Perspective is everything. The Commerce Department’s Bureau of Economic Analysis recently reported that the economy grew at a 5.7 percent annual rate during the last quarter of 2009. At the same time, consumer spending was up 2 percent and exports jumped some 18 percent, signaling a critical recovery in the global economy. Of course, the report contained the usual caveats. Some of this growth is attributable to businesses replenishing depleted inventories, perhaps a temporary stimulus.
Still, the consensus was that this is good news. The worst recession since the Great Depression is over—or at least it will be as soon as the National Bureau of Economic Research gets around to confirming that fact. From another perspective, however, jobs continue to be lost and many doubt that the unemployment rate will dip below 10 percent in 2010.
Perspective is a funny thing. Let us look at one simple measure of economic activity. The Dow Industrial Average hit 11,723 on January 14, 2000. By October 9, 2002, it had plunged to 7,286. Exactly five years later to the day, the average had almost doubled, hitting 14,164. Then, even more suddenly, this measure of economic value plunged to 6,547 on March 9, 2009, before climbing again to about 1,000 points off the level reached a decade earlier.
According to many mainstream economists, markets are an efficient estimator of the underlying value of the economy. Efficient, for economists, might be thought of as meaning rational, or accurate. So, depending on when you happened to look, our economy boomed, collapsed or did just about nothing over the past decade. And surely, for many individuals, they experienced all three corresponding emotional states. Truth, apparently, is a matter of perspective.
Let us start looking at rural America from different perspectives. In the immediate sense, non-urban areas have suffered, though perhaps not quite as much as many urban communities, particularly earlier in the recession. According to a report titled Prospects for a Rural Recovery, the severity of the economic downturn was a little less noticeable in rural America.
Rural job loss was less than in urban jurisdictions, housing prices declined at a more moderate pace, and farmland values remained resilient. While retail spending dropped 7 percent overall, the decline was less in rural areas. Many smaller banks in rural communities, depending more on credit-insured deposits from their customers, showed some relative strength as people searched for safer places to keep their money. Insured deposits actually rose 3 percent during the downturn. Rural communities surely suffered, but often less than those communities that disproportionately enjoyed the inflated expectations associated with the economic bubble that preceded the recent collapse.
From another perspective, the capacity of rural communities to fully participate in the recovery is uncertain. As the global crisis wanes, growing commodity exports undoubtedly will help raise farm prices. At the same time, stubborn factors inhibiting growth remain. Continuing out-migration, industrial consolidation, lack of credit opportunities and geographical isolation are entrenched impediments to growth that defy cyclical economic movements.
Yet, we might widen our perspective even further. Economics is not the whole picture. We often idealize rural family life. Yet, too many of our families are in trouble, often in ways that emphasize unique aspects of urban life. As we reported in previous articles, rural poverty is higher than metropolitan poverty. This is not a trivial fact. A report from the National Advisory Committee on Rural Health and Human Services (NACRHHS) states that poor children are 22 times more likely to be abused and 44 times more likely to be maltreated.
The NACRHHS’ 2009 Report stated that 900,000 children nationwide were victims of child maltreatment in 2006. Moreover, a half-million children have been placed in foster care. According to a Department of Health and Human Services report, rural at-risk children were removed from their own homes at a faster rate than urban kids between 1990 and 1999.
The situation of children, of course, is linked intimately to the condition of parents. The report goes on to estimate that 20 percent of younger adults in rural areas met the criteria for alcohol and drug abuse in 2003 compared to 6 percent for their urban peers. Drugs such as methamphetamine and OxyContin are particularly destructive. Not surprisingly, domestic violence against rural women is a major concern with easy accessibility to guns and the lack of places for women to seek safety and privacy, making a bad situation that much worse. In general the proportion of rural women evidencing depressive symptoms may be twice as high as the overall average.
Troubled younger adults do not make for stable families. For example, according to the report, The State of Our Unions 2008, from the National Marriage Project, the proportion of children in the United States not living with two parents has about tripled between 1960 and 2007, from 9 percent to 26 percent. The proportion of births to unmarried mothers has skyrocketed from 5 percent to 38 percent over the same period. Not surprisingly, marriage rates have declined and the number of cohabiting adult couples outside of marriage has skyrocketed from less than a half million to almost 6.5 million in 2007.
Our societal challenges undoubtedly are deepened by economic decline. Will the anticipated economic recovery solve the problems our children face? Surely, it will help, but it is unlikely to be a panacea. We will need a concerted, coherent and comprehensive human services strategy. Can we expect one? The NACRHHS report estimates that the demand in rural areas for health and human services positions will increase more than any other job category between now and 2016.
But where will these skilled workers come from? More than 60 percent of rural counties do not have a single allied health education program or similar training site. And getting skilled professionals is just the start of what is needed. We must start thinking hard about these challenges. It is, after all, a matter of perspective.
Tom Corbett has emeritus status at the University of Wisconsin-Madison and is an active affiliate with the Institute for Research on Poverty where he served as Associate Director. He has worked on welfare reform issues at all levels of government and continues to work with a number of states on issues of program and systems integration.
Opinions expressed in this column are those of the author and do not necessarily reflect the views of the Rural Health Information Hub.
Professor Corbett welcomes your feedback. Comments and reactions can be sent to: Corbett@ssc.wisc.edu.
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