Rural America is struggling. As blue-collar jobs move overseas and people flock to major cities in an increasingly knowledge-based economy, rural America is being left behind in the next wave of economic growth. President Donald Trump broke the Democratic “blue wall” in the 2016 presidential election by appealing to rural voters, running on a platform blaming free-trade and excessive immigration for slow growth, sweeping all but two Midwestern states as a result. Though shocking to politicos, Trump’s victory across the Midwest and Pennsylvania ought to be unsurprising for anyone calling the rust belt home.
The U.S. Census report on poverty and income for the year 2016 was released this week and further shows rural America is being left behind. Nationally, real medium household income rose by 3.2 percent, and the poverty rate declined by 0.8 percent. Good news to the average observer, but a closer look reveals that this trend doesn’t extend to rural America.
According to the census report, real median income inside principal cities rose 5.4 percent from 2015 to 2016, compared to a 2.1 percent change for areas outside principal cities. Furthermore, real median income for households within metropolitan areas rose 2.5 percent, while incomes for those outside of metropolitan areas experienced no change. These non-urban households also had some of the lowest incomes in the country.
A recent Wall Street Journal analysis shows a rural America that is becoming increasingly desperate. According to the Wall Street Journal, rural areas across all regions of America, rank the highest in poverty levels, teenage birthrates, divorce rates, reliance on federal disability insurance, and in deaths related to heart disease and cancer. And they rank the lowest in college attainment, and male employment. In contrast, major metropolitan areas are seeing higher incomes and lower poverty rates.
The results of the 2016 presidential election speak to these trends. According to data by the Pew Research Center, running on an anti-trade platform that resonated with rural voters, Trump won small towns and rural America with 62 percent of the votes compared to Hillary Clinton’s 34 percent. In urban areas, the results were practically reversed, with Trump taking 35 percent of the vote and Clinton taking 59 percent.
Anti-poverty programs focus on places where resources are readily available to help large populations of impoverished people in relatively densely populated areas, as opposed to rural areas where the population is widely spread. In addition, blue collar jobs in rural areas continue to leave as employers chase lower regulation and cheap labor, devastating once vibrant towns. The negative trends in rural communities can be reversed through reduced regulation, a simplified tax code, and an increased focus of poverty beyond city limits.
The time is ripe for reform, and Congress is taking its cue from the 2016 election. The bipartisan Affordable Housing Credit Improvement Act of 2017 proposed by Rep. Pat Tiberi (R-OH) and Rep. Richard Neal (D-MA) seeks to strengthen the Low-Income Housing Tax Credit seeking to improve affordable housing in rural communities. In addition, Congress and the Trump Administration can pass comprehensive tax reform to simplify the tax code, and bring companies back from overseas.