Re: Milwaukee, segregation, and income disparity

Milwaukee

A couple of weeks ago a website called 24/7 Wall St. did a special report on the best and worst run cities in America. Milwaukee ranked 10th in the worst category. The site offers this blurb:

10. Milwaukee, Wisconsin
> Population: 599,000 (28th largest)
> Credit rating: Aa2, stable
> Violent crime per 100,000: 1,294 (10th highest)
> 2012 Unemployment rate: 10.1% (27th highest)

Milwaukee struggles with poverty and high crime rates. Last year, a typical household made just over $34,000, and nearly 30% of people lived beneath the poverty line, considerably worse than the country’s figures. There were nearly 1,300 violent crimes per 100,000 residents in 2012, more than three times the national rate of 387 violent crimes per 100,000 people. The city’s socioeconomic problems were among the reasons Moody’s assigned Milwaukee a Aa2 rating. The agency also expressed management-related concerns, specifically highlighting the city’s debt burden and the complexity of its debt financing.

No, this isn’t compelling press for Milwaukee. The Milwaukee Journal Sentinel managed to cover the ranking a few days later. Mayor Barrett put forward a series of rather weak responses. It felt as though he didn’t take the ranking seriously.

He shouldn’t have. 24/7 Wall St. plops together a few stories from other sources and calls it news. An internet search of the two writers attributed to the story gives you nothing. No resumes, no personal bios. Do these folks even exist? If I were Barrett, I’d be incredibly frustrated that Don Walker felt the ranking newsworthy. It would be the equivalent to my offering a ranking of Milwaukee area bars based on the number of beer taps.

And it looks like that’s what trumped in this ranking list: violent crimes per population. So let’s have that discussion. It’s bad. And on this issue, Barrett’s mealy we’re-trying-to-do-something response doesn’t give one much encouragement.

(BTW, Dan O’Donnell from WISN jumped on the Milwaukee sucks bandwagon, too, offering the ranking has to do with Democrats. The Marquette Tribune offered that Milwaukee sucks except for the area around Marquette.)

Milwaukee has a violent crime rate of 1,294 incidents per 100,000 of population. That’s news. City Rating gives you a better look at Milwaukee crime rates, both violent and property.

I have not done loads of research, but synthesizing the bits I remember from classes at UWM, I’d have to think the causation is something like: Segregation –> income disparity –> crime.

Segregation

Milwaukee is very black and white. And this time we get real analysis from a couple of professors using data from the 2010 census. (Oooooh. Real data!) This WUWM article led to the story above:

New Ranking: Milwaukee Still Country’s Most Segregated Metro Area

Except that headline isn’t true. There’s real data, remember? And the chart they supply starts like this:

segregation

Milwaukee is the Milwaukee, Waukesha, and West Allis areas. The Milwaukee metro area ties the Detroit metro area for first. That’s a different headline, don’t you think?

Mentally grab some of those recent Detroit images and see how they compare with Milwaukee. Given Milwaukee’s segregation, our city doesn’t seem so poorly managed after all. And for comparison, here are Detroit’s crime numbers from the same source. If I’m seeing that correctly, Detroit is close to double that of Milwaukee. Detroit was second on that 24/7 Wall St. list of poorly managed cities.

Here’s where I adjust my soap box and remind readers that segregation runs both ways. Have you tried living in a black neighborhood lately? Granted I’m working only from anecdotal evidence, but the acquaintances of my children report it isn’t so easy. And my daughter’s year on the East Side taught her that there were, indeed, lines one did not cross. One corner might be safe, but waiting for the bus across the street would find you the white girl in the center of eight black teen boys demanding the contents of your backpack. Riding the bus from the East Side to work in Wauwatosa was a tough job, too, as you were usually the only white on the bus. That’s where your phone becomes their phone simply because they want it, and the black bus driver couldn’t be bothered to stop and call the police.

Segregation is often thought to be whites excluding blacks. I think it’s time segregation also be considered as blacks excluding whites. I promise you a black person would have an easier time navigating the Brookfield Pick ‘n Save at Capitol and Calhoun than I would have waiting for the bus at Holton and Locust.

Income Disparity

A “non-partisan” group called COWS from The University of Wisconsin-Madison offers this new report on Wisconsin’s Extreme Racial Disparity. Keep in mind that income inequality is President Barack Obama’s new initiative prior to the the 2014 mid-term elections. He calls it “the defining challenge of our time.” Except it isn’t.

Here’s a chart since 1913 when the United States started collecting income tax. The percentage of income from the top 1% was higher in 1928 at 23.9% than in 2007 at 23.5%. This article from the Seattle Times shows 2012 at 22.5%. That doesn’t keep them from making this misleading statement last September:

Top 1 percent take record share of U.S. income
The very wealthiest Americans earned more than 20 percent of the country’s household income last year — their biggest share since 1928, according to an analysis of Internal Revenue Service figures dating to 1913 by economists.

Contrary to popular belief, income inequality is not a new topic in the United States. Ben Franklin wrote on the subject in 1782.

I suppose the first lesson in attempting to decipher this subject is to look to the data and not the headlines. The second is to recognize from those charts that an improving economy shows decreases in economic inequality.

Next, no one will tell you what creates income inequality, only that it exists. Half of America will tell you the two ways to fix it are to tax the rich and raise the minimum wage. Nothing ever comes up about improving the economy in general.

Milwaukee Mayor Tom Barrett says the minimum wage should go up to $10.10 and hour. Then, just as you would expect from a typical politician, he explains he has no power to influence that change.

Hey, do it. I think Wisconsin’s R-R-R decision makers should give Milwaukee and Dane Counties everything they want. Raise the minimum wage in those cities. Document every job that flies out of the areas.

In summary

We’ve just started on this topic. The little bit of research this morning does some to affirm my instinct that Segregation –> income disparity –> crime. And who wants to live in a high crime area?

I have some crazy ideas I’ll share in the next couple of days.

Comments

  1. One thing to note when you say “I promise you a black person would have an easier time navigating the Brookfield Pick ‘n Save at Capitol and Calhoun than I would have waiting for the bus at Holton and Locust.”

    If that person drove to a Brookfield Pick ‘n Save, they’d likely get pulled over by Brookfield PD or Wauwatosa PD while trying to get there from Milwaukee. “Driving While Black” is pretty strictly enforced in Wauwatosa especially. You on the other hand would have no problems with police driving through Milwaukee.

  2. “I suppose the first lesson in attempting to decipher this subject is to look to the data and not the headlines. The second is to recognize from those charts that an improving economy shows decreases in economic inequality.”

    Then you better take a closer look at the data.

    Saez’s chart shows nothing of the sort. Since 1976, the top 1%’s share of pre-tax income has more than doubled and has only marginally improved twice since then, once during the collapse of the dot.com bubble and again following the 2008 financial crisis. But yes, income inequality is slightly better than 1928 and the Gilded Age for that matter. So everything’s great.

    “Next, no one will tell you what creates income inequality, only that it exists.”

    I will. Reaganomics, de-unionization and Rubin’s strong dollar policy in the 90’s.

  3. Nick, I did address DWB in 2010 – just not on this blog.

    http://cindykilkenny.com/2010/01/27/dwb/

    Strupp, dude, you may have kind of made my point. You highlight two issues and call the discussion over. I think it’s more than that.

    The post WWII economic expansion was the longest period of shared wealth on that chart. Employment was mostly considered full. It was also a time of permanent war. Vietnam ended and the chart creeps higher. Even though Clinton was there for eight years. Even though Eisenhower, Nixon, and Ford were tucked in to that “good times” scenario against a Keynsian argument.

    Maybe the challenge is to grow an economy outside of war expenditures. True growth. Not bubblicious chart-growth. Blaming it all on Ronald Reagan is lazy, Strupp, and you know it.

    Edit – I just thought of something else – didn’t the U.S. end a conscripted army in 1973 or so?

  4. Jim Spice says:

    Your examples do not even rise to the level of anecdote. I would suggest rumor would be more accurate.

  5. Randy in Richmond says:

    Strupp
    You list de-unionization as one of your 3 reasons for income inequality. Perhaps you could provide a source of statistics for this classification. I can find information on states that evolved to become either ‘forced union’ or right to work but none that were once union and now are right to work. And even if there are a few that is not evidence of a national statistic.

    If we look at the evolved states for these classifications there are 25 right to work and 26 forced union (includes D.C.). CNBC does an annual study that ranks states economically based on many factors, both objective and subjective. In the top half (25) of these rankings are 5 forced union and 20 right to work states. There are no forced union states in the top 6 and only 2 in the top 15. This is not anecdotal but overwhelming statistical evidence by a network that is anything but right leaning, that states without forced unions haved fared much better overall.

    The Democratic model for addressing inequality just celebrated it’s 50 year anniversary and well, that speaks for itself.

  6. Randy in Richmond says:

    Nick
    Are you saying that in Brookfield or Wauwatosa people are pulled over regularly simply for being a black driver?

  7. Jim Spice says:

    “…overwhelming statistical evidence…” HA HA HA HA HA! Yeah, cross-tabs are the ICBMs of the stats arsenal.

  8. @jimspice – that was my daughter. I paid to replace the phone. Rumor my (substantial) backside.

    Party on, you Milwaukee denier you. Party on.

  9. J. Strupp says:

    Post-WWII military spending as a share of GDP has been within a couple of percentage points for decades. I guess I’m not sure how anyone can argue that post-WWII military build-up was the reason for our 40+ years of growth.

    What that chart is really showing you (in plain English) is what happens when productivity growth and real wages for the median American worker diverge. 1945-1980 was considered the Golden Age of the American middle class because real wages stayed in line with productivity gains. Since Reagan, all of these productivity gains have gone to capital (by design). Meanwhile, the middle class worker has seen near zero real wage growth for over 30 years. Reagan’s supply side, trickle down baloney was simply a massive income redistribution program.
    You don’t get “true” growth (whatever that means) without real wage growth, Cindy. Simple equation.

  10. J. Strupp says:

    “Perhaps you could provide a source of statistics for this classification.”

    Oh hell I don’t know, Randy. Can we just agree that private and public de-unionization of the American work force has, in fact, occurred over the past 30 years?

  11. Oh my God! It’s Reagan’s fault!!! Really?

  12. Jim Spice says:

    Well, I’d blame it on Laffer, Cheney and Rumsfeld who spitballed the idea, but couldn’t get Ford on board. But Reagan was the first to implement it.

    http://www.yorktownpatriot.com/printer_78.shtml

  13. It being what?

  14. Got it. “It” is fiction. At that point the author of your link gets to make it whatever one wants. I particularly like the way the story moves from Laffer to a protegee with an easy sentence.

    What was your point again?

  15. Got it. “It” is fiction. At that point the author of your link gets to make it whatever one wants. I particularly like the way the story moves from Laffer to a protegee with an easy sentence.

    What was your point again?

  16. It being the Laffer Curve, AKA Reananomics, AKA Trickle Down, AKA the answer to every problem is tax cuts. That meeting in ’74 is fairly well documented. You should read up on it. Fascinating. And scary.

  17. J. Strupp says:

    Cindy, can we AT LEAST agree that there was a fundamental shift in American economic policy away from New Deal/Great Society tax rates, bargaining rights and strict financial regulation to laissez-faire capitalism, de-unionization of labor and deregulation of the financial sector around 1980? You know, “Give a man a fish, he eats for a day…..”?

    That way we can just go back to blaming income inequality on globalization or the erosion of family values in poor communities or not having enough Jesus in our lives or whatever the modern day conservative line is.

  18. Nah, it oversimplifies the topic to point blame in only one direction.

  19. LOL. Or the right direction.

    Plenty of blame to go around though……Clinton bowed to the rent-seekers and Obama’s done very little to address tax policy or financial regulation either. Reagan handed over the keys to corporate America and we never took them back.

    Self proclaimed Republican, Barry Ritholtz, wrote a good summary awhile back with quality links regarding this issue. He doesn’t really source the starting point for the income equality we see today but every chart/link makes it pretty obvious:

    http://www.ritholtz.com/blog/2013/02/why-are-inequality-levels-skyrocketing/

  20. Ooooh. Now that is productive discussion, Strupp. Thanks for the link. I encourage everyone interested in the subject to look it over.

  21. @Randy – To answer your question – Yes, I believe that Wauwatosa and Brookfield Police *do* pull over black drivers merely because they are black.

    Did those black drivers break the law? Probably – But then again, if a cop watches anyone long enough, I guarantee he will find a law you broke if he wants an excuse to pull you over.

  22. Randy in Richmond says:

    As I read the report Cindy links I suddenly realized what Cindy is saying. Let me take it a step further.
    This report is by 2 college professors. Maybe it’s a standard classification in the acedemic world but I’m not familiar with seeing ” segregation” used to label the concentration of a particular race living within a designated area. My understanding is that segregation is “the practice or policy of creating separate facilities within the same society for the use of a minority group” or something similiar. Labeling a column in a chart “segregation” based on total percentages or ratios of a particular race smells of agenda to me because we can all agree segregation is a word that carries a very negative context in today’s society.

  23. The separation isn’t forced so it isn’t segregation. Everyone gets to live anywhere they want as long as they can afford it.

    So why don’t they want to live anywhere else? Can I live there? I mean, it’s inexpensive and a walkable community and I understand there is plenty of police present… (Thanks Randy)