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Concentration or dilution?


The headline spells out the critical question facing Iowa’s economic development philosophy today.

Should the Grow Iowa Values Fund and other programs designed to shore up the state’s economy share their limited wealth with as many communities as possible? Or should state officials be more judgmental, focusing the money in specific areas or regions?

To some degree, Gov. Tom Vilsack has already drawn the lines of this debate along industry lines, calling for investments in the information services, biotechnology, agriculture and manufacturing industries. That narrows the discussion but doesn’t answer the question of where the money and the new businesses it’s supposed to attract will eventually end up.

And that’s where things are warming up.

There are a number of folks who believe that Des Moines and Iowa’s other large cities can’t remain healthy without strong economies in the countryside.

The argument goes something like this: Des Moines, Cedar Rapids and Sioux City (to name a few of the bigger cities) are growing largely because of migration from rural areas. If the rural areas die, then Iowa’s cities will stagnate as well, having lost the influx of people and talent. Therefore, development dollars must be scattered around the state to help as many people as possible and protect Des Moines’ labor source.

I can understand their case, even if I don’t buy into it. I sympathize with what’s happening, too. I grew up in Detroit, a city that’s lost a heck of a lot of people in the past half-century. In 1950, the city had 1.6 million residents. Today, it has fewer than 1 million. I know what it’s like to live in an area whose population is on the decline.

Rural Iowa, just like other rural areas across the country, is under tremendous pressure. Unlike Detroit, which ignored foreign competition to its flagship auto industry and let racial tensions rip it apart, Iowa’s problem is a result of success.

Technological advances have enabled fewer people to produce far more food. Rural Iowans deserve to be congratulated for their accomplishments, freeing so many more people to pursue productive lives elsewhere. That’s cold comfort, I know, to champions of the rural lifestyle.

Which brings me to my point. Increasingly, Des Moines isn’t dependent on fresh labor from the fields. Sure, young people who migrate from smaller towns across the state help the city. But more and more of the growth in the state capital can be attributed to large out-of-state and foreign companies that locate operations here. As a result, the city is being thrust into a new level of competition. Des Moines now needs to win against places like Kansas City, Memphis and St. Louis.

In this sense, Des Moines’ leaders face a two-pronged fight for capital and talent with both Iowa’s rural areas and other cities across the country. There is evidence that Des Moines, despite its growth, isn’t winning because it isn’t growing as fast as its peers.

As the Legislature begins a new session, I would offer this thought regarding economic development: Rural Iowa will not benefit unless Des Moines is given the tools to win on a national level. Without a solid center, the entire state will struggle – just like Detroit.

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