U.S. foreign policy and national security professionals are often disconnected from the economic realities that middle-class Americans confront and thus unable to test their assumptions about how U.S. foreign policies intersect with those realities. To address this gap, the Carnegie Endowment for International Peace launched a multiyear research effort dedicated to exploring the perceived and measurable economic effects of U.S. foreign policy on the economic well-being of the country’s middle class (see Box 1). Starting in 2017, Carnegie convened a bipartisan task force, whose members have served in senior policy roles in Democratic and Republican administrations, to oversee the effort and make concrete recommendations.
Nebraska is more than just an ag state or a red state.
The task force and its research team have collaborated with university partners—at The Ohio State University, the University of Colorado Boulder, and the University of Nebraska–Lincoln—to gather data in three U.S. states, respectively: Ohio, Colorado, and Nebraska. The task force deliberately chose to focus on the middle class in the center of the country, given prevailing criticism that the nation’s top earners in coastal cities have disproportionate influence on those developing foreign policies in Washington, DC. The findings from the Ohio and Colorado case studies were published in December 2018 and November 2019, respectively. This report focuses on how Nebraskans perceive U.S. foreign policy and its impact on their economic well-being. It contextualizes those perceptions with relevant quantitative data and is written with U.S. foreign policy and national security experts in mind.
Having covered Ohio, a major manufacturing swing state, and Colorado, a new economy state that has trended blue in recent years, the task force decided to round out the trio with an agricultural state that traditionally votes Republican. Few other U.S. states’ economies revolve around agriculture as much as Nebraska’s does.1 Its governor and entire congressional delegation are all Republicans. The Republican presidential candidate has won the state in every election but one (1964) since World War II.2
Yet Nebraska is more than just an ag state or a red state. More than half the state’s population now lives in the Lincoln and Omaha metropolitan areas—two areas that have become increasingly cosmopolitan and remain politically diverse.3 In these areas, banking, financial services, insurance, state government, transportation, healthcare, and universities anchor modern, diversified economies.4 And in the last decade, Lincoln and Omaha have boasted some of the highest rates of refugees per capita in the nation.5 In 2008, president Barack Obama picked up one of the state’s five electoral votes by winning the second congressional district, where Omaha is located. Nebraska and Maine are the only two states where it is possible for electoral votes to be split among multiple presidential candidates.6 And Nebraska is the only state with a unicameral, nonpartisan state legislature.7 It is indeed a unique state, yet at the same time, its population growth, levels of postsecondary education, and percentage of workforce in manufacturing all approximate the national average (see Table 1).
Finally, Nebraska is an excellent example of how the very nature of the middle-class household has changed over the years. Many families secure a middle income by working longer hours, holding multiple jobs at once, and maintaining dual-income households. Nebraska is ahead of the national average in many of these areas, making it a state with especially high labor force participation.
A comparison of key data for the three states is detailed in Table 1.
As in the cases of Ohio and Colorado, this report focuses on perceptions of the economic impact of foreign policy on the middle class and the ways in which those perceptions stack up against relevant economic data; this is because it is not feasible to model quantitatively the total economic impact of all U.S. foreign policy on a specific income group in a single state. There are far too many variables involved, including the wars the United States wages or prevents, the stability for the global economy it provides, the commerce it enables, the trade in goods and services it conducts, the foreign investment it makes or receives, the aid it delivers, and the friendly relations it forges.
To gauge perceptions in Nebraska, the research team—Jill O’Donnell, David Rosenbaum, and Eric Thompson at the University of Nebraska–Lincoln (UNL); Tarik Abdel-Monem and Janell Walther at the University of Nebraska Public Policy Center; and Salman Ahmed and Allison Gelman at the Carnegie Endowment—conducted interviews and focus groups with approximately 130 state and local officials, community leaders and residents, agricultural leaders, and Nebraska-based business owners, managers, and employees (see Appendix A for a list of those interviewed).
The research team concentrated on this group of Nebraskans because they could speak authoritatively about the state’s economy and middle class, yet, other than with a few notable exceptions (for example, Nebraska’s governor and director of agriculture or the president of Nebraska’s Farm Bureau), they seldom have a chance to weigh in on debates about foreign policy in Washington, DC. As in the Ohio and Colorado cases, a key aim of this study is to lift up such voices. The UNL team tapped into its extensive network of local partners across the state—county governments, municipal and city councils, local economic development organizations, local chambers of commerce, and private nonprofit organizations—to organize the visits and solicit participants.
The focus group participants were asked to respond to open-ended questions about how they perceived the impact of U.S. foreign policy on the local economy and economic well-being of Nebraska’s middle class. The same questions and format were employed in all discussions, consistent with the protocol approved by the Institutional Review Board at UNL. All interviews were recorded, transcribed, and subsequently coded (see Appendix B for more details on the interview protocol and methodology for the qualitative research).
The research team conducted interviews and focus groups in six locations around the state to capture its economic and political diversity. These areas (that are solidly Republican, except where otherwise noted) were:
- Columbus (Platte County): The state’s tenth-largest town, with over 22,000 residents and home to large manufacturing and agriculture companies and the headquarters of the Nebraska Public Power District. It is also the seat of Platte County, which, in 2017, was the county in Nebraska most reliant on agricultural trade with Canada and Mexico in terms of total export value.9
- Scottsbluff/Gering (Scotts Bluff County): A joint metropolitan community known for farming and agribusiness, particularly related to beans, sugar beets, hay, and livestock. It also hosts the main retail center and regional hospital for the Nebraska Panhandle.
- Kearney (Buffalo County): After Lincoln and Omaha, one of the state’s most prosperous areas. It boasts historically low rates of unemployment and a diversified local economy centered around agribusiness, manufacturing, transportation, tourism, and the University of Nebraska at Kearney.
- Lincoln (Lancaster County): The state’s capital and second-largest city. Its economy centers around healthcare, insurance, other financial services, higher education, and various state and federal government agencies. The largest county of the metropolitan area, Lancaster, voted narrowly for the Democratic nominee Hillary Clinton in the 2016 presidential election.
- North Platte (Lincoln County): A western regional transportation hub, located in the heart of farm and ranch country, where Union Pacific Railroad has long played a major role in the local economy.
- Omaha (Douglas County): The state’s largest city, a hub for multiple universities and industries, and home to the headquarters of Berkshire Hathaway, Gallup, and Mutual Insurance of Omaha. Douglas County, in which Omaha is based, voted narrowly for Clinton in the 2016 presidential election.
The research team opted against visiting the northeastern rural areas of the state that were undergoing severe stress from flooding at the time interviews were being conducted (see Chapter 2 for further details on the impact of the flooding).
The location and voting patterns of the areas where interviews were conducted are illustrated in Figure 1. Note that some focus group participants came from surrounding counties.
The vast majority of those interviewed reported residing in middle-income households, albeit generally above the median. The interviewees tended to be more male, white, older, and better educated than is representative of Nebraska’s workforce, but the sample is consistent with the demographics of those in community leadership positions across the state. Outside the major cities, the majority of these individuals described themselves as traditional Republicans; most of those in the Lincoln and Omaha areas characterized themselves as center-right or center-left, as opposed to being on the far-right or far-left of the political spectrum. That said, the team met with participants that spanned a wide range of incomes, education levels, and political affiliations. They offered $50 cash incentives and meals to encourage the participation in focus groups of those who might not otherwise readily engage in academic research.
Recognizing the limitations of the interviews and focus groups to tell the whole story, this study does not rely on qualitative findings alone. Economists at UNL’s Bureau of Business Research provided considerable economic and other data that put in context what participants said or did not know. The UNL team drew from the results of household surveys they regularly conduct to elaborate on Nebraskans’ top financial concerns. They also considered information from the recently completed Blueprint Nebraska—a strategic plan developed by a group of business, industry, and civic leaders who recently released a report that surveyed Nebraskans’ economic concerns and offered a detailed set of proposals to address them.11
Finally, it is worth noting that the questions posed during the interviews and focus groups, as well as the supplemental research, were consciously directed toward the economic effects of foreign policy. Had the discussions focused on security, some foreign policy concerns, such as the threat of terrorism, would probably have come up more frequently. Likewise, different views may have been expressed on issues like immigration had the conversations focused on cultural rather than economic considerations. The participants’ values, sense of identity, and the sources of information on which they rely likely played a role in the views they expressed, as research suggests.12 This is noted, where evident, but it is not the subject of this study. Rather, this study is deliberately centered on the intersection of U.S. foreign policy, jobs, and the pocketbook issues of concern to middle-income households.
Box 1: Who Is the Middle Class and How Is Foreign Policy Defined?
There are many different definitions one could employ to define the middle class. These case studies focus on households falling within the middle-income bracket, defined by the independent, nonpar- tisan Pew Research Center as two-thirds to double the median income, adjusted for household size and local cost of living. Table 1 shows the middle-income ranges in Ohio, Colorado, Nebraska, and the United States. The term middle class connotes more than income alone, however. Many also associ- ate this term with the dignity of work, position in society, and/or the maintenance of a certain lifestyle. Those interviewed for the project often described a middle-class lifestyle as the ability to secure a job with adequate pay and benefits to meet their monthly expenses, tend to their families’ medical needs, buy a car, own a home, help their kids pursue decent postsecondary education, take an annual vaca- tion, save for retirement, and not be saddled with crippling debt.
The term foreign policy in this study serves as shorthand for foreign, defense, development, interna- tional economic, trade, and other internationally oriented policies perceived by those interviewed for the project as impactful to their economic well-being. Interviewees across the states also associated foreign policy with some issues that typically fall under the purview of domestic policy, such as foreign direct investment, immigration, and energy and climate change.
Further information on the definition of terms, the rationale for the project, and relevant historical context can be found in the introductory chapter of the first report on Ohio.
1 Bureau of Economic Analysis, “GDP and Personal Income (Real GDP Chain Weighted), Regional Data,” https://www.bea.gov/data/gdp/gdp-state, accessed August 26, 2019.
2 270towin, “Nebraska,” https://www.270towin.com/states/Nebraska, accessed March 4, 2020.
3 U.S. Census, “Quick Facts: Nebraska and Cass, Saunders, Sarpy, Douglas, Washington, Seward, and Lancaster Counties, Nebraska,” Population Estimates July 1, 2018, data extracted March 16, 2020, https://www.census.gov/quickfacts/fact/table/NE,casscountynebraska,saunderscountynebraska,sarpycountynebraska,douglascountynebraska,washingtoncountynebraska/PST045219.
4 Bureau of Labor Statistics, “GDP and Personal Income by County and Metropolitan Area 2018,” Lancaster and Douglas Counties, December 12, 2019, https://apps.bea.gov/iTable/iTable.cfm?acrdn=5&isuri=1&reqid=70&step=1#acrdn=5&isuri=1&reqid=70&step=1.
5 Emily Nohr, “A Welcoming State: Nebraska Led the Nation in Resettling Most Refugees Per Capita in the Last Year,” Omaha World Herald, December 9, 2016, https://www.omaha.com/news/metro/a-welcoming-state-nebraska-led-the-nation-in-resettling-most/article_b84f8b71-d374-5cda-ad33-afa9a923fb54.html.
6 270towin, “Split Electoral Votes in Maine and Nebraska,” https://www.270towin.com/content/split-electoral-votes-maine-and-nebraska/, accessed March 4, 2020.
7 Nebraska Legislature, “History of the Nebraska Unicameral,” https://nebraskalegislature.gov/about/history_unicameral.php.
8 Sources for Table 1:
Middle-Income Range: Rakesh Kochhar, “The American Middle Class Is Stable in Size, but Losing Ground Financially to Upper-Income Families,” Pew Research Center, September 6, 2018, https://www.pewresearch.org/fact-tank/2018/09/06/the-american-middle-class-is-stable-in-size-but-losing-ground-financially-to-upper-income-families/.
Population and Population Growth: U.S. Census, “Quick Facts: United States, Colorado, Ohio, Nebraska,” https://www.census.gov/quickfacts/fact/table/NE,CO,OH,US/PST045218, accessed January 22, 2020.
Population With a Bachelor’s Degree or Higher: U.S. Census, “Educational Attainment: 2018 American Community Survey 1-Year Estimates,” data.census.gov, accessed January 22, 2020.
GDP: Bureau of Economic Analysis, “Annual Gross Domestic Product by State: Millions of Current Dollars,” last updated November 7, 2019, https://apps.bea.gov/itable/iTable.cfm?ReqID=70&step=1#reqid=70&step=1&isuri=1, accessed January 22, 2020.
Median Value of Owner-Occupied Housing: U.S. Census, “Median Value (Dollars) Owner-Occupied Housing Units 2018 American Community Survey 1-Year Estimates,” data.census.gov, accessed January 23, 2020.
Poverty Rate: U.S. Census Bureau, “Small Area Income and Poverty Estimates (SAIPE),” 2018, https://www.census.gov/data-tools/demo/saipe/#/?map_geoSelector=aa_c&s_state=08,31,39&s_county=31001, accessed February 20, 2020.
Unemployment: Bureau of Labor Statistics, “Regional and State Unemployment—2018 Annual Average,” February 28, 2019, https://www.bls.gov/news.release/pdf/srgune.pdf, accessed May 29, 2019.
Labor Force Participation: U.S. Census Bureau, American Community Survey, “Employment Status and Work Status in the Last Twelve Months,” 2018, https://data.census.gov/cedsci, accessed February 18, 2020.
Top Nongovernment Employers: Colorado Department of Labor and Employment, https://www.colorado.gov/cdle; ReferenceUSA, http://resource.referenceusa.com/; D&B Hoovers, http://www.hoovers.com/company-information/company-search.html?aka_re=1; Ohio Development Services Agency, “Ohio Major Employers—Section 1,” May 2019, https://development.ohio.gov/files/research/B2001.pdf; and Jennifer Calfas, “The 6 Biggest Employers in the U.S. Right Now,” Money, April 27, 2017, http://time.com/money/4754123/biggest-us-companies/; CareerOneStop, “State Profile: Largest Employers Nebraska,” 2020, https://www.careerinfonet.org/oview6.asp?soccode=&id=&nodeid=12&stfips=31&from=State.
Manufacturing Employment: Bureau of Labor Statistics, “Current Employment Statistics, Non-Farm Employment, Non-Seasonally Adjusted Annual Averages, 2018,” data extracted February 10, 2020, https://www.bls.gov/data/.
Defense Spending: U.S. Department of Defense, Office of Economic Adjustment, “Defense Spending by State: Fiscal Year 2018,” February 2020, https://oea.gov/sites/default/files/defense-spending-rpts/FY2018-Defense-Spending-by-State-Report_0_0.pdf.
Goods Imports: U.S. Department of Commerce, International Trade Administration, “State by-State Imports From a Selected Market: 2018 NAICS Total All Merchandise Imports From World,” http://tse.export.gov/stateimports/TSIOptions.aspx?ReportID=100&Referrer=TSIReports.aspx&DataSource=SED, accessed August 2019. Calculation for the percent of GDP uses nominal 2018 GDP (current dollars): Bureau of Economic Analysis, “Regional Data: Gross Domestic Product (GDP) by State: All Industry Total (Millions of Current Dollars),” May 1, 2019, https://apps.bea.gov/itable/iTable.cfm?ReqID=70&step=1#reqid=70&step=1&isuri=1, accessed August 2019.
Goods Exports: U.S. Census Bureau, USA Trade Online, data extracted May 10, 2019, https://usatrade.census.gov/; calculation for the percent of GDP uses nominal 2018 GDP (current dollars): Bureau of Economic Analysis, “Regional Data: Gross Domestic Product (GDP) by State: All Industry Total (Millions of Current Dollars),” May 1, 2019, https://apps.bea.gov/itable/iTable.cfm?ReqID=70&step=1#reqid=70&step=1&isuri=1, accessed May 16, 2019.
Service Exports: Nick Marchio and Joseph Parilla, “Export Monitor 2018,” Brookings Institution, April 30, 2018, https://www.brookings.edu/research/export-monitor-2018/.
Party Affiliations: GovTrack, https://www.govtrack.us/congress/members/OH#representatives, accessed April 2019; United States House of Representatives History, Art, and Archives, “Party Divisions of the House of Representatives, 1789 to Present,” https://history.house.gov/Institution/Party-Divisions/Party-Divisions/, accessed September 5, 2019; 270towin, “Colorado,” “Ohio,” and “Nebraska,” https://www.270towin.com/states/, accessed September 5, 2019; and U.S. House of Representatives Press Gallery, “Party Breakdown: 116th Congress House Lineup,” accessed March 16, 2020, https://pressgallery.house.gov/member-data/party-breakdown.
9 Nebraska Farm Bureau, “North American Free Trade Agreement and Nebraska Agriculture,” December 1, 2017, https://www.nefb.org/images/FEDeration/PDFs/NAFTA.pdf.
10 Sources for Figure 1:
Nebraska Secretary of State, “Official Results of Nebraska General Election—November 6, 2012” and “Official Results of Nebraska General Election November 8, 2016,” accessed October 8, 2019, https://sos.nebraska.gov/dyindex.html.
Population, Population Growth, Hispanic/Latino, Foreign Born, Bachelor’s Degree, Household Income, Home Value: U.S. Census, “Quick Facts: Nebraska and Lincoln, Scotts Bluff, Buffalo, Platte, Douglas, and Lancaster Counties, Nebraska,” data extracted January 22, 2020, https://www.census.gov/quickfacts/fact/table/lincolncountynebraska,scottsbluffcountynebraska,buffalocountynebraska,plattecountynebraska,douglascountynebraska,lancastercountynebraska/PST045218.
Unemployment: Bureau of Labor Statistics, “Labor Force Data by County 2018 Annual Averages,” and “Unemployment Rates for States, 2018 Annual Averages,” accessed January 22, 2020, and March 12, 2020, https://www.bls.gov/lau/#cntyaa.
12 Stephen Hawkins, Daniel Yudkin, Míriam Juan-Torres, and Tim Dixon, “Hidden Tribes: A Study of America’s Polarized Landscape,” More in Common, 2018, https://hiddentribes.us/pdf/hidden_tribes_report.pdf. According to polling from the nonpartisan Pew Research Center about the 2016 presidential campaign, 40 percent of those who voted for Trump said their main source of news was Fox; 39 percent who voted for Clinton said their main source of news was CNN, MSNBC, NPR, or the New York Times. See Michael Barthel, “Trump, Clinton Voters Divided in Their Main Source for Election News,” Pew Research Center, January 18, 2017, https://www.journalism.org/2017/01/18/trump-clinton-voters-divided-in-their-main-source-for-election-news/.