Chapter Six: New Arrivals Alter Perspective

Aleris International Corporation had the unique distinction of being one of the first Fortune 500s in the 21st century to select Cleveland as its new headquarters. A result of a 2004 merger between Commonwealth Industries of Kentucky and a Texas-based company IMCO Recycling this private business represented one of only four domestic companies engaged in the manufacturing of rolled aluminum products used in automobile applications. Its other prominent clients included the national aerospace industry, the national building trades and leading commercial transportation sources. Wanting to be closer to its client-base; manufacturing facilities and raw materials sources convinced Aleris officials to locate their central offices in Cleveland.

Over the next 15 year period, the Aleris International Corporation reported annual sales exceeding $1,000,000,000. Unfortunately, that firm also had accumulated a staggering debt over that same time frame. Its unrelenting need for larger and larger amounts of working capital as a way of offsetting mounting operational expenditures inevitably resulted in an extraordinarily large debt. That never ceasing financial difficulty confronting Aleris executives, as that business imbalance grew wider and wider, did not escape the attention of one of its chief rivals Novelis Incorporated. A subsidiary of an Atlanta based conglomerate called Hindalgo Industries, Novelis proposed a $2,600,000,000 merger in July 2018.

Subsequent talks between those companies led the U.S. Department of Justice to file a civil antitrust suit against Aleris International that September.^[1] After much deliberation in the courts, the DOJ finally permitted this controversial merger to take place but only with the understanding that Novelis would divest itself of Aleris’s aluminum auto body sheet operation factories immediately. Such decisive action, on the part of this very eager purchaser, would guarantee future opportunities for the few remaining competitors within that very technically advanced field. The court ruling, with its specific legal requirements, empowered Novelis to acquire Aleris International.

Announced in April 2020, this $2,800,000,000 bailout package obliged Novelis officials to not only pay the $75,000,000 equity value of its soon to be procured corporation; but also, assume any of Aleris’s outstanding debt above $2,000,000,000. In addition, the buyer had to bankroll a $50,000,000 earn-out payment.^[2] Novelis executives complied with the court rulings and Aleris International announced the closing of its Cleveland headquarters later that same month. Again, the decision on the part of Aleris to leave Cleveland, OH for Atlanta, GA, mainly involved business logistics and had nothing to do whatsoever with the attractiveness or lack of attractiveness of this Midwestern community as a corporate center.

Most of the time-honored Fortune 500s headquartered in Cleveland continued to enjoy solid profit gains right into the 21st century. The Progressive Corporation (#153) with its outstanding sales record of $14,000,000,000 led the group followed by the First Energy Corporation (#184) at $12,000,000,000. Other long-term, local companies such as the Eaton Corporation (#207) and the National City Bank of Cleveland (#226) each boasted of $11,000,000,000 in corporate sales, while the tried-and-true Parker Hannifin Corporation (#247) reported that its annual sales topped the $8,000,000,000 level. The Sherwin-Williams Company (#316) and the Key Corporation (#321) each registered $7,000,000,000 in new sales by 2001.

Unfortunately, the Recession of 2008 drastically changed that once very rosy economic picture for many. The National City Bank of Cleveland represented one of that recession’s earliest casualties. In December 2008, Pittsburgh National Corporation (PNC) announced the acquisition of this leading Midwestern banking institution. Heightened negotiators over the previous several months had resulted in a titanic stock exchange buyout between those giants. A quick merger of that magnitude and scope would have been unheard of prior to the Recession of 2008. However, the inability of millions of homeowners nationwide to pay their monthly subprime mortgage obligations set the stage for what was about to transpire between the National City Bank of Cleveland and the PNC.

Prior to the Recession of 2008, the banking industry in the U.S. had increasingly relied on mortgage securities, often discounted and sold in bulk, to boost local residential sales within what many perceived to be a burgeoning national housing market. As long as the national real estate market showed no signs of weakness then vast speculation was viewed as a suitable way in which to fast track potential new homebuyers whether those individuals qualified for residential mortgages or not. Low to moderate income African Americans made up a large percentage of that specially targeted housing market. Regrettably, many unprincipled lenders and mortgage brokers relied on questionable business practices such as predatory loans, reverse mortgages and mortgage securities trading to achieve their unrealistic sales goals often with dire economic and financial consequences later-on.^[3]

Few involved in the housing market at the time of the Millennium care to acknowledge the remote possibility that those newly attained high profits might suddenly come to a grinding halt. Yet, that was exactly what happened. The fact that few engaged in the real estate industry readily admitted the possibility that market might totally collapse due to the strain caused by such questionable business practices may seem perplexing in retrospect. This becomes even harder to fathom when considering the fact that as early as 2005 there was an unusually high number of residential foreclosures. That conspicuous increase in the number of foreclosures demonstrated just how unstable the U.S. housing market had become. Even though domestic home sales by 2006 were fast approaching an unprecedented, new saturation point, it would take a series of cataclysmic business events beginning with the bankruptcy of American Home Mortgage in August 2007 followed by the collapse of Lehman Brothers in September 2008 and other, equally vital global failures before the majority of speculators acknowledged that this nation was indeed in the midst of a serious recession.

The London Interbank Offered Rate (Libor) played a key role in fueling this worldwide financial crisis. Founded in the 1986, Libor rapidly became the international benchmark used by the majority of lending institutions to establish their interest rates on adjustable-rate loans and home mortgages. Corporate borrowers also relied on it to price the debt owed. Libor not only set the rates for Credit Default Swaps (CDS); but also, created the criterion by which lead organizations including the American International Group allotted vast amounts of CDS on their prime mortgages and any additional financial products they might be handling at any given moment.

The subsequent collapse of the real estate market forced American International into bankruptcy. What prompted that collapse involved repeated, and as it turned out, improper dispersal of federally-sponsored subprime mortgages and securities. Libor played into this mounting financial crisis by deliberately estimating higher and higher interest rates on borrowed funds and supplying additional loans as more and more international central banks attempted to slash their interest rates. This inexplicable combination of escalating rates on trillions of dollars of financial products along with the heightened anxiety expressed universally by investors on all levels, due in large measure to constrained bank lending served to radically diminish the flow of money into the economy, which in turn, led to this most serious recession.^[4]

Acknowledging the gravity of that situation compelled the federal government to intervene on behalf of the financially-ailing banking industry. In October 2008, the 110th U.S. Congress passed a $700,000,000,000 relief package. Authorized under the Emergency Economic Stabilization Act of 2008, the Troubled Asset Relief Program (TARP) enabled national lenders to obtain immediate federal assistance through designed loan packages. The forthcoming appropriations were intended to offset recently-incurred losses by those same institutions. Congressional leaders sincerely believed that this bailout package would not only help to stabilize the U.S. real estate market quickly; but also, embolden those same lenders to issue new home mortgages once the present catastrophe had passed.

All of the nation’s 29 leading lending institutions qualified for this massive help with the rare exception of the National City Bank of Cleveland. In June 2008, federal officials placed National City under what was called “a Memorandum of Understanding.” Among other things, this form of probation held potentially-questionable capital investments by National City bankers in check. It also limited the bank’s ability to participate in risk management practices or any other distasteful business procedures. Intent on avoiding bankruptcy, National City’s Board of Directors immediately sought out possible buyers.

A number of leading lenders answered the call; however, most of their proposals fell far short of the bank’s goals. Further discussions resulted in National City accepting an offer made by the Pittsburgh National Corporation. This agreement resulted in PNC issuing a stock transfer worth $5,580,000,000. The U.S. Treasury sweetened that deal even further by issuing to this Pittsburgh-based lender $7,700,000,000 in preferred stock and other related warrants. Standard closing requirements as carefully set down through TARP’s special Capital Purchase Program guided this process. An outgrowth of the early 19th century City Bank of Cleveland, National City Bank closed its doors in 2009.^[5]

The loss of both TRW and National City Bank might have seriously marred Cleveland’s sterling reputation as a leading Fortune 500 center had the local business community not interceded to prevent such a calamity from happening. Its leadership made it quite clear to any doubters that the recent closing of two of its most important Fortune 500s was not symptomatic of a much greater economic catastrophe about to unfold. Cleveland’s long-held positive status as a premier national business center enabled its strong minded leadership to take a robust business approach principally directed towards unfair attacks made on local corporate leaders by outside business interests. Unquestionably, the first decade of the 21st century presented a number of very demanding economic and financial challenges for Cleveland’s proficient business community.

Some of those challenges attempted to undercut Cleveland’s business legacy that originated with its founding in 1796. Rather than acquiesce to those new, overpowering challenges, Cleveland’s corporate leadership banded together to overcome them whenever possible. That was no small feat especially during a time when erratic economic and financial conditions lent a high degree of uncertainty to any new challenges that might suddenly appear out of nowhere. From the Cleveland perspective, everyone remained guardedly cautious especially when it came to what might be the best course of action for them to follow at that juncture. Those new business challenges were analogous to a number of highly germane business and human resource concerns, which Cleveland’s business elite would have liked to avoid if possible.

Those pertinent challenges ran the entire gamut from sustaining a diverse labor force and promoting more sanguine business policies devoted directly towards protecting our nation’s fragile environment to instituting a more congenial work setting and practicing greater transparency in daily business practices.^[6] Of all of those new challenges, the one that proved to be the most problematic involved sustaining a cleaner environment. Achieving that goal proved remarkably demanding especially for Fortune 500 firms that were limited by emerging budget constraints.

Putting aside the many economic and financial restraints affecting less successful corporations, the majority of local businesses made every possible effort to comply with the latest federal environmental requirements even if that meant reserving a sizable percentage of their annual budget for those measures. Beginning with the Millennium, corporate compliance increasingly concentrated on such things as significantly lessening greenhouse emissions and upholding the many new efficiency standards applied to appliances made in the U.S. Within the public’s collective experience, environmental consciousness and strict compliance to new federal restrictions on the corporate level translated into a readiness on the part of big business to do more than its fair share in that regard.

Both the George W. Bush and Baruch Obama administrations supported the policies, programs and regulations issued by the Environmental Protection Agency (EPA). However, each administration followed a somewhat different approach when it came to attaining those desired ends. In the case of the Bush administration, it relied heavily on interagency cooperation to achieve its many goals while the Obama administration attempted to achieve its objectives primarily through efforts directed from the White House. Both administrations repeatedly reaffirming to the eager voting public the importance of upholding the “common good” by supporting new, federally-backed environmental agendas without exemption. Those policies aimed at achieving a much cleaner environment while simultaneously reversing global warming received top priority. Most of the private sector viewed the idea of saving our environment as a just cause well worth pursuing on a multitude of fronts. That kind of proactive thinking continued right through the elections of 2016.

Regrettably, the 45th President Donald J. Trump did not believe in the irrefutable scientific evidence that among other things stated that environmental pollution and global warming were on the increase again. His refusal to accept that evidence enabled him to override if not outright suspend many of the more effective environmental requirements without furnishing the public with any viable alternatives to them. His unilateral decision to withdraw the U.S. from the Paris Climate Accord in 2017 provided some unscrupulous Fortune 500s a chance to ignore many of the earlier, accepted guidelines. In numerous cases, severe economic and financial consequences befell large corporations that refused to uphold those environmental standards.

Business transparency remains an ongoing issue among many Fortune 500 operations right to the present day. In fact, today’s highly sophisticated market increasingly demands more companies to comply with it. Adopting more transparency in such things as corporate goals, operational procedures and performance evaluations usually promotes greater trust among employees as well as higher productivity and greater job satisfaction. A recent study enumerating the many positive benefits of practicing business transparency discovered that most consumers respect those enterprises that subscribe directly to it. In fact, 94% of those surveyed try to purchase as many products or services as possible from those concerns and that 75% of them will pay higher prices for their items. Business transparency affects nearly all attributes of daily activity from advertising and bookkeeping, at one end, to customer relations and products sold, at the other. Without a doubt, creating a better work environment through transparency serves to promote greater honesty and integrity among its satisfied participants.

TravelCenters of America (TCA) symbolizes a Cleveland Fortune 500 that has met many of those new challenges admirably. One of this nation’s largest public service providers, TCA operates numerous service centers, convenience stores and restaurant chains. Created in 1972 by a prominent Rochester, NY benefactor and entrepreneur E. Phillip Saunders (b. 1938); this enterprise was originally known as Travelstops of America. Over the next quarter of a century, the Ryder Corporation and the Standard Oil Company of Ohio each owned it. Following its merger with National Auto Truckstops in 1997, this energetic firm adopted its present name. In 2000, a private equity firm called Monitor Clipper Partners LLC obtained TravelCenters of America.

Six years later, Hospitality Properties Trust, a Newton, MA, public Real Estate Investment Trust (REIT), purchased TCA for an estimated price of $1,900,000,000. REITs are business entities that specializing in financing, operating and owning a wide range of different income-producing real estate. Similar to mutual funds, REITs assemble capital from their stakeholders with the intention of generating dividends for them without having those same investors finance, manage or purchase any of the real estate holdings they have vested interests at that time. Most REITs are highly liquid in that they are publicly-traded on the open market much like stocks.^[7]

On the heels of that 2006 buyout, the American Stock Exchange added TravelCenters of America to its growing list of public corporations. In a bold attempt to bolster the price of its stock, with the intention of not only reducing the supply of its outstanding stock; but also, guaranteeing potentially higher bids on its remaining stock, TCA’s shrewd Board of Directors convinced its many affluent shareholders to repurchase over $100,000,000 worth of its-own stock. The year was 2015.

Later that same year, its resourceful group of executives rejected a merger attempt made by Golden Gate Capital of San Francisco, CA. This private equity firm had planned to invest more than $15,000,000,000 of its-own capital resources to ensure both a successful buyout and smooth transfer. That $540,000,000,000 stock merger would have been an outstanding business event had it occurred as planned. Unfortunately, TravelCenters of America’s Board of Directors projected a more direct, hands-on approach following the merger that would have been targeted towards not only improving its company’s marketing skills; but also, its operational efficiency. That kind of cooperative venture held little direct appeal for Golden Gate Capital and it retracted its most generous offer.

A recently instituted business strategy that inspired a rapid expansion of TCA’s service network by offering eligible buyers generous new franchise options has proven far more promising in terms of corporate growth than was imagined initially. In this case, it resulted in 18 new franchises opening in less than a year. It also sanctioned its shrewd legal team to sell all of its 225 U.K.-based Minit Mart convenience stores for $330,800,000. A new British firm Euro Garages LTD purchased them.^[8] Hospitality Properties Trust and TravelCenters of America reached an agreement in January 2019 by which TravelCenters of America would acquire from its present owners 20 additional travel centers for $308,200,000. That buyout reduced TCAs aggregate minimum due rent by $43,100,000.^[9] With its revenue presently exceeding $6,000,000,000, TCA owns and operates more than 260 travel centers and approximately 650 restaurants throughout the U.S. and Canada. Recently-instituted work furloughs the direct consequence of the spread of COVID-19 has not adversely affected that firm’s bottom line at least not at the time of this writing. This progressive Cleveland Fortune 500 firm also profits greatly from its popular name brand items.

Viewed by national business leaders as one of Cleveland’s most successful Fortune 500s, the Eaton Corporation presently maintains two headquarters. Dublin, Ireland is its main headquarters while Cleveland serves as its operational headquarters. Established in 1911 by Joseph O. Eaton (1873-1949), Henning O. Taube (1885-1958) and Viggo Torbensen (1858-1947), this enterprise began by manufacturing internal gear axles for trucks. Being on the cutting-edge of innovation heartened its ambitious owners four years later to relocate their operations from Bloomfield, NJ to Cleveland, OH. They wanted to be closer to the flourishing, new automotive industry. Through a series of strategically important mergers including the much touted acquisition of the Yale and Towne Locksmith Company and the Dole Valve Corporation, both in 1963, the status of this firm continued to grow right into the 21st century. Today it offers a wide assortment of specialized products that are vital to the aerospace industry, automobile industry, building trades, commercial enterprises and industrial sector. Those commodities include electrical power distribution and control equipment; specialty engine components, fluid connectors, hydraulic products and truck drivetrain systems.

Eaton Corporation’s acquisition of the Irish based Cooper Industries in 2012 prompted that unprecedented company move from Cleveland to Dublin. A popular electrical equipment supplier that specialized in lighting, lighting controls, safety solutions, smart grid and utility power distribution and wiring devices, Cooper Industries complemented Eaton Corporation’s growing interests in such crucial business areas as energy services, power distribution and power quality. That foremost merger resulted in Eaton Corporation attaining a premier presence on the international business stage. That premise is borne out by the fact that it now operates factories in more than 60 countries. In all probability, its $11,460,000,000 cash stock merger would have gone unnoticed within the international business community had it not been for the fact that the Eaton Corporation had developed very close business ties with the federal government over the years. Unquestionably, the board’s decision to relocate its main headquarters from Cleveland to Dublin jeopardized its contractual ties to the federal government. However, another far more pressing legal matter soon gained the attention of federal prosecutors. One of those new legal concerns concerned the amount of corporate taxes owed by the Eaton Corporation to federal officials along with other secondary legal claims or obligations that company might have incurred as a result of its well-publicized relocation activities.

Like so many other Cleveland Fortune 500s, the Eaton Corporation continually faced the challenging menace of paying higher and higher corporate taxes on earned revenue. At the time of its merger with Cooper Industries in 2012, its federal tax rate stood at a whopping 39%. However, all of that changed when the 115th Congress passed the Tax Cuts & Job Act of 2017 in December 2017.^[10] That bill lowered its tax rate from 39% to 21% while also offering some very desirable, new deductions for qualifying companies based in the U.S. Such liberal tax breaks had not existed five years earlier when the Eaton Corporation merged with Cooper Industries. Given the volatility of the international market throughout most of the Obama Presidency, it is not at all surprising that Eaton’s Board of Directors took the lead in what became a most lucrative merger. The many new business opportunities laying ahead for that sharp local Fortune 500 once it joined up with Cooper Industries certainly appealed to its financially savvy Board of Directors. Eaton Corporation’s recently attained economic and financial flexibility, resulting from that well timed merger, gave new economic and financial life to this once, tightly wed Cleveland firm.

The ensuing decision by the Eaton Corporation to relocate its primary headquarters from Cleveland, OH to Dublin, Ireland was not some random act executed by a group of ambivalent leaders, hardly. Major tax considerations played a key role in that decision. In this case, the decision to move enabled that new international entity to lower its corporate tax rate significantly from a rate of 39% to 12.5%.^[11] By 2016, this Fortune 500 had benefitted from more than $160,000,000 in tax breaks authorized through the Irish government. In an attempt to avoid any future legal entanglements in the U.S., due to its extraordinary relocation effort, led its perceptive Board of Directors to approve a second headquarters in Cleveland, OH. That straightforward business tactic seemed to work quite well prior to the passage of the latest tax reform package. From the federal government’s perspective, this latest tax reform measure sanctioned the U.S. Department of Justice to initiate a series of legal challenges leveled mostly against allegedly suspicious Fortune 500s. Those corporations under the watchful eye of DOJ officials were purportedly engaged in what government prosecutors labeled as questionable legal activities.

Taking generous tax write-offs led the list of dubious legal actions foremost on the mind of federal prosecutors. However, it involved much more than just eliminating federal tax loopholes. In this instance, DOJ officials wanted to resolve a wide range of legal issues that recurrently came to light following the passage of this new reform initiative in 2017. The Eaton Corporation legal disputes, which began that same year primarily focused on such things as the amount of back taxes owed the U.S. government by that company and whether or not that enterprise still had the legal right to claim certain, often worthwhile tax exemptions while not paying other, recently incurred liabilities. As of this writing, no decision has been rendered on either account.^[12]

Cleveland’s American Greetings Corporation (AG) is a private enterprise founded by Joseph Sapirstein (1885-1987) in 1906. Initially, a picture postcard distributor, this company first enlarged its operations after the First World War. Sapirstein readily acknowledged the fact that those entrepreneurs able to sell high volumes of greeting cards and other miscellaneous items at a reasonable cost would soon dominate this industry. With the assistance of his two sons Irving Sapirstein (1910-2000) and Morris Sapirstein (1911-1989), this Polish immigrant established the Sapirstein Greeting Card Company in 1926. With capital exceeding $18,000 annually, he incorporated his company eight years later. During the 1930s, he introduced a number of very practical things including self-service display units, standard pricing, trained sales representatives and branch outlets. His patented improvements resulted in corporate sales topping $1,000,000 by 1940. In response to its fantastic growth, corporate officials soon changed its name to American Greetings Publisher.

The successful marketing of several new lines of greeting card, such as the Forget-Me-Not series, led to even further growth. However, that was not enough. Its in-house strategists expected much more than just blanketed recognition for a job well by their growing number of satisfied customers. Those marketing experts sought to enhance their company’s image even further by going global. With that in mind, its Board of Directors signed a long-term license agreement with a respected Australian printer and board games distributor known as John Sands Pty LTD in 1949. Forty-six years later, American Greetings purchased that same down under distributor. Hoping to entice an even greater number of investors into its fold led its executive team in 1952 to announce that this Cleveland enterprise was going public. Later that same year, it became known as the American Greetings Corporation (AG).

The decade of the 1950s found AG officials busily engaging in a number of new endeavors. Much of their activities served to augment its growing presence on the international level. The addition of a brand new line of greeting cards called the Hi Brows saw daily production nearly reach the 2,000,000 mark by 1956. With seemingly unlimited, new economic and financial possibilities straight ahead, this groundbreaking local manufacturer entered a new vista within the international market scene. Emerging new market centers in Canada, Malaysia, Mexico, New Zealand, the Union of South Africa and the United Kingdom soon welcomed AG products.^[13]

First and foremost the American Greetings Corporation prided itself on its matchless ability to not only offer a wide assortment of cleverly presented, reasonably-priced greeting cards; but also, furnish its growing buying public with a dazzling array of equally desirable party favors. Multitasking, on such a grand scale, was not for the faint of heart and AG knew it. However, its shrewd leadership team repeatedly met the formidable economic and financial challenges inherently a part of such widespread speculation. With a net income in 1972 of $11,800,000, AG had demonstrated to even its most cynical competitors the extent of its business commitment to its loyal consumers. Beyond all else, that pledge guaranteed to its many devoted customers the highest quality products at the best possible prices. Many of its many memorable greeting cards and most cherished collectibles featured some of this nation’s most beloved fictional characters of the day. They included the likes of Care Bears, Holly Hobbie, Strawberry Shortcake and Ziggy.

By the mid-1950s, AGs executives fully recognized that catchy phrases and poignant advertising promotions were no longer sufficient to ensure sustained sales volume. They also knew that owning and operating their-own stores embodied one of the most efficient ways in which to remedy that predicament quickly. With that idea in mind, its board enthusiastically approved the formation of its-own retail outlets. Known as the Carlton Cards Retail Company, this affiliate soon operated more than 150 shops worldwide. Those shops featured a wide array of popular items such as American Greeting, Carlton, Gibson, Papyrus and Recycled Paper Greetings. They also offered Design Ware Party Goods, Designers’ Collection stationary, Guild House candles, Learning Horizons educational products, Magnavision reading glasses and Plus Mark gift wrap. The later introduction of online greeting cards and other selected items, primarily through new websites, proved equally profitable. Fortune Magazine listed AG as #478 on its expanded Fortune 500 list in 1983. Annual sales revenues continued to grow reaching the impressive $1,000,000,000 mark by mid-decade. The same could be said about its profitable retail outlets where sales exceeded $2,200,000,000 by 1993.

Unfortunately, its record of unprecedented successes was not to last too much longer. Changing consumer tastes, the barrage of new competitors and some unsound investments, following the recession of 2008, took its toll on AG. In fact, this publicly-traded, Fortune 500 debt-ridden company had to go private in 2013.^[14] Five years later, a New York based private equity group called Clayton, Dubilier and Rice (CD&R) secured 60% of its outstanding stock. With 2018 revenue totaling $1,800,000,000, this combined manufacturer and retailer now controlled 60,000 outlets. Company officials that year also held claim to 440 patents, 2,500 copyrights and 1,000 trademarks. Once ensconced into its very distinct corporate culture, CD&R began to modernize the company’s current operations while simultaneously invigorating its staid marketing approach. It hoped that such actions would help to improve the firm’s bottom line significantly in the years ahead.^[15]

Throughout the fall of 2019 speculation ran high as to whether the Sherwin-Williams Company would keep its corporate headquarters in downtown Cleveland or move somewhere else. Rumors had been circulating for years that this enterprise needed much more office space if it intended to remain in this Midwestern city. However, its spokespersons remained mostly silent on that pertinent issue until February 2020 when a major press release unveiled their latest business strategy. Those detailed plans called for the construction of a new headquarters on several vacate sites located on the west side of Public Square, in the heart of downtown Cleveland. The projected cost for this new 1,000,000 square foot complex stood at $300,000,000.^[16]

Company representatives further announced their intention to build a new, 500,000 square foot, state-of-the-art Research and Development (R&D) facility on the former site of the Veterans Affairs Hospital in Brecksville, OH. They estimated that this new R&D center would also cost $300,000,000.^[17] Government leaders at both Cleveland City Hall and Cuyahoga County enthusiastically supported their efforts. In the case of Cuyahoga County, its commissioners generously authorizing a $14,000,000 grant. At the time of this writing, the Ohio Controlling Board had just approved $70,000,000 in interest-free, incremental forgivable loans targeted for that enterprise’s new corporate headquarters and research facility.

Founded in 1866 by a prominent bookkeeper named Henry Sherwin (1842-1916), this soon to be recognized, international paint manufacturer and retailer began as a local hardware concern. A profitable enterprise from the day it started, Henry Sherwin appreciably expanded his humble retail surroundings after partnering with Edward P. Williams (1843-1903) and Alanson T. Osborn (1844-1919) in the 1870s.^[18] This newly enlarged manufacturing and retail outlet soon gained a commanding lead within its competitive field when it started selling its-own ready-made paint in 1880. Relying on keen business instincts to see it through some very difficult times enabled Sherwin-Williams to acquire several other prominent paint and varnish distributors over the next two decades.^[19]

By the turn of the 20th century, the Sherwin-Williams Company enjoyed a substantial corporate lead over many others within that fast-paced industry. The 1920s symbolized a decade of unparalleled growth for this competent company. Its remarkable success throughout the Jazz Age was not limited exclusively to its continually-expanding retail network and top quality paint related products. It went far beyond just that. The company’s cleverly presented advertisements that included among other things its distinctive “Cover the Earth” logo enabled that booming enterprise to stand out among the rest. After all, everyone knew Sherwin-Williams. As the company’s profits soared so did its need for office space. In 1930, Sherwin-Williams relocated its corporate headquarters to the brand new Midland Building on West Prospect Avenue. A part of the newly completed 52-story Terminal Tower skyscraper and adjacent retail complex, this Classic-inspired Midland Building remained its headquarters into the 21st century.

High sales records during the immediate post-war years provided Sherwin-Williams with a decided economic and financial edge over a number of its chief rivals. By the mid-1950s, its innovative planners had devoted much of their daily energies not only towards increasing the number of retail outlets; but also, perfecting new chemicals, better resistant paints and more durable varnishes. Further strategic mergers with other viable competitors specializing in such things as premier paints, resistant varnishes and everyday household goods provided this successful firm with a much wider business venue than had been the case in the 1920s or 1930s. The ensuing acquisitions of Brod Dugan, ConLux Coatings, FLR Paints, Pratt & Lambert, Thompson Mini Wax and Valspar Paints enabled the Sherwin-Williams Company to retain its prestigious ranking among Fortune 500 conglomerates right into the 2020s.

However, a great deal of the economic and financial success enjoyed by many Fortune 500s in Cleveland including Sherwin-Williams encompasses much more than just the effective marketing of their many popular goods and services repeatedly. In order to remain competitive within their much valued fields, Fortune 500s, such as the Sherwin-Williams Company, must continually invest and reinvest in research and development. In the case of Sherwin-Williams, its R&D currently operates out of the former Standard Oil of Ohio Research Center in Warrensville Heights, OH. Plans call for moving that important division to its new Brecksville, OH facility very shortly. The increase in its Fortune 500 ranking from #215 in 1968 to #180 in 2020 demonstrates its many major accomplishments stretching over the many years. Much of it originated from its impressive R&D department.

Surprisingly, most of Cleveland’s Fortune 500s continue to post high profit returns in spite of the economic and financial devastation wrought by the Coronavirus. Not only has that pandemic claimed hundreds of thousands of lives nationwide; but also, overwhelmed the international market as well. In October 2020, the International Monetary Fund (IMF) projected that if the global economy continued along its present trajectory that by the end of the year it would have shrunk by 4.4%. If that economic projection becomes a reality then it will represent the worst single year decrease since the Great Depression of the 1930s.^[20]

Setting aside that grim prognostication, much of the financial success attained by Cleveland’s top six Fortune 500s over the past two years resulted from them being able to supply a large amount of products and services targeted towards the specific needs and wants of their demanding consumer-base. With the help of the Federal Reserve many large, public corporations, with highly commendable portfolios have been able somehow to miraculously service their credit while still meeting their growing debt obligations. This ability to accomplish both objectives simultaneously enables those enterprises to not only successfully invest in other lucrative stock options; but also, tactfully reinvest in their-own company when appropriate. That latter action is intended to improve both the desirability and value of their-own corporate stock within the accepted bounds of today’s unstable market setting.

The Progressive Corporation leads that group of contemporary businesses with sales soaring from $26,800,000,000 in 2018 to $39,022,000,000 in 2020. The Sherwin-Williams Company experienced similar advances over that same two year period as its sales increased from $15,000,000,000 to $17,900,000,000. That also applies to the Parker Hannifin Corporation where sales had surged from $12,000,000,000 to $14,320,000,000 and the Key Corporation where its assets grew from $6,900,000,000 to $7,694,000,000. Another Cleveland-focused enterprise TravelCenters of America also recorded a small increase from $6,100,000,000 to $6,112,000,000. Only the First Energy Corporation experienced a considerable drop in revenue from $13,600,000,000 in 2018 to $10,800,000,000 by 2020.

In terms of Fortune 500 rankings over that same two-year cycle, the Progressive Corporation climbed 16 slots from #112 to #86 while the Sherwin-Williams Company ascended 10 slots from #190 to #180. That also held true for Cleveland favorites such as the Parker Hannifin Corporation which enjoyed a sizeable jump from #256 to #224 and the Key Corporation which also moved up a slot from #412 to #411. Regrettably, TravelCenters of America and the First Energy Corporation saw notable drops in their Fortune 500 rankings from #465 to #480 and from #219 to #294.

With the outbreak of COVID-19, any earlier forecasts suggesting steady economic growth through Q3 and Q4 2020 are no longer valid. This virus has undermined our domestic economy in ways no one could have imagined just 12 months ago. A remarkably sharp increase in the number of U.S. business closings along with millions of previously unforeseen job furloughs led the 116th Congress to approve the Coronavirus Aid, Relief & Economic Security Act on March 27, 2020.^[21] Known as the Cares Act, this $2,200,000,000,000 relief package offered federal assistance to many small business owners and their employees. It also called for saving existing jobs through special unemployment payments while providing added funds to state, local and tribal governments based on financial need. Congressional leaders said that this emergency bill was only the beginning and that further federal assistance would be forthcoming. Unfortunately, previously unimagined internal squabbles, mostly along political lines, averted Congress from enacting additional assistance within a timely fashion.

Finally on December 21, 2020 both houses of Congress approved the Consolidation Appropriations Act of 2021. This bill called for providing an additional $900,000,000,000 in funds for the growing needs of the people. That aid was to come in the form of stimulus checks, additional federal unemployment benefits and extensive vaccine distribution campaigns. This bill also offered funding for child care, schools and small businesses. Repurposing $429,000,000,000 in idle Cares Act funds originally directed towards emergency lending programs represented another crucial component of that bill.^[22] Congressional leaders believed that this act would not only aid economically struggling Americans; but also, assist our much beleaguered economy as it tries to recover to its pre-pandemic level. At first, President Trump threatened not to sign that bill claiming that the $600 cash relief checks were insufficient. However, in the end he signed it into law. At the time of this writing, the Biden administration is attempting to building upon those earlier relief packages.

Some of the largest U.S. corporations have not experienced the full brunt of this pandemic. However, if this health crisis should persist into 2021 or 2022 then many Fortune 500s previously spared the worse of it might become vulnerable. A number of this nation’s largest conglomerates within the airlines, hospitality, retail and travel industries have already experienced extraordinary financial losses as fewer customers utilize their services. In the case of the airline industry over the past year there has been a 50% drop in domestic business and a 75% decrease in the number of travelers going overseas. Current corporate projections indicate that the airlines industry will not reach pre-Pandemic levels until 2022 or 2023.^[23] Another indicator of the failing market concerns the fate of small businesses. Unable to generate sufficient profits has led countless numbers of independent restaurateurs and small business owners to either curtail services or limit operational hours. Regrettably, many have been forced to close down permanently.