What is the future of Iowa's small towns?

Former Audubon County courthouse, Exira (Source: Wikimedia): county population has fallen from 8559 (1980) to 5578 (2017)

A recent column in the Cedar Rapids Gazette highlighted the angst small town residents have about their future. Bill Menner, executive director of the Iowa Rural Development Council, argued that statewide candidates of both parties should put forth "meaningful rural-specific policy initiatives" as they campaign in the state; by "meaningful" he means "targeted policies and investments" addressing "issues that limit [rural Iowa's] ability to grow."

Iowa developed as a predominantly agricultural economy. In 1890 it was the tenth-largest state in the Union, even without any large cities. (Des Moines' population that year was 50,093; Cedar Rapids had only 18,020.) Our two million residents were spread evenly across the state, with hundreds of small towns serving the surrounding farms with necessities, schools and gathering places. Changes in agriculture, transportation and commerce put that model away long ago: farms are now corporate or similarly huge operations, and use machinery rather than hired labor. (For more on contemporary farm life, see Fox 2018). Some small towns have reinvented themselves as bedroom communities, college towns or tourism/recreation centers, but the majority that lack that option have seen population and economic prospects decline. Both the industrial and post-industrial phases of American economic development took place elsewhere.

Downtown Decorah (pop. 7918, down 217 since 2010) is supported by Luther College

Iowa has grown slowly since the 2010 census, adding just under 100,000 residents by the Census Bureau's 2017 estimates. Ten urban and suburban counties added 127,943, which means the other 89 counties lost more than 25,000 residents. Growth is concentrated even within the Census Bureau's metropolitan statistical areas: in the Cedar Rapids MSA, Linn County has gained 13,000 residents so far this decade, while Benton and Jones Counties have seen marginal declines. The ten urban-suburban counties now account for 58.8 percent of the state's population, but have added 74.5 percent of the state's new jobs in this decade, attracted 228 percent of people moving into the state, and account for over half of people aged 25-44.

[NOTE: That "228" is not a misprint. The other 89 counties have a combined net out-migration, so the number of migrants into the core 10 more than doubles that of the whole state.] 

Some degree of resentment at these disparate outcomes is understandable, and has received attention as Iowa has shifted politically from purple to red in the 2010s. Donald Trump won easily here in 2016, and Republicans dominate both federal and state offices. Iowa Governor Kim Reynolds refers to small towns as "the real Iowa," while lambasting "far-left liberals in Des Moines and Iowa City." (By the way, Governor, Johnson and Polk Counties, which contain Iowa City and Des Moines respectively, together comprise 20 percent of Iowa's population. They have added 70,000 residents since 2010, along with 35.3 percent of the state's job growth, 32.3 percent of the state's GDP, 147.1 percent of people moving into the state, 26.9 percent of college graduates, and 29.3 percent of those with graduate or professional degrees. Without them Iowa is truly in a world of hurt.)

Washington (pop. 7424, up 154 since 2010) has restored its historic downtown square

Menner's column plays to this resentment: Federal and state funding flows easily to urban areas, where elected officials and staff know how to maximize their success. Rural places don't have that same capacity and are often left behind. He calls for the state to [m]easure the disparities in project funding between rural and urban places and put in place remedies to address them. 

But data to confirm or refute federal/state unfairness to small town Iowa don't exist. According to the American Community Survey census of governments, transfers from the federal and state governments amount to 26 percent of county government revenue, 17 percent for cities, 21.6 percent for special districts, and 51.4 percent for school districts. But those numbers are not broken out by county, town, &c.  What we can say for sure: The biggest items in the federal budget are Social Security, Medicare and defense. The former goes to individuals, predominantly elderly people who predominate in small towns and rural areas, so it's not surprising that the 52.1 percent of the state's population that lives in the ten urban-suburban counties receives only 46.9 percent of federal benefits to individuals, and 46.9 percent of federal awards. The biggest item in the state budget is education, which is going to follow the population as well. The state has not undertaken county consolidation, which has been batted about since I've lived in Iowa, so we have counties with less than 10,000 population which nevertheless receive government spending that accrues to (and maybe props up) county seats. Still, it must be hard to see the state allocate a paltry $1.3 million to expand broadband access while a single interchange on I-380 north of Cedar Rapids is going to run upwards of $20 million.

Cities have succeeded in this century--well, they're not all succeeding, but those that are succeeding are building on three factors: the advantages to firms of clusters of knowledge workers, social and cultural amenities that come with dense population, and broad attitudes of tolerance and inclusion. To those we should add better access in cities to mobile broadband as well as venture capital, as firms in those fields see a greater likelihood of returns on their investments where population is denser. That's why urban areas are growing and small towns and rural areas mostly are not. It's nothing sinister, and there's no point in being resentful. The young and hip will always command an outsize share of media attention, but we shouldn't let that affect a cold-eyed assessment of what's working for successful places.

Em's Coffee Co., downtown Independence (pop. 6018, up 52 since 2010)

Small towns and rural areas have advantages, too--strong community identity, easy access to natural places, and often compact walkable business districts--though probably not enough entirely to ensure "the survival of Iowa's 900-plus small towns," as Menner advocates. One of my sons lives and works in Seattle; if he could find a similar job in Decorah, or Clear Lake, or Red Oak, he'd move in a minute. Menner's column suggests some state policies that could build on those advantages: expand the broadband grant program, create a state rural housing initiative, better funding for existing agencies.

But there's the rub, you see: all of that costs money. So do education, health care, and public institutions. The state of Iowa is not building fiscal capacity to make these sorts of public investments possible--quite the opposite, in fact, as the legislature annually delivers substantial tax cuts, and the governor dips into contingency funds to pay the bills. Menner would like to see someone at the state level designated as rural liaison-advocate, but in a state government run by Republicans elected on the strength of rural and small town votes, there already is that someone: the Governor, an acknowledged fan of "the real Iowa." Republicans at the state level, however, have decided to play culture war instead, producing bills to defund Planned Parenthood, bar "sanctuary cities" (of which the state has zero), and ban abortions after six weeks one year after banning abortions after twenty weeks (for laws taking effect this year, see Murphy 2018). None of that helps rural counties out of the doldrums; nor does it help the cities that are the state's economic engines compete for talent.

Rural and small town Iowans, stop voting for policies that help you feel good, and start voting for policies that help you live well.

Some ideas (see also Benfield and Epstein 2012, Brown 2018, Gilmartin and Hurley 2018):

1. Support Menner's group's advocacy for more state investment in your community, while recognizing that investment is not going to happen without tax revenue. Don't wait for the 1 percent, or urban residents, or the magic of supply-side economics, to produce a windfall, but be willing to pay for the services your community needs. 
2. While you're waiting for the state to act, improve your own capacity and attractiveness: Invest in human capital, specifically education and small business development, including the library and adult education opportunities. 
3. Buy local, and avoid national big-box chains, whenever you possibly can; your money will stay in your community and help it grow. 
4. Take advantage of your assets, be they natural, existing institutions or fortuitous location; as Aaron Brown notes, recreation is a bigger industry now than agriculture or mining. And...
5. Do whatever it takes to earn a reputation for openness. The next great idea might come from a Lesbian, or a Mexican immigrant, or a Muslim. If rural Iowa continues to be perceived as the last bastion of grumpy old white people, it will be irrelevant to the 21st century. 

Even a well-funded state government can't afford to buy everyone a pony, but towns can position themselves to use whatever they can get to best advantage.

SEE ALSO:
"Small Business and the Ideological Divide," 2 February 2018
"Condition of the State 2018," 10 January 2018
"Adam Smith and the Road to Correctionville," 8 March 2015 [by the way, I just found out the highway featured in this post was named to this list of top highway boondoggles of that year!]

SOURCES: I owe particular thanks to 

• Dr. Liesl Eathington at Iowa State University's Iowa Community Indicators Program. She advised and guided me through the thicket of numbers on this subject. She is, of course, not liable for what I've done with them.
• Martin Smith, faithful reader and concerned citizen, who pointed out some errors in the original version of the statistical data.

 Kaid Benfield and Lee Epstein, "The Death--and Life--of Small Town America," City Lab, 7 September 2012 [LINK IS DEAD AS OF 2023]
Paul Brennan, "Gov.Reynolds Signs So-Called 'Sanctuary Cities' Bill, Which She Says Was Aimed at 'Far-Left Liberals in Des Moines and Iowa City," Little Village, 10 April 2018
Aaron Brown, "Rise of the Rural Recreation Economy," Minnesota Brown, 25 May 2018
Russell Arben Fox, "What Do Farmers Want?" In Media Res, 6 July 2018
Dan Gilmartin and Daniel J. Hurley, "Column: Invest in Talent That Drives Economic Growth," Detroit Free Press, 25 January 2018
Phil McCausland, "Rural Communities See Big Returns with Broadband Access, But Roadblocks Persist," NBC News, 11 June 2018
Bill Menner, "Rural Matters: Small Town Voters are Looking for Big Ideas in 2018," Cedar Rapids Gazette, 24 June 2018
Erin Murphy, "New Laws Affect Drunken Driving, Opioid Abuse," Cedar Rapids Gazette, 1 July 2018, 1A, 11A

SOME DATA (I have wads more if anyone would like to see it):

	IOWA	10 COUNTIES (PCTG)	REST OF STATE
Population 2017 (1)	3,145,711	1,637,905 (52.1)	1,507,806
Pop Growth 10-17 (1)	98,842	124,192 (125.6)	(25,350)
Jobs 2016 (2)	2,076,231	1,171,595 (56.4)	904,636
Job Growth 10-16 (2)	124,298	92,644 (74.5)	31,654
Migration 10-17 (1)	24,342	55,513 (228.1)	(31,171)
Age 25-44 2017 (3)	761,908 (24.2)	431,533 (56.6)	330,375
% Bachelor’s Degree or Higher 2016 (3)	25.7	33.1	18.8
% Grad/Prof Degree 2016 (3)	8.0	10.9	5.2
Federal Personal Benefits 2016 (4)	$25,206,000	$11,813,000 (46.9)	$13,393,000
Federal Awards (5)	$22,500,000	$10,551,000 (46.9)	$11,949,000

NOTE: The "ten counties " in the table include the eight that contain the central cities of Metropolitan Statistical Areas (Black Hawk, Dubuque, Johnson, Linn, Polk, Scott, Story, Woodbury); Pottawattamie County (Council Bluffs) in the Omaha MSA; and largely-suburban Dallas County. "Rest of State" is comprised of the remaining 89 counties.

(1) U.S. Bureau of the Census, “American Factfinder: Iowa (P1, S0701),” Dubuque County, Iowa - Census Bureau Profile

(2) U.S. Bureau of Economic Affairs, "Total Full-Time and Part-Time Employment by Industry (CAEMP25N)," BEA : Regional Data Table Availability
(3) Iowa Community Indicators Program, Iowa State University

·         “Educational Attainment of the Adult Population,” https://www.icip.iastate.edu/sites/default/files/uploads/tables/education/educational-attainment.xls

·         “Population in Selected Age Groups,” https://www.icip.iastate.edu/tables/population/age-groups

(4) “Personal Current Transfer Receipts (CAINC35),” BEA : Regional Data Table Availability
(5) USASpending.gov, “Iowa,” https://www.usaspending.gov/#/state/19

Ely (pop. 2150, up 369 since 2010) works with its proximity to Cedar Rapids and Iowa City