FED LOOKS AT FUTURE OF RURAL MISSOURI

KENNETT, Mo. -- Readers' answer to the question -- Does Rural Missouri have a future? -- may be both rapid and annoyed.

Of course we have a future, and the optimists among us may even declare that Missouri's outstate area, comprising approximately 90 of our 114 counties, has prospects exceeding those of the urban regions.

On the other hand, there are numerous statistics and a sizable cadre of statisticians pointing to numerous facts that suggest otherwise. I believe we may be ignoring some trends that, if continued, will produce scenarios resembling the sorry state of our leading large city.

One does not need to be a historian to realize that had anyone asked another question Does St. Louis have a future back in 1950, he would have been greeted with loud, vigorous denials that one of the nation's largest cities faced anything but growth, progress and prosperity. Over the past five decades, St. Louis has been transformed from a teeming center of corporate headquarters, flourishing industrial plants and gigantic retail and wholesale establishments into a relatively small-population city that has seen many of its most prosperous corporations disappear and its inhabitants fleeing as fast as suburban housing can be secured.

Old trends resurface

Some of the trends that went unresolved, apparently even unnoticed, by St. Louis's civic and political leaders back in the 1950s are visible in today's outstate Missouri. At least one agency, the Federal Reserve, has recently turned its attention to these rural trends, devoting large amounts of time, resources and brainpower to both recognizing them and proposing remedial policies.

In pursuit of this subject, seven Federal Reserve banks, including the one at Kansas City, have held lengthy roundtables to get a better handle on non-urban Main Streets that are at risk, with economic challenges rapidly mounting.

New center takes a look

The question is important enough that the Kansas City Fed has just recently founded a Center for the Study of Rural America, and researchers and economists have been assigned full-time to the new unit.

At the Kansas City bank, one roundtable even featured the appearance of Alan Greenspan, the chairman of the federal banking system, who echoed the earlier concerns of numerous U.S. fiscal experts.

The very first conclusion reached thus far by this extensive study is that Fed officials are convinced that the rural business environment is the center of outstate America's -- and Missouri's -- greatest challenge.

One of the components of the problem is the lower profit margin in agriculture, as well as the continuing disappearance of a variety of rural businesses, growing business consolidation, and the pervasiveness of regressive tax policies.

A concern that has been voiced repeatedly is the effect of business consolidation on prices and competition in rural areas. What some Fed economists refer to as the Wal-Mart effect was identified as a threat to local control and competitive activity, especially in retailing and banking.

Another rural challenge equally important to the future of outstate Missouri concerns the constantly shrinking population totals. For example, Kansas City Fed economists have begun to suggest that populations in some rural counties are shrinking below the critical mass necessary to sustain a community.

The consequences of this outmigration are gentrification and an erosion in the local tax base. Persistent poverty and a struggle to provide everyday services such as police and fire protection have also become related concerns.

Although precious little attention has been given to this in our state, except in limited quarters, there is major concern by Fed officials over the quantity and quality of human capital in outstate regions.

Economists note that the rural workforce and the local pool of important technical skills are shrinking with the rural population, retarding business and economic development.

Another factor of the study is rural Missouri's problem of distance -- referred to by one economist as the "tyranny of distance" and by another as the "digital divide" -- a remoteness that limits residents' exposure to policymakers and constrains their participation and influence in the political process.

Only passing notice

Yet another is the deteriorating quality of rural infrastructure, including highways, bridges and water-sewer systems.

Still another challenge relates to financial resources and the availability of credit for business expansion.

This doesn't end the Federal Reserve's menu of concerns for outstate Missouri and rural America, but it does include the major ones, many of which, I fear, have received only passing notice from most residents of the endangered areas -- and most certainly viewed only peripherally by the state's elected and departmental officials in Jefferson City.

Missourians passed through the 2000 election period without receiving even a bare a tip of the hat to monumental problems and concerns that are even now directly affecting life on Missouri's Main Streets.

Promises, not action

When was the last time you heard a candidate for governor or the state legislature even mention one of these problems, except to serve as a passing boost for the candidate's desire to "serve the good people of our great state?"

We get a plethora of promises but no activity toward correction, and even when some enlightened official attempts to approach resolution of these problems, his or her attempt are often met with the kind of partisan nonsense that too often transcends effective state programs.

Do rural Missourians want their communities to end up like the state's once-largest city: hemorrhaging homeowners, losing leaders, severing services, ignoring infrastructure, failing families?

The Federal Reserve is concerned about our communities' future.

Shouldn't we be too?

~Jack Stapleton is the editor of Missouri News and Editorial Service.