6

Steady and conservative: The Nebraska Way

A mural in downtown Wayne, Neb., just off of Main St.

Trisha Peters, an associate broker with 1st Realty, in Wayne, Neb.

Marion Arneson owns The Midwest Land Company, in Wayne, Neb. There is a deed from 1871, hanging on the wall behind him.

Darrell Miller, co-founder of Heritage Homes, a Wayne-based company that makes modular housing.

Kai Ryssdal: Obviously you have to have a certain something to thrive in Nevada, a tolerance for the economic booms and busts. In other places, though -- a lot of other places -- it's all about the even keel. Not getting too excited when things are going well, which helps when things elsewhere start going bad.

Here's Marketplace's David Gura from Wayne, Neb., population 5,600.


David Gura: Main Street cuts right through the center of this town, and this ain’t the strip. There’s a movie theater on one end and a dollar store on the other. A small real estate agency sits catty-corner to a bank that was founded here back in 1892.

Trisha Peters is a broker at 1st Realty. She says things slowed down some, in 2008. She’s seen a few homes in foreclosure. But not because the owners were gambling on the housing market:

Trisha Peters: We weren’t going crazy with building.  People were staying in their homes.  They were trying to improve what they had.

Wayne is a farming town -- and a big one by Nebraska standards. There’s a college here and a few factories. Peters says home prices have been stable. If you wanted to flip a house, this was not the place to do it.

Peters: Due to the size of our communities around here, people know when somebody buys a house for $80,000, and if they tried to turn around in six months from now and list it for $180,000, they would know something’s up.

There really wasn’t a housing bonanza in Nebraska, and because of that, there wasn’t a housing bust. According to RealtyTrac, last year, only seven states had lower foreclosure rates.  In this part of the country, if you want a loan, you’ll need equity.

Peters: Our banks are pretty strict.  You know, we’ve got some pretty straight shooters.  Most of my clients are going through one of the four local banks here, in the Wayne community.

The Midwest Land Company is right across the street. Marion Arneson is the owner.  He’s a farm manager and a land broker, and there’s a deed on the wall to a piece of property that is still in Arneson’s family, he tells me, four generations later.

Marion Arneson: You can talk all day, but Nebraskans have been through blizzards. They’ve been through heat. They’re strong-willed, pioneer stock. They’re going to have a couple down years -- they just come back.

Arneson’s clients are farmers, and their line of work is cyclical.  Mark Landow is a political scientist, and a Nebraskan, born and raised. 

Mark Landow: When farmers have a bad year, it has a tremendous effect on the rest of the state.

And when farmers have a good year, that has a tremendous effect, too. This is, after all, the Cornhusker State.  They’ve had a string of good years. The price of corn, the price of soybeans: they’re through the roof.  And farmers are making a lot of money.  But the ones I talked to seemed so modest.  

Landow: I think we see just a general conservatism -- a general unwillingness to bite off more than you can chew -- that is sort of the hallmark of the Nebraska personality.

Landow says that’s what’s called “The Nebraska Way.” 

Landow: That’s the way we do things out here. We cooperate. We get together. We work things out. 

Heritage Homes has a factory in Wayne, about a mile from Main Street. The company builds modular homes and ships them to states that aren’t doing as well as Nebraska. It’s a tough line of work to be in.

Darrell Miller: Housing usually leads us into a recession and takes us out, but it just doesn’t seem to be working quite as well that way.

That’s Darrell Miller, who co-founded Heritage Home in 1978. Last year, sales were down 40 percent, and there were layoffs. Competitors went out of business. But Miller has his eye on North Dakota, where there’s an oil boom. And he’s optimistic about the market.

Miller: We know it will come back. It just does.

That’s "The Nebraska Way."

In Wayne, Neb., I'm David Gura for Marketplace.

About the author

David Gura is a reporter for Marketplace, based in the Washington, D.C. bureau.

Trisha Peters, an associate broker with 1st Realty, in Wayne, Neb.

Marion Arneson owns The Midwest Land Company, in Wayne, Neb. There is a deed from 1871, hanging on the wall behind him.

Darrell Miller, co-founder of Heritage Homes, a Wayne-based company that makes modular housing.

Log in to post6 Comments

I was born in Wayne, I grew up in Wayne, I was educated in Wayne . I've lived all over the country and had the opportunity to travel to a number of wonderful places around the world but I will always call Wayne my home town.

Mr Landow's definition of conservative is so refreshing: "We cooperate. We get together. We work things out." In this Orwellian age where the advocates of a societal free-for-all and the rule of each man for himself are called "conservative" we should all look to Nebraska for good old-time common sense -- REAL conservatism and REAL progress. In a REAL economy, the two would not be considered mutually exclusive.

Thanks for the note, newmoviegirl! I did admire the beautiful Majestic Theater on Main Street, but it was closed while I was there. I'll have to make a return trip soon.

I wish I had known you were here. I would have loved to show off our movie theatre to you! And I'm sure there are lots of other people who would have loved to show off our city: the rec center, the library, the baseball field, the construction on campus... Everywhere you look there is proof that this town is different, and a truly amazing place to live.

Nebraskans are on the whole fiscally conservative because they remember the agricultural boom years of the 1970's and early 1980's which coincided with massive exports of U.S. agricultural commodities to the flailing USSR whose socialist central planning committees had by that point completely exhausted the productivity of the nation’s agrarian land – particularly in the once fertile Ukraine. More and more U.S. farmers took greater risk buying land, equipment, and more land by leveraging as of yet unpaid-for parcels to buy more ground often with little cash down because everyone, including their bankers, believed that they could live off the inflation since the value would continue to increase indefinitely. And then the bubble burst...sound familiar? (and no, they weren't purchasing vacations and second homes in the Sun Belt).

We’re in the midst of a recession induced real estate housing crisis which has so many parallels to the 1980’s farm crisis that it’s surprising more economists didn’t see it coming. The Farm Aid concerts were organized initially to attract the attention of the proportionally larger and disconnected U.S. urban population to the plight of rural America’s producers (the financial impact of the charitable earnings was for the most part symbolic and negligible in a macro sense). Most current farmers were either actively farming or are the sons and daughters of ones who were when they lived through the farm crisis of the 1980’s and the subsequent agricultural commodity price slump of the next 15+ years. Those fortunate enough to have survived have not forgotten the hard-learned lessons and the agricultural economy is very strong today. Although ethanol is often cited as the chief cause and culprit, the current agricultural economic high tide is largely due to other factors including dramatic increases in population and standards of living in China and India, low interest rates, a weak U.S. dollar, and often speculative buying and selling of commodities by money market mutual funds (Goldman Sachs) which have either distorted or magnified market swings – both up and down.

Although agricultural land has seen double digit percent increases in value in the last few years, most sales are made with 50% down and adequate collateral, if not paid for outright. This isn’t to say that there won’t be a turn around, but barring significant economic shock(s) it appears that overall the agricultural economy should remain healthy.

If Nebraskans are so conservative, why is it that "Farm Aid III was held in Lincoln, Nebraska on September 19, 1987." and "As a result of the efforts of Farm Aid and family farm leaders, Congress passed the Agricultural Credit Act which said that the Farmer's Home Administration (FmHA) could not foreclose on any family farmer unless the FmHA would make more money through foreclosure that they would by investing in making the farm profitable"? From what I recall, one of the reasons "family farmers" were losing their farms is that they'd borrowed against their farms to pay for vacations and second homes in the Sun Belt.

With Generous Support From...