|Three decades of wins and losses for Oregon business|
Aluminum manufacturing powered towns such as The Dalles in the 1980s and 1990s, but the bottom fell out in 2001.
The aluminum industry was a powerhouse in the 1980s, back when power came cheap. Some 7,000 people worked at 10 smelters in the Pacific Northwest in an industry that relied on subsidized power from the Bonneville Power Administration. In 1986 BPA altered its direct service contracts to tie power rates to the price of aluminum. A young entrepreneur named Brett Wilcox was able to restart the smelter in The Dalles, and wealth spread as the aluminum price tripled, driven by Japanese demand. The results were big bonuses for The Dalles workers, big profits for Big Aluminum and a $221 million bonus to BPA.
It was the proverbial win-win, until everyone started losing. The bottom fell out in 2001, when electricity prices soared as a result of utility deregulation and aluminum dropped to 60 cents a pound, less than the price of production. The decision by several aluminum companies to resell their subsidized power on the open market rather than employing people did not sit well. The subsidies went away, and so did thousands of blue-collar jobs. Former aluminum towns were left to court new suitors. The Dalles brought in Google with a new set of subsidies. Troutdale is the site of a humming new FedEx operation.
View-Master was developed in Portland in 1939.
The hottest Oregon stock 30 years ago was not Nike. It was Animated Electronics. Founded in 1978, Animated went public in 1981 and quickly earned shareholders a 134% return on investment, nearly tripling Nike’s performance. The company’s primary product, the Lucky Eggs Machine, dispensed colored eggs from vending machines in grocery stores for a quarter. President Robert Poirier nabbed licensing rights from Hanna Barbera to use the likenesses of Fred Flintstone and Scooby Doo on his merchandise, and just like that parents had a whole new way to dispose of their change while shopping — and Oregon had a wildly successful public company. But the goodies inside turned out to be booby prizes.
Within a few years Animated Electronics had become MSM Systems, a company that focused on plastics injection molding using the raw material MSM, imported from Japan. From there things went downhill quickly. The Food and Drug Administration began seizing shipments of MSM, calling it an unapproved food additive. The company’s losses piled up and the lawsuits multiplied. Poirier stepped down in 1984, the same year his side company, Chocolates of Switzerland, also landed in bankruptcy court. Poirier and his associates stood accused of spending company money on elaborate home remodels and expensive trips to Switzerland. The legal mess took years to unravel.
Another Oregon-based toy company, View-Master, fared much better in the 1980s, only to experience disaster of a different variety. View-Master grew from $35 million in sales in 1983 to $106 million in 1986 cranking out the iconic three-dimensional image viewers first developed in Portland in 1939.
Then Tyco bought the operation in 1989 and Mattel bought Tyco in 1997 with plans to cut labor costs. Mattel was in the process of shifting hundreds of jobs from Beaverton to Mexico when environmental tests showed that the plant’s drinking water source was contaminated with the industrial solvent trichloroethylene at 300 times the government’s allowable limit. Water formerly used for drinking was hauled off and disposed of as hazardous waste. Former View-Master employees filed numerous workers’ compensation claims attempting to link the tainted drinking water to health problems, but all were denied. Mattel continues to make View-Masters in Mexico.
Going to the Dogs
The Multnomah Kennel club has been vacant since 2004. The dogs could not compete with the lottery games and casinos.
Another public company on the rise 30 years ago was the Multnomah Kennel Club, the greyhound racing track in Wood Village. The Kennel Club’s best season was in 1987, when 611,430 people visited the track and wagered $55.67 million. President and CEO George Dewey told the Oregonian, “We’re the No. 1 spectator sport in the state.”
Not for long. The dogs could not keep pace with the Oregon Lottery, video poker, off-track betting and Indian casinos. Magna Entertainment Group took over in 2001 but could not compete with the growing monopolies overseen by the state and the tribes. Magna shut down the track in 2004 and it has sat vacant since. Today it is the site of a long-planned gamble to develop the first non-tribal casino in Oregon, a gargantuan enterprise complete with water park, bowling lanes, 3,500 slot machines and projected revenues of $589 million per year. Voters shot down that idea decisively in November.