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Building Up America

Aired April 17, 2010 - 15:00   ET


TOM FOREMAN, CNN HOST: Way down Texas way they play fiddle every night or at least an old song says so. You can throw guitars into the mix, too. What they do all day, however, is something else. They are one of the key states leading the way in BUILDING UP AMERICA.

Hi, I'm Tom Foreman. Welcome to the CNN Express and to the beautiful city of Austin, the capital of the Lone Star state. As the whole nation struggles with this down economy, this really is a great place to go on our quest to find individuals, businesses and communities that are finding ways, not only to survive, but also to thrive.

Some economic forecasters are already saying that this area will lead the entire nation in the economic recovery. You don't have to ride around long before you see why. At Jenny's little Longhorn Saloon, the crowd is always happy when Dale Watson is on the bandstand. And they should be. Not only is he a bona fide country music legend who lives here, but also their community is building up its economy even while the recession is holding much of the country down.

SHANNON CHAPMAN, STAY AT HOME MOTHER: I don't feel like we have felt it as much.

FOREMAN: Dale's fans have an idea why.

UNIDENTIFIED MALE: Slot of different types of businesses here.

UNIDENTIFED FEMALE: People support their local businesses.

UNIDENTIFIED MALE: Businesses want to come here because it's a tax haven. That creates a growth during periods of recession.

FOREMAN: With a strong base of steady jobs, government higher education and the private sector, this is home to Dell Computers, Austin is hanging tough. While nationwide unemployment is around 10 percent, Austin's is closer to 7 percent. While foreclosures continue to rock many communities, real estate analysts are predicting Austin will be one of the country's strongest markets this year. Why do you think you've done so well? Take a walk with the Mayor Lee Leffingwell and he'll tell you all about it.

MAYOR LEE LEFFINGWELL, (D) AUSTIN, TEXAS: A lot of it is plan old, I mean we have a great quality of life here, based on a good climate, and we are blessed with a well educated and very young work force. FOREMAN: What have you done beyond that that made it work so well here?

LEFFINGWELL: Well, we have actively tried to diversify our economy.

UNIDENTIFIED MALE: Number one meat chili was gold medal chili.

FOREMAN: And while in many places gloom as prevails, here and even something as simple as the annual chili cook-off at the Jewish Community Center, you can find people pulling together in the face of adversity.

ROBERT CULLICK, AUSTIN: There are a thousand reasons to be separate, right? Separate ourselves into disparate groups. And the great thing about this community is that we are finding all sorts of reasons to be together.

FOREMAN: Back at Jenny's that is sediment Dale Watson shares. It's not that the recession hasn't hit here, it has hit here, but the town has reacted to it differently.

DALE WATSON, MUSICIAN: I'll go with that. It definitely has hit here. We don't feel it as much because I think we support local businesses more. That goes from Dell Computers to Joe's Coffee Shop downtown.

FOREMAN: Big and small, it's all connected. Of course, even in places where things are swinging, individually folks can face some very hard times because all the regular problems of life keep coming, and that can test even the most determined souls.

In all of central Texas, there may be no one who knows more about rebuilding than the woman who runs this lumber company out on the edge of Austin. For the past few years, that's all her life has been about.

LAURA CULIN, AUSTIN LUMBER COMPANY: Hey there. What you got for me?

FOREMAN: A dozen years back Laura Culin took over her dad's business. As a single mother, she was making a go of it until New Year's Eve 2005. So then calamity strikes. What happened?

CULIN: A massive fire, everything that Laura owns burnt to the ground.

FOREMAN: A million dollar worth of buildings, equipment and inventory gone. Laura had no insurance, little savings, but she did have conviction. This would not defeat her. Laura moved into a house on the edge of the property and day by day started to rebuild. Now remember, while this was happening, the entire construction industry in this country took a nose dive. She didn't have to just rebuild, she had to remake her entire business plan. This is could the top insulation.

CULIN: This is made out of recycled blue jeans. FOREMAN: To cash in on new construction trends, she began stocking more green products, recycled plastics, sustainable woods.

By selling things like this, sustainable lumber you're able to get a niche in the market that really nobody was serving quite that well.

CULIN: Nobody.

FOREMAN: She tapped into a government program that pays young people to learn trades, augmenting her small staff.

CULIN: You'll be working in the hardware store; you will be learning retail sales.

FOREMAN: So you're also now renting out property.


FOREMAN: She cut down on the space she uses, making some available to other struggling small businesses.

UNIDENTIFIED MALE: What I'm doing right now is virtually impossible, which is a one-man shop.

FOREMAN: And she joined a business group and meets every few weeks with a mentor. John Braun, who owns a much bigger construction company.

The basic idea is it's better for the whole business community if more established businesses help out those that are just coming along?

JOHN BRAUN, BUSINESS MENTOR: Yes. You should always be willing to grow the next generation.

FOREMAN: Laura knows the economy is bad, but she's not afraid. Do you think you have fully recovered at this point?

CULIN: No. No, but I am on the way up.

FOREMAN: Because each time she winds down from another day of building up her corner of America, Laura knows she'll be right back at it tomorrow.

CULIN: We are going to survive.

FOREMAN: Some of the most successful people we have met while traveling around are those who have been tested time and again by adversity. If you think about it, that makes sense because in effect, they've been practicing dealing with big problems and getting over those big problems. So when a recession comes along, they're able to handle it. Almost all of them say this you have to have three things. You need to have innovation, evolution and cooperation, a bigger sense that the community is trying to work together on this problem.

In a moment, second chances and what that can mean in a tough economy.


FOREMAN: One of the worst problems that can absolutely plague a community for years and years is chronic unemployment. When a person can't get or hold a job, obviously, they suffer, but they also depress wages for everyone else and they hurt the tax base. It just goes on and on from there.

Sometimes the issue is that when they got out of school they never made the transition to the work place effectively. They lost the first job then they lost the second job. By the time they're in their 30s it's all over with. They can't figure out how to get into the work force. That's why some people here in Austin tried to take that problem head-on.

Out on the east edge of Austin, rebuilding America starts with rebuilding lives. Meet the latest class of the Skill Point Alliance Construction Gateway, funded by city and county tax dollars; this is an innovative, five-week training program to turn the unemployable into the employed.

This is a big deal to you?

UNIDENTIFIED MALE: Yes. Very big deal. This is the beginning of the rest of my life.

UNIDENTIFED FEMALE: I'm excited, even though it's really intense.

FOREMAN: The target is individuals over the age of 18 who ought to be entering the work force, but who have little hope of doing so because they dropped out of school or wound up in jail or had some other problem. Sean Gamez, for example, had been in and out of prison for robbery by the time he was 25.

SEAN GAMEZ, GATEWAY CONSTRUCTION: There was no work. It was nonexistent to me for people like myself.

UNIDENTIFIED MALE: If you follow the basics and always do the basics right, everything else fall into place.

FOREMAN: But then he ran into Sylvestre Villarreal who recruits students for the Construction Gateway program, scouring homeless shelters, unemployment lines.

SYLVESTRE VILLARREAL: I look for two things that I feel will benefit from this. The second which is just as important is an individual that is going to be a good employee.

FOREMAN: Once in there, they are taught the boot camp basics of construction work, showing up on time, doing what you're told, the language of tools and rules of building. All with the goal of helping not just them, but the broader community too.

The result, close to 90 percent of Construction Gateway graduates who had little hope of a job before entering the program are employed within days of graduation. And they stay that way. How confident are you that you'll get employment once you leave here?


FOREMAN: It certainly worked for Sean. He's been on the job for seven years and is now a foreman on an electrical crew.

GAMEZ: This right here is the sole reason why I'm employed today.

FOREMAN: The program only takes 100 students a year, but that's 100 doing good work. Good for them and good for their communities, too.

The recession has certainly cost a lot of people their jobs, but for some people here in Texas, it has also been an opportunity. They looked at how communities are grappling with the recession, and they've seen a way that they might make a living that will benefit everyone. Just another way that they're building up their part of America.

LISA GAYNOR, SMALL BUSINESS OWNER: I would imagine if you're really creative you could make something out of them.

FOREMAN: If there is one thing Lisa Gaynor knows it is this.

GAYNOR: There is a story behind everything.

FOREMAN: And hers is about foresight, opportunity and building up when everything seems headed down. About ten years ago, Lisa's family moved back to her home state of Texas. Her husband, a consultant, travels for work and she had a good job with a big corporation in Austin, but then came bad news. Lisa was let go.

GAYNOR: Really knocked the wind out of my sails. I had no idea where to go. That was my identity that was who I was.

FOREMAN: With nothing else to do Lisa started decorating her new home by shopping in consignment shops. But few had the nicer items she wanted. She had seen high-end consignment shops in other cities and she thought this could be a good time to open one here. Lately that's proven particularly true.

GAYNOR: Historically, only 10 percent of the consumer population is really aware of or open to the idea of consignment shopping. I think what the recession has done is changed that. Can I help you find anything?

FOREMAN: She never owned a business before, but with the encouragement of local business groups and friends, Lisa launched Design it with Consignment.

GAYNOR: I sell things that are owned by other people. It doesn't mean antique, it doesn't mean used. It doesn't mean beat up.

FOREMAN: It does mean bargains.

GAYNOR: Retailed for $13,000 and we've got it for $3,500.

FOREMAN: Most items sell for 50 to 75 percent less than they did new.

GAYNOR: Lots of "sold" signs. I like that.

FOREMAN: And the recession that's taken so many jobs has been turned into an opportunity for Lisa and her five employees.

GAYNOR: Ironically, it has been a boost to my business. We were just reviewing numbers. We have gone up 30 percent over the last two years.

FOREMAN: It's hard work. She's at it six days a week, but it is working.

In a moment, a local company with worldwide impact. You have probably never heard of it, but rest assures they are watching you.


FOREMAN: Many families are looking around to see if there are other ways to expand their income or perhaps limit their costs at a difficult time like this. They are not alone. Businesses are doing it, too. So far we've been talking a lot about small business here, which is very, very important to the local economy.

But there is a very rapidly growing big business here; too, that is making a lot of waves all around the world in tech. People are paying attention to this company, not only because it's growing so fast, but because it has found such an innovative way to tap into an underutilized resource. The morning commute for Julie Barrett is only as far as the kitchen where she grabs coffee, puts out the cat, and starts reading what other people write on the Internet.

JULIE BARRETT: I feel like I have the best of both worlds, that I contribute to the family income and then I also get to participate in my children's life.

FOREMAN: its real work with real pay for dozens of stay-at-home moms who found new income, purpose and satisfaction in a company called Bazaarvoice.

UNIDENTIFED FEMALE: Single mom with four kids. I wanted to be home. I needed something that would allow me to contribute to my husband's income, especially in these economic times.

BRETT HURT, CEO, BAZAARVOICE: You use us all the time. You just probably don't realize it.

FOREMAN: What exactly does Bazaarvoice do? Brett Hurt started the company and it runs those consumer product review sections you see on company websites when you want to buy a TV, a camera, a car.

HURT: You've got to make sure that conversation doesn't have anything racist or profane.

FOREMAN: You're not editing it for content.

HURT: Absolutely. Like any community, you want to have some standards.

FOREMAN: This is big business. In under five years, Bazaarvoice has picked up almost 800 clients. Suites of offices with gongs and game rooms, all in the middle of a global recession.

HURT: In this office we have about 250. As I mentioned, we have quite a few that work at home.

FOREMAN: Brett's simple philosophy, care about the workers and they will care about the company. Need proof? The vacation policy is this, take as much as you need.

HURT: In four years, nine months of business, treating people with that amount of great respect, not a single person has abused it. Not once. So how many volumes of "War and Peace" have you read?

PATTI SCHUMACHER, BAZAARVOICE: This is the first job I ever worked at in 30 years where I feel like I can plan my work schedule around my family rather than the other way around.

FOREMAN: The result? Just listen. How many of you are optimistic about the future of your area right now? The employees of this company are just outrageously optimistic right now about many things. They face the same problems we all do in terms of the cost of living and different problems in the economy, but they're convinced because their job is solid and their overall regional economy is doing well enough that they are going to be fine.

Next up, keeping it light. The art of rebuilding.


FOREMAN: It is impossible to address the economy of Austin without noting the symphony of arts that flows through this town, and the Long Center downtown is evidence how a vibrant arts community can be good for residents and business, too. For 40 years the multipurpose aging Palmer Auditorium sat here. When the city decided to replace it in the '90s, the town was flush with dot-com money, a $125 million plan was developed. By 2002, however, many dot-comes were dot-gone, and the plan was, too.

REYNOLDS "CLIFF" B. REDD, JR, EXECUTIVE DIR., LONG CENTER: People were accustomed to coming here. They knew what it was. It was so odd, but such a symbol for the city.

FOREMAN: Cliff Redd runs the center and Stan Haas was a key architect of its revival.

REDD: So to give it a new life and a new place of people's hearts. It was a really seductive project for us.

FOREMAN: Unable to afford an entirely new facility, the city like many homeowners remodeled.

STAN HAAS, ARCHITECT, NELSEN PARTNERS: We began to investigate what's the idea of taking the great bones of this building and making it even more than it was. The eureka moment for us was finding a construction photo of this building in 1958. And what it showed was this beautiful concrete perimeter ring beam.

FOREMAN: Stripping the old building down to its bones, they reused every piece they could to create a state-of-the-art new performance center. A hidden concrete ring beam came into the light as a sweeping architectural element. Old weather-beaten roof tiles were converted into stylish hip siding. Windows were made into decorative panels. Old light fixtures were rewired, reworked and re-hung for a retro splash. Five tons of steel were melted down and returned for reuse.

In all, 45 million pounds of debris recycled and used again. The results are staggering. Not only did the Long Center open on time and on budget, but listen to how much they saved by using the old to build up the new.

REDD: Typically when we research these across the country, the mind-numbing figure that stopped us, they are running about $1,100 a foot to build what we have. We were able to build this project for $278 a foot. It becomes one of the most studied projects. An iconic example of Austin ingenuity, at best.

FOREMAN: Now, that's a finale. What are the keys to building up America we found in central Texas? They have a broad-based diverse economy that can't be taken down by a single economic event. They have a premium on innovation. They have a strong sense of community support for each other's businesses. And they have a good quality of life that makes both employers and employees want to be here.

It means they will fight for their community. We hope some of these ideas can help you in your community as you try to rebuild your corner of America. I'm Tom Foreman. Thanks so much for watching. For all of us here on the CNN Express, we hope we see you down the road.