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A Conversation on Distressed Counties

ARC's Distressed Counties Program was first proposed by the Appalachian governors in a report to Congress in 1981. The program was intended to provide basic services, such as safe drinking water and affordable waste disposal, to the Region's neediest counties, and to enable those counties to take better advantage of other Commission programs. Funding for the program was begun in fiscal year (FY) 1983; since then, the Commission has invested nearly $236 million in distressed counties. Most of the money has been spent on basic infrastructure improvements.

One hundred and eight of Appalachia's 406 counties are classified as distressed in FY 1999. These counties have high poverty and unemployment rates and low per capita market income rates, compared with U.S. averages. Because they are designated distressed, the counties are eligible for special funds allocated to the states by the Commission, and for reduced matching-funds requirements for regular ARC grants.

For a range of informed perspectives on distressed counties today, the editors of Appalachia interviewed three experts on the Region and the issues it faces.

Ron Eller is an associate professor of history and director of the Appalachian Center at the University of Kentucky in Lexington. He coordinates research and service programs on a wide range of Appalachian policy issues. A descendent of eight generations of families in the southern mountains and the current ARC John D. Whisman Scholar, Eller has published more than 50 articles and reports but is best known for his award-winning book Miners, Millhands and Mountaineers: The Industrialization of the Appalachian South.

Amy K. Glasmeier is a professor of geography and regional planning at Pennsylvania State University. A former John D. Whisman Scholar, Glasmeier has studied a number of issues for the Commission since 1991, including the implications of globalization for Appalachian industry, the capability of Appalachian firms to acquire strategic business information, and, most recently, a 20-year statistical study entitled Building on Past Experiences: Creating a New Future for Distressed Counties.

Greg Bischak, a senior economist for ARC, previously served as executive director for the National Commission for Economic Conversion and Disarmament, a nonprofit advocacy group. Bischak is the author of a number of articles and reports, including the 1997 ARC study Welfare-to-Work: The Challenges and Opportunities for Appalachia.

Q: Who are the poor in Appalachia?

MS. GLASMEIER: Women, children, and the elderly. The percentage of children living in poverty in the Region goes from probably 14 up to 50 percent. So in some counties, every other child is living in a family that lives in poverty.

MR. BISCHAK: The poor are principally concentrated in the central region of Appalachia. And even though Appalachia has a smaller share of blacks than the nation as a whole, the Region's black population is two-and-a-half times more likely to be poor than the white population.

MS. GLASMEIER: White Appalachians have one experience, and black Appalachians have another. Some of the defining characteristics of poverty in the Region have to do with geography. I also think you have differences in length of time in poverty. In the central Appalachian core, you have generations of families that have lived in poverty, whereas in the south, I think you have people that have gone in and out of the labor market and in and out of being really poor.

MR. ELLER: The poor in Appalachia are often what I might call a "placed population," often tied to a specific geographic place. The larger society, especially in the late twentieth century, assumes that jobs are available anywhere in the country and that people are free to move wherever the jobs may be. That simply is not the case for many of the poor in Appalachia. They don't have the education to be mobile. In many cases they are tied because of a need to take care of a disabled or older relative or tied emotionally to their place. It means that we must design and direct programs that are much more place-oriented than nationally designed programs often are. We need to look at programs that reach people where they live.

Q: Are the poor working?

MS. GLASMEIER: In the southern part of the Region, most poor people are working. In the central part, a lower share of the total are working, largely because of the absence of any kind of employment opportunities.

MR. BISCHAK: You also have a higher welfare dependence in the central region of Appalachia. That we have both the working poor and welfare dependents explains, I think, the pockets of poverty dispersed throughout the Region and the concentration of poverty in the central region. The poor educational quality that many people get in remote rural locations has a lot to do with their ability to earn a living or not.

MR. ELLER: Obviously they are not employed in occupations that are measured in the international market economy. In most cases the poor are very much engaged in an informal economy. They find a way to survive and make a living through barter and exchange of goods and services—domestic work, cutting firewood, clearing land, and working for neighbors. The image of the poor as lazy ne'er-do-wells usually does not fit the reality of rural poor.

Q: That raises another question. Is the "culture of poverty" concept still alive and well?

MS. GLASMEIER: What I see is a series of failed expectations over the life of an individual. Kids, until they are about 13 or so, actually have some degree of optimism. They can imagine a world that's different from the one they live in. But when they begin to put all the pieces together and they become self-conscious, in their early teens, they realize that they may not be able to change the life that they see around them and they, to some extent, buy into it.

MR. ELLER: The whole notion of the "culture of poverty" makes me very uncomfortable. It's been too easy over the years to apply the term "culture of poverty" to a group of people in Appalachia as it has been applied to lots of other groups of people across the country in other kinds of settings. In many ways, the true culture of poverty, if it exists in the Region, may in fact be the attitudes and values of those that make the decisions about access to economic opportunity. It seems to me that the real culture of poverty is a culture that doesn't value people, that doesn't value the land and the environment that those people live in, that doesn't value giving the kids that Amy was talking about an opportunity to choose for themselves what they want to do in their life.

MR. BISCHAK: What is interesting in the Welfare-to-Work demonstration projects that ARC has funded around the Region is how engaged folks are in trying to make it happen. The stories we hear about welfare dependents just don't ring true in Appalachia. People have the drive and determination to make a living and to improve things for their children.

MR. ELLER: It's been my experience over the years working in the mountains that poor people want the same kinds of things for their kids and they have the same kinds of hopes for their children that most Americans have. Poor people in the mountains, however, do want to see their children stay close by. That's part of Appalachian culture. I, frankly, see that as a very positive thing.

MS. GLASMEIER: Parents do have aspirations for their children. But at the same time, they feel uncomfortable when they see their child facing a future which is very different from their own. When a child comes to a parent and says, "I want to do something different," there may not be mechanisms in the community to say to the parents, "That's okay, and we'll help your child have a different experience than you did."

Q: How do you define "distress"?

MR. BISCHAK: The key thing is the lack of a living wage. That translates into the day-to-day concerns of putting food on the table and shelter and all of the basics.

MR. ELLER: My definition is a measure of capacity—the capacity of both individuals and communities to shape their future in a way consistent with their own value system. All of those involve assets or lack of assets. But it seems to me that people in distress are people who are dependent upon their lives being shaped by other people. Communities that are in distress are communities that are dependent upon outside, external sources of income. The key for me is the freedom side, the freedom to choose, to shape your own destiny. Distress is the absence of that freedom.

Q: Besides the reduction in welfare caseloads, what has been the main effect of welfare reform (Welfare-to-Work) in Appalachia?

MR. BISCHAK: I don't think anything really definitive can be said on this because we don't have county level data—we don't have a count of the number of people who have been placed in jobs. So we can't answer one of the most important questions: has it improved or worsened the situation or is there no change? But I suppose there are two effects we have seen. One is on government service providers, who used to be sort of cordoned off from each another in their own little worlds. Now they have to work together. So far as the recipients go, in terms of real service delivery, the one real thing I've seen in terms of projects is that child care and transportation have expanded. That's particularly important in remote rural communities.

MR. ELLER: The impact at this point is certainly good in some communities and for many individuals; it's probably less positive in others. Historically, a boom economy lifts all boats, and we have a relatively prosperous economy today. But we also know that when the national economy takes a dip, the recessions in Appalachia are more severe and last longer and that those at the bottom rung of the job scale are the first to lose their jobs. We don't really know whether welfare reform has fundamentally and structurally improved the condition of the Appalachian people.

MS. GLASMEIER: We don't actually know very much about what has happened, except on an anecdotal basis. What we do know is that people who live in distressed counties are individuals who are very likely to be receiving some type of public support. We also know that these are communities with no child-care services; few, if any, Head Start programs; and no special bus services for children, so that the options facing families on welfare are really grim. You are going to find pockets of people who will lose their benefits status but simply do not have the social infrastructure to move into the paid labor force. At the same time, there are exemplary programs in the Region offering services and job training to the unemployed that predate welfare reform, that need to be more widely recognized and more widely praised. The Region has a lot of the seeds of the answers to its needs. The question is how to encourage replicability of successful programs where it's appropriate.

Q: Currently, the Commission uses unemployment rates, poverty rates, and per capita market income to identify the areas of greatest need. Are these indicators telling us what we need to know in order to come up with intervention strategies in these areas?

MR. ELLER: We're measuring outcomes. We're measuring the products of the lack of capacity. And we're not really getting at both the human and the community capacity to take advantage of those funding assets that we might provide. We fail to find ways to look at the capacity of the organizations, and the individuals in those communities to work together, to make public decisions, to tap into federal and state programs that might begin to provide the assets that are lacking.

MR. BISCHAK: It would be nice to be able to measure quality of life and community capacity. It's very difficult. And it's easy to say we're just measuring the symptoms and we're not measuring the underlying causes. But actually, if you take a look at the data and you start going into those counties, my view is that we do a pretty good job. The real issue about using these measures is whether or not we actually target our resources using that data in a meaningful way.

MS. GLASMEIER: I think the point he's making is that there is little relationship between the current investment strategy and a basic understanding of the existing data, and the underlying problems of the Region. Look at the statistics; what should high poverty levels really mean with regard to policy? What should high unemployment rates mean with regard to policy making? In other words, what type of policy response is required given these conditions and the data?

MR. ELLER: I think Greg's right. The issue isn't that we're using the wrong indicators. There's a broader range of indicators that we ought to be looking at—for example, the number of nonprofit organizations in a given community, the presence of institutions that can partner and work together, and examples of how they do work together.

Q: Assuming for the sake of argument that the measures, the kind you just suggested, are available, what are the implications for ARC?

MR. ELLER: ARC and state agencies can try to encourage partnerships in communities. And build the capacity in those communities. There's a lot of inferential evidence today that those communities that are able to create local partnerships are more successful. And I can point to a number of those in Appalachia.

Q: What are the greatest challenges facing people living in distressed counties?

MS. GLASMEIER: Changing the fate of children is really the most important and most difficult issue. Families face a lack of opportunities to gain and maintain self-respect.

MR. BISCHAK: But the Region itself won't change unless, as children grow and get educated, there are economic anchors and social and cultural anchors to keep them in the community. What we see is the out-migration of this talent. Then the Region becomes older, and we have all the liabilities and none of the assets of the population.

MR. ELLER: Their greatest challenge is survival at this point, and survival in a wide range of ways. They survive based on the traditional, informal mechanisms of survival that folks in these communities have utilized for years and years and years. The long-term question, however, becomes how can they transfer those assets that they have for survival into assets that are going to allow them to grow, to become independent in the future.

Q: If you had to design a program for distressed counties, what would your strategy be?

MS. GLASMEIER: There needs to be more financial support of the creation of innovations to deal with human resource problems and create local capacity. I would treat the ARC distressed county funds as 50-50 matches, so that in order to get these funds you need to find equal financial matches from some other source. This, of course, will require technical assistance.

MR. BISCHAK: To spend ARC money on just water and sewer infrastructure is missing a tremendous opportunity. ARC should essentially be creating the capacity, as Ron was just saying, to be able to access other money. Our money should be a lens to focus the energy of the communities and allow them to access other resources.

MR. ELLER: If you look at ARC program development, there's a clear period of time between 1965 and the mid '70s, where ARC put resources in a whole range of comprehensive programs and emphasized partnerships. It's the period of the origins of the development districts and categorical grants. But then by the mid '70s and then increasing in through the '80s, you find a shift away from those kinds of programs. Within the ARC counties as a whole, the early investments in health care and housing, and some of those human and social resource programs, succeeded in helping many counties move into higher economic development stages later on. They helped to create a stronger foundation for development.

MR. BISCHAK: That's absolutely true. That's why we have far fewer high-poverty counties. There's a dramatic reduction from 279 high-poverty counties in 1960 to 135 in 1980, and then an uptick in the '90s.

MS. GLASMEIER: There is a strong historical link between the distress of these places and their narrow economic bases. Although the Commission has spent significant resources on infrastructure and done a lot to encourage job development, it has not been able to counteract that.

Q: What will be the effect of telecommunications on all this? Will the "information highway" be the salvation for rural communities?

MR. BISCHAK: It's not a salvation, but it's a key ingredient. In fact, a lot of rural communities both inside and outside Appalachia have already seized on back-office work, everything from data processing to catalog orders and a variety of things like that, which has actually built a substantial business base in a lot of rural communities. What's lacking is some of the front-office, more professional services, with more high-wage, high-value-added potential. We in the ARC have spent, through the regional initiative on telecommunications and the more recent one on entrepreneurship, key seed money. But what we haven't done is try to tie those strategies closely to the economic base, not just of the Region but of the nation, and see where we can actually parlay these investments into longer-term economic opportunities.

MS. GLASMEIER: I think one of the difficulties is that some communities have weak leadership. So the benefits that Greg described are just not available to them. And if it doesn't become available in the not-too-distant future, they will never grab on because the technology is changing. We know, for instance, that corporations are finding that they can do back-office sourcing globally.

MR. ELLER: Technology will make a difference in these distressed communities with respect to access to services. For example, we're not going to build a college in each rural distressed county. But we can do a much better job through effective technology of getting education resources and training resources to them, instead of with bricks and mortar. From that perspective, I'm very hopeful that technology will make a difference.

Q: So is there hope for the distressed communities and the distressed people of the Region?

MS. GLASMEIER: I think so. I think that ARC can be a catalyst for lots of new and exciting things in the Region. ARC was an experiment. There are places which will find things persistently difficult because of the way that the nation and the international economy are going. But there are lots of places where, if people were given opportunities, and resources were redirected toward a locally based and inclusive form of development planning, many communities would be able to imagine and realize different outcomes than they have now. I also think it requires changing our scale of understanding what constitutes an "economy." I'm not willing to write off 100 counties, but to have conditions substantially different in the future will require a significant reorganization of the resources that go toward those places at present.

MR. BISCHAK: Progress has been made since 1960. Projecting current measures back in time, many counties have exited and stayed out of distressed-county status. When you start looking over what happened, many of them did develop specialized strategies. Some cultivated tourism, others a manufacturing base, and some tried to diversify their local economy. That, I think, is a key lesson. And to second what Amy had to say, we do have to take seriously this strategic focus on distress. One thing that augers well is larger cities growing and pushing people into the next county, the next community over. The amenity values in some of these regions—where they are very beautiful and somewhat remote—promises the potential for further recreation tourism development. That's a very important factor, actually. We have to have a better sense of how to value these kinds of assets and to ensure a return on them in high-value-added jobs. We're trading them off for short-term gains through manufacturing or mining or whatever else without really looking at the long-term payoff. They're really the future of these communities.

MR. ELLER: The hope for distressed counties lies in our ability to help them develop the comprehensive capacities necessary to sustain quality development—human resource capacity, social resources, and the physical infrastructure necessary for the community to take charge of its own future. It is out of these capacities that communities will be able to build their own futures and to overcome the burdens of the past that have made them dependent. There is no silver bullet solution, however. Building communities of hope requires a comprehensive approach to development.

The interview was conducted by Jack Russell, director of ARC's Customer Relations and External Affairs Division, and by freelance writer Fred D. Baldwin.