Urban free traders or rural individualists

Lawrence Solomon
National Post
November 30, 2000

After the U.S. presidential election, USA Today published a startling map showing counties that voted for Al Gore in blue and those that went for George W. Bush in red. The map was a sea of red, with Gore voters relegated to a few blue patches along the coasts and the odd spot in the interior.

Bush supporters see vindication in this map, which largely isolates Gore’s support to densely populated urban and suburban areas. Rugged rural individualists imbued with the entrepreneurial spirit — the very combination that made the country great — voted Republican, they say, while the subsidy-seeking collectivists in the cities went for the Democrats.

The conservatives mostly have it backwards. While cities have their share of collectivists, cities house free traders. Wall Street is in Manhattan, the Mercantile Exchange in Chicago, Hollywood in Los Angeles. Unlike these and other urban powerhouses, which export to the world and generate America’s immense wealth, rural America is primarily a stronghold of the subsidized and collectivized that saps America’s strength. Under a free market system that respected basic property rights, most low density rural communities simply could not exist.

The single greatest infringement on people’s use of their property today comes through local zoning ordinances. Nowhere in the United States is this infringement stricter and more onerous than in rural communities near urban and suburban areas, whose governments typically force owners to maintain extraordinarily large minimum lot sizes of one, two, or five acres. Advocates of minimum lot sizes — including several conservative think-tanks that otherwise rail against government restrictions on the use of personal property — defend these minimums as necessary to maintain property values and the lifestyle that rural residents desire. Individual property owners within these rural communities who might wish to profit by subdividing the land, they argue like classic collectivists, should not be permitted to put their personal gain ahead of the good of the community.

Without this heavy-handed zoning, which prevents owners from putting their land to its best economic use, desirable rural communities — typically those near metropolitan markets — would become denser, and no longer rural. But zoning is only one of many props required to maintain low- density areas. Most basic services provided to rural areas require subsidies. Rural electrification is prohibitively expensive compared with providing power to metropolitan areas. So, too, are water and sewage services. So, too, are roads. The accumulation of these costs, if they were to be paid by the users of the services, would make most of small-town USA unaffordable. Without enormous transfers of wealth, via the tax system, from metropolitan to rural areas, many U.S. towns would become ghost towns.

Archer Daniels Midland, the agribusiness multi-national whose fast-growing advertising budgets massively promote U.S. agriculture and itself as the Supermarket to the World, accurately portrays the U.S. farm economy as one of the country’s largest exporters. The ads do not reveal that farm exports, as well as the entire U.S. farm economy, run at a loss, with subsidies from taxpayers exceeding the agricultural sector’s profits. Although ADM is the poster child for the agricultural economy, it has been, according to the Cato Institute, "the most prominent recipient of corporate welfare in recent U.S. history …. At least 43% of ADM’s annual profits are from products heavily subsidized or protected by the American government. Moreover, every $1 of profits earned by ADM’s corn sweetener operation costs consumers $10, and every $1 of profits earned by its ethanol operation costs taxpayers $30." Wayne Andreas, then chairman of the Decatur, Illinois-based corporation, explained it best to Mother Jones magazine: "People who are not in the Midwest do not understand that this is a socialist country." People who are not in the Midwest also do not understand that, without subsidies, most farmland far from population centres would revert to forests and wilderness.

Agriculture — by far the largest rural resource industry — accounts for much of the red Bush country that the USA Today map displays. Other large rural industries — the logging towns dependent on uneconomic cutting of old growth forest, for example — also bleed red ink. Rural America does have one vibrant, true-blue industry — tourism, which prospers by servicing those Gore supporters from the cities.

The entire U.S. resource economy — the farming, fishing, forestry and mining industries that form rural America’s heartland — account for but 3% of the country’s GDP, less than, for example, motion pictures and other copyright industries, an overwhelmingly urban sector that also includes sound recording, entertainment and business software, and book publishing. This fabulously profitable creative sector has become America’s number one exporter. But it, too, is dwarfed in size by the service sector — representing close to two-thirds of the U.S. economy, thanks to fast growing, urban-dominated knowledge-based industries.

In contrast to the plodding, government-dependent rural economy, urban America is steeped with wheelers and dealers, retailers, traders, dot-com entrepreneurs and others dependent upon a free market economy. Because urbanites have so big a stake in globalization, Gore is an ardent free trader, as is Clinton. They, after all, brought in NAFTA and — had they not been defeated by pro-union Democrats and protectionist Republicans in Congress — would have obtained fast-track authority to greatly expand trade.

Bush supporters — defensive at losing ground in Congress and in state governorships, defensive at losing the country- wide popular vote for president and at losing the Electoral College outside Florida, fearful that they will win Florida’s electoral seats only because elderly and ill-educated Democrats failed to vote properly — seized upon the USA Today map to reveal some hidden truth. They attained, instead, collective delusion.

THE U.S. VOTE, COUNTY BY COUNTY:

Al Gore won in 677 counties and George W. Bush in 2,434 counties, according to preliminary results.

SQUARE KILOMETRES OF COUNTIES WON

Gore: 1,502,556

Bush: 6,285,658

POPULATIONS (1999) OF COUNTIES WON

Gore: 127 million

Bush: 143 million

POPULATIONS (1990-99) OF COUNTIES WON

Gore: 5%

Bush: 14%

Note: County election data not reported for Alaska, unavailable from two counties in other states.

Source: Associated Press, ESRI Inc., USA Today, National Post

Read a counter-argument from the Ayn Rand Institute: A response to: Urban free traders or rural individualists

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