The decline of traditional industries, or “deindustrialization,” has been a topic of growing interest among American historians. Most of the existing literature illuminates the experiences of individuals, communities, and companies directly affected by plant closures. Historians have recently begun to explore public policy responses to industrial decline, although policymaking on this issue at the state level has received almost no attention. State government has nevertheless been an important locus of activity for dealing with deindustrialization. This is not surprising, considering the importance of the states in the American federal system and the fact that industrial decline often concentrates in particular areas of the country at a given time.

Numerous historians of deindustrialization argue that industries went into decline because established manufacturers moved production to cheaper locales to escape unions and high wages. A different pattern of decline occurred in the New England cotton textile industry, where downsizing began in the 1920s. Rather than fleeing their home area to build facilities elsewhere, most New England manufacturers were driven out of business by lower-cost competitors in the American South. Southerners founded, managed, and financed a heavy majority of the textile companies in their region. Although some New England firms did set up Southern plants, this was a defensive reaction to changing market realities. New competitors have brought about deindustrialization in other core U.S. industries. Recognizing this trend is important for a full understanding of the political economy of modern capitalism.