The Chasm Among American Cities Is Growing Ever Wider
The news this past year has been full of the tribulations facing the cities at the vanguard of the great urban rebirth. There are fights over Uber limits in New York, cash-free purchasing in Washington, D.C., and extreme housing costs in San Francisco.
Dayton, Ohio, has been grappling with a different set of concerns. For example, there was a spate of disturbing, unexplained deaths in a formerly middle-class neighborhood just northwest of downtown. Over the span of seven months, five women’s bodies were found scattered around the area, at least three of them the victims of homicides, the others likely dead by overdose. Three had gone undiscovered for so long that they’d been partly eaten by animals. The deaths, and their aftermath, seemed to capture three of the city’s pathologies — violence, drug abuse and abandonment — inside an area of little more than a few square blocks
The plight of small and mid-sized post-industrial cities like Dayton is hardly new, but it’s gotten obscured in recent years. The 2016 election drew a lot of attention to the urban-rural divide — between vibrant blue islands and fading red expanses that turned out so strongly for Donald Trump. What all the talk of the urban-rural gap overlooks is the growing divide among cities, too.
There have always been more and less wealthy cities, but nothing like what is on display today, as a select group of hyper-prosperous cities put ever-greater distance between themselves and their counterparts. Consider this. In 1980, even after the first wave of deindustrialization, Middle American cities such as Dayton were remarkably close to par with their coastal peers. Per capita income in the Seattle area was only 16 percent greater than in the Dayton area. In metro Boston, the edge was only 6 percent. In New York, 14 percent. In Washington, 31 percent. And in the San Francisco Bay Area, 33 percent.
All those cities have since left Dayton in the dust. Seattle’s per capita income is now 48 percent greater. Boston’s edge has jumped all the way to 61 percent — a tenfold increase. New York and Washington are both over 50 percent greater. And in the Bay Area, per capita income is 94 percent greater than in the Dayton area—that is, almost double. (And these stats are for the whole Dayton area, not just the diminished city proper, which has lost nearly half its population since 1960, to about 140,000 today, and where more than a third of the population now lives in poverty.) You’ll find similarly widening gaps if you substitute Dayton with St. Louis or Milwaukee or Fresno or Buffalo.
You hardly need income data, though, to discern these divides. Just use your own eyes. Take, for instance, the increasingly stark contrast between Washington, D.C., and Baltimore, where I live. A few decades ago, the cities were strikingly similar in their scale, levels of wealth and urban challenges — in fact, Baltimore’s population was 150,000 larger than D.C.’s as recently as 1980.
Today, to travel the 40 miles between the two cities is to risk vertigo, so wildly disparate have they become in cost of living, income levels and growth trajectory. Baltimore is laboring to demolish thousands of late-19th century townhouses that would each fetch close to seven figures in many parts of D.C. Last year, a single Realtor in D.C. sold five homes for more than $3.7 million each, more than any home sold in Baltimore that year. Maryland Gov. Larry Hogan in 2015 approved an expansion of the Washington Metro while killing a new rail line for Baltimore’s paltry transit system, furthering the divide.
You might expect regional inequality to self-correct, given how costly and congested the hyper-prosperous cities have become. Instead, the success of these cities feeds on itself, as more employers and highly educated people decide they need to be where the action is. It’s a winner-take-all, rich-get-richer effect. The result is less than ideal for everyone: Those in the winner-take-all cities struggle to get by even with a decent salary, while those in the left-behind cities face demoralizing blight and struggle to find fulfilling work.
This is the exact opposite of what was supposed to happen in the digital age. The internet was supposed to free us to live anywhere. But as Berkeley economist Enrico Moretti foresaw in his 2011 book, “The New Geography of Jobs,” the tech economy in fact encourages agglomeration: Innovation happens best in close proximity, not to mention that it’s easier to make your venture-capital pitch face to face. “It is almost as if, starting in the 1980s, the American economy bifurcated,” Moretti wrote. “On one side, cities with little human capital and traditional economies started experiencing diminishing returns and stiff competition from abroad. On the other, cities rich in human capital and economies based on knowledge-intensive sectors started seeing increasing returns and took full advantage of globalized markets.”
The irony for Dayton is that it knows the value of innovation clusters as well as anywhere. In the early decades of the last century, the city was home not only to the Wright brothers, but to lesser known inventors like Charles Kettering, who is credited with the electrical starting motor, among many automotive advances. The difference in the industrial age was that the manufacturing that flowed from those advances could be done just about anywhere with manpower, raw materials and transportation access. Today, manufacturing is typically done overseas, while the wealth accumulates in the hub cities where the intellectual property originated.
Economic concentration also plays a role in how the tech economy fuels regional inequality. As certain industries become dominated by certain companies — think of Google and Facebook’s growing share of ad revenue, or Amazon’s growing share of retail — it follows that more and more wealth flows to the places where those companies are based: the Bay Area and Seattle.
Social factors play a role, too. Since workers are less likely to spend their careers with one employer, they’re more likely to seek out a city where they can easily find a new job in their field if one doesn’t work out. You’re more likely to take a biotech job in Boston than that one intriguing option in Rochester. The rise of the two-income professional couple exacerbates this; you understandably want to be somewhere where both of you can find good jobs. Then there’s the growing tendency of well-off people to live amongst themselves, rather than in more mixed-income places, which increasingly concentrates them not only in certain neighborhoods, but certain metro areas. Call it the Brookline or Bethesda effect: seeking security in the comfort of excellent schools full of the children of fellow highly educated achievers.
The regional inequality is most glaring when it comes to the hyper-prosperous coastal enclaves, but it plays out within the interior, as well. Optimists about Middle America like to point to a handful of non-coastal cities that are thriving, without noting the many nearby cities being left behind. You hear a lot about Nashville, but less about Memphis; a lot about Columbus, but less about Akron and Toledo. As a recent report by the Greater Ohio Policy Center found, Columbus, which was from its founding less reliant on manufacturing than other Ohio cities, has in recent years “diverged dramatically” from other cities in the state on a whole range of economic measures, including population growth, poverty rates, labor force participation, and median income. More often than not, these regional winners are home to state capitals and major public universities: talented students head there for college, and don’t come back.
Too often, talk about left-behind regions is met by eye-rolling from cosmopolitans who view it as yet another attempt to summon sympathy for woebegone Trump voters. But this betrays a misreading of who lives in these struggling cities. Yes, they’re home to white working-class Obama-Trump voters. They’re also each home to tens of thousands of African-Americans, many of whom voted for Hillary Clinton, and many others of whom stayed home, seeing nothing on offer to address their plight. (Dayton proper is 40 percent black.) It was the combination of these voting blocs that explained Clinton’s losses in Midwestern states—not just voters turning to Trump, but Democrats in Milwaukee and Detroit and Cleveland who stayed home or voted third party.
Nan Whaley, the mayor of Dayton, joked darkly in a recent interview with me about how it took the 2016 election to draw notice to the plight of Middle America. “I mean, like look, I think the coastals need to pay attention to this because we can destroy elections,” she said. “You know, that’s what we can do, and I mean, then we get your attention.” Regardless of the cause, the growing regional disparities are starting to get overdue scrutiny from at least some in the upper echelons. Earlier this year, Larry Summers, the former treasury secretary, co-authored a big paper with Harvard colleagues Benjamin Austin and Edward Glaeser titled “Saving the Heartland,” which makes the case for place-based policies such as increasing wage subsidies like the Earned Income Tax Credit in struggling areas. The problem has also attracted AOL co-founder Steve Case, who, with “Hillbilly Elegy” author J.D. Vance, has been trying to draw more venture capital to Middle America.
For now, though, these cities are forging ahead on their own. For Dayton, that has meant, among other things, trying to make itself welcoming to immigrants and refugees. This effort has succeeded in one regard: The city has drawn hundreds of Ahiska Turks, an ethnic Turkish minority who were persecuted in Russia and former Soviet republics and briefly granted refugee status last decade. The Ahiska Turks have prospered in the trucking industry — their luxury cars are a familiar sight around Dayton — and they have renovated countless formerly vacant homes on the north side. As Islom Shakhbandarov, a community leader who co-owns a trucking company called American Power, put it to me with a knowing smile as he sat behind his big executive desk: “I see the opportunity, because it was almost empty — and there was room to fill it.” But this solution only goes so far for struggling cities at a time when the Trump administration is sharply curtailing refugee admissions, especially when it comes to Muslim refugees such as the Ahiska Turks.
Cities like Dayton are also embracing job growth of a sort that not so long ago would have been considered beneath them. The vast GM plant just south of the city that shut down in 2008 is now home to a Chinese-owned auto glass company called Fuyao. It employs more than 2,000, which helps explain why the unemployment rate in the Dayton area is back to pre-recession levels. But Fuyao pays much less than GM did. Wages start at about $15, and the work is grueling; an employee was crushed to death in March.
When I asked Cho Tak Wong, the billionaire founder and CEO of Fuyao, about the wages, he objected to the premise of my question. The proper comparison, he said, was not to what people used to make in Dayton, but to wages in Mexico and China, by which yardstick Fuyao’s pay in Dayton looked okay. “Old GM workers are very thankful towards us, because they lost their jobs after the closure,” he said. “They are very happy since we came and offered them jobs.”
In fact, happiness is an emotion on scant display in Dayton these days. The city has been one of the hardest hit by the opioid epidemic: nearly 400 people died of fatal overdoses in Montgomery County, which includes Dayton, in just the first half of last year, eclipsing the county’s total for the entire year prior. Montgomery County Coroner Kent Harshbarger has deployed refrigerator truck back-ups usually reserved for mass fatality events. The overdose rate abated slightly over the second half of the year, as the fentanyl strains in the local heroin supply weakened. That drop-off sadly did not happen in Baltimore, which ended 2017 with a stunning tally of 761 fatal overdoses.
For all the talk about the opioid epidemic leaving few places untouched, the fact is that it’s hit far harder in struggling cities than in winner-take-all ones. And once the struggling cities become known as thriving markets for illegal opiates, they draw ever more addicts from nearby towns and suburbs, who avail themselves both of the drug supply and of local social services: shelters, soup kitchens, and drug treatment programs that aren’t available in the communities from which they’ve come. It’s a dark inversion of the winner-take-all dynamic in prosperous cities: instead of drawing ever more wealthy professionals, the struggling cities draw ever more people in desperate straits.
Judging by the opioid epidemic stats alone, these cities come across as awfully bleak. Nonetheless, I’ve developed a strong fondness for them—not just a fondness, but a preference for them over the winner-take-all cities. They are vastly more affordable, making possible a more expansive, less stressed existence; they are places where, thanks to their high need and smaller scale, one committed person or family can make a real difference.
And they offer countless offbeat discoveries of the sort one is less likely to find in glossier environs. One evening in Dayton — at the end of a day when I observed a harrowing autopsy at the coroner’s office of a 45-year-old woman who had suffered a drug overdose — I stumbled upon a chess club inside an abandoned retail building downtown with a beautiful terra-cotta façade. There, I played a couple close games against a local community college student, and then wound up having dinner in a friendly tavern that turns out to be one of just two cooperatively owned brewpubs in the country. Naturally, I bought a share.
But the fates of these cities can’t depend on just the predilections of this or that new arrival with a soft spot for the underdog. The country must decide what it’s willing to do to narrow the regional gaps, from tackling economic concentration to targeting public investment. For some time, there’s been a growing awareness of the problem in having so much wealth concentrated in such a narrow slice of the income ladder. It’s now worth also considering what it means to have so much wealth concentrated in a narrow slice of cities.