an era.  When the
first railroad to cross the North American continent was completed with a gold
spike, that single event symbolized not only a success for the railroad
industry, but opened a new chapter in American history.  So many meanings are packed into today’s
subject that I won’t have space to explore them all, but I’ll try.

In 1919, a metals foundry
called the Kearney Pattern Works began operations in what was then the small
town of San Jose, California.  Back then,
the state was largely agricultural, and the castings the foundry made were used
by farm-product manufacturers, canneries, and the water and power utility
industries.  During and after World War
II, Kearney no doubt participated in the huge defense-plant buildup that
transformed a sleepy agricultural economy into one of the nation’s economic
powerhouses.  Corporations such as IBM
and Hewlett-Packard (now HP) became clients. 
In my own career as an RF and microwave engineer, I became familiar with
some of HP’s products that used heavy aluminum castings for electrical
stability, and it is entirely possible that those castings were poured in the
shops of Kearney Pattern Works.

Metal casting is an ancient
art mentioned in the Bible.  My
university is one of the few in the U. S. that has an active foundry-education
program, complete with a small working foundry, where once or twice a semester
you can see the soul-stirring pouring of nearly white-hot glowing iron into
molds.  For many people who grew up in
the middle or latter part of the twentieth century, foundries symbolized the
essence of industry.

We still have foundries, but
increasingly, at least in my branch of engineering, the word means silicon
foundry—a place where silicon chips are fabricated.  And even those are mostly offshore now.  After a century of operation, the Kearney
Pattern Works is shutting down and the land will be sold to Google, which is
planning a 245-acre complex employing 20,000 people in downtown San Jose.  I know nothing about the details of Google’s
plans for their complex, but I’d be willing to bet any reasonable amount of
money that if you walk in and observe what most of those people will be doing
once the facility is up and running, they will be in clean, well-lit,
air-conditioned offices sitting at computer monitors. 

Is that a bad thing?  The city of San Jose doesn’t think so.  Jim Wagner, 71, is the principle owner of the
foundry and grandson of the founder Al Kearney. 
He says the city has been pressuring him and other heavy-industry firms
to leave the downtown area, but the expenses of moving would have been
prohibitive.  So the alternative is
simply to close the doors and sell the property to Google, which is probably
one of the few private entities in the world that can afford to buy more than
200 acres of prime real estate at the southern end of Silicon Valley.

Foundry work is hot, dirty,
and dangerous.  But foundry workers
didn’t need a college education, or even much high school learning, at least at
the lower levels of the firm.  During the
Great Migration of blacks from the rural south to the industrial north, many
found work in foundries and other muscle-intensive industries, which often paid
well and allowed even uneducated people to afford decent housing and living
standards for their families.  The
hollowing out of these industries over the last four or five decades has
contributed to the deterioration of many Northern cities and the inner-city
areas of many other parts of the country as well.

If this were Cuba, the foundry
would still be operating, because the government wouldn’t let it fail.  Socialism tends to freeze industries at a
given moment and make them independent of actual economic conditions in the
rest of the world.  But the bad result of
this is that state-controlled industries tend to make stuff that nobody wants,
and can’t make stuff that people do want. 
The free-enterprise approach of letting innovation, success, and failure
happen more or less as the market demands seems to keep companies on their toes
to change with the technological and social environments they must operate in. 

It was Austrian economist
Joseph Schumpeter (1883-1950) who came up with the phrase “creative
destruction” to characterize the way technological innovation makes whole
industries obsolete when new ones come along. 
If everyone just accepts this process as a price of a free economy,
progress continues.  But inevitably,
companies that decide to do only one kind of thing end up taking the risk that
some day, no one will want that kind of thing anymore.  And something like this has happened to

When the timing of a firm’s
demise coincides with the end of one’s career, as it has in Jim Wagner’s case,
creative destruction isn’t so bad.  But
the reporter who wrote the story didn’t mention any younger employees who will
have to find work elsewhere.  Maybe there
weren’t a lot of younger workers—even at its peak, Kearney employed only about
35 people, and many of those left years ago.

There are many contrasts
between what Kearney has done at their location for the last century and what
Google plans to do there for the next century, but another contrast is
size.  Kearney was a small,
privately-owned firm.  Google is—well,
Google:  a nearly ubiquitous but oddly
anonymous presence in the lives of people all around the world, whose doings
are often opaque, secretive, and hugely influential.  In a foundry, what you saw was what you
got:  the molds, the sand used in the
molds, the hot metal, the smoke, the finished product.  What Google is doing at this moment, how they
make their billions, and what goes on inside their shadowy corporate universe
is known largely only to Google employees.

Modern industrial societies
have accepted disruptive technological changes as the cost of enjoying the
benefits of those same changes.  And
while almost nobody will miss the smoke or mess or dirt of the Kearney foundry,
it’s possible that some of its employees will wish it was still in
business.  And maybe some of their children
and grandchildren will get jobs at Google. 
But they will probably have to spend a good part of their lives in
school first, and even then, they might not make the grade.

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