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for people who care about the West

Denying the warts on the West's service economy


Once upon a time, in 18th-century France, the king and his court had pet economists known as "physiocrats." The nobility liked their physiocrats very much. Not only did they bow and scrape in a very respectful way, but they told the king and counts and dukes that all wealth comes from the ground. The aristocracy liked hearing that because their wealth did indeed come from their estates.

The nobility also liked the theory because it helped keep the riffraff who engaged in commerce in their place. Trading and manufacturing and running inns, the physiocrats taught, were mere embroidery on the wealth that originated on farms and forests.

In the end, the physiocrats' theory was no defense against the guillotine, although the nobility probably found satisfaction in knowing that without metal mining - another source of ground-based wealth - there could have been no quick severing of their heads.

But it takes more than a bunch of bewigged heads in a basket to kill a theory. Anyone who lives in the rural West knows that the physiocrats are here in force, although now they wear Stetsons and Forest Service uniforms.

But just as the physiocrats are here, so is Robespierre. His name is Thomas Michael Power, and he has made a career of demolishing the West's physiocrats. In his new book, Lost Landscapes and Failed Economies, Power shows that conventional approaches to logging, mining and ranching are more likely to lead the West to poverty than to wealth. He argues that the less logging and grazing and mining, the more prosperity. To take one example, is the timber industry on its knees in the Northwest? Of course. Is the supposedly timber-dependent Northwest on its knees? Of course not.

Looking ahead, full of hope, Power asks: What if all federal grazing ceased in the West tomorrow? At average growth rates, the 11 public-land states would make up for the loss in just six days. That's the dollar value of the West's cattle and sheep industries: six days of average expansion.

Is there a downside to this new economy, like the loss of rural ways? The University of Montana economist writes:

"We must put our agrarian sympathies aside: Agriculture does not step lightly on the land ... Residential development can actually reduce the demand for water, reduce the quantity of chemicals introduced into the environment, and create a more diverse habitat - trees, shrubs, parks with wetlands - to replace field crops."

Power is against extraction not only because of the physical damage it does, but because, as an economist, he sees it as a low economic use. The landscapes that are cut and mined and dammed simply to create jobs and cash flow, he writes, could serve a much higher economic use, rather than just a commercial one. Landscapes are like schools and churches and museums - assets that make a community attractive and healthy. They draw in people who create jobs and cash flow without despoiling the land: "Forested landscapes can create economic vitality simply by attracting and holding residents," he writes.

Power says there is a second way to eat the scenery without damaging it. He writes that rural people get a "second paycheck' - the well-being that comes from small populations, less crime, uncrowded highways. He puts numbers to this idea and shows that "real" wages in small towns are as high as in New York City. Rural places, Power suggests, have much more wealth than they acknowledge, and it is time for them to stop complaining about poverty.

Power also wants residents of rural places to stop criticizing environmentalism for damaging their economies. He says the declines in extraction are due to larger economic forces than environmental regulation, and he lists them: The federal government has turned against blue-collar labor unions, and so their members' wages have dropped; legal and extra-legal immigration is high, further lowering wages; and the United States has dropped trade barriers and thereby opened the nation's workforce to global competition. He writes:

"To blame local environmental protection for depressed wages or unemployment that's caused by international competitive pressure is not only unproductive; it seriously misrepresents the actual economic choices we face."

Power has done us a great service by describing the economic changes transforming the West. He has added to his punch by recruiting 65 other economists to join him in a December 1995 report, Economic Well-Being and Environmental Protection in the Pacific Northwest, which echoes many of his book's conclusions.

It is useful and important work, delivered with passion and conviction. But Power has weakened the work by looking away from sizable warts on the service economy, and by interpreting anything that happens as proving that the new economy is wonderful.

For example, when Power looks at the growth of part-time work, he doesn't see corporations escaping from paying benefits. He sees people choosing to work fewer hours so that they can lead fuller lives.

Or take his argument that subdividing is better than intensive agriculture. It may be true in California's Central Valley, but it's largely irrelevant here. In the Intermountain West, it is mostly ranchland being subdivided, especially around Power's hometown of Missoula and around Bozeman, 200 miles to the northwest. When big acreage is split, wildlife biologist and professor Rick Knight of Colorado State University writes, the best subdivision is more damaging to water quality, wildlife habitat and watershed than the worst ranch.

Power also avoids looking at the impacts on communities. He cites Kremmling, Colo., as an example of the success of the service economy. After Louisiana-Pacific was forced to close its waferboard plant, he says, the town flowered. Unfortunately, much of the flowering is driven by maids and cooks commuting to distant ski areas. When High Country News published its "Servant Economy" issue (HCN, 4/17/95) on the ski industry, some of the French-speaking Africans working at the resorts were housed - in difficult conditions - at Kremmling. That's not the whole Kremmling story. But it's part of the story.

The Africans are the dramatic tip of an iceberg the size of which we can only guess. But Power never asks who is doing the West's work. Jackson, Wyo., was recently hit by a federal immigration raid that traumatized that town. If the police had had the time, they could have driven a few miles over Teton Pass and arrested hundreds of workers in Idaho's potato fields. The Idaho Falls Post-Register estimates that 70 percent of the harvesting and processing work in Idaho agriculture is done by undocumented workers. The gambling casinos in Wendover, Nev. - another Mecca of the New West - were shut down this year by immigration raids.

Of course, I am concentrating on a different West than the one Power chose to see. In my West, workers set out before dawn to drive icy roads to ski resorts to take care of the comfortable people produced by the new global economy. Driving to and from work in the dark means these workers are not collecting their "second paycheck'; they can't see the landscape in the pre-dawn and evening dusk, and they're on crowded highways that are more dangerous than those in urban areas. The work pays so little that it doesn't attract the displaced workers from ranching and logging and mining.

Power relegates such things as undocumented workers doing much of the West's grunt work to the implacable working of the economic machine, or to the shift in federal policies. He says such shifts shouldn't be blamed on environmentalists.

It's not that simple. National environmental groups are players in the setting of these policies. NAFTA, our trade treaty with Mexico, is heavily weighted toward the urban and service economies and away from rural economies. Environmentalists split over NAFTA, but the major groups lined up for the treaty. The wise-use groups make sure that rural Westerners know that.

Look also at the recent merger of the Union Pacific and Southern Pacific railroads. The abandoned tracks may mean closed mines and mills, and a further decline in the extractive economy. It may also mean the conversion of former railroad towns into amenity towns, and railroad rights-of-way into trails.

This isn't the impersonal working of a global economy or the free-market economy. Ed Quillen, writing on the merger (HCN, 8/5/96), showed that it was in part the result of a political fix. In this case, environmental groups chose to ignore the issue. So technically, perhaps, Power is right when he argues that our hands are clean. But given the role that environmentalism plays in the West, we are implicated in the structural changes that are stacking the deck against rural economies and for urban economies.

You don't have to look at NAFTA or railroad mergers to see that Power has created a sort of Potemkin, or false-front, West. Drive around the region and compare what you see with the idea that the landscape will attract nondestructive economies. Even if you ignore the intense commercialization around (and in the airspace over) the popular national parks, commercialization of the public lands is rampant. People burrow in as close as they can to Forest Service and Bureau of Land Management and national park land. It's land-use zoning they've come 1,000 miles for, and it sells for top dollar.

Once they're here - in their dream house on their dream land - they often feel betrayed when they realize that the land is not just a landscape: It leaks fire or cougars or tree disease or hunters. Despite the image they've bought into, the land isn't simply beautiful, pristine landscape.

It is not only the land that is idealized here into a Barbie Doll landscape. I think Power also idealizes this latest economic boom, making only a few generalizations about the strength of oncoming diversified economies. About the wet Northwest, he is probably right. Urbanization is a fact, urban economies are growing, and land-based economies and cultures are disappearing.

But east of the Cascades - in Montana, in western Colorado, in southern Utah, in the Greater Yellowstone ecosystem, in northern New Mexico - it is not clear whether we are seeing the creation of a diversified and sustainable urban economy or simply another land rush.

Power's most curious approach to the question of sustainability comes in his citation of the work done by another Montana professor, Pat Jobes, formerly of Montana State University in Bozeman. Jobes found that four out of five immigrants to the West's fast-growing towns don't stick. So Power does an economic calculation: How much money, he asks, will the non-stickers drop in town before they move on? It's enough money, he concludes, to keep these towns going.

It's an interesting calculation, but it doesn't include the non-economic effects on the towns that are living off these transient newcomers. Jobes does comment on the effects:

"There was not, and indeed could not be, true community in such places because they lacked the sustained personal, informal commitment to other residents and to the locals."

Jobes also gives statistics about Bozeman (HCN, 6/12/95) that were not in Power's book. "In spite of the relatively higher growth and perceived success of such areas (towns switching to a service economy), the proportion of residents officially designated as below poverty is increasing. In Bozeman, the percent below poverty jumped from 9.5 percent in 1980 to 25.2 percent in 1990." Jobes concludes, "Collectively, the quantity and quality of newcomers literally deconstructs traditional small towns."

Is Jobes right? He's probably about as right as Power, for each is writing from a particular perspective. There is nothing about newcomers that Jobes likes, and there is nothing about extractive economies and their cultures that Power likes.

Power is contemptuous of today's cowboy physiocrats and their French predecessors. He says those "intellectuals of the royal court provided a sophisticated rationale" for the king and the landed aristocracy, "both of whom were engaged in what was soon to become a life or death struggle with the urban-based bourgeoisie." What Power doesn't see is that he comes dangerously close to doing the same thing. He has provided a sophisticated but one-sided rationale for the new social and economic classes that are moving into the West.

Power is absolutely right to take aim at the inflated economic claims extraction makes and the emotional pleas its proponents make for preservation of their "custom and culture" and their "way of life." The polemicists of the extractive industry can drive you nuts with a drumbeat for jobs that invariably involve destroying the land.

But in destroying extraction's fiction, we need to be careful not to create a counter-fiction, in which we all have part-time jobs that we joyously perform while gazing off at a big rock candy mountain. We should also be careful, as we work to bring the West back from the ecological brink, that we not engage in class warfare. The goal should be the reform and not the destruction of the land-based industries. The goal should be to eventually make those industries part of the restoration of the West.

Lost Landscapes and Failed Economies: The Search for a Value of Place, by Thomas Michael Power, was published in 1996 by Island Press. 304 pages, $29.95.

Ed Marston is publisher of High Country News.