Justin Farrell interviewed more than 100 of the wealthiest people in Teton County for his upcoming book, “Billionaire Wilderness,” and one of the things that struck the Yale professor from Cheyenne was the desire among some of the upper class for a rare commodity on Wall Street or in Silicon Valley: authenticity.
They refuge in their Western clothes and chunky log cabins with Western art adorning the walls. And they foster passing friendships with the people that live full-time in the shadow of Wyoming’s most recognizable mountain range. They are hungry for intimacy with the soul of Wyoming, which they see as real, working-class and normal.
But, the economic divide between the haves and the have-nots in Jackson is the deepest in the U.S.
The wealthiest 1 percent of Teton County earned on average 142 times the income of the bottom 99 percent of families in the county, according a report released Thursday from the Economic Policy Institute.
It’s a distinction that the Jackson metro area receives nearly every year and it highlights the strange community throbbing on the western edge of the state, where the working poor serve some of the richest people in America.
The income gap has actually fallen in Teton County since last year, when the average one-percenter earned more than 200 times the average among the rest of the population.
Mark Price, co-author of the Economic Policy Institute study, said there are a couple reasons that may have happened.
When you’re dealing with extreme income levels, money is tied up in markets that can fluctuate, he said. A bad year for someone in a high income bracket can change those income levels dramatically. Another possibility is that someone wealthy died or moved. So much money in so few hands makes each household pretty relevant in these studies, he said.
Regardless, the inequality in Jackson, where a few earn more and more, while growth in the lower percentiles is much slower, is happening across the U.S.
Nationally, one-percenters earn an average of 26 times more than everyone else.
The report is the fourth of its kind and it seeks to highlight that trend — one the authors say is a growing concern.
A national problem
Despite a strengthening economy since 2009, following the Great Recession, disparity between the bottom 99 percent of families in the U.S. and the wealthiest continues to widen, according to the report.
What’s happening today is a trend that began in the 1970s. The good old days of Leave it to Beaver were a time of greater economic equality in the U.S., according to the study.
There’s a reason things were better then, for a larger part of the country.
“This earlier era was characterized by a rising minimum wage, low levels of unemployment after the 1930s, widespread collective bargaining in private industries … and a culture, political and legal environment that kept a lid on executive compensation in all sectors of the economy,” the study states.
None of those factors are true today, a situation that the authors see as unsustainable. The data for the EPI studies is available on their website.
Walmart is an example of how distant the gap in income has become, Price said.
On the one side is the Walton family, made incredibly wealthy by one of the most successful businesses in America. On the other side are thousands of low-paid workers, whose wages and benefits are depressed enough that many employees qualify for public assistance like Medicaid and SNAP benefits, he said.
The situation hasn’t happened by accident. Price pointed to examples like no-poaching agreements in fast food franchises, which are currently under scrutiny in a number of states, for artificially depressing wage competition for low-income workers.
There is a debate among economists about the risks of boosting wages, he said. Some economics note concern that solutions like raising the minimum wage would cause runaway inflation and high prices.
“I don’t accept that view,” he said. “There’s not been enough wage competition, not enough income growth, and that is troubling.”
Whatever risks there are to narrowing the income gap are worth it, he said.
A local issue
Laura Soltau has to bend around her clients’ lives.
She is the director of the Teton Literacy Center in Jackson. The organization, which used to be a sister to seven literacy programs across the state, services mostly lower-income residents, largely Latino. The program fosters early education, providing English courses and childcare for working and in-school parents.
In Jackson, that means being flexible: extended hours, online classes, text messaging.
“They are working later. They are working on weekends, they are working the night shift,” she said of her clients. “We really have to be creative in what we are providing because of the amount our families have to work.”
Jackson has its own complicated story within Wyoming. The region is home to a small middle class and a number of wealthy people who do not live in the area year-round. It’s also the hub of seasonal tourist activity in the state that demands a large group of service workers cleaning floors, manning registers and flipping beds.
“Because of the depth of our hospitality industry — those aren’t necessarily middle class jobs, they are working wages,” Soltau said. “That’s what makes that working class so much bigger than what you might see in a town of our size normally.”
Having a number of wealthy people in the community has its upsides: philanthropy.
Real estate has become so expensive that most regular people can’t afford Jackson, but there are more than 200 nonprofits in the area.
When Wyoming’s downturn led state lawmakers to shave down the budget, one program to go was the family literacy program. State funding disappeared and the program in Casper, Casper Family Literacy Program, closed within six months.
Teton Literacy is still going because there were philanthropists who could afford to support the program, Soltau said.
Farrell, the Yale professor, sees philanthropy as an untapped resource in the area.
For his upcoming book, Farrell interviewed 155 of Jackson’s wealthiest to figure out why they come to Wyoming and what it means to them.
Some have never been outside of the Yellowstone area, but they come for the obvious reasons: natural beauty, no income tax.
Though the rest of the state may look at Jackson as fistula in an otherwise energy and cowboy state, the authentic Wyomingness of Jackson is a key driver for some Teton County residents, he said.
They like the community. They care about it. But the majority of their investment in nonprofits goes to environmental issues, according to Farrell’s research.
They value the natural resources of the area, the public land where they ski or recreate in the summer, the elk and moose and mule deer that are characteristic of western Wyoming, he said.
There’s room for that commitment to go into the community that they are part of too, he said.
But there is a misconception that would have to be overcome.
“The thing for me is they equate the issues of poverty in Wyoming or Teton County — they view that as ski bums,” he said, referring to the young people who show up in the area to ski and snowboard each season. “They don’t view that (economic class) as immigrants from Mexico, which are the large majority of the working poor.”
Perhaps more importantly, the working poor of Latin American heritage are not the people the rich come to Wyoming to mingle with.
“They don’t view that (group) as authentic, Western, working-class people that they want to get to know,” he said.
Wyoming is ranked sixth in the nation for income inequality, but that’s largely the result of wealthy families in Teton County. Wyoming’s ranking also fell from last year, when it placed third in the infamous list, likely caused by the drop in the Jackson area, said Price, the report’s co-author.
But income inequality in Western cities similar to Jackson isn’t nearly as high. And economies in places like Montana aren’t nearly as narrow as Wyoming’s.
Mark Haggerty, an economist for Headwaters Economics in Montana, said Bozeman is a good example of how diversification in a resort, wealth-friendly city keeps drastic income inequality at bay.
The city’s wealthiest 1 percent earn on average 24 times the bottom 99 percent, on par with the national average, according to the EPI study.
Bozeman has a university, a tech and software sector and a large hospital, he said. And having those higher wage industries in a city lifts other wages, he said.
“That doesn’t suggest that we don’t have problems in Bozeman, we do. We have really crazy real estate prices and inequality,” Haggerty said. “But, I don’t think it’s nearly the scale as Jackson.”