Authored by Charles Hugh Smith via OfTwoMinds blog,
Recent research supports the idea that this under-the-radar migration is already under way.
The decline of rural regions and small towns is a global phenomenon, and the causes are many but boil down to two primary dynamics:
1. Cities and megalopolises (aggregations of cities, suburbs and exurbs) attract capital, infrastructure, markets and talent, and these are the engines of job creation. People move to cities to find jobs.
The San Francisco Bay Area megalopolis of roughly 8 million people in 9 counties and 101 cities offers an example of this dynamic. The region added over 400,000 new jobs since the 2008-09 Global Financial Crisis and over 1 million additional residents since the early 2000s.
In effect, the region absorbed an entire new city with 400,000 jobs and 1 million residents. Roads and public transport did not expand capacity, and housing construction lagged. As a result, traffic is horrific, homelessness endemic and housing costs are unaffordable to all but the favored few.
Rural / small town regions cannot match these employment opportunities and so people move, reluctantly or enthusiastically, to overcrowded, horrendously costly urban zones to find jobs.
2. Globalization has lowered the cost of agricultural commodities by exposing every locality to globally set prices (supply and demand).
The relatively low cost of fuels has enabled produce from thousands of miles away to be shipped to supermarkets virtually everywhere.
These mega-trends have slashed farming incomes while costs have risen across the board. This squeeze as revenues decline and costs increase has driven even the most diligent and devoted farmers out of business.
What would it take reverse these trends?
1. The price of agricultural commodities and products would have to triple or quadruple, so that farming would become lucrative and attract capital and talent.
Imagine an economy where ambitious people wanted to get into agriculture rather than investment banking. It’s a stretch to even imagine this, but if energy suddenly became much more expensive and crop failures globally became the norm due to fungi, plant viruses and pests that can no longer be controlled and adverse weather patterns, this could very rapidly change the price of ag products to the benefit of local producers.
Another potential dynamic is the decline of global trade due to geopolitical issues and domestic politics, i.e. the desire to reshore “strategic industries” such as food production regardless of the higher costs such a trend might cause.
The repudiation of finance as the engine of economic “growth” (or pillage, if we remove the gloves) and the prioritization of real-world production are also trends that could arise as the financial bubbles pop and cannot be reinflated with the usual trickery.
2. Wealthy owners of capital tire of cities and move to small towns, bringing their capital and entrepreneurial drive with them.
There are many historical models in which the spending/investing of wealthy families drives the expansion of local economies. Colonial America and the Roman countryside are two examples of this dynamic.
When capital flows to small towns, jobs are created as the wealthy hire people to serve their needs. These new jobs create new markets for small businesses, and these new opportunities attract new capital.
Some owners of capital are passive owners, collecting rents from afar and spending this income in the local small-town economy. Others are restless entrepreneurial types who will fund new local businesses as a challenge or as an opportunity that’s been ignored in the mad rush to sprawling cities.
Both kinds of owners bring new spending and investment.
Wealth enables this class to bring its luxuries and desires with it, and so cultural activities favored by the wealthy get funding they never had before.
Wealthy types follow leaders just like everyone else, and once they hear of wealthy people extolling “the good life” in a small town, they investigate this option in a way they would never have done before.
Thus capital attracts capital, opens market opportunities, increases employment and starts attracting talent which is frustrated by the high costs and competition of the megalopolises.
Why would wealthy owners of capital move from places like Los Angeles, San Francisco, Seattle, Atlanta and New York City to small towns?
Any urban dweller in an overcrowded megalopolis can give you the answer: the traffic is unbearable, homeless is expanding, costs are skyrocketing and so on. The cultural benefits the city offers are increasingly outweighed by the friction, even for the wealthy.
What would cause the trickle of wealthy people leaving cities to swell into a mini-flood? A recession that guts tax revenues would cause cities and counties to raise taxes and fees, many aimed specifically at the rich, while limiting spending on the intractable problems of traffic, homelessness, public education, etc.
Most city dwellers cannot leave for lower cost climes because they need the higher income of city employment and they have a stake in the real estate market via a home they own and a mortgage to pay.
The wealthy, whose income is derived from capital rather than solely labor, have the financial freedom to leave the city but retain much of their income.
If both of these trends manifest, we might see those who can abandoning increasingly unlivable cities for lower cost, safer and more livable small towns.
Recent research supports the idea that this under-the-radar migration is already under way. The Rise of the Rural Creative Class (via Kevin M.) A growing body of research shows that innovative businesses are common in rural areas, and rural innovation gets a boost from the arts.
A series of studies from Tim Wojan and his colleagues at the U.S. Department of Agriculture’s Economic Research Service documents the drivers of rural innovation. Their findings draw on a variety of data sets, including a large-scale survey that compares innovation in urban and rural areas called the Rural Establishment Innovation Survey (REIS). This is based on some 11,000 business establishments with at least five paid employees in tradable industries—that is, sectors that produce goods and services that are or could be traded internationally—in rural (or non-metro) and urban (metro) areas.
The dominance of urban regions in tradable goods and services is visible in this map. We can imagine an economy in which rural / small town areas prosper within their local regions and within the domestic economy in a form of vibrant autarchy, without needing overseas trade as an engine of well-being.
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“1. The price of agricultural commodities and products would have to triple or quadruple, so that farming would become lucrative and attract capital and talent.”
Here we face the greatest obstacle to a sound economy where agrarian values dominate. Farming (not industrial agriculture) is not a job, it is not a career, it is a way of life. It’s like wanting to be a sailor, but not wanting to be on a ship or go to sea. It isn’t possible. If money is the baseline for the decision the entire planet would starve to death within the year. What a person gets from farming in addition to any money earned is almost impossible to quantify.
Is a good night’s sleep or communing with Nature daily something that can be entered into a ledger? Of course not. What about time spent with family as opposed to coworkers and fellow commuters? Is one more valuable than the other? Or how about the myriad skill sets that must be purchased from specialists because you have neither the time nor the experience and skills to do yourself? What does that savings equate to and does anyone ever think of factoring that in? How about the health benefits of hard work , fresh food and time outdoors? Does that account for anything?
People will repopulate the rural areas when their values realign to something based not on dollars, but on quality of life.
HF- I agree on your last sentence but I don’t think the goods and services in the article was referring to farming/food products. I could be wrong.
Random thoughts:
Before I retired, there were some heavy hitters in the computer programming contract world that lived in rural areas. So there are other goods and services that can be produced out there.
I wonder what will happen when 3-D printing becomes more common – you wouldn’t need a highly concentrated population area to provide a work force based on the 19th Century manufacturing model we assume is the norm.
Farmers buy what they use to produce crops at retail prices, then sell crops at wholesale prices.
Unless the govt skews things, ala mandated gasohol programs, it’s a great way of life – but a poor way to get a salary.
HSF,
MAMMON!!!
I settled south of the Mason Dixon line more than forty years ago, after a short professional career in Washington, London and Milan. When you are young city life can be very intoxicating. Now, in my 70s, I can drive to town in 10 minutes and buy superb produce, meats, eggs, and baked goods at our community market once a week. This is in a town of only a couple of thousand. If I want to I can drive to a couple of other farm markets in 20 to 40 minutes. And, like the ancient agoras of Greece, the market is a meeting place. Someone is playing music, blue grass, country or jazz, and folks are meeting and chatting and buying from their neighbors. This is now. It is already happening.
Great imagery. Sound life.
gryffyn- Are you in KY? What do you like about the south in contrast to DC ?
BL
In Mount Sterling, KY, they have what is called the County Courthouse Day. Everyone is selling everything you can imagine on the streets, and much of it includes firearms. People walk all over the place buying, selling, and swapping guns, and it is all cash and carry.
BL, No I am in the border state of West Virginia. Not really south and not at all northern. We are somewhere in the middle. Our flora and fauna are a rich blend from the north and south. The people are mostly good souls, descendants of outlaws, renegades and rebels. No comparison with DC. The State motto is “Montani Sempre Liberi”, “mountaineers ever free”. I hear coyotes howl at 3 in the morning, see the occasional black bear, deer are everywhere and life is good.
Hmmmm…. I wonder if I ever knew anyone who knew how to talk to country folks?
All it would take is some new awful plague.
https://www.zerohedge.com/news/2019-06-08/los-angeles-disease-renaissance-typhoid-typhus-make-comeback
Which the Globohomogayplex is working on bringing in.
There will be no rural revival. The only people moving to rural areas don’t care about the local rural culture, those days are gone.
A bunch of outsiders bring their petty values with them, along with their compaints (too hot, too cold, locals are stupid, locals are bad drivers, and so forth).
Happens everytime. See it all the time.
And this happens no matter where, Eastern NC or Western Montana.
See the Poconos today after 40+ yrs. of big city NYer & Joiseyfuck influx. Sad, very sad.
Asheville, NC is a great example of the degradation. Once, traditional, no congestion, no destructive
development, virtually no crime, a good old- fashion downtown, etc. – now a carbon copy of some
San Francisco, Miami. Oh yea, and for some reason, the criminal black just had to come.
Now a jew mayor; jew vice mayor. They always take over the local politics.
Whenever the masses come, they destroy.
My family before WW2 were farmers and coal miners. When that generation (my grandparents) went away and experienced the world, there was no chance they were going back. The post WW2 industrial boom created jobs with set hours and days off as opposed to 12+ hours everyday and no days off including Sunday.
When their parents died off the farms were sold. More often than not they became housing developments. The mines were already shuttered by then.
I do small scale farming/beekeeping as a diversion from life. I enjoy it and make a few $. I donate most of my “crop” to the foodbank. If my family had to depend on it we would starve in short order.
The town where I grew up was incorporated in the mid 1800s. My great-grandfather’s parents settled there a few years after that and he later became the sheriff of the county.
In 1880, its population was around 1,200. In 1970, its population was around 4,500 and in the 2010 census, the population was around 4,800. To this day, according to Wikipedia, the population is still less than 5,000 and the area remains 98% Caucasian.
Off the beaten path, a fair distance from the nearest city, the town sits nestled among the hills & plateaus surrounding a river. It’s downtown intersection divides like a cross between roads going north and south and east and west; with three-story brick buildings spreading out from the center, complete with a courthouse square and clock tower. The courthouse is a very large brick building that was constructed for $42,000 before the turn of the century.
I grew up under an endless canopy of trees over ornate street lamps, and within walking distance of the town square. Our neighbors included the county veterinarian, hardware store owner, lumber yard owner, and publisher of the local paper. A little further down the street lived two competing attorneys who lived by the local funeral home.
As far back as I can remember, the distant train whistle would be the last thing I heard before I went to sleep at night. Even from where I live now, I still hear that same lonely sound echoing from the same set of tracks. In fact, I could hop that train and be back in my hometown in less than a day’s ride.
This weekend, however, we drove the road that parallels those tracks and returned to my place of birth to visit someone. We had lunch at the local cafe, took a walk under the trees by the river, through a completely shaded city park, and then back downtown to visit a friend of mine who still owns a local business there.
I don’t know if it’s because the town is still maintained by local businesses, being (somewhat) self-contained, or for some other reason, but several items there were near half price of what we would pay in the city. Our home style meal at the cafe had large portions and with baked potato and salad both included (not extra) for less than what Burger King or Wendy’s would charge for a double burger meal.
The cafe also had photos of the town through the years on the walls and I actually captured a few of them on my phone before leaving. Three of them did not have dates on them but they were of the same view, looking northward and within the downtown. One showed single-story buildings and horses and carriages. The next showed two and three-story buildings and model T cars parked out front. And the other looked to be taken in the late 1940s or early 1950s. Pretty cool, and I might write about this later and show some of them (except the glass-encased photos have reflections and, therefore, are not the best quality).
After lunch, two of the folks wanted ice cream, so we walked to a retro ice-cream shop that was located in a local five-and-dime pharmacy both still resembling something out of another era. They got cones for $0.80 (scooped, not soft-serve) each that would of have cost $4 where I live now.
The town is clean and modernized, but still retains it’s camelot-style charm. I did not see one empty storefront in its downtown area and I noticed at least two American flags hanging from the local businesses. The flags brought to mind a memory of when I participated in the bicentennial parade there in 1976.
As we drove home that evening, my gratitude was two-fold. First, for being lucky enough to grow up there. And, second, for still being able to go back.
(The photo below is not my hometown, but it’s not too far off.)
I don’t about your liberal state, but Georgia taxes the unholy crap out of rural incomes, then sends the high taxes collected down highways that all lead to Atlanta, where it is handed out to thousands of Urban Welfare Maggots. The rural areas will soon prosper due to crop failures (food shortages) in this Eddy Minimum which will be similar to the Oort, Wolf, Sporer, Maunder, and Dalton Minimums (ref the GSM). When I was in college, money was in Plastics, then Computers, then Real Estate, then Finance; the future will be in food. Bon Appetite!
Bob Siddell- I think you are right about that.
Uncola , would you mind telling me were this 98% white town is located . I will still probably go to the Appalachian mountains but it’s nice to have idea of other places.
Kentucky is the only state in the Union where the black population is lower than it was in 1900, and I think many that remain have moved to Louisville. Christian County is about 22%, and Fulton is 24.5%. Most other places with a few exceptions tend on the low side, and most of them are good people..
Sorry, Beebs. If I told you, it wouldn’t be a secret. ?
I figure about 3 weeks or so of supply chain disruption preventing the processed food trucks from stocking the shelves in big cities is about all it will take. People will be fleeing the urban areas like rats from a sinking ship.
Three days.
Uncola ,I didn’t see where you said it was a secret . Please explain. Like I said the West is a little to far but I hope to find a town that is small with at least a 90% white population. I’m looking in Western North Carolina right now. Mainly on the internet. Most any of the towns have a have a majority white population.
Check out Marshall, NC
How many of those jobs went to native-born Americans? A damn small percentage I’ll wager, and we already know who most of the new arrivals are.
Great article!
Meanwhile here east of California many Phoenix area farmers are selling out their farmland to developers for far more than they ever made in farming.
Many of the people buying the resultant homes are the same people who destroyed California.
I do agree that we need to de-industrialize agriculture and the food industry; the benefits would be many. I hope it happens in my lifetime.