As Inequality Rises, So Does Support for Government Action

Leah Binkovitz | @leahbink | April 25, 2016

The percentage of residents living in a household with an income below the poverty threshold. Image via Heather O'Connell, the Kinder Institute for Urban Research.

The percentage of residents living in a household with an income below the poverty threshold. Image via Heather O’Connell, the Kinder Institute for Urban Research.

The Houston-Galveston area has been a leader in job growth for decades now, outpacing the national average since 1990, according to PolicyLink.

But the region also is facing an uncomfortable truth: it’s ahead of the national average, too, when it comes to increasing inequality, according to PolicyLink, putting it at the center of a discussion about the government’s role in creating and correcting socioeconomic disparities.logosurvey

While candidates campaign for votes, a consensus seems to be building among Harris County residents, 66 percent of whom said government should do something to reduce income inequality, according to the results of this year’s Kinder Houston Area Survey. That’s up from 45 percent in 2010. And while support for some sort of government intervention has increased for both Republicans and Democrats since 2010, the shape of the proposed interventions varies widely. Houston Mayor Sylvester Turner, for example, champions job training programs and a minimum wage increase, while Texas Governor Greg Abbott has prioritized a set of education reforms.

A growing problem

Amid the so-called Texas Miracle, inequality has not only gotten worse in the state’s largest metropolitan area but poverty has also grown more concentrated, further isolating the poor. In the Houston-Galveston area, “the share of poor people living in high-poverty neighborhoods,” defined as neighborhoods where 40 percent or more of residents live at the poverty rate, “has doubled since 1980,” according to a 2014 profile of the area from PolicyLink and the University of Southern California’s Program for Environmental and Regional Equity.

Estimates from the 2014 American Community Survey show the disparities by census tract. The developing neighborhood east of downtown, branded as EaDo, had a median income of $99,688, for example while the neighborhood just south of it across Interstate 45, part of Third Ward, had a median income of $18,919.

“When I was a young person, I remember we would drive downtown and there’d be a certain area we used to call Skid Row, and it was just this little population of people,” said Judson Robinson III, president of the Houston Area Urban League. “Now those little populations are all over.”

Split support

Even as support for government action creeps upward, there are still large differences. Only 46 percent of white Harris County residents thought government should take action to reduce income inequality, for example, while 78 percent of black and 81 percent of Hispanic respondents favored the idea, according to the Kinder Houston Area Survey.

Support was lowest among Republican respondents, only 41 percent of whom said policy intervention was a good idea. Republicans were more likely, however, to say that the government should make sure everyone who wants to work can find a job. Fifty-eight percent of Republican respondents agreed.

Bridging the gap

Cities and states have looked at a variety of policy solutions to address growing income differences and boost households. Seattle, San Francisco and Los Angeles all recently raised the minimum wage to $15 dollars per hour. California did too, and New York adopted a two-tier system that includes a $15 minimum wage in the most expensive parts of the state. Washington, D.C leaders are mulling an increased minimum wage of $15 per hour, and Massachusetts recently passed a $15 per hour minimum wage for home health care workers. There is also increasing debate at the federal level about raising the minimum wage.

In Texas, however, similar legislation is tricky because cities cannot mandate that private employers pay above the federal minimum wage. Efforts to increase the state’s minimum wage in the legislature have failed, but when the left-leaning think tank Center for Public Policy Priorities looked at what would happen if the state instituted a $10.10 minimum wage, it found that some 2.4 million Texans would benefit with a wage increase. Sixty-percent were between the ages of 25 and 54; half of them lived in households with children and 43 percent had at least some college education.

Texas, argues the report, relies on a larger share of minimum and low wage jobs than most other states.

But minimum wage critics across the country argue that minimum wage hikes result in job cuts, since they put higher labor costs on employers.

Another approach

Education reform, however, has found bipartisan support. Abbott’s bill creating a grant program to incentivize pre-kindergarten passed unanimously in the House and 25-6 in the Senate with some advocates pushing for more. And the idea of better matching education with jobs has found broad support.

In a survey of Harvard Business School graduates, 71 percent of respondents said rising inequality, poverty and the stagnation of middle class wages were problems for their business and not just social issues. Respondents also identified the education system not only as a national weakness but a leading cause of, and also a solution to, rising inequality.

“The most palatable [policy reform in Texas] is education and workforce because it’s bipartisan — until we get to investing in it; then that gets difficult,” said Garrett Groves, economic opportunity program director for the Center for Public Policy Priorities.

“Career pathways is a buzzword across the country,” Groves continued, “and for good reason. Few of us can afford to go to college or pay for additional workforce training beyond high school and not have a job to show for it in the end.”

Under H.B. 5, passed in 2013, the state implemented graduation requirements that includes an effort, known as “pathways,” to better align curriculum to the job market. Students may choose an “endorsement” or area of concentration, similar to a college major.

“The entire education and training system is undergoing a transition toward career pathways,” Groes explained. Some critics worry the pathways program might effectively label students as not college material from an early age, and statements from Abbott that not everybody needs a four-year degree seem to reinforce that.

To align education with the modern workforce, the Texas Education Agency, the Texas Workforce Commission and the Texas Higher Education Coordinating Board are working together to create a comprehensive plan. “The big question is what comes out of it,” said Groves.

Local challenges

Working with communities in Houston, Robinson, of the Urban League, said he sees many workers struggle to keep up with a changing job market. He was part of a transition team that came up with economic opportunity policy recommendations for Turner, including workforce development initiatives.

“Our biggest challenge is finding people jobs,” said Robinson. “I have several people who have worked in higher paid jobs who are now reaching an age where they’re being laid off and they can’t find new employment that picks up at the same level and it’s really got a lot of people in jeopardy.”

At the other end of the equation, Robinson questions the state’s commitment to expanded early education opportunities. The recent bill creating a grant program to increase pre-kindergarten programs falls well short of providing for universal access and is only temporary. “What does that say about our sincerity about really trying to help Texas children?” asked Robinson.

Robinson said he’s hoping neighborhood job centers can help connect communities with training and employment opportunities while also motivating the private sector to invest in them.

So far, many of the recommendations presented to Turner are still “under consideration,” but the administration said in a progress report that it’s already begun investing in areas with high unemployment and poverty and boosting support for minority, women-owned and small business enterprises.

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Leah Binkovitz

Leah Binkovitz is Senior Editor with the Kinder Institute for Urban Research.

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