Feb 27 2016
In the months since Dow and DuPont announced their merger, our state has faced some very trying times. People are rightly concerned about what comes next, but I could not be more proud of how Delawareans have come together to make the most out of a tremendously challenging time. Last week, some of our efforts paid off when DowDuPont announced that its new agriculture company, which will be formed by the merger, will be headquartered in Delaware.
Delawareans have a long history of working as a united front to make the most out of less than ideal situations. Last Sunday, the News Journal published an op-ed I wrote about what we have already accomplished since the merger was announced, and what we must do to move forward and ensure that we make the absolute best of this situation. The full piece is included below, and I hope you will take a moment to read it.
Last December, Delaware received some welcome news to come out of the Dow DuPont merger – that the specialty products headquarters would make its home in the First State. Last week, we got even more good news when it was announced that the corporate headquarters for the new agriculture company would be located in Delaware as well. While many other states were jockeying for the opportunity to host both these corporate headquarters, our governor provided exemplary leadership with the active support of our congressional delegation and many others to make Delaware the victor.
Delaware is no stranger to adversity, but as Albert Einstein said, “In adversity lies opportunity.” My grandfather in West Virginia had a less elegant saying, “In that pile of manure over there, Tommy, is a pony. It’s our job to find it.”
I don’t want to sugarcoat what’s happened. This merger brings with it real adversity for a lot of people. They’re our friends, neighbors and families. But we’ve found two ponies already, and if we’re smart about it, we’ll find a great many more. The challenge for our governor, our congressional delegation, state legislators and citizens is to work closely together with DuPont’s leaders to make sure not one of those ponies gets away.
Let me offer a to-do list for what I’ll call “Team Delaware.” First, we need to work hard to ensure that Chemours remains in Delaware, and that it grows successfully here. Second, we need to provide a nurturing environment that will ensure the two new Dow DuPont companies that will be headquartered in Delaware – the agriculture and the specialty products companies – become thriving and successful businesses. Third, we must work closely with DuPont and others to ensure that many of the DuPont scientists, researchers, and engineers who are being let go have the opportunity to start up and grow technology businesses of their own. Many will need access to intellectual property as well as lab space that DuPont may not need in the future. These entrepreneurs also need access to capital, which could come from investments made by DuPont, the state, foundations, high-wealth individuals, as well as ordinary Delawareans. Fourth, we need to ensure the University of Delaware continues its interest in collaborating with DuPont’s Stine Haskell labs near Newark. Lastly, there are a number of companies that have expressed strong interest in leasing or purchasing some of the space DuPont is vacating. Let’s be sure not to waste those opportunities.
We have seen earlier versions of this movie before. In 1977, Delaware’s credit rating was lowered to the worst in the country, and we were shut out of credit markets. We had the top marginal personal income tax rate of any state in America. We had no pension fund and no cash management system. What cash we had was in a bank that was in danger of going under. And, we were the best in the country in overestimating revenues and underestimating spending.
In November 1992, General Motors Vice President Tom Davis told an audience of over 1,000 workers at the Boxwood Road assembly plant that it was closing for good - no ifs, ands or buts.
Six years later, we learned that Zeneca, a large science company in Delaware, would be merging with Astra. The newly created company, AstraZeneca, was widely expected to locate its North American headquarters in Pennsylvania, in part because the key decision makers lived and worked there.
Ten years ago, Delaware experienced a different kind of adversity as a result of something called BRAC: Base Realignment and Closure. Among the many changes ordered that year by U.S. Defense Secretary Donald Rumsfeld, was to redeploy all of our C-130 aircraft to other states, effectively cutting the Delaware National Guard in half.
All of these examples presented real adversity to the people of Delaware. In response to that adversity, we had Governors who led. We had congressional delegations that stepped up and asked, “How can we help?” We had state legislators who embraced the 3 Cs – communicate, collaborate and compromise. And, we had citizens up and down our state ask, “What can we do to help?” And, boy did they!
In the face of each of these challenges, Delaware pulled together like the team we needed to be. As a result, when this last century ended and the new one began, Delaware had created one of the best business climates of any state in the nation. Under the leadership of Governor Pete DuPont, we had put in place some of best financial controls and investment policies of any state in the nation - reforms that have been widely replicated throughout America. Our GM plant didn’t close in ’92, but lived on for another 15 years. AstraZeneca, against all odds, chose tiny Delaware. While it employs fewer people than it once did, it’s still a major employer, has a great pipeline of products, and its future is bright. And, when you drive by the New Castle airport, you’ll still see C-130s in a bounce pattern or taking off en route to Afghanistan or some other country. That’s because of the work that all of us did by coming together and refusing to give up.
When I was sworn into office in 1993 as governor, there were nearly 30,000 employees at DuPont. But when last year ended, there were only 7,000. Last month, we learned this merger will reduce Delaware’s DuPont workforce even more. These are valued employees. They’ve helped build and reinvent one of most remarkable, enduring companies in the history of America. These layoffs are painful for the DuPont workers and their families, and they are painful for us, too.
Having said that, we’ve already found at least two ponies in this pile of adversity, and I’m convinced that there are a lot more waiting to be discovered. It’s time to once again to seize the day by working together to create a nurturing environment for these new businesses to start, grow and thrive. Carpe Diem!