Scott Winship critiques recent research by economists Ilyana Kuziemko and Stefanie Stantcheva, who find that while Americans disapprove of rising inequality, they are skeptical about using government to reverse the trend. Specifically, Winship suggests that Kuziemko and Stantcheva neglect the possibility that even if most Americans don’t think of rising inequality as a good thing, they don’t think about it as a particularly important development. A more pressing issue, in my view, is the persistence of multigenerational poverty, the subject at the heart of Patrick Sharkey’s new book, which he previewed in a recent New York Times op-ed, and which Sean Reardon and Megan McArdle and Evan Soltas, among others, have addressed from various different angles. My plan is to engage with the Sharkey thesis for some time, but for now I want to highlight one of his more dramatic findings.
Drawing on a widely-used test of reading and language skills, scaled to have a mean of 100 and a standard deviation of 15, which means that 70 percent of the population will fall between 85 and 115 (within one standard deviation of the mean) and 95 percent of the population will fall between 70 and 130 (within two standard deviations of the mean), Sharkey compares children across groups defined by the poverty concentration of the neighborhoods in which they’ve been raised and the poverty concentration of the neighborhoods in which they’re parents had been raised. Children raised in non-poor neighborhoods by parents raised in non-poor neighborhoods have a mean score of 110. Children raised in non-poor neighborhoods by parents raised in poor neighborhoods have a mean score of 102. Under the reverse scenario, with children raised in poor neighborhoods by parents raised in non-poor neighborhoods, the mean score is 101. And finally, children raised in poor neighborhoods by parents raised in poor neighborhoods have a mean score of 94, a score 16 points lower than for children from families in the first category — more than a full standard deviation, and a cognitive deficit that can be compared to the gains associated with four to eight additional years of schooling.
It is often said that public schools in cities with high concentrations of poverty often spend a great deal per pupil while delivering only modest gains in educational performance. There is some evidence that charter schools can reduce per pupil spending while delivering the same educational outcomes, which is encouraging. Yet the prospect of actually closing a cognitive deficit of this scale is daunting. Some strategies, like Summer Opportunity Scholarships designed to address summer learning loss among students from low-income households, seem promising, as they directly increase instructional time. In the most expansive and optimistic scenario, two additional months of school over the twelve years of K-12 education might yield more than two years worth of cognitive gains, particularly if summer enrichment programs embrace instructional models well-suited to the needs of the student population in question. But when you recall that the gap we’ve dealing with is equivalent to four to eight additional years of schooling, it’s obviously that a school-focused strategy isn’t enough.
As Sharkey observes, his findings strongly suggest (they do not in themselves prove) that a child’s environment isn’t all that matters, as the effects of neighborhood poverty appear to be amplified over the course of multiple generations. This ought to lend a new urgency to poverty-fighting efforts, but not to just any poverty-fighting efforts. Rather, it seems that we ought to pay closer to attention to the effects of concentrated neighborhood disadvantage. One of the more interesting findings from the economic mobility literature, highlighted by Winship, Sharkey, and others, is that while white Americans raised in middle-income or more affluent households tend to “stick” to the middle class, African Americans raised in such households are far more likely to fall out of it. Sharkey argues that this in part reflects the fact that African Americans are raised in neighborhoods with higher poverty concentrations than white Americans at any given level of income. That is, a black household earning X is likely to live in a neighborhood that is poorer than the neighborhood that is home to a white household earning X. This can be true for any number of reasons, ranging from housing discrimination to a preference for living in culturally familiar neighborhoods, or some blend of the two.
If our goal is to reduce poverty concentrations, there are a number of approaches we might take. Sharkey emphasizes that most U.S. neighborhoods that have seen a decline in poverty concentration have been magnets for upwardly-mobile immigrants. He is more cautious about the potential benefits of gentrification, in which educated middle-income and high-income residents settle in low-income neighborhoods in large numbers, as the empirical evidence on gentrification of this kind is limited. Some intuit that the main beneficiaries of gentrification are the gentrifiers themselves (this resembles George Borjas’s finding that under a standard “textbook” economic model, most of the economic gains associated with immigration flow to immigrants themselves in the form of wages and benefits), and that the spillover benefits to incumbent residents are limited by increases in the cost-of-living that can lead to displacement. A not-incompatible view is that neighborhood churn is always happening, but that the rising quality of life or amenity value associated with gentrification makes incumbent residents more inclined to remain in gentrifying neighborhoods. Stephen Smith has described how restrictions on housing supply exacerbate the displacement aspect of gentrification. Normally, the gradual deterioration of housing stock will decrease its value, a phenomenon known as “housing filtering.” Yet in the absence of new housing supply within easy commuting distance of the central business district, high-earners will embrace this older, close-in housing stock, leaving low-income incumbents to outlying neighborhoods that necessitate longer commutes. Through Sharkey’s lens, one could argue that efforts to increase density in gentrifying neighborhoods are an attractive poverty-fighting strategy, as they will tend to restrain housing cost growth, thus making it somewhat more likely that neighborhoods won’t simply transition from low-income to high-income as low-income incumbents are displaced, but rather that they will become stable mixed-income neighborhoods.
Granted, this gentrification dynamic might be of limited relevance to the larger landscape of poverty concentration, as it applies to a relatively small number of close-in neighborhoods in cities with robust labor markets. The larger issue is how we address the economic and social isolation of neighborhoods that aren’t currently attractive targets of gentrification. Immigration, as Sharkey suggests, might play a role. But perhaps the most obvious strategy is a greatly expanded effort to reduce urban crime rates, which, despite “the great American crime decline” of the past two decades, remain far higher than they had been at midcentury. I’ve been advocating a huge increase in the size of urban police forces for over a decade, and William Stuntz made the case more systematically in The Collapse of American Criminal Justice. As of 2004, total spending for local police stood at $68 billion. Stuntz observed that if the U.S. increased the number of local police officers by 100,000, the U.S. would have 310 police officers per 100,000 population — substantially lower than 350 police officers per 100,000 population, the number in European Union countries. Stuntz estimated that this increase would cost $15 billion, a relatively small share of the $214 billion spent on criminal justice in the U.S. in 2006. I would start by recommending that we get to the EU ratio of police officers per 100,000 population, and I would also consider several of the measures Dylan Matthews identified as effective crime control strategies in a recent Wonkbook post, including increases in alcohol taxes (which could be used to defray the cost of expanding police forces), improving foster care options, and (yes) sports education.
Focusing on crime control has a number of virtues: it is politically unassailable; it is cost-effective, as the gains in economic activity that would flow from reduced crime rates and the reduction in the costs associated with incarceration, including its wage-scarring effects, would be substantial; it would make high-poverty urban neighborhoods less violent and thus more attractive to new non-poor residents, whether immigrants or gentrifiers; and it would have significant health and economic benefits for incumbent residents. Consider, for example, recent research on adverse childhood experiences (ACEs) on adult health, as described by Paul Tough in How Children Succeed: a history of physical and sexual abuse, physical and emotional neglect, and family dysfunction, e.g., having divorced or separated parents or family members who were incarcerated or mentally ill or addicted, is strongly associated with negative adult outcomes, which can severely damage lifetime earning potential. The more ACEs experienced by an individual during childhood, the more likely the individual was to be obese, depressed, to some, or to have engaged in early sexual activity. What is more noteworthy still, as Tough explains, is that ACEs didn’t just impact behavior. Rather, they appeared to have a powerfully negative impact on health and life outcomes even when self-destructive behavior played no role. The consensus view is that ACEs have this damaging effect through the channel of the body’s stress management system, which is more likely to be overloaded in high-crime neighborhoods.
The challenge for those of us who want to invest more heavily in making high-poverty neighborhoods safer and more attractive, and to provide children living in them with more instructional hours, etc., is precisely that these neighborhoods tend to be isolated from the most politically influential networks. Gentrification has helped mitigate this phenomenon to at least some extent in some small handful of cities, which is one of many reasons why I think gentrification is a fundamentally very beneficial phenomenon. But somehow we need to gin up more collective outrage about crime. The prison reform conversation has emphasized the importance of humaneness towards offenders, which is not an entirely bad thing, particularly if it leads us to emphasize deterrence over incarceration. Yet I worry that an emphasis on the well-being of offenders might distract us from the larger problem that violent crime destroys neighborhoods and lives in ways that sap our collective well-being. This has led me to believe that Stephanos Bibas’s approach to prison reform, which, as outlined in National Review, emphasizes the importance of restitution and prison labor as part of the process of reintegrating offenders into society, is extremely valuable.
So when we talk about concentrated neighborhood disadvantage, I suggest that we lead with crime, we pursue Summer Opportunity Scholarships as a vehicle for choice and instructional innovation in urban school districts, and we emphasize the importance of breaking the intergenerational transmission of poverty. The beauty of this agenda, from my engaged and not detached perspective, is that it is all about strengthening civil society, my favorite right-wing fetish. But who is going to take up the mantle?