BROOKINGS, S.D. (KELO) — When the Pandora Papers were released and spotlighted South Dakota’s growing trust industry, David Wiltse wanted to know why so much money goes mostly unnoticed by everyday South Dakotans.
In a Twitter thread, the South Dakota State University political science professor and director of The SDSU Poll shared insights he’d found from polling registered voters in the state. His shared thoughts on the social media platform turned into an article published by The Washington Post’s independent site called The Monkey Cage, which aims to give political scientists a forum.
Wiltse’s main conclusion: South Dakotans view their local economy in the same way their grandparents did.
“Ag is very visible here. You can’t escape it. I don’t want anyone to take away that South Dakota is no longer an ag state. Ag is still hugely important to this state,” Wiltse said. “But we’re an ag state that happens to have this really large industry that’s been largely hidden from us. This financial service sector has just grown and grown in importance over time.”
Wiltse cited the U.S. Bureau of Economic Analysis of South Dakota’s Gross Domestic Product showing “Finance and insurance” making up 21% of the state’s GDP, while “Health care and social assistance” was about 10% and “Agriculture, forestry, fishing and hunting” was only 7%.
Wiltse wanted to emphasize there are more than one method people can measure overall economic impact, but he was citing the official government GDP measurements by the U.S. BEA. He noted how much the agriculture industry can have with “secondary” industries that benefit as a result of agriculture as not being counted into the data from the U.S. BEA.
Regardless of how big of a role the agriculture industry plays in the South Dakota’s economy, Wiltse said people should not overlook the financial industry even though it’s not thought of as South Dakota’s biggest money maker ahead of tourism and agriculture.
“It’s a really interesting story about how our perceptions of our surroundings make it easy for us to lose track,” said Wiltse, specifically noting the estimated $360 billion in trusts managed by South Dakota trust companies.
“That’s the GDP of Demark. That’s a massive amount of money,” he said.
Wiltse said he doesn’t favor any way for or against South Dakota’s trust industry. He wants to point out “how an industry can really create for itself a nice regulatory environment when it is largely free of any public pressure.”
“One of the most important consequences of that misperception is citizens aren’t really demanding anything of their policymakers on these trusts,” Wiltse said. “It’s ridiculously technical, very difficult to understand and there’s no organized interest that are saying we need to stop this.”