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5 Places Where the Rich Got Richer -- Mostly on the Government's Dime

In a few islands of prosperity, Americans are flourishing. This is where -- and why.

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Loudoun County is a prime beneficiary. Military contractors Northrop Grumman and Lockheed Martin are located here and are neighbors to a number of top-secret government offices and suburban shopping amenities.

Fairfax County, which borders Loudoun, has the second-highest median household income nationwide. The military contractor General Dynamics, whose offices are based in Fairfax, has seen revenues grow from $10.4 billion in 2000 to $31.9 billion in 2009. Fairfax is also home to a new top-secret security complex called Liberty Crossing, which employs 1,700 federal employees and 1,200 private contractors.

“It’s not your grandfather’s military-industrial complex anymore,” says O’Mara. “It’s this privatization of defense and privatization of government services more generally.”

Loudoun County’s prosperity shows that government can be a force for economic growth. But while government critics champion privatization as a method of protecting taxpayer dollars, Loudon’s prosperity also shows how privatization funds an economic elite tied not only to the military-industrial complex but to a corporate shadow government that is taking over once-public functions.

 

2. A coal, oil and natural gas boom has lifted Wyoming’s economy into the stratosphere. This is what explains the relatively high median income ($76,863) in Campbell County, home to the rich coal beds of the Powder River Basin. It also explains why the wealthiest people here have seen their income grow 6.9 percent since the recession started

While counties and states nationwide are cutting services like education, Wyoming is running a  surplus and spending an estimated $100 million on new  schools.

“We’re up to nearly 400 million metric tons [of coal] shipped out of Wyoming,” says Jason Shogren, professor in economics and finance, at the University of Wyoming. “A good chunk of it comes out of Campbell County. Despite the push to move to renewables, coal is still a vital part of U.S. energy supply.”

Wyoming, he says, provides more energy to the rest of the lower 48 than anyplace in the world. Ironically, it was the 1990  amendments to the Clean Air Act that set off the boom for Wyoming’s low-sulfur coals. It is, of course, not low in carbon.

Today, fast-growing Asian economies sustain the growth. “China’s consistent demand has pretty much kept Wyoming out of the recession,” says Samuel Western, a writer who specializes in Wyoming economic history.

But Wyoming has seen booms go bust before. Gillette, the county’s largest city, gave rise to the term “Gillette Syndrome” during the 1970s, when rising oil and coal prices pushed up violent crime and domestic violence.

“Wyoming has gone from being one of the poorest states in the nation to one of the wealthiest,” says Western. “There’s a collective memory in this state of what it was like to live without. And man, that is a very powerful dynamic,” so he does not begrudge his neighbors the success. “I am grateful to see Wyoming prosper so much. Damn, Wyoming’s been poor for a long time.”

Wyoming is also overwhelmingly conservative and highly suspicious of the federal government. Sen. Mike Enzi, once mayor of Gillette, has been a good friend to the mining companies. But the natural resources that fuel the state’s boom times are often extracted from federal land, and taxes on the collectively held resources pay for the new social services. In the end, the earth’s atmosphere will pay for Wyoming’s carbon boom. Politicians in Washington have yet to reckon with the cost.

 

3. A planned community where people drive around in golf carts called Peachtree City is the residential centerpiece of Fayette County, Ga. A developer named Joel Cowen built Peachtree in the 1950s, and became its first mayor in 1959. At the time, it was not contiguous with Atlanta or any suburb. It was a town sprouting up on farmland off I-85, 30 miles southwest of Atlanta.

 
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