The Demise of American Denim?

By JOEL D. JOSEPH

Levi Strauss and Cone Mills were partners in the production of denim jeans in the United States for more than 100 years, creating an American style. Denim became part of the American culture that was spread around the world.

Late last year, we received probably the worst news possible in the American denim scene: On October 17, 2017, Cone Mills announced it would close its last American denim mill at the end of the year. After more than 110 years of continuous production the Cone’s White Oak mill in Greensboro, N.C., ceased operations.

The Role of Commerce Secretary Wilbur Ross

In March of 2004, current US Secretary of Commerce Wilbur Ross bought Cone Mills for $46 million. He also bought their longtime competitor Burlington Industries and several other smaller manufacturers and rolled them all into a new conglomerate, the International Textile Group (ITG).

Wilbur Ross, a billionaire investor, saw an opportunity to turn around declining domestic textile producers. Secretary Ross sought to take the knowledge and name brand appeal of these domestic mills while moving their operations overseas, a tactic he employed to great success with bankrupt steel companies just two years prior.

But textiles didn’t prove to be the quick turnaround Ross found with steel. His textile companies began with a combined revenue of about $900 million in 2005, but had dropped to $610 million a decade later in 2015. The company’s flagging sales combined with Ross’s political ambitions led him to sell the textile company to private equity firm Platinum Equity in October, 2016 for $99 million. Ross then became Secretary of Commerce in the Trump Administration in February of 2017. Within a year after the sale, Cone Mills closed its doors forever.

It is ironic that the Secretary of Commerce for the administration claiming to champion “Made in the USA” would be responsible for the loss of the world’s largest denim manufacturer.

History of Cone Demin

The Cone family history began in 1845 when Herman Kahn (1828–1897), a Jewish-German immigrant, and his family left their home in Bavaria, Germany, for a new life in the United States. Herman changed the spelling of his last name from Kahn to “Cone” upon arrival in the United States to become more American. Their first child was Moses Cone, born in 1857, who was the founder of Proximity Manufacturing Company (original name for the Cone Mills enterprise). Their next son was Ceasar, born in 1859.

In 1887, the Cone brothers invested $50,000 in the C.E. Graham Mill Manufacturing Company of Asheville, N.C. In 1905, under Proximity Manufacturing Co., the Cone brothers built White Oak Cotton Mills in Greensboro. By 1908 it was the world’s largest producer of denim. The heavy-duty blue denim manufactured by the mills controlled by Moses gave him the reputation of being the “Denim King.” The Cone company produced denim fabric for Levis Strauss & Company since 1915.

Cone Mills and Levis saw rapid growth as denim became accepted as American casual wear in the 1950s, ’60s, and ’70s. By the 1980s, the foreign fabric producers began to compete with what was produced in the US but significantly reduced cost.

1994 would deal a double blow to Cone. First, the North American Free Trade Agreement (NAFTA) went into effect and eliminated textile and apparel tariffs between the US, Mexico and Canada. Over the next decade, companies like Levi’s, Lee, Wrangler, The Gap, Lucky Brand, and many others moved most of their production out of the US. With fewer garments produced domestically, it became less advantageous to buy domestic fabric and more brands used imported fabric.

Second, the World Trade Organization called for an end to textile and apparel quotas worldwide by 2005. Previously, countries could set limits to the amount of fabric they wanted to import. In ten years, textile and apparel manufacturers would all be competing directly against each other without such regulation to protect domestic mills like Cone.

By 2003, only a fraction of the clothing consumed in the United States was being produced domestically and much of what was made here, was being made with imported fabric. The global wholesale price of denim had dropped 27%.

What is Left of the Denim Industry in the United States

With the death of Cone Mills, only Mount Vernon Mills is left, the last large-scale denim producer in the country. Mount Vernon operates one of the largest denim manufacturing facilities in the world in Trion, Ga. This mill produces a wide variety of denim including washed, over-dyed, and stretch fabrics. Other products within the group include twills, drills, duck, and plain weave fabrics.

There are also other, much smaller, selvedge denim operations emerging in the US in the wake of the closure. Most notable is Huston Textile in Sacramento, Calif.

Denim has and will likely always be the fabric of America. Billionaire Wilbur Ross should have preserved the largest denim producer in the world, rather than letting it die. He is another phony “Made in the USA” member of the Trump Administration, that includes Ivanka Trump and Donald, who made all of their signature clothing in Asia.

Joel Joseph is chairman of the Made in the USA Foundation, a non-profit organization dedicated to promoting American-made products. Email joeldjoseph@gmail.com. Phone 310 MADE-USA

From The Progressive Populist, December 15, 2018


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