Has New York City Recovered From the 1970s? Poverty

Since the 1960s America’s older central cities have been associated with poverty.  New York City is no exception, and that is something that for the moment has not changed.  According to American Community Survey data, 15.9% of U.S. residents were poor in 2011.  The poverty rate for the New York metro area as a whole was lower at 14.4%, so New York’s metro area economy and culture are not, in fact, associated with greater poverty.  But the poverty rate for New York City by itself was higher at 20.9%, meaning that within the metro area poverty remains concentrated in the city.  And within the city the poverty rate was above the U.S average not only in the Bronx (30.4%) and Brooklyn (23.6%) but also in Manhattan (18.3%).  Queens was about average, with Staten Island below average.

The ACS poverty data for 2011 is in the spreadsheet linked below.

ACS_11_1YR_Poverty

The data show New York City’s poverty profile was different than the U.S. average as of 2011, and radically different than in the past.  Nationwide, as a result of public priorities and changes within families, senior citizens have become better off, and children have become worse off.   In 1969 27.3% of U.S. residents age 65 or over were poor, compared with just 9.3% in 2011.  And in 1969 just 15.0% of U.S. children under age 18 were poor, compared with 22.2% today.

The New York metro area in general, and New York City in particular, share the U.S. situation of having a large share of their children in poverty.  The 2011 poverty rates for children are 19.7% for the metro area as a whole and 29.5% for New York City, including 40.7% in the Bronx and 33.4% in Brooklyn.

What makes New York City different is the poverty rate of its senior citizens.  In 2011 19.0% of NYC residents age 65 and over were living in poverty, more than double the U.S. average.  The rate for the city was high enough to pull the rate for the New York metro area as a whole up to 12.0%, well above the U.S. average.  New York City’s poverty rate for senior citizens was significantly higher than the U.S. average in every borough but Staten Island.

The poverty rate for seniors in 2011 is in large part a product of history.  And that history can be seen in the spreadsheet linked below, which uses Census of Population data to track the overall poverty rare in 1969, 1979, and 1989.   This is another one of the spreadsheets I compiled while idle between administrations during my time at NYC Planning.

CPPERPOV

The 1970 Census was the first to include local area data on poverty, which had become a national concern during the 1960s. Hard to believe now, a time when no Democrat running for Mayor (let alone President) would dare to express concern about the poor, but concern about the poor was common at the time.  Perhaps because the middle class was larger and more secure, and the average person was becoming better off instead of worse off.  The Census asked about income the year before, and based on that income in 1969, just 14.9% of New York City residents were living in poverty, just slightly above the U.S. average of 13.7%.

While we don’t have the data, I would expect that New York City’s poverty rate had been much higher, compared with the U.S. average, for much of the city’s history.  As a port of entry for immigrants, and a place of dreams for the young, it attracted people who arrived with nothing, some of whom made it rich while others ended up toiling in poverty in low wage manufacturing industries.  But after 1920 the federal government turned the immigration spigot off, and many of those already in the city moved into the middle class.  In a nation growing richer New York City was briefly ahead of the rest of the country, before falling behind.

From 1969 to 1979, however, with city’s poverty rate soared to 20.0%.  It has been in the vicinity of 20.0% ever since.  Since the national poverty rate fell during the 1970s, the gap between the city and the national average became huge during the 1970s, the highest it has been since 1969 according to available data.  But even at that point the poverty rate for city residents age 65 and over was just 14.4% — lower than the U.S. average of 14.8%.

New York City had attracted (not created), a welfare generation, a generation of people who moved in from (for the most part) the South Atlantic states and Puerto Rico.  Perhaps they moved here hoping to get the kind of low-wage manufacturing jobs New York City traditionally had.  But those jobs, and the middle class, were exiting the city at the same time these new, unskilled would-be New Yorkers arrived, and a large share ended up on welfare.

While at City Planning, once I asked the Population Division there to tabulate the place of birth of the heads of households with public assistance income in 1979 and 1989.  Just one-third had been born in New York State.  Relatively few were immigrants from other countries.  Most were from the states from Maryland to Florida, states where may of them had not received a decent education in the 1950s and 1960s before showing up unskilled in New York.  Or from Puerto Rico.  Which is why it is a great irony when Afro-Americans who did manage to move up into the middle class in New York City decide to head south, along with other better off New Yorkers.  Certainly the migration between New York City and the South Atlantic states, in both directions, made the city poorer and the South Atlantic states richer from 1960 to 1990 or so.

Having moved to New York City at the worst time, however, many never did advance, never did move into the workforce, never did get a decent education for their children in the city’s post-United Federation of Teachers and pre-Campaign for Fiscal Equity schools.  The city’s welfare caseload soared to 1 million people in 1969, and stayed between that level and 800,000 until the mid-1990s, after which it plunged.  But those who fail to achieve 40 quarters of work experience are not eligible for regular Social Security and Medicare.  They “retire” on less money from SSI and less health care Medicaid instead.  (And while the federal government pays for Medicare, the federal share of the cost of Medicaid is just 50.0%, with New York State and New York City picking up the rest).  It is for this reason that New York City’s poverty rate for seniors is so high.  The poor young adults of the 1960s, 1970s, 1980s and early 1990s are the poor seniors of today.

This history convinces me that eventually, as the “welfare generation” passes on, New York City’s poverty overall rate is going to fall.  Meanwhile, as Generation Greed passes on, the U.S. poverty rate may be expected to rise, because younger generations have been left poorer, and will be worst off in particular when they reach old age themselves.  Starting with the second half of the Baby Boom, subsequent generations of Americans have had lower work earnings in general, and retirement benefits in particular.  They have been unable or unwilling to save nearly enough to make up the difference.  When those my age and younger reach old age, I expect the poverty rate for U.S. seniors to rise, and eventually the life expectancy of Americans to fall.

The gap between the overall New York City poverty rate and the U.S. poverty rate has already shrunk, and not for a good reason – the national rate is rising.  Eventually, as the city rate falls and the U.S. rate rises, that gap may disappear.  Which raises some interesting issues.

Reading the New York newspaper articles over the years, reporting on press releases associated with “reports” by the dwindling number of groups that concern themselves with the poor – and their legal successes – I am struck by a contradictory attitude.

On one hand, those concerned with the poor decry the city’s high poverty rate and the concentration of poverty here.  This implies they wish fewer people were poor in New York City.

On the other hand, the same people advocate in favor of creating more places in the city where the poor can live.  Even as other localities – suburbs throughout the nation – do all they can to make it impossible for poor people to live there, even if that means prohibiting the rental multiple dwellings that would also make it possible for seniors and young adults to live in town.  The advocates don’t want fewer poor people in New York City.

The amount of poverty in New York City has been and will be determined by three things.  Decisions about education, work, recreational drug use and family by individuals that seem to be beyond the influence of public policy.  Trends in the global, U.S. and metro area economies that are little influenced by a mere municipality.  And how many places the city has, or makes available, or is forced to make available by lawsuits and court decisions, for poor people to live in, regardless of where they are from.

With regard to the third factor, the city has been exemplary in creating more places for the poor.  It has been reported that 600,000 people live in housing that is low income by statue, the projects of the New York City Housing Authority.  In other cities those projects have been demolished and their residents scattered, but not here.  Since the early 1980s, the federal government and court decisions have required urban public housing authorities to give preference to those the suburbs did not want – ex-offenders, the disabled, the addicted, the mentally ill, and the homeless.  Not the working poor.  Lawsuits have been filed to give those arriving in New York City from other places a right to subsidized housing equal to that of city residents.

At the same time, the city has continued to uses its own resources to create affordable housing.  That is something few other municipalities have attempted.  Most of this is not for the dependent poor, but some of it is.  Given that the city has 3 million housing units, and the demand to live here by those moving elsewhere seems endless, there is no way the city could possibly affect the overall market for housing here.  But it has provided more places for the low- and moderate income people fortunate enough to grab one of the subsidized units.

In the face of this, in the past I have said that I’ll start worrying about gentrification when the city’s poverty rate approaches the national average.  But looking to the future I’d put this another way.  When the city’s poverty rate approaches the national average, I’m going to start worrying about gentrification.  After all, part of New York City’s core identity is as a place where a poor person can come from another country or part of this country even though they are poor, work and advance out of poverty.  That is an identity that preceded the welfare generation, and will perhaps outlast it.  If Manhattan becomes an exclusive place to live that’s fine, as long as those who live there pay city taxes to benefit the rest.  For the entire city to end up in the same situation is unfortunate.  If I wanted to separate myself from the less well off by living in an exclusive suburb I would have done so.

For the moment, however, New York City’s problem is too many poor people, and too high a share of the metro area and state’s poor people, not too few, particularly since those in better off areas of the metro area, state and U.S. seem unwilling to help support the poor people who live elsewhere.  According to American Community Survey data in 2011 14.8% of U.S. residents age 18 to 64 years old were poor. The New York metro poverty rate was lower at 12.9%, but the rate for the city alone was still higher at 18.4%.  The NYC/U.S. poverty rate gap for working age adults was 3.6% in 2011.  It had been 6.0% in 1979, when the poverty rate for those ages 18 to 64 was 10.3% for the U.S., and 16.3% for NYC.

If history explains New York City’s concentration of poor seniors, however, what explains the relatively high poverty rate for New York City’s children?  Is it likely to continue?

Since the poverty rate for the New York metropolitan area as a whole is lower than the U.S. average, neither the New York metro area economy nor the New York metro area culture are pushing up the poverty rate for children, compared with the U.S. as a whole.  Rather, the metro area’s poor parents remain more likely to live in the city, while the metro area’s non-poor parents are more likely to live elsewhere. As to why, it is best to question whether New York City’s quality of life has recovered from the 1970s.  I’ll turn to that question next.

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