Oelwein, Ludlow and the rest of us

The Asian currency crises (which I lived through) exposed the corruption of crony capitalism that was prevalent through out the region. It also exposed the high levels of debt (gearing ratios of 3:1 to 4:1 in many cases) that large corporations had at the time. The U.S. financial system and the IMF pushed the region into cleaning up their financial institutions, increasing transparency of financial data for investors as well as regulations, and reduction of corporate debt. Some of the countries, most notably South Korea, really took the lesson to heart and reformed themselves. They are now stronger as a result. The results though out South East Asia are more mixed. Thailand reformed itself but Malaysia largely did not. In any case, it is worth noting that the financial earthquake of last year and the response to it by our government and financial institutions shows that we committed all of the same mistakes as the Asians did in the 80's and 90's. The difference is that the North East Asians and, to a lesser extent, the South East Asians largely learned the lesson. We clearly have not.

We (our country) is just as corrupt and has just as much crony capitalism as Asia. We also have as little regard for objective rule of law.

http://www.firstthings.com/blogs/spengler/2009/06/03/rule-of-law-in-the-us-on-par-with-china/

In other words, we are no different than Asia with regards to crony capitalism, corruption, and the lack of objective rule of law. This means that when the economy recovers (which it will eventually), the smart ambitious people will go where ever the most growth and dynamism is. There is no guarantee that this will be the U.S.

"In the developing world, people look at Washington and see a system of government that allowed Wall Street to write self-serving rules which put at risk the entire global economy -- and then, when the day of reckoning came, turned to Wall Street to manage the recovery. They see continued re-distributions of wealth to the top of the pyramid, transparently at the expense of ordinary citizens."

A good example why guillotines and bullets, (as horrific as they are), often seem a justifiable solution to a society's ailments.

(Apres eux, le deluge.)

It's hard to see how the problems get solved in the larger sense, or even if they are truly "problems". In 1990 (according to census data), about 3/4 of the population in the US lived in urban or suburban areas. That proportion has increased since then as part of a trend that has been happening for at least the last 100 years. Where are the votes? Not in the countryside. The one thing that gives rural areas some clout in Congress (far, far out of proportion to their population; in terms of pure numbers, rural Americans are probably the best represented "special interest" as a result) is the composition of the Senate.

There's a very good reason for this flight (and for the long, drawn-out death of the communities left behind): agriculture simply does not require the manpower it did a hundred years ago, and it's cheaper and more efficient to aggregate industrial and most service sector jobs in one place (i.e. in cities).

In general, this is a very good thing for society as a whole: agriculture has never been much of a path to wealth and prosperity unless you were one of the very, very few who owned a lot of the land. Agricultural societies invariably have the vast, overwhelming majority of their population locked into poverty (regardless of whether they are slaves, serfs or freeholders). Throughout history, the way out of rural poverty has been to move to a town or city and to find work as skilled labor or commerce (look at the Middle Ages—your greatest upward social mobility is invariably in towns and cities; in the country, if you were born a serf, you would in almost certainly die one).

As long as there is sufficient resources to keep people in the cities fed and provided with reasonably inexpensive sources of energy, I see no reason why we should try to reverse this trend. While pastoral fantasies of idyllic country life appeal to nostalgia (and have done so dating back to both Rome and before that Alexandria), they gloss over the reality of rural life in pre-industrial ages: extremely hard labor for not much recompense.

Even the "crunchy" option of farmer's markets and artisan cheeses require an industrial society producing vast amounts of wealth to stay in business. You don't get cheesemakers making $100 per tin in pre-industrial societies.

Right now, the one and only industry I can see that might stem the tide even a little is the alternative energy industry. After all, someone has to build and maintain all of those windmills and solar panels, and they need to go where land is cheap and where they won't interfere with all of the other activities in the cities. But that's a rearguard action at best.

What do we do about this? Why aren't people asking this question, and demanding an answer? Why do we put up with this? Where are the real populists in either party?

Thomas Frank's What's the Matter With Kansas covered some of this ground. I'm guessing it wasn't high on most conservatives' must-read list, though, since its focus was explaining why people in these small towns whose economies are being destroyed are nonetheless persuaded (or duped) into voting for the right-wing politicians who keep the destruction going. (Short answer: cultural issues are used to distract them from their economic interests.)

But I'm with Geoff G. on this: a lot of these regions are just regressing to the mean. Populating them was an artificial undertaking in the first place -- and one that depended heavily, BTW, on vast and intense government intervention, subsidies, etc. (which is ironic given the libertarian politics to be found in many of these places; "Get government off our backs!" writes the blogger whose town was settled thanks to federal railroad land grants, and whose computer is drawing power from a New Deal hydroelectric project). In America's early years, the interior was seen as largely uninhabitable, a mix of desert, swamp and barren waste. You can read some of these predictions here, in in this classic study of American imagery -- check out chapter XVI:

http://xroads.virginia.edu/~HYPER/HNS/home.htm

The early worry was that regions like the Great Plains would be home only to roving bands of semi-civilized nomads, and maybe the meth-lab culture is the modern fulfillment of that nightmare. At any rate, a lot of the development was temporary and unsustainable. And it should be noted that something similar has been happening in other countries too; in Britain, for instance, little thousand-year-old villages have been emptying out, although sometimes one of them gets revived through gentrification when wealthy Londoners come back and rehab the old houses as quaint little vacation cottages.

Geoff and Charles are right. The depopulation of the plains has be ongoing since the 1960's, if not earlier. So, it is silly to blame it on the shenanigans of Wall Street, which started with the bubble around 1995. In any case, globalization cannot be blamed for the problem because we are a net exporter, not importer, of food. If anything, globalization benefits our agriculture industry.

The notion that Wall Street, or this or that politician, is to blame for someone's meth adiction is a new concept! And not something I have much sympathy for. The very last thing any substance abuser needs is yet another scapegoat for his or her own bad choices.

As for the larger issue, I am with Geoff on this. These small towns are hardly the first places to dwindle to ghost towns. Down through history whole cities have been abandoned and reclaimed by desert or jungle (Ubi nunc gloria Babylonae?) This just the way of things, part of the endless cycle of birth and growth and death and decay. The second half of the cycle is no fun, but short of the Parousia no one will repeal the laws of time and entropy.

But.. Re-reading your post, Rod, If what we believe is true..

Well, my friend. There's a battle on, isn't there?

How are we supposed to react? The confessional muddle of the Reformation, and the sterility of the Enlightenment is breaking.

Put scare quotes around the second and third capitalized, there.

It seems we have some work to do. There are prophets and priests yet to come, you know? Ones even greater than those of old..

Or so we've been told.

so many good points made here and Rod your anger over this speaks well of you.

Sharon as usual has an excellent point about the use of the old enlightenment political categories being poor preparation to begin to deal with these issues - how nice if we could remember this in future discussions.

Individuals behave much the same as a corporation - we seek to maximize our profit - or at least minimize our expense. So instead of buying a well made here in the US dress in a local store for more money - we go buy the cheap dress made in Korea at Walmarts. We eat prepared foods made of chemicals instead of veggies a local farmer may have grown. We get arugala from farmers living like serfs in Chile. ( Another reason to support FairTrade).

What may change some of this is when oil becomes expensive. Furniture is an example - most US furniture companies send their designs to China and get the stuff made there and shipped back here- but when oil was going to 150 a barrel - it stopped being cheap and so orders starting going back to the furniture makers in the Carolinas. Expensive oil would re generate a lot of those small factories and businesses here in the US.

Rich,
Excellent point and I also want to add that this is one of Rod's best posts in a while.
In fact, if you take a look around the internet for info on Oelwein and read the book excerpt, you'll see that what's been hit hardest in the last 20-30 years is actually their manufacturing base (e.g., meatpacking, railway repairs, etc.). These towns had all sorts of ways of adapting to previous shifts in the economy, but aren't adapting now.