Walt Disney’s Midwestern Roots

I have been reading about Walt Disney lately, mostly because I think he’s one of the most creative minds of my lifetime.  Creative people have always fascinated me.  In my work as a recruiter and career coach, they’re the type of folks I’m most drawn to.


I was surprised to discover that Disney was born in Chicago’s Hermosa neighborhood.  I don’t know why.  I just didn’t peg Disney as a Chicago kind of guy.  Hermosa was also the birthplace of another iconic American brand, Schwinn Bicycle.

Disney didn’t stay in the Windy City.  As a young child, he moved with his family to a farm in rural Missouri before settling in Kansas City.  It was there that Disney got his first job in animation.  It didn’t work out.  He was laid off and so he started his own company in the city before moving to Hollywood in 1923.

America was a lot bigger then than it is today.   There was no commercial aviation industry.  Los Angeles was still a small, relatively isolated place at the time.  It was at least a full day away by train and almost impossible to reach by car.  Route 66 wouldn’t be finished until later in the 1920s.  Leaving Kansas City for the wild frontier was a lot bigger deal than it would be today.  Disney went anyway.  I suspect that those who knew him best might have thought he was crazy.

I wonder what he was thinking.  Was the Midwest too cloistered for him?   It was for me.  I first left Indiana at about the same age.  I couldn’t wait to get out.  I went to Denver, a city that in 1981 probably wasn’t too unlike Los Angeles in 1923.  It had yet to grow and blossom.  It was cheap and opportunity was everywhere.

These days, not so much.  Denver is still a magnet but I sense most of those who are attracted to the Mile High City now don’t really understand that there’s nothing left there for them.  Denver has already been mined.  It has been played out.

To move there now is to make an implicit deal to accept a life where the numbers don’t work and that means perpetual poverty for most.   Like it or not, buying property is the easiest way to acquire wealth and it only works if you have a long horizon and a lot of upside.  That’s how the game is played.  It’s almost impossible to win financially if you move to a city where the average home already costs 5 or more times the annual salary.   You’re on the wrong side of the curve.  The math doesn’t work.

I think that’s why so many people have left California over the last twenty years.  I also see the same thing starting to happen in Colorado.  The people who leave first are the ones who have the clearest vision of the future.

It is worthwhile to pay attention to where they are going.  Cities that stand to benefit are relatively low cost in high quality of life states.   These are places where things like education and health care are still in relatively good shape and yet the cost burden of government is still manageable.  Fargo, Sioux Falls and Des Moines come to mind.

Where would Walt Disney would go today if he still had 20-30 years of highway ahead of him?  Beats me, but I suspect it might not be California.  I think there’s a good chance he might have come back to the Midwest.  At this moment in time, this is where the best opportunities to buy property, build wealth and carve out a good life going forward are located.  This is the the new frontier.


Brain Drain and Educated Millennials

There’s a tendency in certain Rust Belt states to blame brain drain on things like mountains and oceans.  Young people want to ski or go to the beach, so the thinking goes.  We don’t have that, so they leave us for places that do.  My native state of Indiana ran an ad campaign that said as much.


Turns out it’s not that simple.   I was looking at an analysis of America’s top one hundred metros prepared by the Brookings Institution in conjunction with Amazon’s HQ2 push.  It address where educated Millennials are choosing to live.  As it turns out, lots of mountain-less, ocean-less places are on the preferred short list.


Des Moines has one of the best networks of bicycle side paths anywhere in America.  Downtown is accessible on mixed use trails from the far reaches of suburbia.

Here in the Midwest, Madison (#2) and Minneapolis (#9)  both cracked the top ten. They beat out places like Denver (#10), Austin (#12), Seattle (#13).  Des Moines was ranked 14th and beat out Portland (#22).  Last time I checked, Madison, Minneapolis and Des Moines were as flat as pancakes.  None are on the seashore. They all have pretty severe winters, too.   And yet they thrive while cities like Indianapolis (#39) languish.    It’s obviously not geography.

One anomaly that stands out  is quality of life.    Iowa, Minnesota and Wisconsin are consistently ranked in the top ten states when it comes to quality of life.   Indiana is consistently ranked at the very bottom.   In fact, all of the states that are home to top ten metros are high quality of life states.

So maybe this is the real reason that people are fleeing states like Indiana.  Maybe it’s not geography.  Maybe it’s quality of life.  If so, this is good because quality of life is something that any state can invest in if it chooses to.   This is the Midwest’s advantage.   Those who recognize it and choose to leverage it are holding their own with the best of the best.  Those who aren’t only have themselves to blame.


Midwest Rising?

For the first time in my adult life, I’m extremely optimistic about the future of the Midwest.  Of all the regions in the country, I think we have the most upside.

I have some experience with this sort of thing.  I first left the region in the early 1980s after graduating from college.  The Midwest was economically dead at the time and so it was relatively easy to go to Denver and ride the oil boom.  Later, I ended up in Minnesota’s Twin Cities during what was an incredibly vibrant period there, and later still I moved to Austin Texas.  We all know what happened to Austin.


Jefferson (population 4,100)  is the quintessential small Midwestern town, built around a vibrant courthouse square.


The Midwest is chock full of recreational amenities.  I can ride on a rail trail from my home in Jefferson right up to the steps of the state capital, some 70 miles away in Des Moines.


No state generates a greater percentage of its electricity from wind than Iowa.  In fact, nobody else is even close.  That means clean air and a higher quality of life.

Denver, Minneapolis and Austin were all cost competitive with the Rust Belt when I showed up.  By the time I left, they were different places.  Prices had risen and opportunity had fallen.   It’s hard to believe that I once owned homes in or near all three of these cities.  I couldn’t afford to live in them now.  The property taxes on inflated real estate values alone would be enough to make me run away in fear.

These days it’s pretty easy to work remotely so if things like buying a house and paying off a mortgage are important to a person, a small town in the Midwest makes a lot of sense.  Here in Jefferson Iowa, housing prices are about 25% of what they are in Denver and about 33% of what they are in Minneapolis and Austin.  We have an engaged community that is focused on the arts and quality of life.  We’re 40 minutes from Ames and Iowa State University and an hour from surprisingly hip Des Moines.   Life is pretty good.

We also have geography on our side.   Iowa has incredible soil and so we have a lock on growing food which is about as primary an industry as you can find anywhere.  Agriculture is high tech these days and so a lot of agriscience and biotech spinoffs have taken root here.   There are good paying jobs (opportunity) to go along with low costs.  People will eventually take notice.

One area that concerns me is legacy cities in the Rust Belt.  I’m talking about places like Cleveland, Detroit, Indianapolis and even Chicago.  These cities have all experienced massive urban population loss over the last sixty years.  Too much emphasis is being placed on creating glitzy downtown districts at the expense of surrounding neighborhoods. Of these places, I know Indianapolis best and the road they’ve embarked on just feels like a losing bet to me.  Time will tell.

Regardless, I’m much more inclined to believe in smaller regional cities like St. Paul, Sioux Falls, Fargo and Des Moines where a greater focus is directed towards maintaining strong neighborhoods which in turn draw families who have a vested interest in things like good schools and safe streets.   College towns like Ames, Iowa City, Lincoln, Champaign-Urbana, Columbia, Lawrence, Manhattan, Bloomington, Ann Arbor and West Lafayette are all good bets, too.

These are the places where courageous, visionary people are looking forward with confidence rather than fear.  I think that they will thrive over the next 30 years as native sons and daughters grow tired of the high cost of living and declining quality of life in today’s preferred destinations and remember the good old days back home.   Nobody’s talking about the Midwest these days.  It’s America’s forgotten quarter.  I think that’s about to change.




Non-Competes, Innovation and Brain Drain

I’ve noticed that a lot of Midwestern companies use non-complete agreements with their people, even at the lowest levels of the organization.   Back in the day, non-competes were used to prevent high level people from taking the company’s secrets and leaving, ostensibly to go to the competition for more money.  These days, at least here, they’re used with everybody.

I found myself thinking about this recently because there doesn’t seem to be a lot of really big thinking happening around here these days.  Once upon a time,  the Midwest was to America what Silicon Valley is today.  Henry Ford was the Steve Jobs of his day and his company was headquartered in Dearborn Michigan, not Palo Alto.  This is where the transformational ideas and products that changed America came from.


These days, the really big ideas come from other places.  Take Marc Andressen, for example.  He was a local boy whose product, the Netscape browser, was every bit as transformational as Ford’s Model T.  He did a lot of the groundwork at the University of Illinois in Champaign-Urbana, but spent his summers with IBM in Austin and fled to Silicon Valley as soon as he graduated.


Urban abandonment is a problem across the Midwest.  As people have left for other places, cities have struggled to reposition buildings.  What were once assets are now liabilities.


Declining tax revenue makes infrastructure maintenance difficult to fund. 

There’s a tendency among many here to blame Midwest brain drain on geography and climate. but I think that’s a cop out.  Life is good here.  Sunshine, mountains and beaches get old after a while, believe it or not.   No, people are leaving here for other reasons and I think being shackled by backward thinking companies is a much bigger part of it than most people will admit.

They have non-competes in California, but in a typical West Coast way, they are not enforceable.  As a practical matter, this means talent flees Company A for Company B with regularity.  This, in turn, results in a form of cross-pollination where ideas spread and grow.  I think that’s why so many of America’s most innovative products have come from the Valley for well on 30 years now.

Midwestern states really need to look at California law and consider adopting something similar here.   Non-competes are fear based and nobody wins by protecting the downside.  If you hire the right people to begin with, you really don’t have to worry about them stealing your intellectual property.

If that’s not enough to sell the argument, consider this.  Cross-pollination works both ways.  If local custom and law shackles employees when they leave their present employer, where are you going to get the talent you need to grow and succeed?


Before I talk about the Midwest, I want to share with you what I think it is.  This seems like a non-starter, but if you ask ten people to list all of the Midwestern states you’re probably going to get ten different lists.  Aaron Renn beats the issue to death here.

For my purposes, the Midwest basically extends from a little west of Appalachians to a little east of the Rockies and from the Canadian border down to the Ohio River and then west along a horizontal line from its confluence with the Mississippi at Cairo Illinois.  This is what it looks like on a map.



Right or wrong, this is my Midwest

These boundaries are somewhat arbitrary.   On one hand, I think that the Ohio River clearly delineates the region from the South and there’s no doubt in my mind that Pittsburgh is more East Coast than it is Midwest even though it sits west of the Appalachians.

It gets a little trickier out west.  Rapid City South Dakota feels like a Rocky Mountain town.   The eastern plains of Colorado are really just an extension of Kansas and Nebraska.  You have to draw your lines somewhere, though, and this is where I’ve chosen to draw mine.

The Midwest is pretty big.   Take a look at what I’ve shaded versus Texas and let’s break it down a little more.


Three Midwests

There’s the mostly industrial Rust Belt (orange), the mostly agricultural Grain Belt (yellow) and the touristy Northwoods, aka the Green Belt.   This breakout is also somewhat arbitrary.  Iowa’s Cedar Rapids and Davenport are Rust Belt cities.  Much of rural Indiana is more Grain Belt, in spite of all those abandoned GM supply factories that dot the landscape.

It has often been said that the Midwest doesn’t have a defining feature like mountains or oceans.    Maybe…maybe not.  There’s no place else in the world that has an abundance of fresh water like the Midwest.  Not only does it have the Great Lakes, it also has one of the world’s most significant river systems in the Mississippi-Missouri-Ohio.  Water is the region’s competitive advantage and water is its future.  It’s going to almost certainly be a bigger issue tomorrow than it is today. You can’t get water from an app.

Water is going to be the Midwest’s biggest challenge, too, because it won’t be long before people from points south and west try to take that water and use it themselves.

More on that soon.