The Midwesterner: Blogging the Global Midwest

The Midwest: New Homeland of Inequality

Inequality, a growing social and political issue in the United States, has become particularly acute in the industrial Middle West.

This makes sense, considering the transformation of the industrial economy that once supported millions of middle-class jobs across the region. But new statistics show that this perception is reality, with inequality growing particularly fast in such states as Illinois, Ohio, and Michigan.

The statistics come from the Martin Prosperity Institute (MPI), the Toronto-based home of urbanologist Richard Florida, and they appear in one of the articles that Florida writes regularly for The Atlantic Cities website. The site, and Florida’s thoughts, contain some of the most useful writing on urban issues today.

Much of the growing inequality in the Midwest can be blamed on the usual suspects—the rich are getting richer, the poor are getting poorer, the 1 percent is outpacing the 99 percent, the uneducated are out of luck, and the middle class is vanishing. All this is true, the MPI says, but it’s pretty much true everywhere. So they ask: why is inequality growing faster in some places than in others?

The False Promise of Eds and Meds

Much of their manufacturing has disappeared, but many old industrial towns in the Midwest still have two things going for them. These are colleges and hospitals, or eds and meds, as they’re called. Most of these towns are counting on these industries to support them in the way that factories once did.

This always sounded a little desperate, even when both education and medicine were fast-growing parts of the economy. That’s stopping now, and towns that have staked their future on teaching young people and treating old people may be in for a disappointment.

Basically, both eds and meds depend heavily on government financing. In an era of tight government budgets at all levels, that financing just isn’t going to be there.

Trapped Without a Haven in Tornado Alley

The American Gothic House still stands on the edge of the tiny town of Eldon, Iowa, just where it was in 1930 when  the artist Grant Wood made it the backdrop to his famous painting, American Gothic. When the Dibble family built the little house in 1881, they put a proper cellar beneath it. That’s what you did in those days, to store preserves and to have a place to hide when a tornado hit.

I thought of the American Gothic house while reading the news from Moore, Oklahoma, where a mile-wide tornado not only flattened the town but killed 20 people there. Ten of the victims were children, including seven students at a grade school named Plaza Towers. According to news reports, only 10 percent of the homes in Moore have a cellar or even an above-ground safe room. Plaza Towers Elementary had neither.

An Overgrowth of Democracy

Spring is late coming to the Midwest this year, but democracy is blooming in Illinois. Most of the state is to hold township elections on April 9 to elect some of the most redundant and least useful public officials in American politics.

Personally, I could do with more tulips and fewer townships.

Leveraging Philanthropy for the Economy

There's a new community foundation in St. Joseph, Missouri, that is trying something really new -- to marshal the funds it oversees to promote economic development in St. Joseph and the northwestern Missouri region that neighbors it.

A community foundation exists to house personal or family foundations in its area. Most wealthy families can't set up vast billion-dollar foundations, lavishly staffed, like the Fords or MacArthurs. So they set up smaller foundations and park them inside community foundations, which handle the paperwork and see that the funds are spent as the founding families direct.

This money can go to scholarships, or to an arboretum, or to the care and feeding of cats. The Community Foundation of Northwest Missouri will accommodate these directives, if asked. But one of its goals is to educate the region, including its philanthropists, on the importance of repairing the region's tired old economy, generating a new economy and reviving the area as an economically decent place to live.

So far as I know, no other community foundation in the country --and there are more than 700 of them -- has set itself this goal.

Saving the Countryside

A Midwestern public radio reporter phoned the other day with a really good question. Why do small towns and rural areas matter? she asked. Everybody talks about scarce federal and state resources. So are small towns and rural areas important enough to our future to be worth investing in?

She referred to a recent speech by Tom Vilsack, the agricuture secretary, who said that "it's a fact that rural America with a shrinking population is becoming less and less relevant to the politics of this country, and we had better recognize that and we better begin to reverse it."

Pop Goes the Bubble

Yogi Berra has reminded us that "it's tough to make predictions, especially about the future." With all respect for the Sage of St. Louis, I'm going to make a prediction that is sure to pan out. Here it is:

There is a big and growing bubble in farm land prices across the Midwest, and this bubble will pop, sooner or later. The result will be a rash of failed farms and rural misery.

We know this will happen because it's happened before, most recently thirty years ago. In the 1970s, a variety of factors -- mostly high grain prices -- sent farm land prices to record heights as farmers borrowed heavily to buy as much land as they could. Then, in the early 1980s, other factors -- mostly falling grain prices -- left many indebted farmers unable to pay their debts.

The result: thousands of Midwestern farms failed. Banks foreclosed. Many small rural banks, holding too many bad loans, also failed. Newspapers reported farmer suicides, even the murder of bankers by distraught farmers. Farm foreclosure sales became common social events. Most big farmers weathered the storm, but medium-sized farmers, whose debt soared by 250 percent in the 1970s, collapsed. Usually, they were bought by bigger farmers next door, accelerating the consolidation of Midwestern farming and the decline in rural population.

A Lifeline from the World

As the global economy concentrates in cities, it has left behind a hinterland -- too often a wasteland -- of old factory cities and rural towns literally cut off from the global conversation.

It's easy --and wrong -- to say that the people in these towns are globalization's leftovers, men and women who can't cut it in this new economy, refugees happily hiding from the rest of the world, with no interest in that world and nothing to say about it. Many do indeed feel like castaways, but they long for more links with a world that has passed them by.

Icarus on the Farm

All farmers keep a constant eye on the horizon, watching for the cloud that might bring rain to nourish the crops or hail to destroy them. As the new year dawned, the most ominous financial cloud in a generation appeared on the horizon of the rural Midwest. Even farmers too young to remember the last big storm would be wise to get their financial crib doors shut before the next one hits.

It seems cruel to sound this warning just now. At the moment, farming is the one prosperous part of the American economy. Farmers are getting prices which, if not records, are very high. Corn is rising again, to about $6.50 a bushel. Soybeans are also up, to about $12 a bushel. The price of farm land has never been higher. The average price of an Iowa acre shot up no less than 32 percent last year, to $6,700: Illinois and Indiana aren't far behind. Sales of $10,000 per acre or more are common.

The real estate market may be dead everywhere else, but not down on the farm. In a recession-weary nation, it's great to be a Midwestern farmer. 

So what's the problem? What's the cloud that threatens to rain on the rural picnic?

Drifting in the Driftless Area

I spent the last week in Galena, a gem of an old Victorian town, nestled in the hills and forests of the so-called Driftless Area, in northeast Illinois near the Mississippi River Valley. I came away thinking how this area could be more than the beautiful but generally depressed region it is now.

Galena itself seems to be doing fine. It is a tourism and second-home mecca, packed with good restaurants and refugees from Chicago. But the Driftless Area itself is divided between four states and some 25 to 35 counties, depending on where you draw the boundaries. None of these jurisdictions -- not the states nor the counties -- has been able to work with the others to leverage the region's scenic potential and combat the economic distress that, like the scenery, they all share.