Friday, July 29, 2011

Is Wealth Inequality Increasing in Ward 6? (Part 1)

Earlier this week, the Washington Post reviewed a Pew Research Center report on the widening wealth gap between whites and minorities. Lately, I have written about the Gini index, which is often used to measure inequalities in household income. The Pew study importantly studies household wealth, which is made up of assets (houses, cars, banking accounts, etc) minus debts (mortgages, auto loans, credit cards, etc). According to the Post, the most significant findings were:

"Between 2005 and 2009, the median net worth of Hispanic households dropped by 66 percent and that of black households fell by 53 percent, according to the report. In contrast, the median net worth of white households dropped by only 16 percent.

The median net worth of a white family now stands at 20 times that of a black family and 18 times that of a Hispanic family — roughly twice the gap that existed before the recession and the biggest gap since data began being collected in 1984."

The Pew Research Center graph to the left dramatically represents the enormous differences in wealth.

In addition, during the recession, the wealth gap within these groups increased. Across all groups, during the recession, the wealthy became more wealthy: "Between 2005 and 2009, the share of wealth owned by the wealthiest 10 percent of all households rose to 56 percent from 49 percent."

Did the wealthy become more wealthy and the poor become more poor in Ward 6 during the recession? I'm working on getting an answer to this.

Tuesday, July 19, 2011

What is Neoliberalism? Is there Neoliberalism in Ward 6?

I have spent the last two weeks co-teaching a course in Budapest at the Central European University. One of our main topics was neoliberalism. For most people outside the United States, neoliberalism is a well-known concept. Sociologists around the world use the term neoliberalism to understand many global trends. I use the concept of neoliberalism as one helpful tool for understanding what is happening in Ward 6 and elsewhere around the world.

To those unfamiliar with the term, I generally say that neoliberalism can be understood as the ideas and policies of Margaret Thatcher and Ronald Reagan that support free markets and are anti-state. However, neoliberalism is a confusing term, because different groups have used the term in a variety of ways. In general, people see that capitalism has changed since the 1970s, and they call this new kind of capitalism "neoliberal." Broadly, neoliberalism contains the following changes:
  • it rolls back the welfare state. On the one hand, it ends social services through austerity programs, which abandon people to a "precarious" existence. On the other hand, it expands the state by enhancing surveillance and coercion/violence to maintain order. In contrast to the usual perception that Ronald Reagan sought to dismantle the state, he in fact expanded the state in numerous ways, thus reorganizing the state. As many scholars have argued, both Republicans and Democrats have realized neoliberal policies, such as when Bill Clinton sought "to end welfare as we know it."
  • it expands the realm of the market into state activities. Public-private partnerships bring together the state, corporations, and non-profit organizations to realize tasks of the state, such as military activity conducted by private contractors and education provided by the Harlem Children's Zone (funded by corporate donors and focused on testing, an education fundamentally different from that of middle- and upper-income children). Most importantly, the logic of the market changes these services, so that they focus on profits, efficiency, and the short-term, rather than, for example, equal access to these activities, cooperation, and long-term sustainability.
  • it eradicates public or social property through privatization. In the US, most water is owned and managed by city governments, while elsewhere the water supply has been privatized and is run by international corporations.
  • it supports the interests of owners and managers (especially in multinational corporations and international banks), rather than the interests of employees, the unemployed who would like to work, and those precariously employed (the precariat, see the video).
  • it creates a new kind of individual, the neoliberal "subject." These neoliberal changes create a highly competitive, fragmentary, unstable life, to which people are adjusting (successfully or not). In this great article, sociologist Ulrich Beck shows how the new capitalism simultaneously liberates people from past constraints, puts them at considerable risk, and then blames them individually for failing in a situation they could not control. For example, our students often find themselves with a wide range of possible options and thus ask themselves "what do I really want to do? what kind of person am I really?," at the same time most options are illusory and thus they are individually blamed for their failures on the job market. For a similar discussion of the neoliberal subject, see also sociologist Richard Sennett's The Culture of the New Capitalism.
  • it creates the neoliberal, entrepreneurial city. In the new context, cities like Washington, D.C. have taken on many of the tasks once carried out by the national state, but these cities do not have the resources to realize these tasks (due to austerity and low tax rates) and do not have the power to stand up to the demands of multinational corporations. Cities have thus become entrepreneurial, competing with other cities for international investments, high-bond ratings, and high-income residents (including the "creative class" discussed by Richard Florida). The entrepreneurial city must focus on competition and neighborhood branding to lure new residents and international investors. These trends create "dual" cities, with areas of great wealth and other areas of great poverty, through gentrification and dispersal of the poor from certain places (The Yards in SW and Hine Jr. High, both in Ward 6) to make way for new development projects funded by international investors, which in turn fund the entrepreneurial city government. As a result, city residents are not equal, as democracy requires, but rather residents are measured by the revenue they generate.
Is there neoliberalism in DC?