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1 University of Virginia Frank Batten School of Leadership and Public Policy Virginia Policy Review The Virginia Policy Review (VPR) is the public policy journal at the University of Virginia Frank Batten School of Leadership and Public Policy. VPR is published mid-november and mid-april. The graduate student review staff considers submissions throughout the academic year. Printed issues of VPR are produced by the editors using InDesign software and are printed by Bailey Printing, Inc., Charlottesville, VA. Copyright No material may be recorded or quoted, other than for review purposes, without the permission of the writers, to whom all rights revert after the first serial publication.

2 The New Face of Poverty Poverty hits the suburbs by Andrew Hammond As America begins the 21st century, we must determine how the poverty of the future will differ from the poverty of the past, and, in turn, how our knowledge and our policy responses should adapt to these changes. One important area where 21st century poverty will differ from that of the 20th century is the dramatic increase in the suburban poor. Poverty has followed Americans to the suburbs. A 2006 study from the Brookings Institution that analyzed U.S. Census Data in the nation s 100 largest metropolitan areas found that in 1999, large cities and their suburbs had nearly equal numbers of poor individuals. By 2005, however, the suburban poor outnumbered the urban poor by over one million. As Alan Berube, one of the authors of the report, put it in his testimony before Congress, Today, a plurality of poor Americans live in suburbs. The Brookings report continues by stating that, this tipping of poor populations to the suburbs upends historical notions about who lives in cities and suburbs. Little boxes made of ticky-tacky This is not to say that social scientists and anti-poverty advocates should no longer be concerned about cities. As Alan Berube and Elizabeth Kneebone note, cities and suburbs have both experienced rising poverty rates, but faster population growth in suburbs has tipped the balance of poor populations toward suburbs. The poor are not leaving central cities for the suburbs en masse. Rather, they are simply no longer confined to the central city. Of course, not all suburbs are the same, even within a single metropolitan area. Advocates and academics have sought to categorize suburbs in order to overcome this conflation of communities. One category is the profile of first suburbs, or those inner-ring suburbs that have been part of the metropolitan areas since the middle of the twentieth century and are often more urban than newer suburban developments. Many assumed that if poverty were to increase in the suburbs, the

3 increase would be concentrated in these first suburbs. This suspicion might have been fueled by the well-documented poverty around prominent European cities, such as Paris. The Brookings Institution, however, documents that the first suburbs did not bear the brunt of increasing suburban poverty in the early 2000s. In fact, their share of the suburban poor actually fell by 2%. Rather, the continued decentralization of metropolitan populations to second-tier suburbs and exurbs has included low-income workers and their children as well. Therefore, even though suburbs vary considerably among and within regions, it is most likely that the marked increase in suburban poverty is not driven by an increase in poverty in one type of suburb, but is distributed among suburbs both close to and far from the central cities. The causes behind suburban poverty Three main factors are driving the increase in suburban poverty: the movement of people and jobs to the suburbs, the movement of foreign immigrants directly to the suburbs, and the expansion of what Berube calls municipal distress from the cities to the suburbs. The growth in the number of suburban poor roughly mirrors the growth in the number of suburban Americans generally. Since 1992, suburbs in America s major metropolitan areas have grown twice as fast as their central cities. As a result, American suburbs have absorbed a broader economic cross-section of the nation s population. Many of the new jobs available in the suburbs are in the lower-wage industries of the service sector. Suburban employees, therefore, often have fewer opportunities for promotion and limited benefits. In addition, immigrants to the United States are now moving directly to the suburbs. According to Audrey Singer, by 2000, more immigrants in metropolitan areas lived in suburbs than cities, and their growth rates there exceeded those in the cities. Traditionally, immigrants passed through cities like Chicago, New York, and Los Angeles. After living and working alongside

4 other immigrants, they would move to the suburbs once they had achieved affluence. This longstanding pattern has changed. Immigrant populations are growing most rapidly in unexpected metropolitan areas such as Charlotte, Atlanta, and Dallas. Many of these new immigrants, furthermore, are not living in the central cities, but are moving directly to suburbs. This trend is closely correlated to the job growth in these suburban areas; indeed, these two conditions could be mutually reinforcing - employers are allowed to pay immigrants lower wages with impunity, which exacerbates poverty in the area. The third explanatory factor is that in many older metropolitan areas, particularly the Rust Belt, first suburbs are looking more and more like their central city neighbors. Both the first suburbs and central city share common characteristics like stagnant job growth, aging housing and decrepit infrastructure, and gang-related drug trafficking and violence. Economic development efforts by city government might be contributing to this trend. In Chicago, for example, City Hall was instrumental in drawing upper and middle-class residents to the South Loop area of downtown, thereby pushing poorer residents farther south. These residents move to communities like Calumet, which now resemble inner-city satellites. Still, as noted above, first suburbs are not wholly responsible for the increase in suburban poverty. It is clear, however, that inner-ring suburbs suffer with their city counterparts if they are located in areas with significant job loss. In sum, the marked increase in suburban poverty is best explained by a combination of people and jobs relocating to the suburbs, the unmediated arrival of immigrants, and the spillover effects of urban distress in the Rust Belt. What does this all mean?

5 The ramifications of suburban poverty might not yet be felt on a large scale. There are, however, three short-term consequences that have already appeared in the suburbs: an unmet demand for local services, a lack of affordable housing, and a paucity of public transportation networks. First, the increase in the number of poor Americans living in suburbs has caused a similar increase in demand for social services. Scott Allard of Brown University researches service provision in metropolitan areas, and his data show that service providers for the poor are disproportionately located in the central cities. Services, essentially, have not followed the poor to the suburbs. One study finds that, among immigrants, take-up of the earned income tax credit (EITC) is lower in low-density suburban jurisdictions than in high-density city neighborhoods. This is intuitive. If the welfare offices are located in the central cities and the welfare recipients are located in the suburbs, informational deficits and geographical barriers will depress participation in programs like the EITC, Medicaid, and food stamps. Moreover, decades of poverty in urban areas have led to the creation of local safety nets supported through government funds, private charity, and non-profit advocacy. The suburbs lack such safety nets. The new poor are living in communities that have no history of providing services to them. In addition, the rise in suburban poverty has also increased demand for housing. Subsidized housing, however, has traditionally been built in urban areas. James Roby, County Executive for Maryland s Howard County, noted the undeniable gap between the supply and demand for low-income housing in suburbs. The severe shortage of affordable housing for the poor often leaves people into temporary homelessness or forces families to live in substandard housing. Third, suburban access to suitable transportation is nearly non-existent. Unlike central cities, suburban public transportation is generally undeveloped. Access to an automobile is quickly becoming a prerequisite for employment, but one-fifth of poor Americans live in households that

6 do not have such access. Lack of access to a car not only raises barriers to employment, but also impedes the satisfaction of other human needs. In Rockingham County, North Carolina, for example, people often arrive at the food pantry by carpooling, cramming one person each from four or five families into a single vehicle to save gas. In testimony to Congress, Alan Berube stated that limited access to public transportation in the suburbs, or even reliable private transportation, may constrain not just job access, but child-care opportunities as well. For example, if a single mother does not have access to a car, she might need to take a job closer to home. Such employment, however, might not be in her best interests as a mother. Prescriptions for the problem In order to address the issue of suburban poverty, three policy interventions should be undertaken: increase state and federal funds to promote a rapid expansion in service provision, expand housing vouchers, and subsidize private and public transportation. First, we should increase the supply of local services in the suburbs. This expansion must come from state and federal governments, where suburbs have political representation, as opposed to municipal governments, where they seldom even have seats in city council. Service providers located in the city should also advertise programs such as EITC and Women, Infants, and Children (WIC) in the suburbs. On a national level, Congress should enact targeted increases to the EITC and change the income support from a yearly to a monthly benefit in order to help families pay rent. The second challenge of providing affordable housing for the suburban poor is an even more difficult one. Many suburban residents strongly resist the construction of low or mixed-income housing in their neighborhoods. Such resistance should lead policy-makers to adopt policies to provide housing vouchers for the suburban poor rather than construct public housing units. As

7 Janet Currie argues in The Invisible Safety Net, the voucher programs are both successful and enjoy the broadest base of support among federal housing policies. In addition, the Low Income Housing Tax Credit (LIHTC), which is currently used to build affordable units in the central cities, could be directed towards affordable units in the suburbs. Third, there are relatively inexpensive ways to increase access to private and public transportation. The best way to immediately increase access to transportation is to build an inter-municipal bus system. While the construction of rail and subways are expensive, a bus system takes less time and money to build, while still meeting citizen needs. It s all in the neighborhood Finally, anti-poverty advocates should address problems of regional governance. The American political system is not designed to deal with suburban poverty. Local governments are responsible for problems within their municipalities, while city governments are likewise expected to deal with issues that arise within city limits. Federalism, indeed, is predicated upon such boundaries. As a result, issues that transcend local boundaries can become particularly vexing collective action problems.1 As poverty spreads beyond the central city, it is essential that regional governments work differently. A regional campaign to raise awareness for the EITC, for instance, would yield much higher returns if city and suburban officials coordinated their efforts. In addition, it would be cheaper for adjacent municipalities to share the cost of the construction of a local service provider instead of each having their own. More affordable housing would be available if municipalities pooled their resources, as opposed to either doing nothing or undertaking their own individual housing projects. Finally, an inter-suburban bus system would be infeasible if adjacent municipalities did not work together to design, implement, and execute the system. As

8 Dreier, Mollenkopf, and Swanstrom write in Place Matters, suburban poverty requires a new metropolitics that empowers localities to join in defining mutual problems, debating how to solve them, and crafting coalitions to implement those solutions. This policy response is, without question, difficult to execute because it requires a fundamental transformation in how policies are enacted and how they are subsequently enforced. Taking this step, however, is central to addressing suburban poverty. Bringing it all together The suburbanization of poverty in the United States will change the way Americans think about poverty. Much has been written about the economic dichotomy between poor cities and affluent suburbs. The increase in the suburban poor, however, challenges the conventional notion of poverty as solely an urban issue, especially when cities like Detroit, Los Angeles, and Washington D.C. all have fewer residents living below the poverty line than their surrounding suburbs. As the suburbs share in the cities hardship, perhaps more Americans will support policies designed to reduce poverty and inequality in the United States. The marked increase in suburban poverty in American requires a cogent policy response. Driven by a nationwide movement of people and jobs to suburban areas, the arrival of immigrants to the suburbs, and the demise of inner-ring suburbs in the Rust Belt, suburban poverty has led to an increase in demand for local services, affordable housing, and access to transportation. Much can be done right now to meet each of these consequences. Yet, beyond these immediate measures, a more transformational change must occur in the way we govern our metropolitan areas. By making regional governance more effective, we can use public policy to truly meet the challenge of suburban poverty. In doing so, we can finally provide people with genuine paths out of poverty.

9 1 A paradigmatic example of this collective action problem is the expansion of air travel in the Chicagoland area. All policymakers agree that, as they stand, O Hare and Midway cannot supply enough space for the number of flights coming in and out of Chicago. But each important stakeholder has a different solution. Mayor Richard Daley wants the federal government to fund yet another expansion of O Hare, because doing so would further increase the city s tax base. Congressman Daniel Lipinski. who represents the Southwest side. wants to expand Midway because his constituents rely on jobs at that airport. Congressman Jesse Jackson Jr. argues for building a third airport, in Peotone, which happens to be in his district. While none of these policymakers are willing to budge, they all can agree on one thing: that they will not let Gary, Indiana, which has a serviceable airport that could easily be expanded, becoming the third airport for the Chicagoland area. That airport, after all, is not in Illinois. Endnotes

10 Allard, Scott. Access to Social Services: The Changing Geography of Poverty and Service Provision. Brookings Institution, Berube, Alan. Testimony Before the House Committee on Ways and Means., February 13, 2007, Available at Berube, Alan. Tienes EITC? A Study of Earned Income Tax Credit in Immigrant Communities. The Brookings Institution, Berube, Alan and Elizabeth Kneebone. Two Steps Back: City and Suburban Poverty Trends The Brookings Institution. December Blank, Rebecca M. It Takes A Nation: A New Agenda for Fighting Poverty. Princeton University Press, Currie, Janet. The Invisible Safety Net. Princeton University Press, Dreier, Peter. Poverty in the Suburbs. The Nation. September 20, 2004 issue. Dreier, Peter et al. Place Matters: Metropolitics for the 21st Century. University Press of Kansas, 2nd Edition, Minority Suburbanization, Stable Integration, and Economic Opportunity in 15 Metropolitan Regions. Institute on Race and Poverty. University of Minnesota. February Available at projects/index.php?strwebaction=project_ detail&intprojectid=15 O Connor, Alice. Poverty Knowledge. Princeton University Press, Press, Eyal. The New Suburban Poverty. The Nation. April 23, 2007 issue. Puentes, Robert and David Warren. One-Fifth of America: A Comprehensive Guide to America s First Suburbs. Brookings Institution, Singer, Audrey. The Rise of New Immigrant Gateways. Brookings Institution, February 2004.

11 Andrew Hammond is reading for an M. Phil. in Comparative Social Policy at Oxford University as a Rhodes Scholar. He has been a fellow at the Center for the Study of Social Policy, a researcher at the National Center for Children in Poverty, and a staff writer at the Sargent Shriver National Center on Poverty Law. A Truman Scholar, Andrew graduated Phi Beta Kappa with special honors in Political Science from the University of Chicago.