Posted on 07/25/2022 7:14:41 AM PDT by BenLurkin
Inflation is crippling rural America and driving some people to consider moving closer to cities in an effort to ease the financial stress, according to the latest analysis from one expert.
Iowa State University professor Dave Peters has been studying the effect of inflation on people in rural communities as part of the school's Small Town Project. He found that this year alone, expenses for rural Americans had increased by 9.2%, but their earnings only increased by 2.6%.
And Peters has pinpointed where it's hurting most.
"Mainly, fuel prices, particularly among the farmer and agricultural community," he said. "They really are worried about the price of gas and diesel."
Inflation soared to a 40-year high in June, and is affecting all American households. But Peters said travel was one of the main reasons it was hitting harder in rural areas.
"Rural people have to drive long distances for work, for school, for health care, just to get the daily necessities of life like groceries ... there is no public transportation," he said.
His analysis found it costs rural households $2,500 more a year to pay for gasoline than it did two years ago. At the same time, prices are also rising for health insurance, veterinarian care, and fuel to heat homes.
"Most rural homes have to buy tanks of liquefied petroleum or liquefied propane, or they have to get fuel oil," Peters said. "And those have really risen in costs as well; that's, I think, something like $1,000 more."
In response to the June inflation figures, President Joe Biden said tackling the issue was his top priority.
He said the administration would continue to release oil from the strategic petroleum reserves in an effort to bring down gas prices, and that he would "continue to give the Federal Reserve the room it needs to help it combat inflation."
"Inflation is our most pressing economic challenge ... we need to make more progress, more quickly, in getting price increases under control," he said in a statement.
The Fed is now attempting the delicate task of lowering inflation without driving the economy into recession, and is expected to raise interest rates for the fourth time in five months when it meets later this week.
"The Fed slows the economy down by raising interest rates, which cuts spending," Princeton economist Alan Blinder told NPR. "If you do too much of that, you're going to get a recession."
Peters warned that if prices stayed too high for too long, it could start a dangerous cycle for some rural Americans.
It begins with people dipping into their savings, which Peters said was already happening. Next, they will be forced to use their discretionary money on essential goods; and after that they will go into debt on credit cards.
But what really worries Peters is the idea that some in rural America will then start taking out home equity lines of credit because the value of their homes has increased, especially in the Midwest region. But he warned this strategy could backfire.
"That's particularly dangerous if home prices fall back down and then they're left with a mortgage that the value of their home doesn't cover," he said.
This combination of factors was driving some people in rural areas to consider moving closer to cities, Peters said. But it's complicated.
"There are people that I've talked to in Iowa and in Nebraska ... that are really trying to do that financial calculation," he said. "They would love to work and get city wages, but they can't commute. It's too expensive with the gas prices. And really, the thing that's holding them back is the cost of homes."
"Some people are contemplating moving closer to a city, moving to the suburbs, or moving to a small community 45 minutes from a city. So yeah, it will probably, if it continues, accelerate rural depopulation in parts of the Midwest and Great Plains."
That would be a happy side effect for the Left, it it weren’t deliberate outright, thought I don’t credit them with that level of intelligence.
They have been trying to get rid of rural Americans for decades.
“Moving people from the rural areas to cities is / was part of Agenda 21. Now that 2021 was passed what the new moniker for their evil?”
See my post 40, spot on
Agenda 2030. Another “Great Leap Forward”.
I lived in rural Illinois where you might be able to barter for Denton corn to make corn meal, but nothing else because dent corn was the only thing grown for miles and miles and miles. No fruit stands, no victory gardens, just miles of corn with hardly an occupied farmhouse in sight. Not like southern Illinois or Florida where farm stands are everywhere.
The plan is to turn us into renters and serfs.
Agreed. End game is government managed apartments and public transportation. They don’t want us in EV’s even. They know there’s no infrastructure for it, and they hate coal and nuclear to extend electrical service.
Its NPR. Its DC bubble state-run propaganda.
I believe the exact opposite is true. The cost of living in America's biggest cities is far higher, relative to incomes.
There aint no cows or deer roaming around the city.
Just sayin.....
relative to quality of life as well
All according to plan ...
The enclosure thing didn’t work so well- wasn’t it the poster child for tragedy of the commons, when land held in common was abused and became barren and unproductive from overgrazing because people wouldn’t put in effort to maintain it much less improve it because they didn’t individually own it?
I live in a somewhat rural suburb (lots of my neighbors have small pastures and much of the land is undeveloped forest land, maybe about 30% of the acreage is suburban with many of those owning 1/2 acre per lot). Yet my house cost way less than a house in town, especially if I got the same size house and lot. The same for the necessities of life like groceries and transportation (all conveniently excluded from the "official" CPI inflation calculation).
Rural Indiana is different. Every staple is available.
for now. If the economy crashes and the trucks stop running you are in for a big hurt.
When the EBT cards stop working the cities will become a blood bath
That’s exactly what the commies want
Rural people moving into crime ridden hellholes instead of staying out in the country where they can grow and harvest their own food?
Some people just don’t get it.
People can and will successfully homeschool.
People don’t need to move to cities for a school for their kids to go to.
FOOD + FUEL and they're more than 9.2% higher, especially if you look at 3 years instead of the stupid year on year. It's a 50 mile round trip to the grocery store or for many, their daily commute. Where I am is hill country with lots of gravel roads and we have winter. Not many people drive a 30mpg car on hilly, curvy 55mph roads because if you crash, you die and bumpy gravel roads wear them out quick. That means 15 mpg so right now, many people are spending $100/wk to commute to their $400 take home pay job. Take another $100/wk out for food and they're left with $800/mth for electric, phone, insurances, mortgage/rent. There are not enough jobs out here for every family to be a two income family and even poor people here tend to be the go forth and multiply type.
They're still not apt to go to the cities. Not until there's an actual depression and the way things are going, there might be in the next year or two.
So this is a reversal of all the city dwellers who fled to rural areas during the pandemic and the riots?
I live in a rural area and housing starts are still surging because of demand from still fleeing urbanites.
Hell, somebody is even building “luxury” storage units that are climate controlled for their wine stashes.
I have no doubt they will quickly ruin the local schools and start demanding gun control.
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