The Entrenchment of Urban Poverty


How high urban housing costs and income inequality have exacerbated urban poverty

A few years ago, on a drive from New York to Washington, I turned off I-95 in Baltimore to see H.L. Mencken’s home. Abandoned row houses lined the street, some boarded up with plywood, others simply gutted. Signs offering fast cash for houses and a number to call for unwanted cars outnumbered pedestrians. It was a landscape of rot and neglect with few signs of renewal and investment.

Writers have expended vast amounts of ink about the recent resurgence of cities, yet pockets of great poverty like West Baltimore have proven disturbingly resilient. Maryland has one of the nation’s lowest poverty rates, but is one of eight states where 70 percent of the poor are concentrated in one city. In most of the city’s schools, close to 50 percent of students qualify for federally assisted meals.

Looking at data from the 2006 US Census American Community Survey, many urban cities have poverty rates that far exceed the national level of 13.3 percent. Bronx County tops the list at 29.1 percent. The city of St. Louis and Baltimore as well as Philadelphia, Wayne (Detroit), Kings County (Brooklyn) and Denver counties all have poverty rates hovering between 19 and 27 percent.

The poverty in these communities testifies to a widening schism of income inequality distressingly common across America but most pronounced in the nation’s cities. Cost of living in cities is one key factor. The federal poverty threshold for a family of four in 2004 was only $19,157, but this number does not make an adjustment for the high rents that low-wage workers must pay to live in an urban environment.

Deborah Reed of the Public Policy Institute of California found that the poverty rates in wealthy cities like San Francisco and Los Angeles were actually significantly higher than the official rate. In San Francisco, the poverty rate was 19 percent adjusted for housing costs compared to the official ten percent; Los Angeles had a 20 percent poverty rate with the factored adjustment compared to the 16 percent official number.

Furthermore, numerous studies have documented the “high cost of being poor” in many urban areas. Low-income neighborhoods like Compton in Los Angeles (where one third of the residents are in poverty) or the Tenderloin in San Francisco suffer from a paucity of services that are plentiful in surrounding communities. Manhattan Beach has one bank for every 4,000 residents. Residents of Compton, on the other hand, can access barely one for every 25,000. Residents must make do with corner stores that sell inferior food goods at higher prices and check cashing outlets that often deduct three percent of the customer’s paycheck.

What is all this leading to? The unsettling contrasts between rich and poor of John Edwards’ “Two Americas” narrative is all too real in many American cities. Walking down Minna Street in San Francisco this week, I saw a homeless man drying his socks in the sun, just twenty yards from restaurants with $30 entrees and nightclubs so discrete in their hipness they need only signify their sign with a small letter.

And although often more startling in affluent, white-collar havens like San Francisco, this contrast exists in almost every city. In Baltimore the gap between high-earning skilled professionals living in gentrified neighborhoods with waterfront view and a procession of hard-pressed, violence-plagued communities nearby is equally striking.

The celebratory accounts of gentrification of small parts of cities like Baltimore – or large parts of sections of San Francisco or Chicago – needs to be balanced with a far greater concern with creating upward mobility for those large populations left behind. These lower income populations need to be treated as potential assets that will require investments in skills training and childcare subsidies, all the while nurturing high wage blue collar industries and improving basic public infrastructure.

In the past, poverty reduction never stuck around long enough to become a major issue in the presidential campaign, partly because voter turnout in these communities is low and, as we suggested earlier this week, there is little doubt which party will win urban voters.

But there is some reason, perhaps, to feel more optimistic this year. Senator Obama’s community organizing background in Chicago’s South Side has led him to adopt a broad anti-poverty platform targeting greater federal resources for working parents and low-income children. The presumptive Democratic nominee also proposes tripling the popular Earned Income Tax Credit that supplements low-income workers and supports pegging the minimum wage to the cost of living. Interestingly, Obama has also voiced support for creating a White House Office of Urban Policy.

Coming from a party skeptical about increasing poverty spending, McCain has supported tax credits being used to attract businesses to low-income neighborhoods and also favors increasing childcare subsidies for low-income families.

Mencken once wrote that his house in Baltimore “is as much a part of me as my two hands. If I had to leave it I’d be as certainly crippled as if I lost a leg.” However, given its current condition, it is highly unlikely today he would linger in his old neighborhood for long. Hopefully, after November, there may be reason to reassess that assumption.

Andy Sywak is the articles editor for

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The OP wrote: "The celebratory accounts of gentrification of small parts of cities... needs to be balanced with a far greater concern with creating upward mobility for those large populations left behind."

Start small and think big.
Micro versus macro.
I don't see why I should have a "greater concern" with the poor people who make poor choices.

Dave Barnes

"urban cities"

Maybe you're the Articles Editor but it wouldn't hurt to have your writing reviewed by somebody with a finer literary sensibility.

Also, I would posit that "creating upward mobility" has in America always been the responsibility of the upwardly mobile themselves, not of the State, once the basics have been established: law and order, secure property rights; legal equality of opportunity; a school system with minimally acceptable physical and intellectual infrastructure...

Haven't we by now adequately determined the actual outcomes of State interventions towards "poverty reduction", pushing five decades into the Great Society?


Very literary reply

The problem is that there often is not law and order or solvent schools in these neighborhoods. Poor inner-city neighborhoods are a great example of abject market failure where residents do not have access to services that the market provides residents of higher-earning neighborhoods. I would argue that this is not a result of the "choices" made by residents but by the social and economic conditions in their neighborhood.

Without banks, supermarkets, restaurants that don't sell fast food (poor neighborhoods have higher rates of obesity due to lack of food options besides fast food) adequate public safety or jobs that pay living wages, these communities will only fall further and further behind and pass on costs to society at large. Subsidizing private sector jobs and the establishment of enterprise zones have been shown to not be the most cost-effective ways to deal with the problem.

I've never felt that opponents of public assistance to the poor have really addressed the challenge of market failure in these neighborhoods.

market failures?

"ref: "poor neighborhoods have higher rates of obesity due to lack of food options besides fast food".

This is pretty far-fetched example of an alleged market failure. Nobody is dragging inner city populations down to these greasepits and force-feeding them McWhoppers. Fortunately, the LA City Council is on the case, with their recent moratorium on building new fast food joints. Way to go! Let's set up aragula stands instead.

Last time I looked, (uncooked) rice and beans were available at the 7-11s. Cheap canned tuna, mackerel and spinach too.

The reason in part for the breakdown of law and order is that whenever the cops play hardball, the human rights NGOs and bien pensant apologists for ghetto psychopaths are in their face with lawsuits, bad press, and worse. Another reason is that nobody is willing to testify for the prosecution: partly out of well- warranted fear of retribution, but also because they don't want to be seen getting down with The Man.

Oh and don't forget the added element of not telling the nasty feds when illegal immigrants are nabbed for major felonies and then sprung.

SF homeless

Your observation about SF homeless is poignant, but utterly misses the point. The implication is that their status is somehow the result of societal neglect, when the truth of the matter is precisely the opposite. No city in the United States provides the homeless with a more staggering array of social services than San Francisco. Moreover, the city has an absolutely intractable homeless advocacy industry which fights stridently to exempt street people from any consequences whatsoever for the most egregious, self-destructive, sociopathic behaviors. There's no expectation of self-help, rehabilitation or civil public behavior in exchange for the city's largesse and indulgence. The net result is hundreds of millions of dollars wasted annually and no improvement in the lives of street people. SF kills its homeless with kindness.

SF Homeless

My intention was to show the vast contrast in wealth in SF but you make a very good point about whether homelessness is a symptom of societal neglect or not. I would say that it depends. As one of our blog posts mentions, some working poor are homeless in SF because the cost of housing is so high (OK, there's some choice here).

I also agree with you about the vitriol of the homeless "advocates" in SF who insulate their charges from accountability. There needs to be a distinction made in SF between the working poor and the homeless that can help themselves and those that cannot. Kindness is a good thing but kindness with accountability is better.

Still, another Chronicle article recently had a good article about the search for a grocery store in the Tenderloin and how residents have to take the bus to the Castro Safeway.