Staying in the slow lane this week, but two NYT items that I read this morning brought me back to a familiar thought: that so many well-meaning experts are forever locked into trying to repair what capitalism repeatedly breaks while being unable to actually address capitalism as the cause of the damage. It’s not “creative destruction” where something dynamic and new arises from the old, it’s an endless cycle of folly and abuse where the state is used all at once as a shield against risk, so that the wealthy interests making bad decisions never suffer from their mistakes, and then as a shield against responsibility, where the state will always be the imagined instrument that can repair what was destroyed.
On one hand, we have Tony Pipa of the Brookings Institution offering a perfectly plausible, useful set of policy recommendations for helping to alleviate the often woeful poverty of rural America. He focuses on Shamokin, Pennsylvania, and argues that its poverty rate (presently 30%) and declining population is “a cautionary tale for what happens when we lack policy solutions that can truly help places cope and adapt to major economic and social shifts”. What shifts is Pipa talking about? Essentially, the decline of coal mining, but not that alone.
When was Shamokin not poor? In the later half of the 19th Century, white settlers forced out the recently resettled Lenape who had been moved to the upper Susquehanna River and turned Shamokin into a coal mining center that also had a number of other factories—and the city then became a major hotbed of union activity. That Shamokin, built on first-stage industrialization, grew to its largest size in the 1920s, at around 21,000 people, part of the hard-working region that was west-central Pennsylvania. That Shamokin began to dwindle in the Great Depression, like the rest of west-central Pennsylvania, and then to collapse in on itself for the remainder of the 20th Century, continuing into the 21st Century, now under 7,000 people.
That’s what Pipa calls, in the usual passive construction common among policy experts, “a major economic and social shift”. It’s a naturalistic phrasing as well. Something that happens, like the tide going out. Industrialization happens, labor fights for its rights, people prosper, then deindustrialization happens and people leave and become poor. All we can do is build policies that try to revitalize and re-energize, looking for something to replace coal. Shamokin already tried a favorite solution of rural American communities, which is to lobby for and receive a prison—which is one reason why the United States is the most prison-laden country on the planet. All those Trump-voting rural Americans hate big government and are afraid of socialism, but they pin their hopes on prison socialism, a gulag in every deindustrialized pot.
Pipa approves of what the leaders of Shamokin are doing now instead, which is using government support to turn former mining land into an “outdoor recreation destination and conservation site” while using rural development money to “incubate” new small businesses in the town itself. But that’s what neighboring Jim Thorpe did already (that’s partly why the town has the name, though that’s a convoluted story). It’s what towns throughout the Poconos and elsewhere in Central Pennsylvania are being advised to do, in some form: become a destination for people who have money to spend, and somehow use that to also make new small businesses, new Main Streets.
Maybe it’s not a zero-sum problem but it’s not an infinitely reproducible solution either. There can be only so many “outdoor recreation and conservation sites” where that is itself a major revenue-generating, life-sustaining purpose in a purely commercial sense. Now if the state actively compensated communities directly for conservation (rather than ask them to build revenue-generating businesses around that idea), maybe that could actually scale to the rural America that exists. Billions to lock up people, but not so much for keeping land free and clean—in part because we don’t think of that as something to pay for but instead somehow as the default state of the world.
What we will allow, in that vein, is speculative investors to build communities in places that no one in their right mind should be building due to the lack of water and blazing heat with the expectation that somehow the government will come along to make good on the risk the investors took because it will be a “crowning achievement”, because as the article observes, “water runs uphill to money”. If somehow the development never happens because government can’t simply make water exist where there is none to be had, then somehow the investors will likely be compensated anyway. Capitalism is pitiless towards those left gasping for air when its tides recede, but governments usually find a way to supply lifeboats for those whose wallets are fat enough. The consequences of risk are visited upon the generations to come who never agreed to take those risks, while the actual gamblers never go bust if they have enough powerful friends and a house that can’t afford to let them walk away with empty pockets. We don’t spend to maintain what we’ve already built, or on making the water infrastructures that existing communities need, but we’ll let “innovators” write blank checks using the future’s money.
Which goes to show that “shifts” aren’t remotely a thing of nature. Policy-making that is trying to keep rural America a going concern but is not asking why and how communities are made by theft and deception and then are abandoned to their fates is like watching Lucy and Ethel try to keep up with the factory conveyor belt. No doubt the people trying to help Shamokin—or the people living in it, hoping for some help—would argue that bickering about deep causes helps no one. And the people trying to somehow find still-imaginary Teravalis its imaginary water, insisting that somehow Arizona must have more houses and government must make that possible on behalf of a small number of people who need their investment to pay out, would ask, “Well, what else do you expect us to do?”
What we could expect, in a different dispensation, is that we would invest directly in the Shamokins that our past history built, on the simple grounds that punishing them for risks they never took nor never benefitted from is a sign of a morally disordered world. And that we would learn from the past and prevent more Shamokins from being made. We could redistribute pity and pitilessness to match the knowing risks that individuals take. There are policies that would look more like that approach, where in time the policy-makers might seem more like the people running the factory—and making the profits—and less caught up in haplessly trying to repair what powerful people are allowed to so easily break.