First National Conference on the
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The Future of Rural America 2000 - 2050: Conditions, Trends, and Issues

Power Point Notes

John W Keller

Kansas State University, Manhattan Kansas USA

    Introductory Slides

Slide 4

This presentation highlights the major trends in rural planning and development throughout North America. The presentation opens with the importance of rural imagery to today's society. The focus then shifts to an analysis of the major demographic trends that define the rural condition. Key issues, such as rural elderly and telecommunications development are examined. The presentation then moves to key strategies to stabilize advanced decline in non-metropolitan communities.

Slide 5

Welcome to a quick tour of Rural America - with some international flavour thrown in. While poking a little fun at our rural imagery, it is still important to remember the critical role played by rural areas in modern life. In the developed world, about one-fifth of our population still resides in the countryside; this rural sector contains nearly all of our natural and scenic resources, more than three-fifths of our historicity, and the greatest share of our recreation.

Slide 7

Actually, rural industry is a bright spot in the United States. Clusters of related industries are viewed as a real success in many areas.

Although much has been written about the new rural industries of today, it is unfortunate that most economic development efforts have failed to halt the decline of older, more established small industries in our rural towns. Rural firms that once employed 25 or less people have now fallen to all time lows in the U.S. The 93Sanitary Mattress Company94 was started in 1938 and finally closed in 1989 - under marketed, under capitalized, and poorly managed.

Slide 8

Like the Pub, newspaper, bakery, and the funeral home, the local restaurant is a critical minimum for community. When the local eating places leave town, the community loses it heart and soul. The old neon signs were a constant presence along the rural by-ways of America. The folklore is that the food was always better at a small town cafE9 because rural people knew how to prepare a 93home cooked meal.94 The role that the local restaurant plays in the life of the elderly, the retired, and the working community is critical. Although little is mentioned about it in the literature today, one of the greatest sources of rural dissatisfaction is the lack of simple places to gather and eat.

If you ask a middle aged American 93where is the best place to get good food,94 the reply is likely to be 93a small town.94 Generally, this is true if you do not mind the cholesterol special - although sometimes it is like having your stomach pumped in reverse. Almost every small American town had an eating place called Mom's94

Slide 10

Religion, at least on the surface, plays a vital part in rural America - especially in what we call our Bible Belt. The deeper rural you travel, the more fundamental and prevalent the religion. At Tom's Truck Stop outside of Enid, Oklahoma you can shop for religious articles will you truck over the road.

Slide 11

Friendly attitude! Not so! Rural areas, especially those on the lower socio-economic scale are hostile to most planning efforts. Of the 105 counties in Kansas, 50 do not have land use regulations or plans of any sort.

Slide 13

In our study of very small rural towns in 1990 we developed a set of 93critical minimums94 for community life. In effect, these are the social and commercial institutions that form the basis of community. The last blow to community life, as a town passes from 93community94 to simple rural settlement, is the loss of the local pub and restaurant.

Slide 14

Fast food is not a bright spot in rural America. The concept of 93fast food94 grew up in the rural towns of the 1940s and 1950s leading to the dominance of nationwide food chains today. A few of the rural independent, family owned, fast food establishments still exist today (like the milk bars) and are almost always found in communities of 5,000 or less. Its too bad Americans never discovered 93meat pies94 and 93sausage rolls,94 or they might still be alive today.

Slide 15

The dead opossum picture was taken near my hometown. I have sent it around the world several times via e-mail. The most common reply is that 93it cannot be my town - the lines are too straight.94 The witch is actually the mayor of Marrian, Kansas. This community annually holds the 93Most Ugly Witch Contest94 at Halloween.

Slide 22

The term "redneck" is often applied to deep rural people. The "redneck swimming pool" is an award winner at the `Best Redneck Photo Contest." for 1998. I though you might enjoy the annual Foster's Drinking Contest in Swettland, Oregon.

Slide 23

Enough of the tour. Poking fun at rural areas and rural people is simply a way of bringing a little levity to this presentation. Some presenters tell jokes - I think the visual aspects tell it all. Personally, I think it shows the diversity of rural areas and their lack of convention with modern trends.

    Rural Imagery

Slide 24

Probably the most important aspect of rural areas is their imagery. It is a powerful source of perception and often not true. In a recent survey at Kansas State University, over 800 persons were asked to give their most powerful perceptions of rural areas. In the slides that follow, we can see the visual images of these perceptions.

Many researchers note that as metropolitan scale increases, the power of the imagery becomes stronger. Rural areas have now reached the 93icon94 level and are viewed as 93restorative94 places to escape the issues generated by urbanism.

A good share of the literature and research on rural emphasizes the imagery of the countryside and nature as a bedrock principle in understanding the deep commitment rural people have with their ecosystem. Students of rural landscape point to the factors that people value and bring meaning to their lives. The implication is that metropolitan landscapes display a similarity of urban form while rural landscapes convey an infinite variety of change and closeness to nature.

Slide 25

Imagery is a definitive asset to rural areas. After all, rural America contains our playgrounds, many historic landmarks, recreation, and scenic views. These assets, as we all know, are marketable on several levels.

Slide 27

Probably the most commonly mentioned image of rural is the idea of a remote place. American sociologists feel that is a strong incentive for outer suburban development. As a sense of place, the farm invokes a powerful image of working areas within vast open spaces.

Slide 28

Small towns are a unique form of compact development. The image of a friendly place with a thriving business environment is also powerful - although often less than real. It is interesting that communities as large as 200,000 persons consistently advertise one of their major advantages as 93a small town feel94 on their WEB sites.

The New Urbanism and the drive to return to compact development and personal identify is based on the small village concept with attention to mixed use and integrated space.

Slide 35

Rural areas have always been viewed as 93consumables.94 For many decades Americans looked on rural places as holding areas for future development. It is interesting that the underlying use as open space, farm production, or just scenic value is so often ignored.

Slide 36

America is the home of the roadside attraction. Almost all rural communities have some type of roadside attraction - although many of them have now fallen into obscurity with the advent of the Interstate Highways.

Slide 38

RURAL AREAS ARE TOURISM! The rural towns and communities serve as gateways to America's tourism. While some communities have prospered significantly from tourism dollars, the question still remains 93at what expense?94

Slide 39

Tourism is the number one business in the United States following Agricultural Output/Processing/Packaging. This map shows the 117,000 registered tourism sites (International Travel Association) in the U.S.

Several rural counties, such as those containing national parks, enjoy receipts of $300 per capita from tourism related expenditures. Between 4 - 8% of those receipts flow back to local government in the form of taxes and fees.

Slide 42

However strong the imagery of rural America, it cannot overcome the reality of isolation and the sense of being left behind. Two great events that contributed to this isolation in the United States were the death of rail passenger service and the building of the Interstate Highways.

Rural areas in the United States became increasingly isolated after the middle 1950s'. The great majority was by-passed by the new interstate highways of the last 45 years. Their once thriving small business districts slowly began to disintegrate from lack of commerce and disinvestment. The new rural downtown is now some distance from the community as these settlements seek to capitalize on interstate traffic. They are impermanent, lack the older dignity of rural character, and help to further drain resources from the community.

Slide 43

Worldwide, being rural is synonymous with being regulated to a way of life regulated to the minority. These Gypsy women from eastern Hungary are descendants of peoples inhabiting Transylvania for over 1,000 years.

Rural is now a battleground in many places. As incompatible land uses arise, the ability of rural people to assimilate change is very limited. The encroachment of urban use into deep rural areas is the hallmark of the second half of the 20the Century.

Rural is often poverty of the soul - a sense that conditions that always were will always be. It may be instructive to note that the 400 richest persons on earth make more than 3.2 billion inhabitants on this planet.

Slide 47

At the turn of the century America contained 5,000 more communities than today in 2000. A few were relocated because of large projects - such as water impoundment or persistent flooding. However, 95 percent of them simply vanished because they were all communities under 300 persons. Triplett, Missouri was one such town. It reached its largest population in 1910 and today is no more than an old Sinclair gasoline station, a cemetery, and four houses. Almost all the people who remember Triplett as a living community are now deceased. Within another 20 years there will be no memory of Triplett.

Slide 49

As we pour over the mounds of research and literature in this century about the country place we are struck by three main features that stand out: the abiding sense of place conveyed by our imagery of rural; the failure of public policy to halt the continual decline, disinvestments, and stagnation of non-metropolitan areas; and, the separateness of rural place brought about by the embeddedness of the rural world in national and international trends.

However, one aspect of imagery will remain true and that is our rural places contain icons of lasting memory. The very essence of rural is defined by this memory. Shown are the great Ayer's Rock in Australia; a view of Devil's Tower in Wyoming, and a Vermont Farm framed in the Sugar Maple trees of the White Mountains.

    Condition - Trends - Issues

Slide 51

The graph is part of a United Nation's report entitled Our Global Village. The graph equates our world to a 93Village of 1,000 People.94 The significance of the pie chart is that the data show that more than one half of the world's population will live in Asia - which is also experiencing the fastest rate of metropolitan growth.

Slide 52

Current estimates of the world's rural/metro population place the ratio at 53 percent rural and 47 percent metro. By the year 2020 we project that the ratio will fall to 60 percent metro and 40 percent rural. Less than 10 years later, in 2030, this balance will hover at 35 percent rural. At the half century point, in 2050, population modeling indicates that a static 80 percent metro and 20 percent rural should occur. If present world growth and fertility rates continue, which is highly problematic given the time and uncertainty involved, the rural share could drop to 10 percent.

Slide 53

The metropolitan engine began to gain fuel - rural to urban migration - in the 1950s. For the developed nations, metro growth is characterized by a steady linear trend of increase to the year 2000. To 2040 we expect this growth rate to accelerate rapidly as the dominate growth form of our planet gains consolidation over its rural hinterlands out to 100k and farther.

The less developed nations are characterized by an entirely different growth pattern. The human fuel - rural to metro migration - is more prevalent and the need more pressing. In 1950, metros in the developing nations housed only about 20 percent of the population. By 2030 these rapidly growing metro areas will contain about 65 percent of all their people.

Slide 54

All of the world's metro areas, ranging from the smallest at 50,000 to the largest at 20 million+ show strong signs of growth. But, by far the strongest growth is in metro areas that range between 10 - 15 million people. In the United States, urban cores still continue to lose population (as do many of the oldest inner suburbs, but metro spread is still sufficient to allow growth rates to remain high.

Slide 55

The two graphs illustrate the cumulative distance between urban and rural places as the United States approaches the 450 million level. The actual 93rural94 population of the United States in 2000 is approximately 24 million persons (in rural counties and places under 2,500).

Slide 57

Although seldom mentioned, the shear number of rural areas in the U.S. is staggering. With over 16,000 rural places under 10,000 population in the United States, there simply is no coherent strategy for revitalization.

Slide 58

In 1999 there were 3,140 county governments in the U.S; 2270 are classified and non-metropolitan and 870 as metropolitan counties. The figure is somewhat deceiving. To be classified as non-metropolitan means that the county does not contain a place of 50,000 persons or more even though the total population of the county may exceed 50,000 persons.

Slide 59

In 1999 there were 3,140 county governments in the U.S; 2270 are classified and non-metropolitan and 870 as metropolitan counties. The figure is somewhat deceiving. To be classified as non-metropolitan means that the county does not contain a place of 50,000 persons or more even though the total population of the county may exceed 50,000 persons.

Slide 60

This map displays two growth issues of the 1980s and 1990s. First, is the tremendous metropolitan/urban growth area in the Atlanta region extending over four states (American southeast). The second, is the shift in growth from the eastern to the western U.S. The American inner west is now the fastest growing region in North America.

Slide 61

Rural out migration, aging, and loss of product is a phenomenon of place. It is not occurring evenly on a geographic basis. The map of persistent rural decline (population loss from 1990-1998) is concentrated in our areas of greatest poverty and traditional farming

Slide 62

Farm dependency is defined as when a county derives 30% or more of their total income from production agriculture. In 1950 about 62 percent of all counties were farm dependent. By 1995, this number declined to 24 percent; by 2015 less than 12 percent of all counties will contain significant agricultural production as a percent of their economies.

    Rural Aging - Globally

Slide 65

During the 20th century, the number of persons in the United States under age 65 has tripled. At the same time, the number aged 65 or over has jumped by a factor of 11! Consequently, the elderly, who comprised only 1 in every 25 Americans (3.1 million) in 1900, made up 1 in 8 (33.2 million) in 1994. Declining fertility and mortality rates also have led to a sharp rise in the median age of our Nation's population -- from 20 years old in 1860 to 34 in 1994.

Slide 66

In the next 15 years we will begin a major demographic transformation. In the early 1900s, approximately one out of every 25 persons was over age 65. By 1980, the ratio was one in eight and in the early 2000s it is expected to be one in every five. This rapid growth in the aging population-due to factors such as increased public health services and aging baby boomers-will undoubtedly prompt profound social change in our own era.

Slide 67

A new and serious issue for rural areas is aging. We have known for four decades that rural areas would age at an increasing rate, but only recently have several trends began to solidify.

The perception of "elderly" and "poor" as practically synonymous has changed in recent years to a view that the non-institutionalized elderly are better off than other Americans. Both views are simplistic. There is actually great variation among elderly subgroups. For example, in 1992 -

  • The poverty rate, 15 percent for those under age 65, rose with age among the elderly, from 11 percent for 65- to 74-year-olds to 16 percent for those aged 75 or older.
  • Elderly women (16 percent) had a higher poverty rate than elderly men (9 percent).
  • The rate was higher for elderly Blacks (33 percent) and Hispanics (22 percent) than for Whites (11 percent). As the graph below shows, poverty became less prevalent during the 1980's for every elderly sex/race/ethnic group. In addition, within each race/ethnic group, poverty was more common for women than for men at both the decade's beginning and end.

America's non-metropolitan population has proportionately more elderly people than metropolitan areas. In 1997, 21 percent of the rural population was elderly compared to 15 percent of the urban population. This was due to a population aging in place, the out-migration of the younger populations to cities in search of better employment, and in some counties, the in-migration of elderly in search of a retirement destination.

    While the proportion of elderly population in non-metropolitan counties was greater than the proportion in metropolitan counties in 1997, many of the elderly residents in non-metropolitan counties were located in urban areas because of better access to services such as health care.

The majority of non-metropolitan counties with an elderly population of 20 percent or more are concentrated in the Great Plains subregion, specifically North Dakota, South Dakota, Nebraska, and Kansas. These non-metropolitan counties have experienced a large out migration of their younger age groups and have a large percent of elderly individuals aging in place.

Retirement counties, mostly counties with natural amenities and better health services, have experienced an increase in the elderly population due to in migration of that age group. These retirement counties tend to be located in areas with scenic natural beauty, and are spread out across the nation.

    Slide 69

It is difficult to count elderly homeless people accurately as many live in inappropriate or insecure housing and even on the streets. Those people aged 60+ who are homeless or at risk of homelessness are estimated at 250,000 across Australia. These are people who either rent, live in boarding houses or are homeless, with an income under $12,000 per annum. War veterans account for 10% of this group. In 1993, 140 000 people aged 60 and over, living on a pension and renting or boarding, expressed need for some kind of assistance; 28% of people in public housing in Victoria rely on the aged pension (15,000 people) while a further 10,000 aged people are on the pubic housing waiting list and at risk of homelessness.

    Slide 70

3FThe number of "young old" (sixty-five to sixty-nine) will roughly double over the next half century, but the number of "old old" (eighty-five and over) is expected to triple or quadruple -- adding the equivalent of an entire New York City of over-eighty-five-year-olds to the population. Nearly three quarters of those over eighty-five will be single, divorced, or widowed -- the groups most likely to need extensive government assistance.

    The increased vitality of mature men and women, combined with the above-mentioned breakthroughs will cause a radical redefinition of what it means to be "old" and when this decline occurs. When Otto Von Bismarck picked 65 to be the marker of old age in the 1880's in preparation for Germany's first pension plan, the average life expectancy was only 45. In the year 2020, men and women will be considered "old" at the age of 80+. Indeed, increasing longevity will not only postpone the arrival of old age, but will cause all of the stages of life to stretch and shift significantly:

  • 18-25 - Youth
  • 25-40 - Young Adulthood (lasting longer than in the past)
  • 40-60 - Middlescence (a new stage)
  • 60-80 - Late Adulthood (postponed and extended somewhat)
  • 80-100 - Old Age (postponed and extended considerably)
  • 100+ - Very Old age (postponed)

Slide 71

Many areas of public life will be greatly affected by the aging of the baby-boom cohorts. The baby-boom cohorts, the very large numbers of children born between 1946 and 1964, begin to turn age 60 about 2006 and age 65 about 2011. The current concern about the aging of our population arises from three new conditions, linked closely to one another. The first condition is that the proportion of elderly in the total population is now substantial (13 percent). The second is that the number of elderly and the rate of aging are expected soon to increase steeply, with implications for a vast increase in the numbers of persons requiring special services (health, recreation, housing, nutrition, and the like); participating in various entitlement programs; and requiring formal and informal care. The third is a recognition of the possible implications of an aging society for the whole range of our social institutions, from education and family to business and government.

    Slide 72

The U.S. elderly are mobile! Forty-five years ago, prior to the Sunbelt boom in the United States, only 2 of 1,000 elderly persons (65+) could be expected to move from their place of residence to a final retirement destination. With each decade the proportion changes. Currently, about 35 percent of all elderly retirements result in a move of 100 miles or more from their home community. This figure does not include elderly with two addresses who live in permanent quarters throughout the year.

    Slide 73

Over the past two decades a strange phenomenon has become clear in much of the center of the United States: people have almost stopped having children. Several factors may explain this. Much of the Baby Boom generation has finished having children, and its successors, known unimaginatively as Generation X, have delayed having children and chosen to have much smaller families. These facts, which apply to the country as a whole, acquire ominous dimensions when considered alongside the "rural flight" away from the Midwest that began in the 1930s and continues today. The problem is far from just local: the area suffering from this reverse baby boom comprises 279 counties in six states, totaling nearly 470,000 square miles. Included are Wyoming and Montana, most of North and South Dakota, three fourths of Nebraska, and more than half of Kansas. In the past ten years 16 percent of the lower forty-eight states has seen barely one percent of the nation's births.

    Slide 74

Rural out migration and decreased fertility will have numerous impacts on the countryside. Important among these is the increased median age among the longer-lived rural population. The graph, beginning in 1995, shows that three 93old nations94 will experience marked median age increases in their working population (ages 15 - 69).

    Slide 75

Being very old is a recent development. One hundred years ago, with average life expectancies around 40 years, large and complex rural families were common with several marriages throughout an adult lifetime. Today, even in the less developed countries, increasing life spans are a unique feature of rural areas. Retirements, inter-regional migration of the elderly, and wage dependency factors play a large role in shaping non metropolitan places.

    The "oldest old" -- those aged 85 and over -- are the most rapidly growing elderly age group. Between 1960 and 1994, their numbers rose 274 percent. In contrast, the elderly population in general rose 100 percent and the entire U.S. population grew only 45 percent. The oldest old numbered 3 million in 1994, making them 10 percent of the elderly and just over 1 percent of the total population. Thanks to the arrival of the survivors of the baby boom generation, it is expected the oldest old will number 19 million in 2050. That would make them 24 percent of elderly Americans and 5 percent of all Americans.

    Slide 76

During the past decade, population aging has attracted worldwide attention. As a result of the lower fertility rates and improved mortality rates that have evolved over the course of the 20th century and are projected to continue well into the next century, the numbers and relative size of older populations are advancing rapidly. The process started earliest in the industrial countries. The United States, for example, has gone from 8 percent of the population over age 65 in 1950 to 14 percent in 1990 a and is projected to reach 22 percent in 2030. In Thailand, less than 6 percent of the population was over age 60 in 1985, and the proportion is expected to rise to 12 percent by 2020.

    The population pyramids above illustrate the process of aging in the United States. By the year 2050 the age bulge will have moved through the pyramid - but the pre 2000 age structure is not expected to return.

    Slide 79

The Canadian population structure will transform their country by 2050. Although the data seem strange, if current fertility rates and aging factors continue, by 2050 the largest cohort in Canada will be males and females aged 80 +.

    In many small towns the proportion of persons aged 65+ will hover at 50 percent. By the year 2050 there will be a precipitous population drop throughout all Canada unless immigration rates are increased.

    Slide 80

When we consider the great demographic shift that will shape our national future over the next fifty years, we are speaking not of a mere transition but of a genuine transformation. Just fifteen years from now the first batch of Baby Boomers will hit sixty-five, bringing changes -- economic, political, social, cultural, and ethical -- that will transform American society. This transformation will challenge the very core of our national psyche, which has always been predicated on fresh beginnings, childlike optimism, and aspiring new generations. How we cope with the cultural dimensions of this challenge I will leave to others -- to sociologists, political scientists, historians, and philosophers. I am none of these. I am a rural town planner who has long participated in public debates over the political economy of rising living standards. What concerns me most about America's coming demographic transformation is simply this: on our present course we won't be able to afford it.

    Slide 81

Climate matters less than services to elderly migrants. In order of importance, the elderly list the following as 93important94 in their final destinations:

  • Affordable, appropriate housing
  • Assisted care living
  • Available medical facilities
  • Affordable economies
  • Active, cultural opportunities
  • Amenities
  • Family

    Slide 82

It is unfortunate that so much of this presentation deals with the negative aspects of rural areas. It is important to remember than a number of rural towns and regions, perhaps as many as 25 percent in developed nations, are thriving and showing very positive signs of growth.

    The fundamental challenge of rural areas involves distance, and the costs associated with overcoming that distance. In fact, those regions of rural America located away from metropolitan areas that have performed the best, economically speaking, were those that benefited from what Emery Castle described in a 1993 paper as the three Rs- -recreation, retirement and residences.

    Slide 83

The data in the bar graph show the vitality of many rural areas - especially those based on amenities and tourism. This is an analysis of the fastest growing and most rapidly declining counties in the U.S. As the data indicate, current estimates are that the same number of counties in the sample are growing as declining.

    Slide 84

This pie chart illustrates the distribution of places in the United States under 10,000 persons. Each slices shows the number of places subject to the forces of change. As can be seen, the vast majority of all rural places lie within the 93deep areas94 without access to the successful ingredients for growth.

Slide 85

Remoteness appears to have become a real liability in rural areas. Only one in 50 remote rural places of under 5,000 persons in the United States shows economic gain.

    Remoteness can lead to concentrations of economic distress. Nearly 23 percent of all non-metropolitan counties had high levels of poverty at the beginning of the l990s compared with 4 percent of metropolitan counties. Rural poverty tends to be less event specific that is related to death or poor health of the primary earner, and more related to long-established factors such as the limited employment opportunities in the local economy, according to a 1993 study by Calvin Beale.

    Rural Proposals

Slide 88

Counterurbanization, or the process of reverse population flow to rural areas, is a constant topic for demographers; many are deeply divided over the issue. Evidence of turn-around in the 1970s was flawed and, in fact, North America experienced its greatest rural losses during this period. Some see evidence of rural population turn around in the 1990s'. The trends should be evident is several more years.

    Slide 85

Triage, or the policy decision not to treat the worst or the marginal cases, can only occur on the national level. Failed experiments in Eastern Europe are tragic. To some extent, Scandinavian efforts have paid benefits.

    Slide 86

Hospice in rural areas is a concept developed in the middle 1980s. It has been manifested around the world in relocation and resettlement programs - for many the bitterness still remains. It has never been seriously consider in the U.S. until recently. The Hospice program would begin a slow buyout of deep rural properties and a repurchase of equivalent properties in rural country towns.

    Slide 91

Many rural areas worldwide have undergone rural population relocation programs. The United States was conceived with a policy of Amerindian Peoples relocation away from settlement areas. Counties such as Indonesia, Thailand, Paraguay, Hungary, and the former Soviet Union are all modern examples today. Worldwide, relocation falls disproportionately on the poor and elderly.

    As an example, Thai authorities plan the relocation or 13,300 persons to curb illegal logging in the area and will only allow aid agencies to deliver assistance at government sponsored points. The protesters do not want to move to the new site and are asking to be allowed to stay and receive assistance in the current location. They have pledged to cooperate with the authorities to preserve the Salween national park.

    Slide 92

The real bright spot in rural areas today is the regional country towns. These small scale service areas, usually starting at about 30,000 persons are real winners.

    Slide 93

    Regional country towns, generally with a population ranging from 13,000 to 40,000 received the greatest proportionate share of new residents among all forms of rural communities. These towns are well represented in the middle south - but gains in the American West were more pronounced.

    Slide 94

    ?The United States population added 100 million people between 1950 and 1990, and if current rates of growth continue (fueled primarily by mass immigration), U.S. population will double again by 2060 to exceed half a billion people.

    3FCurrent mass immigration legislation allows one million legal immigrants into the United States annually.

3FIllegal immigration to the U.S. may total 300,000 to 400,000 annually.

Slide 95

    Although rural Americans often lack easy access to advanced information technologies, they regularly use a number of telecommunications systems. A survey of rural businesses and residents conducted by the Rural Policy Research Institute (Allen et al., 1995) found that 69 percent of the rural community respondents regularly use fax machines, 46 percent use computers, 25 percent use computer modems, 15 percent use e-mail, and 6 percent use the Internet.

    Nearly two-thirds of the respondents see telecommunications as important or very important for future economic growth. An even greater percentage of respondents (over 75 percent) believe telecommunications is important for the delivery of educational and medical services. Many rural residents are already taking courses online. One report, Falling through the Net (McConnaughey, Nila & Sloan, 1995), found the percentage of rural households with a computer and modem participating in online courses ranges from 12 percent in the West to 22.3 percent in the South. In both the South and Midwest, rural households with a computer and modem were more likely to take courses online than their urban counterparts.

Slide 97

    Rural communities face two types of barriers to full connectivity to information technologies: barriers to access and barriers to use. Barriers to access are the physical, technological, regulatory, and economic barriers which currently impede the provision of expanded telecommunications services to rural areas. Rural telecommunications policy discussions tend to focus on overcoming barriers to access and creating physical infrastructure. The most successful strategic telecommunications plans, however, also address barriers to use. These barriers include unawareness of the benefits of information technologies, technophobia, the need for training in the use of information technologies, and the cost of information technologies relative to their perceived value.

    Barriers to access - Distance and low population density, the defining characteristics of rural areas, increase the cost of providing wireline telecommunications services. The wireline systems and technologies developed for urban areas may be less than optimal for rural areas, especially for more isolated areas. Connecting isolated farms and ranches will most likely require the deployment of emerging wireless technologies. The higher costs and lower return on investment involved in servicing rural areas discourages many telecommunications providers from providing expanded telecommunications services to their rural costumers. While urban markets are able to support multiple service providers, many rural markets may only be able to support a single provider. Appropriate regulations are needed to ensure that all Americans have access to information technologies at a fair price.

Slide 98

    Telecommunications is not and 93end,94 it is means to enhance access to social, cultural, and economic benefits. High speed, superior quality telecommunications systems in the digital age is the product of technological innovation brought about mainly by affluence. Affluence, by its very nature, flows to areas of concentrated capital - metropolitan locations - where benefits can be maximized.

    Slide 99

    One of the realities of Teledevelopment and digital innovation is the mass extinction of existing rural businesses (also urban businesses). This is in direct contradiction to the notion that Teledevelopment assets enhance businesses. Extinctions occur at two levels. First, suppression occurs when a new or established business makes a successful entry into the market using internet capability to the detriment of other existing businesses (see next slide - "He Who Hesitates is lunch.") Second, obsolescence rapidly accrues throughout related services as the need for face-to-face transactions or telephone services is replaced by digital communication.

    Slide 100

    Telesales is still in the infancy stage. The first providers are rapidly capturing sales from competitors. Worldwide internet sales will increase beyond the one trillion dollars level (U.S.) within the next 20 years. In 1993 there were roughly 40,000 sites worldwide engaged in low level telesales. In the final quarter of 1999, the number of registered internet sites capable of handling credit sales transactions stood at 9.5 million. By the year 2020, this number is expected to increase to approximately 28 million.

    Slide 101

    Clusters are concentrations of competitive firms in related industries that can create quality jobs and share common economic needs. California's Silicon Valley is an example of a highly-developed economic cluster. The 10 key clusters so far identified include:

  • BioIndustry
  • Business Services
  • Environmental Technology
  • Food, Fiber & Natural Products
  • High Technology
  • Mining & Minerals
  • Optics
  • Software
  • Tourism
  • Transportation

Slide 102

    The map indicates that cluster centers (high and moderate innovation) are primarily located on the coasts of the U.S. and not necessarily within areas of natural resources. Industry clusters are normally composed of several segments or layers--the leading industries (the principal manufacturers or service providers), support industries (suppliers to the leading industries), and other pieces of the economic infrastructure (such as services and transportation).Clusters can take different geographic forms. They can be located in large metropolitan areas (such as aerospace in Los Angeles) or in medium and small cities (such as furniture in Hickory, North Carolina), and they can span rural areas (such as automobiles in eastern and central Tennessee).

Slide 101

Clusters can be important to regions because they generate wealth, exports, jobs and sources of information. Firms are attracted to clusters because of economies of scale and productivity, and for marketing and competitive advantages.

Some clusters form without direct intervention, such as Detroit's automobile industry. They may develop because of such factors as availability of raw materials and labor, proximity to markets, transportation and availability of support services. Other clusters can come about through strategic intervention by states and regions or by public and private development groups. The development of industry clusters usually takes a lot of time, and there are fewer examples of successful clusters induced by strategic intervention.

Slide 106

    Although economic viability remains one of the central tenants of rural economic development, there has been a remarkable shift in the past 10 years to substitute quantifiable life quality measure for gross product. The leading factors of life quality tend to be:

    3F Environmental quality

3FHealth care quality

3FAffordable housing

3FEducational quality

Slide 108

    The Great Plains Region is already underpopulated. As a whole, the 279 counties average only six people per square mile, according to the 1990 census. Even this average would be lower were it not for a few comparatively populous places, such as Hall County, Nebraska, which is served by an interstate highway and is thus a center of trade; in 1990 it had ninety-one people per square mile. In that census half the counties had fewer than four people per square mile and nineteen counties had fewer than one. In contrast, New Jersey has nearly 1,100, and three New England states taken together average more than 750. This area can ill afford the economic and social consequences of a lost generation of unborn children. When it comes time to pass the torch to the next generation, too few hands will be waiting.

    Slide 109

The Buffalo Common is not about buffalo. It concerns the failure of a massive rural system stretching across a fourth of the United States. Essentially, this portion of the U.S. should never have been opened for settlement.

    Slide 110

    The crash of 2005, or maybe even 2001, is much discussed in the United States, especially among sociologists. The reality of this type of event is neither predictable nor seriously considered by most market analysts. Interestingly, most researchers assume that the rise of metropolitan areas is due mainly to affluence and opportunity. Lacking wealth and opportunity, many also assume that a general migration back to rural regions would begin as it did in the U.S. in the 1930s.

    Slide 111

    Economists and sociologists teach that there are critical masses -- minimum numbers below which essential "synergisms" break down. These synergisms build and sustain communities. A community built on a hundred births a year cannot remain cemented if births drop (and stay) below fifty a year. The areas where births have declined by more than half are destined to undergo profound changes within a generation. For some communities the changes will begin within a decade.

    Slide 112

    There are a host of studies centering on the determinants of rural survival. In short, they are:

  • Major interstate highway locations
  • Rural towns that lie within the outer layers of the metropolitan component economic area
  • Communities that use liberal incentives in local development
  • Amenity rich counties

Slide 113

    The leading indicators of rural survival and change in deep rural areas are:

  • The presence of quality educational institutions
  • A balance between working and retired populations
  • Cluster activities in the local area
  • Sustainable base populations of 5,000 or more persons

Slide 114

There are limits to the magnitude of rural turn-around that can be expected within the next 50 years. Some turn-around and stability will happen, but the price may be high and changes cannot be avoided. Every way of life requires some economic basis; a commitment to preserving a total way of rural life in the face of profound economic shifts cannot hope to succeed.

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