Poverty and Politics

Eli,
Thanks for sharing the  The 2017 Distressed Communities  report with me. It's a fascinating report and a touches on a few topics I am particularly interested in.

One of the things that struck me, maybe not what the authors wanted me to focus on, is how prosperous most of the country is. If I listened to the Failing New York Times and other mouthpieces of the Liberal Industrial Establishment I'd come to believe there are only two types of people in the US: the 1% lighting up their cigars with $100 bills and the rest of us living in a neo-Dickensian nightmare. But then there is this, from the report:

 

I recognize 110 million people "at risk" or "distressed" is a lot. 150 million prosperous and comfortable is a country that is sharing the wealth to much greater extent than the Occupy crowd pules about.

It reminded me of this chart I grabbed from AEI. The author admits the middle class is shrinking. Because more of the middle class are moving to the upper classed. Seems to be a similar take by the Distressed Community crowd.

 

I'm also fascinated by the reduced mobility in the US. Famously, in the 1800's, Georgians wanting to escape their creditors would place a sign on their empty house "GTT," Gone to Texas.  We like to think of ourselves as a nation of immigrants. First we immigrated from the old world for a better life here and we move within the US seeking out a better place. That tendency seems to be less these days.

The report states:

Prosperous zip codes may contain 32.5 million more Americans than distressed zip codes, but distressed ones contain three times as many people receiving SNAP and other cash public assistance benefits—14.3 million compared to 4.7 million. With people less likely than ever to move—and with low income people some of the least able to afford the costs and risks of moving—there is a compelling public policy rationale for investing in the economic development of the places where public assistance beneficiaries are concentrated.

I have an unproven thesis that one of the reasons for the reduced mobility is the increased SNAP and public assistance benefits, so cause, not effect. And I wonder why we want to build up dying towns. Why not a GTT voucher?

I subscribe to a newsletter called Granola Shotgun that discusses many housing issues in America. This post in particular was interesting: Beginnings, Middles, and Ends. The author talks about the great migration west but everything has a beginning middle and end, including towns:

But everything has a beginning, a middle, and an end. After decades of rapid rural population growth and relative prosperity circumstances conspired to dismantle small family farms. The mechanization of agriculture, the rise of industrial cities, boom and bust economic cycles, and the deployment of young people during the First and Second World Wars all gradually depopulated the countryside. The final nail in the coffin struck when U.S. Secretary of Agriculture Earl Butz radically altered federal policy in the early 1970s toward heavily subsidize large scale vertically integrated corporate agribusiness. “Get big, or get out.” Commodity crops are now cheaper and more plentiful than ever as a result, but much of what was left of the rural landscape was eviscerated.

Migration from farms to cities decimated the rural life and migration from cities to suburbs decimated some cities:

As downtowns all across the country began to fail in the mid twentieth century newly built suburbs were thriving. Society decided it was easier to create new places than fix what was wrong with the old ones. A whole host of federal legislation such as the National Housing Act of 1934, the Servicemen’s Readjustment Act of 1944, and the Federal Aid Highway Act of 1956 provided the government subsidies and legal mechanisms that promoted suburban development. And for the last several decades these places have been the economic, cultural, and political center of American life. It’s the only landscape many people have ever known.

Granola followed up with this post  The Sacred Cul-de-Sac: Lakewood, which is well worth 5 minutes of your time.

One of the themes Granola focuses on is the impact government policies have. Many policies, restrictive zoning for instance, or many of the wetlands regulations, benefit the well-off by making it more expensive to build housing. San Francisco is one of Granola's favorite subjects with regard to zoning regulations. And it seems to contradict his "Beginning, Middle, End" thesis which seems more deterministic.

I saw another chart in the Distressed report that caught my eye:

 I have a couple of converging theories on calories and weight gain in the US.  I maintain the market system has been incredibly successful in lowering the price of a calorie. The US food industry has also been particularly good at creating yummy calories at a very low price point. 240 calories for a Payday candy bar, 240 for 1.75 ounce bag of Doritos Nacho Cheese chips and 150 from a can of Pepsi gets me to 30% of my RDA. But it's not just calories, its bad calories, chock full of carbs/sugar, which I think keeps you hungry and results in greater diabetes. So we have low price per calorie, or low price per gram of carbs, which results in poor health outcomes. [One of the many issues I had with the assumptions on Obamacare was assuming poor health outcomes were a function of poorly delivered health care. Maybe our health outcomes has more to do with our lifestyle choices including fast cars, guns and carbs.] Why the distribution shown in the Distressed report slopes the way it slopes I'll leave to someone else.

Bill