By Ariel Miller, Executive Director of the Episcopal Community Services Foundation, Cincinnati, Ohio

In August, 2007, the U.S. Census Bureau ranked Cincinnati the third poorest major city in the U.S., and the poorest in Ohio. At 27.8%, our poverty rate is more than twice the national average. How did we get to this point? I posed this question to Terry Grundy, Adjunct Associate Professor of Community Planning in the School of Planning at U.C.  He also serves on the faculty of Northwestern University’s Asset-Based Community Development Institute.

Grundy started our conversation with a global perspective and brought the implications right down to the Over-the-Rhine block where partisans of Music Hall and the Drop Inn Center are going head-to-head. The question: do we want to save our historic cities? If so, and Grundy makes a passionate case for this, the solution will require changing course nationally and regionally, not only in City Hall.

Any social problem that persists stubbornly almost always belies a lack of political consensus about the solution or forces that desire that viable solutions not be implemented, Grundy began. The problem of poverty is not unsolvable, but clearly has remained unsolved. There are three possible reasons:inattention to this most morally acute of problems, lack of political will, or certain groups which see it as in their self-interests to block the adoption of viable solutions.

There are three cogent theories that have been proposed to explain the persistence of poverty in the United States,” he continued.  “Though none of the three can explain the whole phenomenon by itself, each is worth considering.

Model 1: This view holds that overcoming poverty would require a vast expenditure of public treasure, an expenditure effectively resisted by powerful political forces, Grundy said. Partisans of this view point out that our public treasure has been aggregated for international adventures in places like Iraq and Afghanistan and that these efforts will cost us upward of a trillion dollars. Holders of this view question whether these wars are making us demonstrably more secure and harbor the suspicion that the main purpose of the wars is to transfer a trillion dollars to military contractors. They see this as a diverting of public resources from things that count to things that are unnecessary and perhaps futile

We're a rich nation but don't have enough money to be the world's policeman and for investments to develop people, for example, through education and health care, or rebuilding our crumbling infrastructure. In contrast, cities like Munich are putting in new high-speed train systems and we can't fix our bridges. The things that matter and stimulate your economy are ports, highways, good environment: human asset development.

National Public Radio reported in February 2007 that US military spending exceeds that of all other nations of the world combined. Other political entities spending a far lower proportion of their GNP on the military, the European Union, Japan, China, India and Brazil have shown dramatic economic growth. Their economic development is a good thing - to our advantage to encourage - but now we are running for our money, Grundy notes.These nations are investing in human resources.Japan has a very low military budget partly because we protect them.This raises the question: Why should the United States continue to bear that expense for an economically robust competitor?

Model 2: According to this model, in advanced capitalism, you need a perpetual unemployed class to bid down the price of labor, Grundy said. Holders of this view point out that, if you go below a 5% unemployment rate, the cost of labor rises too high to be palatable to businesses. Add to that the more efficient mechanisms for moving capital and the growing stability of other countries since the 1980s. It is now very easy to move manufacturing capacity from markets where labor costs $7-$11/hr to markets where it costs 40 cents.

Ohio's loss of over 200,000 manufacturing jobs in the last six years bears out this analysis. Ohio's minimum wage is $7/hr, and many workers in this city hold jobs paying well below the City of Cincinnati's official living wage of $10.70. A local resident needs to earn at least $12.85/hr working full time to afford a market-rate two-bedroom apartment here. (National Low Income Housing Coalition)

Out of Reach

Model 3: Another view is the so-called culture of poverty theory which holds that poverty persists because of cultural artifacts. Its a culture that preserves itself like any other, Grundy continued. If we contrast immigrant groups which arrive poor, but subsequently prosper, to low-income Americans who stay poor, we see contrasting behaviors. Recent immigrants show economic solidarity. They lend each other money, create informal networks of jobs, and some place a huge emphasis on education. Couples stay together, families delay gratification, they exercise thrift, and they save and invest. These moves fit the capitalistic society very well.

By contrast, studies show, people who stay poor too often do not marry, do not finish school, and emphasize consumption over saving. Young men, instead of giving each other loans and jobs, shoot each other. Even here we have controversy over why these behaviors persist, Grundy added, but one thing is certain: The worst thing to do to perpetuate the culture of poverty is to concentrate the poor. We can prove that people who grow up in neighborhoods of concentrated poverty are less likely to do well than those who do not, even though they start out equally poor.

Today, 85% of the poor in the Tri-State are concentrated in the City of Cincinnati, Grundy said. If you add Covington and Newport, probably 95%. As people with resources move away, the residents of the city increasingly are those people who don't have economic choices. Revenues to the City of Cincinnati have been going down steadily as costs rose, and about two years ago the lines crossed in this city, creating the ongoing budget crises we see today.

If concentrated poverty is a disaster for cities, what's the cure?

Save the city, Grundy answered. What's good for the city is also best for low-income people. Like all of us, they want to live in orderly, beautiful, prosperous neighborhoods.I'm reminded of a New York Times columnist who in 2001 referred to gentrification is a bad name for a good thing.

City Councilman John Cranley's Zero Impaction Ordinance, which outraged affordable housing advocates (including this writer), represents an attempt to reverse the ghettoization of Cincinnati. While it's a very difficult policy to promote, it's fair to say that the quickest way to induce the communities that surround the city to take their fair share of the poor is for the city to decline to create more concentrated low-income housing within the city limits, Grundy said.

The concentration of poverty is bad for the poor and a disaster for our old, historic cities. No one with choice wants to live in a city in which the principle business is the delivery of social services. Grundy continued, It's important to note that the Cincinnati metro region has been using up land at a rate four times faster than its population growth, we are a region flying apart. Citing the research of regional development expert Michael Gallis, he added, In the U.S. no region can thrive that lets its historic core city fail. The middle class is deluding itself to think that flight to the suburbs will save it.

The huge impact of concentrated poverty, both to the families that remain and in the city's loss of economic vigor and tax revenue cannot be corrected by the city acting alone.

If the problem of the region's poor is a regional problem, as it certainly is, we have to ask ourselves why the City of Cincinnati bears nearly all of the burden, the city which has the least resources? Grundy asked. The solution needs to be located at higher levels of political effort. Some regions have addressed the problem by creating, if not regional government, then at least city-county government. Our regional competitor cities like Louisville, Indianapolis and Lexington have adopted city-county government, in contrast to the crazy jig-saw puzzle of cities and townships in the Cincinnati metro region.

Every step that could have been taken in the Urbanist direction in the last 30 years was not, Grundy notes. In many cases the city did what it thought was the moral thing, but didn't understand the tradeoffs. Political self-preservation mitigates against a regional solution: African-American politicians within the city are naturally suspicious of any policy that would seem to dilute the black vote, while white politicians in the suburbs don't want to get involved with the city and its problems. A solution to this intractable set of problems is more likely to come from an alliance of the civic and business sectors than from elected politicians. This alliance can call for a solution of the problem of poverty at the regional level.

This writer believes that the concentrating of the poor in ghettos slashes residents' chances of rising from poverty and that a rational alternative is to give them the means (such as Section 8 vouchers) to move to safer areas with good schools, while attracting those with means back into the urban core. But Cincinnati currently has a huge waiting list for housing vouchers: only a fraction of those who qualify receive this subsidy that can bring valuable revenue and stability to our city.

Grundy pointed out that Over-the-Rhine shrank from about 60,000 people at the end of World War II to 4,000-5,000 now. There is hardly anyone left to displace, and virtually no children in the neighborhood. When the aging Laurel Homes project was demolished to make way for City West’s new mixed-income housing, original residents were given housing vouchers and the choice of staying or moving. Lifelong Laurel Homes tenant Marquicia Jones told a reporter from the Austin Business Journal that her twins grades went up dramatically after they moved into a new home at City West. I saw a change in my kids that was just unreal. Several Leadership Cincinnati alumni live in City West as well. Grundy sees the city core as a priceless patrimony. Think about German Village in Columbus, and how small it is compared to Over-the-Rhine, he exclaimed. Over the Rhine could be like the Back Bay in Boston, our assets are so much greater than that of our competitor cities.

Can we overcome the phobia of suburban communities toward opening themselves to working, low-wage families with vouchers who seek a safe place to live and good schools? Will we tackle poverty as a region and call on Congress to increase the budget for housing subsidies for working families who desperately need help to make up the gap between their wages and the current cost of housing?

The city as a cultural entity is the highest achievement of the human spirit, Grundy concluded. Since the birth of cities in the Neolithic, every other human innovation has come from them: jurisprudence, medicine, literature, politics. Expecting the City of Cincinnati to stand alone against a rising tide of poverty is intrinsically unjust to the city, bad for the low-income residents trapped within it, and certain to undermine the competitiveness of the entire region. The solution to poverty in the city needs to be located at higher levels of political effort - at the regional level, the state level, and at the national level.