Blue State Views

Leave a comment

Sioux Falls: It’s Been a Boom Town Before


Sioux Falls, South Dakota, has been in the spotlight recently as America’s latest “boom town.” Touting the city’s consistently low unemployment rate – currently at 3.3 percent – the National Journal reported, with a headline that used the “boom town” theme, that the city’s “multiple thriving industries” (banking, healthcare, agriculture) made Sioux Falls the envy of other urban areas. And Forbes again listed Sioux Falls in first place on its annual list of The Best Small Places for Business and Careers. So, more and more people go to Sioux Falls.

Talking with National Journal reporter Amy Sullivan, Sioux Falls mayor Mike Huether explained what the city’s booming success looks like on the ground:

We do have between 3,000 and 4,000 people moving here each year . . .. This year, we will blow away the record for construction in a single year. We’re already 150 percent of where we were last year, and last year was the second-highest construction year in our city’s history.

. . .

We had 30 businesses in downtown Sioux Falls that either opened or expanded last year. There is no vacancy right now for people who want to live in downtown Sioux Falls.

Sounds like a boom to you? Oh, please. You don’t know the meaning of “boom.”

If you really want to know what Sioux Falls looks like when it’s booming, you have to look back 125 years to the period right around the arrival of the railroad there in 1878. Fortunately, we have a fascinating record of what that booming period looked like, compiled by Gary Olson, a now-retired professor of history at Augustana College in Sioux Falls and an expert on the city’s history. Olson sifted through census data, newspaper accounts, and archival materials to provide an illuminating “snapshot” of Sioux Falls in the late 1870s. The city’s extraordinary growth was a thing to behold:

In March 1878 the Sioux Falls Pantagraph reported that . . . every day brought large numbers of new arrivals. The hotels, the Pantagraph observed, ‘are crowded to their utmost capacity; the boarding houses have eager customers for all their hash;. . . [and] the lumber dealers are up to their eyes in business.’ . . . In April the Pantagraph announced that new arrivals were increasing, averaging about forty-five per day, ‘coming by stage, by livery, by freighters’ wagons and on foot.’ . . . Naturally, the population pressure had an impact on real estate prices. In June 1878 a visitor from the Sioux City Journal reported that houses and buildings were scarce – ‘remarkably so’ – resulting in real estate prices doubling during the previous three years. The Pantagraph confessed in June that Sioux Falls had been overwhelmed by being ‘the vortex of a whirlpool of immigration for months.’

1908. Panoramic photographic of the main street of Sioux Falls, SD. Library of Congress

In April of 1878, the U.S. Land Office in Sioux Falls handed over nearly 200,000 acres of land, a 50 percent increase over the previous month. The office was processing an average of more than seventy claims a day. On one Monday in May, 1878, the office handled 134 claims, “a disposal of 160 acres every three minutes.” Olson writes: “This is how the term ‘doing a land-office business’ gained its meaning.”

In late July 1878 a correspondent for the Sioux City Journal visited Sioux Falls and reported that . . . houses, additions to hotels, livery stables, and business buildings were ‘springing up in every direction …’ A reprinted article from the Bodhead (WI) Independent reported that Sioux Falls had eleven dry-goods stores, fourteen groceries, six hardware stores, and an equal number of lumberyards plus several each of the usual tailors, shoemakers, harness makers, and so on. There were ten blacksmith shops, two newspapers, six doctors, seven or eight saloons, fifty or more lawyers . . . .

Let’s pause for a moment to consider one of those details: two newspapers!

[JF note: the Sioux Falls Argus Leader is now the town’s main paper. By the standards of today’s beleaguered newspaper industry, it is still editorially ambitious and in less-dire-than-most business shape. It has launched some ambitious reporting projects, for instance tracing the ties among the area’s recent refugee population and their homelands in Sudan and elsewhere. It also runs a civic-issues discussion series called “100 Eyes,” a charming homage to its name.]

Here’s what’s amazing about the growth described so far: it was all in anticipation of the railroad’s arrival. When the railroad finally was completed into town on July 30, 1878, the Sioux Falls boom accelerated still more. According to one reporter, in the following months, new stores were opening up “as fast as the buildings can be got ready for them, which is from three to four a week.”

A writer from the St. Paul Press, visiting in November of 1878, observed that what was happening in Sioux Falls was “one of the most marked instances of sudden growth and success” he had ever seen. And he reported that it was destined to become “a city of ten thousand inhabitants in ten years.” The reporter was prescient. The population of Sioux Falls exploded, growing from about 600 residents in 1876 to a little more than 10,000 in 1890.

1908. Panoramic photograph of the Sioux Falls business center, looking west. Library of Congress.

Sioux Falls had some advantages and important economic resources that other growing towns on the Plains did not have – most notably, the cascading falls of the Big Sioux River and, as we’ve seen, the acquisition of early rail connections to settled areas to the east and south.  The other important way in which Sioux Falls proved atypical, as Olson notes, is that “it did not boom and bust but continued to grow and prosper long after many other boomtowns of the ‘Great Dakota Boom’ had stagnated or even disappeared.”

It’s true: the history of Sioux Falls is one of almost uninterrupted growth and economic vitality. What’s remarkable is how strong its economy has remained throughout its history — with the exception, of course, of the Great Depression, when South Dakota was especially hard hit. But even then, Sioux Falls fared better than the rest of the state. And during the two most recent severe recessions – in the early 1980s and from 2008 to 2010 – Sioux Falls had very low unemployment during both periods.

The question is: what’s the secret to the city’s extraordinarily long-lived success? I understand that Jim will offer another hypothesis, about its role as “fringe city,” in the next installment.

Below, part of the city’s still-in-process riverfront-revitalization projects.


This post originally appeared at

Leave a comment

Government Spending Falls Under Obama

The right-wing claim that government spending under President Obama is "out of control" is, of course, sheer nonsense. Now, we have Forbes magazine and the Wall Street Journal, two bastions of conservative journalism, confirming that, in fact, spending by the federal government is growing at a slower rate than at any time in 60 years — since Eisenhower!  Two compelling charts:




Republican Nonsense


© Tom Toles

Iron Knee elaborates:

Republicans, who voted against every single bill that Obama came up with to help jumpstart the economy, spent their debate last night attacking Obama for not doing enough about the economy. But their only answer is lower taxes, which ignores the fact that one third of the cost of Obama’s stimulus bill (which they opposed and now attack) was to lower taxes, and the fact that taxes right now are the lowest they have been in 60 years, yet the economy continues to go into the toilet. Oh, they also want decreased regulation, even though it was decreased regulation of banks that triggered the economic collapse in the first place. They also complained about the deficit, even though Republicans have done far more to run up the deficit than Democrats.

Why does anyone listen to them when they trot out their old, tired answers that clearly have not worked? I would love it for some Republican to suggest something new, but they all seem to be part of the Borg collective. As First Read puts it:

The other big loser of the night was a serious, substantive discussion on the economy. After spending the last few weeks criticizing the Obama administration on this subject, not a single GOP presidential candidate offered a convincing plan on how to create jobs. We heard plenty about lower taxes and less regulation. The problem: Taxes are already at their lowest level since the 1950, and that hasn’t really jump-started the economy. Moreover, there was little regulation during the Bush administration, and that didn’t produce a wave of jobs between 2001 and 2009.

Leave a comment

Pushing Back at the Greedfest

Inequality-page25_1You have to be comatose to be unaware of the grotesque income inequality that prevails in contemporary America. Take a look at the disturbing data (here and here), documenting  the extent of the inequality and the rate of change over time. 

This insanity was brought home powerfully to those of us in the Boston area this week when Wednesday's Boston Globe carried a front-page article detailing the $8.6 million in compensation that Blue Cross / Blue Shield of Massachusetts paid in 2010 to Cleve Killingsworth, the chief executive officer of the non-profit organization who resigned abruptly in the Spring of 2010 at the urging of the board.  This was after BC/BS posted back-to-back operating losses in 2009 and 2010 totaling $215 million. 

What is wrong with this country?  What is wrong with Blue Cross?  Are we really supposed to believe that it takes compensation at that level to find a competent executive to lead this organization?  That's absurd.  

Continue reading

Leave a comment

Wealth and Inequality in the U.S.


Moreover, the
gap between the top 1% and everyone else hasn't been this bad since the
Roaring Twenties.

Go to this article in Business Insider, containing this and fourteen other graphs about the dramatically worsening wealth gap in America.

(h/t Nicole Belle at Crooks and Liars)

The Onion offers a visual take at the situation.

Leave a comment

Volcker Over Summers and Geithner

Is it just an eclipse or a more enduring realignment of celestial objects?  Hard to know, but I took heart from the news late last week that President Obama had finally paid more heed to former Fed chair Paul Volcker’s advice than to that of the Two Wall-Street Toadies, Larry Summers and Tim Geithner.  Shoving aside Summers and Geithner, who from the get-go have been overly protective of the big banks, Obama agreed to follow Volcker’s advice to limit the size of the biggest banks, curtail their risk-taking activities, and prohibit commercial banks from proprietary trading of financial securities.  It’s about time. 

Whether it was Scott Brown’s victory on Tuesday or some other set of prods, Obama finally moved off the dime on this measure that’s been under consideration for a while and threw his weight in with Volcker, Vice-President Biden, David Axelrod, and others who had long been pushing for tougher crackdowns on the banks.  This is very good.  I would have liked to see more here, such as tight limits on compensation.  But when it comes to taking on the big banks, possibly the worst entities in our sordid economy, Obama will never be populist enough for me.

And a delightful little sidelight of this story is that Larry Summers has finally had his arrogant sails trimmed again. (When I say “again,” I’m thinking of Harvard having fired his smug, imperious ass.)  In the future, let’s see a lot more of Christina Romer, chair of the Council of Economic Advisers, and a lot less of Summers. 

(One of the problems with being too busy at times to blog is that the big news stories just keep piling up and one keeps falling behind more.  I’ve decided that mini-reactions are better than none.)

Leave a comment

Overpaid College Presidents

Today's newspapers are reporting that 23 private college presidents made more than $1 million in 2008. Take a look at this article from today's New York Times

This is truly outrageous that many of these university presidents are being paid close to $1.5 million a year. Can anyone seriously say that the president of Suffolk University in Boston needs to be paid that much?  Or that Neil Kerwin (an old acquaintance of mine, now president of American University in Washington, D.C.) deserves to earn almost $1.5 million a year?  Nonsense.  The argument that these universities have to pay these salaries to be competitive for "top talent" is ridiculous.  The managerial revolution in higher education has produced bloated university bureaucracies with excessive salaries paid to far too many mediocre administrators.  

At some point soon, parents are going to stop ponying up the $50,000 per year demanded of private colleges and universities in this country.  And the first people to take a hit from the changing economics should be the overpaid administrators.  I can't wait!  Along with the greedy bankers, these people should be drawn and quartered.   

Leave a comment

Sick Society

Take a look at this graph:  



The image represents how much cash separates the top 1% from the bottom 99% of the population in the United States. It gets worse:

    During eight years of the Bush administration, the 400 richest Americans, who now own more than the bottom 150 million Americans, increased their net worth by $700 billion. In 2005, the top 1 percent claimed 22 percent of the national income, while the top 10 percent took half of the total income, the largest share since 1928….

    The highest incomes come from executive pay at top corporations. In 2007, the ratio of CEO pay to the average paycheck was 344 to 1, lower than the record 525 to 1 ratio set in 2001, but substantial.

This gross inequality is perpetuated and exacerbated by the shameful compensation practices of the big corporations and banks.   Get a load of this item from Political Irony, which says that Morgan Stanley, despite just posting its third quarterly loss, has set aside 72% of net revenues for bonuses.   Good lord. What a sick society.