Sac City Fights for Survival

U.S. 20 slices decisively through rich Iowa farmland, where the dirt is almost as dark as the two-lane asphalt ribbon that bisects the table-flat prairie west of Fort Dodge. The highway dips, then rises gently to Sac City, a town devastated by plunging crop prices, sagging spirits and the near collapse of rural America in the past decade.

In many respects Sac City looks terminal. The population is down to 2,400, from 3,000 in 1980. Fister's Department Store is out of business. Iowa Public Service has trouble collecting electric bills from nearly bankrupt farmers, and the utility's Sac City office has dropped from six employees to two. Bill Brenney, the town's remaining optometrist, says, "People are spreading payments way out. Accounts receivable are way up." The town's children look elsewhere for jobs, and not even fathers can help sons. Says Ralph Youll, co-owner of Youll Plumbing and Heating: "We've only made money one year in the last five. My son Jerry came home from college and wanted to get into the business, but I had to tell him no."

Sac City's reluctant Scrooge is Arnold Thomas, 32, who heads the local office of the Farmers Home Administration. He has the unpleasant duty, as the agent of the Federal Government's lender of last resort, to foreclose on farmers who cannot keep up their debt payments. After a two-year moratorium on foreclosures, Thomas is now sending out letters politely advising farmers on how to avoid default through loan reschedulings, reamortization, even voluntary liquidation. "It bothers me to foreclose," says Thomas. "If it didn't, you wouldn't be human. I try to leave my job at the office. Otherwise it'll eat you up."