Economic Inequality in Baltimore, MD

Powerpoint: Economic Inequality in Baltimore

Economic Inequality in Baltimore

Economic inequality and its causes, repercussions, and potential solutions are increasingly popular topics of discussion throughout academic and political realms alike. Inequality, whether referring to wealth, income, or social status, is becoming increasingly present in societies on a local, national, and international level.

A particularly poignant case of economic inequality presents itself in Baltimore, Maryland. Over the past two years, flares of rioting and violence have plagued the already crime-ridden city. As economists, sociologists, and politicians have begun to unpack the racially charged times on Baltimore’s streets, many have pointed to economic inequality as a fundamental cause of tensions that have perpetrated many of the problems and injustices faced by Baltimore’s residents.

History of Economic Inequality in Baltimore

Beginning in the industrial era and continuing throughout the postwar years, many American cities followed a similar trend. Most were in relatively healthy economic standing, with stable employment and a prosperous middle class, due mainly to the presence of strong unions and high income taxes, which generally resulted in mild local inequality. For these cities, these markers only began to change as jobs were automated or were outsourced with the globalizing economy.

Much of this was true of Baltimore, except for one main distinction: White Flight, or the migration of white populations out of urban centers to more affluent (and less diverse) suburbs, began much earlier. By 1890, a combination of Baltimore’s geographical location, the population of free blacks from before the Civil War, and the population of newly freed blacks from the Reconstruction era resulted in Baltimore having the highest proportion of blacks of the country’s ten biggest cities (2). Throughout the early 20th century, a series of decrees and laws were passed that prevented black families from moving into neighborhoods and areas that were predominately white (and vis versa) to “prevent conflict” in the city (3).

Although these decrees were eventually struck down as unconstitutional through anti-segregation movements, the areas that had been spatially designated as “black” or “white” spaces were physically divided with the introduction of various transportation plans, including the I-70 “Highway to Nowhere”, what would eventually be a failed streetcar project, followed by I-695, or the Baltimore Beltway. All of these transportation initiatives had a similar trend: they allowed middle and upper class populations to avoid the sections of the city that had been populated by the lower classes, which were predominantly the areas that had earlier been designated as “black neighborhoods.”

With ineffective means of escaping the impoverished neighborhoods to which they were historically banished, residents of the lower-income west and east sides of Baltimore had no way of escaping the cyclical nature of poverty within inner-city Baltimore. There was no public transportation through which they could access the jobs in the hub of downtown Baltimore hugging the Chesapeake Bay harbor, nor could they afford to uproot and move to the more affluent neighborhoods that did have public transport stations and thus, employment opportunities.

Baltimore’s Economic Inequality Today: Facts and Figures

The breakdown of Baltimore’s inequality problem is evident in almost all facets of a resident’s life, particularly impacting Baltimore’s youth, as economic inequality often does. Many Baltimore neighborhoods have shorter life expectancies and experience poorer health conditions than “economically distressed cities in Nigeria, India, China and South Africa” and Baltimore ranked in the top three cities with teens seeing the “highest prevalence of sexual violence, substance abuse, depression, and PTSD” (7).

On top of this comparatively low standard of living, these same youth have a lower chance of escaping this environment. Baltimore City is among the worst counties in the U.S. for income mobility for children in poor families. “If a child in a poor family were to grow up in Baltimore, Md. instead of an average place, he or she would make $4,510, or 17 percent less at age 26” (6). Thus, not only is a child in Baltimore exposed to worse living conditions during their early adolescence through young adulthood, but the ability to rise out of their economic and social situation is projected to be much lower than if they were growing up outside of Baltimore, solely based on their geographical location.

These projections are supported by the wage gap in Baltimore, which in 2013 was one of the largest in the country. “The typical Baltimore resident in the bottom fifth of earners made $13,588 in 2013, whereas those in top 5 percent made an average of $166,924 that year” (7). In 2013, the national average for the ratio of 95th percentile income to 20th percentile income was 9.1. Baltimore’s 95/20 ratio was 12.3 (8).

Breakdown of Economic Inequality within Baltimore City

Comparing Baltimore City as a whole to surrounding suburbs within Baltimore County or to other cities of similar size presents a disturbing reality about the poverty levels within the city. It is true that the average annual pay for jobs in Baltimore is higher than the national average, and this average is also rising faster than the national rate (1). Baltimore ranks 12th in the nation for largest downtown employment, meaning that it has a significant number of employment opportunities in its metropolitan “downtown,” which is defined as the one-mile radius from the city center (4).

Despite these facts, it is evident that this alleged prosperity is not shared across neighborhood lines within the city. The jobs that are supposedly increasingly available in Downtown Baltimore are not available to all people across the city. The range of inequality within the city itself presents deep divisions between geographical locations as well as between races. Neighborhoods just west and east of downtown Baltimore exhibit very high rates of poverty, and those same neighborhoods are predominantly black. The racial isolation that exists in these neighborhoods and the concentration of poverty in these areas “help account for stark differences between Baltimore’s black and white populations in key economic outcomes like education, employment and child poverty” (1).

It is essentially impossible to address economic inequality in Baltimore without acknowledging the racial components behind its existence. For the black community, which is 63% of Baltimore’s population, unemployment is at 14% compared to the white unemployment rate of 3.6%. The trend of strong racial inequality continues in educational achievement and household income. The median household income for a black family in Baltimore is $33,801, whereas the median household income for a white family is at $62,751 (5).

Economic inequality in Baltimore City is above the national average across many measurements and areas, and when race and geographical location are taken into account, the trends are exacerbated. The income inequality faced by black Americans living in the west or east sides of Baltimore is one of the highest rates not only in the United States, but remains one of the highest compared to cities across the world.

Breakdown of Economic Inequality in Baltimore City compared to Baltimore County

Baltimore County stretches around the entirety of Baltimore City’s border, with the exception of where the city meets the Chesapeake Bay. Thus, Baltimore County has an eclectic economic spread, as some parts of the county are minutes away from the city’s affluent north side, whereas other parts share a border with the city’s west side public housing projects.

One such part is Catonsville, a suburb just four miles from Baltimore’s notorious West Side, and about eight miles from the heart of Downtown Baltimore. Despite their closeness in distance, Catonsville and neighborhoods on the West Side, such as Sandtown-Winchester (the neighborhood that Freddy Gray was from), have stark differences in their economic demographics. The median household income in Catonsville, MD is close to $77,000, where as the median household income in Sandtown-Winchester is a mere $37,000 by comparison.

Perhaps unsurprisingly given Baltimore’s racial history, the suburb just a few miles outside of the city has a markedly different racial breakdown. The white population in Catonsville is over three times that of the black population, and the exact opposite is true of Sandtown-Winchester: the black population is over three times as large as the white population in this neighborhood.

Baltimore’s deep and polarizing racial history certainly has contributed to the staggering inequality between inner-city and county economies. However, these injustices are perpetrated by the current events and legislators that impact the policies of our local governments.

The inequality that runs rampant between Baltimore and its surrounding county could be attributed to a number of sources, but one that is widely supported is public transportation connectivity in Baltimore and the surrounding suburbs, or more appropriately, the lack thereof. In the past twenty to thirty years, state and local elected officials have largely ignored the problems facing Baltimore, choosing to focus on areas of Maryland that have more “potential,” or, perhaps, just have fewer problems to tackle. Many politicians have channeled money that should have been going towards revitalization efforts in dilapidated inner-city neighborhoods and ineffective public transportation towards richer suburbs, because these area’s issues were less politicized and more “widely” accessible (2). By ignoring the systemic issues plaguing Baltimore’s poorest neighborhoods and allocating funding to areas of suburban Maryland that need public and federal funding less, the schism between rich and poor, and thus, economic inequality in Baltimore, only worsens.

Works Cited

(1) Berube, Alan, and Brad McDearman. “Good Fortune, Dire Poverty, and Inequality in Baltimore: An American Story | Brookings Institution.” Brookings. Brookings, 02 Aug. 2016. Web. 20 Mar. 2017.

(8) Berube, Alan. “All Cities Are Not Created Unequal | Brookings Institution.” Brookings. Brookings, 28 July 2016. Web. 20 Mar. 2017.

Berube, Alan. “Beyond Baltimore: Thoughts on Place, Race, and Opportunity | Brookings Institution.” Brookings. Brookings, 28 July 2016. Web. 20 Mar. 2017.

Broadwater, Luke. “Hogan Transportation Map Cuts Baltimore out of Maryland.” The Baltimore Sun, 26 June 2015. Web. 20 Mar. 2017.

(9) “Catonsville, MD.” Data USA. N.p., n.d. Web. 20 Mar. 2017.

Chetty, Raj, and Nathaniel Hendren. “The Impacts of Neighborhoods on Intergenerational Mobility: Childhood Exposure Effects and County-Level Estimates.” Harvard University and NBER, May 2015. Web. Mar. 2017.

(4) “Downtown Development Report 2015.” DOWNTOWN BALTIMORE (n.d.): n. pag. Downtown Partnership of Baltimore, May 2015. Web. Mar. 2017.

Frech, Egon. “Baltimore Forum Tackles Problems of Inequality.” SMCM Newsroom. St. Mary’s College of Maryland, 07 Apr. 2016. Web. 20 Mar. 2017.

(6) Leonhardt, David, Amanda Cox, and Clair Cain Miler. “An Atlas of Upward Mobility Shows Paths Out of Poverty.” The New York Times. The New York Times, 04 May 2015. Web. 20 Mar. 2017.

(2) MacGillis, Alec. “The Third Rail: Transit, Race and Inequality in Baltimore.” Places Journal. N.p., 01 Mar. 2016. Web. 20 Mar. 2017.

Malter, Jordan. “Baltimore’s Economy in Black and White.” CNNMoney. Cable News Network, 29 Apr. 2015. Web. 20 Mar. 2017.

“NAACP Legal Defense Fund : Defend, Educate, Empower.” Baltimore Residents and Civic Groups File Title VI Complaint with United States Department of Transportation over Maryland’s Discriminatory Decision to Strip Baltimore of Transportation Funding | NAACP LDF. N.p., n.d. Web. 20 Mar. 2017

(3) Power, Garrett. Apartheid Baltimore Style: the Residential Segregation Ordinances of 1910-1913, 42 Md. L. Rev. 289 (1983)

(5)  The Racial Wealth Divide in Baltimore (n.d.): n. pag. JP Morgan Chase & Co, Jan. 2017. Web.

(7)  Rios, Edwin D. “7 Charts Explaining Baltimore’s Economic and Racial Struggles.” Mother Jones. N.p., n.d. Web. 20 Mar. 2017.

Saltzman, Amy. “Nearly 66% of Baltimore Families of Color Lack the Savings to Sustain a Job Loss or Other Emergency.” CFED The Inclusive Economy Blog. N.p., 31 Jan. 2017. Web. 20 Mar. 2017.