America as a Tale of Two Neighborhoods

Welcome to what Arianna Huffington has aptly called Third World America — we’d expect riots and revolution in any foreign city with NYC’s level of economic and racial segregation.

Both the affluent and the impoverished in NYC can ride the same mass transit system (AKA the subway) and might work in the same office buildings. But at the end of the day — they return home to very separate parts of the city, their children attend dissimilar schools and their families lead quite different lives.

The subway station at West 116th Street is in the 10027 zip code area (which extends north to West 135th Street). The subway station at West 86th Street is in the 10024 zip code area (which extends south to West 73rd Street). These two subway stations are separated by 30 blocks — a 30-minute walk, five minutes by car, 10 minutes by subway — and an ever-widening gap in opportunity more appropriate for a third world kleptocracy, than America’s largest and most affluent city.

Economically:  Median family income for zip code 10024 (the 86th Street subway stop) is $110,000/year, with only seven percent of the population (and only three percent of its children) below the poverty level. By contrast, median family income in zip code 10027 (the 116th Street subway stop) is just $36,000/year, with 30 percent of its residents (and 40 percent of its children) living below the poverty level. Moreover, in the area from about West 116th Street to West 168th Street — at least half the children live in households at or near the poverty level.

Educational Attainment: Around the 86th Street subway stop, 75 percent of the over-25 population has at least a B.A. degree. And very often those degrees are from prestigious elite colleges, with names like Brown, Wellesley, Harvard and Yale. Around the 116th Street subway stop and further uptown, only 30 percent of the over-25 population has at least a B.A., and their degrees are more likely from regional or community colleges. Graduation from college is a good indicator of lifetime income potential, so the 70 percent of the adult population in that area without any college degree — is likely to keep falling even further behind.

Racially: 85 percent of the population from West 73rd to West 86th Street is white. From West 116th to West 135th Street, only 30 percent of the population is white.

Frighteningly, the areas noted aren’t the poorest or the richest zip codes in NYC, nor are they the most racially disparate — NYC has even larger extremes.

The people in these two worlds might be acquaintances at work — but, generally, they aren’t friends. An 86th Street resident with a Yale degree is unlikely to have friends uptown who never attended college. That Yalie residing near 86th Street probably grew up somewhere far from NYC. And friends outside that Yalie’s current socio-economic group likely reside back in a hometown far from NYC (and frequently, outside the United States).

Mayor DeBlasio’s signature proposals — cutting back on charter schools, offering pre-kindergarden and additional affordable housing — won’t make a dent in the widening gap between NYC’s “two cities.” The Mayor’s education proposals, even if effective, would take at least a generation to have any impact. And affordable housing will do nothing to close the gap in opportunity and income.

These trends are not just about NYC, they are happening in much of America. Over the past generation, we’ve had ever-widening income inequality, combined with (at best) stagnant upward mobility and continued de facto segregation/discrimination. This isn’t a good picture of civil society. If we saw these characteristics in a foreign country, we’d expect seething discontent and riots.

I’m not sure how this tale of “two cities” ends for America, but if current trends continue, I don’t see this story having a good ending.

This piece is cross-posted from the Huffington Post with permission.

One Response to "America as a Tale of Two Neighborhoods"

  1. benleet   April 30, 2014 at 2:46 pm

    The BEA.gov says that disposable income per capita (after-federal-tax income) is $39,000. That would be $156,000 for every four person family after federal taxes. I take it back, it is $40,045 currently. With 317.3 million population, that is $12.7 trillion in personal income. The top 1% earn more than the lower 60%, both groups earn about 21% to 22% of all income. The top 10% earn more than 50% of all income, a first. The mean average household savings is $690,000 per household, but less than 10% and maybe more like 5% are "average". You can easily look it up at the Fed's Flow of Funds Report, page 2, over $80 trillion in household net worth. The lower saving 50% own 1.1%, and the top 1% own about 45%, even though officially the Survey of Consumer Finances states 34.5%, when you factor in the amount hiding in tax-free havens, then the portion rises. Piketty's book, Capital, showed that inequality is institutionalized or inherent, and it's increasing. His colleague Emmanuel Saez proposes a top bracket on personal income of 81%. Of course much more than raising taxes needs to be done. A federal jobs program such as proposed by Phillip Harvey would employ about 10 million, and a tighter labor market would tend to increase the lower-earning workers' income. But there is much more structural reformation to accomplish: military spending, medical system that is more than twice as expensive as it should be, and the financial sector which contributes very little in return for its out-sized profits. My blog: http://benL8.blogspot.com — and the EPI.org details much of this story.