My Register Experience

The New Poverty: Scenes from Iowa’s recession

Posted in Publication Week by Michael Bugeja on November 23, 2009

November 23, 2009



For The Register

Editor’s Note: Two journalism professors spent most of a week looking for stories that reflected today’s tough times. For the full account of how they prepared, access the blog’s archives.

They arrive at Gray’s Lake Park in the morning, basking on borrowed time of a mild mid-November, realizing the winter can arrive any day like layoffs without warning.

They are the unemployed, strolling with friends, partners or retirees, or sometimes alone. Everyone has a story to tell. Everyone knows someone else out of work in what some call “The Second Depression.”

They are neighbors, acquaintances, family members, colleagues, friends. They may be you. They belong to “The New Poverty,” people who followed the rules, paid bills and mortgages on time and whose lives were scuttled by Ponzi and subprime schemes happening far away.

Now many are unemployed or underemployed, walking around a lake days before Thanksgiving, known for blessings, food and the start of holiday shopping — seemingly beyond the reach of many jobless Iowans.

There is a quiet desperation in the air, not only at the lake. To date, 24 Iowans have died of H1N1 virus, but a more desperate killer has taken a greater toll this year — suicide — at record levels in the state.

Money is in short supply, so much so that counterfeit bills and gold coins are circulating in the city. Iowans who never entered pawn shops in their lives are hocking gold jewelry to get by.

Some just walk around Gray’s Lake to give themselves something to do.

Gray’s Lake is on the road to the Des Moines International Airport, and an air traffic controller on a daily walk chats about the failing state economy. Fewer flights are arriving and departing Iowa’s largest city, he says.

Indeed, total departures and arrivals of small and large aircraft in Des Moines peaked in 1998 with 137,000, says Anthony Molinaro, a spokesperson for the Federal Aviation Administration. That was down to 96,000 in 2008. As of September, total flights were 68,000 this year, compared with 77,000 for the same nine-month period in 2007, and 74,000 in 2008.

Some say the decrease is due to higher fuel costs. Molinaro is not so sure. “If you can’t afford a ticket, you don’t need as many flights.”

At Gray’s Lake Park, the air traffic controller moves on, continuing his walk. Behind him on a bench is a woman lost in thought. At first she gives her name, then later asks that her identity be withheld. Contacted again by telephone, she is firm. “No name.”

She’s a registered nurse, laid off twice this year. It took six months before she found another job, but then last month it happened again.

How does it feel to be an Iowan with a strong work ethic but with no work?

“You feel flawed because 90 percent of the people are working and you’re not,” she says. “I look for work all the time. I learned about resumes and other recommendations, but at the end of the day that’s not enough because there are not a lot of jobs to go around.

“Even hospitals have furloughs and hiring freezes.”

Cars arrive at noon in the parking lot off Fleur Drive. People emerge from vehicles dressed in business wear, with sneakers or comfortable shoes. These are the employed in a state with a 6.7 percent unemployment rate, enjoying a stroll at the lunch hour.

Signs of the times: A few blocks down the road, a McDonald’s marquee beckons: “Times are tuff. Let us help. 25 items $1.” McDonald’s and Burger King are in a $1 double cheeseburger war, trying to lure the newly impoverished on fixed or low incomes.

A big burger may not be as delectable as some prefer, but it’s affordable. In 1972, that burger cost 55 cents. A dollar then had the buying power now of $5.12. So two beef patties should sell at $2.81.

There is another story at the McDonald’s on Fleur Drive — workers willing to accept underemployment. Manager James Kennedy says college graduates often apply for jobs at his franchise.

“I had an application from a guy with a master’s in engineering and another degree in biochemistry,” Kennedy says. “He didn’t get the position.”

Out of every 100 applications, Kennedy gets about 10 to 15 from college graduates.

Business booms at a nearby pawn shop. Vince Madonia, owner of The Pawn Specialist on Army Post Road, has struck gold — literally.

Gold is more than $1,100 an ounce and may keep rising if the dollar continues to decline.

In the Great Depression, investors hoarded gold to such an extent that President Franklin Roosevelt issued a gold confiscation order in 1933, “forbidding the hoarding of gold coin, gold bullion and gold certificates.” (Gerald Ford legalized private gold ownership in 1974.)

“People are bringing in gold by the handful,” Madonia says.

“I had a guy bring in gold teeth this week. Would you like to see them?” He displays them on the counter. “These are caps, but I’ve had people come here who ripped out the gold from their mouths.”

Madonia also has seen fake gold. In the past, real gold was stamped 14 karat. But now you find that stamp on brass.

That bears out at Christopher’s Fine Jewelry and Rare Coins on Merle Hay Road. An elderly man waits for numismatist Ed Armstrong to return from lunch, clutching four yellow “liberty head” coins. He wants to cash them in for return on his investment.

Before Armstrong arrives, his assistant Brian Dresback looks at the coins and says each is brass with gold plate and worth “a quarter each.”

The elderly man is stunned. Did Dresback mean $250 each?

“No,” Dresback repeats. “Twenty-five cents.”

Armstrong enters the store, verifying that figure.

“Don’t buy gold coins from Internet, from television or anywhere else,” he warns, “unless you can look the seller in the eyes.”

Another reminder of the Depression – people who are out of work need food. Carey L. Miller, executive director of the Food Bank of Iowa, worries about whether partner pantries will have enough resources to fill demand.

Rising numbers of unemployment claims give cause to her fears.

By the end of September, the number of Iowans filing claims in 2009 was 298,285, or 33,602 more than were filed through all of 2008. Add October’s 32,613 claims, and totals reach 330,898, an increase of 183 percent over the same 10 months last year.

This weighs heavily on Miller. Pantries in her 42-county area serve 12,464 families per month, an increase of 1,495 families per month over last year.

“This has to be some kind of record,” she says. “I have been associated with the Food Bank for 20 years. I can’t imagine the need has been any greater or remember a time when I felt quite so concerned about having enough resources to meet demand.”

People at pantries using services for the first time are especially under stress. One man at a local pantry apologized for visiting a pantry, Miller says, “but he was laid off and had two kids he needed to feed.”

Children are the unseen victims of any poverty, but especially now. As families struggle to meet basic needs, children can develop emotional issues.

Heather Soener, executive director of the Young Women’s Resource Center, serving girls and young women ages 11 to 21, has noticed a theme running through some programs. “One of the things impacting their lives and normal development is unemployment. Families are under great pressure with layoffs now.”

Emotional trauma especially affects girls. The State Department of Public Health reports that in 2008, 13 percent of 11th grade females tried to kill themselves. In fact, the total number of suicides in Iowa is at record 10-year levels, with 376 such deaths in 2008, compared with 331 last year and 289 deaths in 2000, according to data from the state.

“Chronic stress or major losses in a person’s life, whether it is unemployment or any other personal crisis, can lead to depression,” says Douglas Steenblock Jr., president-elect of the Iowa Psychiatric Society.

In particular, he adds, “making the transition from a substantial income to virtually no income is very difficult and represents a significant loss in that person’s life.”

Options exist for Iowans who are battling stress or depression but have lost medical insurance. Most counties are affiliated with community mental health centers that offer psychotherapy and/or medication management, he says.

The Iowa Psychiatric Society may organize workshops for non-members to enhance education about available resources.

“There is a growing number of citizens who are struggling with the chronic stress of unemployment or underemployment, and this may be an issue that we will need to be more attentive to,” Steenblock adds.

Got work? Economic difficulties can seem insurmountable, but some are overcoming them.

Freelance businesswoman Suzanne Hull, creator of the Web site Unemployed, provides advice about getting a job.

A 1999 Wartburg College graduate, Hull has been laid off three times.

“The first was in 2003, and I was able to find work three weeks later.” When she was laid off from a West Des Moines genetics firm in February 2009, she was unable to find work for three months.

“I was angry — angry at myself for not being able to find work as quickly as I had before,” she says.

Hull tried different methods of networking, joined a business book club and followed advice that led to a positive attitude: She moved her laptop from the comfortable couch in the basement to the kitchen table, writing, blogging and designing her Web site and a T-shirt business. Her garments ask, “Got work?”

She uses that laptop to help bring together the unemployed not only through social networking, but also face-to-face at Smokey Row Coffee on Cottage Grove Avenue, where people meet every other week for informal networking.

In sum, she created her own community out of work ethic, self-reliance and that third very Iowan value, neighborliness, which eliminates the isolation of sudden or prolonged unemployment and inspires new options, opportunities and priorities.

Hull may not be the exception but the rule for the future as Iowans rely on old values to overcome new economic woes, reinventing themselves in the process.

Michael Bugeja is director of the Greenlee School of Journalism and Communication at Iowa State University, and Dennis Chamberlin is an assistant professor of visual communication. The reporting and photography for this article were part of a weeklong professional experience at The Register.