This piece was originally published in the monograph “Place-Based Initiatives in the Context of Public Policy and Markets: Moving to Higher Ground” by The Center on Philanthropy & Public Policy at the University ofSouthern California.
The Case for Addressing Poverty One Place at a Time
by Greg Giornelli, President and COO, Purpose Built Communities
One particular quote in Chapter 3 of this monograph caught our attention: “tackling poverty one place at a time is a fool’s errand.” We disagree. For the last 50 years our nation has fought a war on poverty through “systems-level” policy, yet our poverty rate is little better today than it was when the War on Poverty started. It strikes us that the only fool’s errand would be to continue to address the complex problem of poverty by applying the failed top down, disconnected systems approaches of the past that focus on the symptoms as opposed to the causes of the problem.
Purpose Built Communities is led by a former mayor, a former city chief operating officer, a former city policy advisor and a former general counsel at a housing authority, and we can say with some confidence that reform at the systems level – whether they be schools, housing, or public health – is a less effective path to success than the focused efforts on neighborhood transformation. The scale of problems at the systems-level is simply too big; the institutions too bureaucratic; the politics too ingrained to allow for large-scale reform. Anything more than marginal improvement is unrealistic.
Neighborhoods of concentrated poverty trap people in swamps of multi-generational poverty. Dilapidated housing, high crime, failed schools, nonexistent wellness programs, the lack of high quality early childhood education – these are all at the heart of America’s poorest communities. If these neighborhoods remain unchanged, future generations are all but guaranteed to continue the cycle, even if a lucky few manage to escape. The science behind brain development, toxic stress and environmental impacts on long-term health all point to a direct connection between the conditions of concentrated poverty and inter-generational poverty. Both science and commonsense say the same thing: the conditions you grow up in have an enormous impact on your outcomes. You can’t solve inter-generational poverty without fundamentally changing America’s poorest neighborhoods.
Proponents of systems-level solutions will argue that there are too many poor neighborhoods and that trying to make changes one neighborhood at a time will take too much time. Is that true? How many of these neighborhoods are there?
Paul Jargowsky at the Center for Urban Research and Urban Education at Rutgers University estimates that in 2011 there were approximately 10 million people living in 3,400 urban Census tracts with poverty rates over 40 percent.1 These tracts average 3,000 residents each and are generally “clumped” together, forming impoverished neighborhoods of 10,000 to 15,000 residents. Using that math to generalize across the country, there are approximately 1,100 highly distressed neighborhoods in our metro areas.
While 1,100 neighborhoods is a lot of neighborhoods, it is important to remember that Purpose Built Communities alone has projects underway in ten of those neighborhoods and has initiated efforts in another 20 to 30. Imagine what a nationwide effort could achieve if properly led and resourced.
Assume for a moment that a neighborhood revitalization effort of the scope and scale that Purpose Built Communities leads was directed at these 1,100 neighborhoods. Further assume that $200 million is needed for each neighborhood to deliver the mixed-income housing, cradle-to-college and community wellness solutions that we suggest is needed to transform these communities. The total one-time cost of this effort would be $220 billion.
That sounds like a lot. But consider this: $220 billion is less than 6 percent of the total annual federal budget. The federal government already spends over $500 billion on poverty-related programs each year. If you add state and local funding, the annual total exceeds $1 trillion. A one-time time investment of $220 billion that would fundamentally transform the worst pockets of multi-generational poverty in this country strikes us as a relatively modest investment. As a point of comparison, the U.S. Department of Housing and Urban Development (HUD) has spent more than $1 trillion over the nearly 50-year life of the agency; if they had dedicated those funds simply to buying rental housing, they would own more than one-third of the existing rental stock in the country by now.2
This is not to say that local, state and national policies are unimportant. Of course they’re important. But it is hard not to be skeptical given the track record. A half century of experience would suggest that systems initiatives are either wrong-headed (e.g., urban renewal, public housing) or focused on providing relief rather than attacking root causes (e.g., income support, food stamps, Medicaid).
Truly transformational change can happen at the neighborhood level. While no one can point to a single urban school system that has been transformed into a college factory, there are hundreds of examples of neighborhood schools that regularly send almost all their graduates to college. The scale of the neighborhood makes these problems solvable.
A place-based approach also has the advantage of addressing issues at the level at which people actually live their lives – in neighborhoods. The urban attributes that we all aspire to create and nurture in our cities – walkability, access to green space, cultural vitality – all are experienced by our residents largely through the neighborhoods they inhabit. The quality of peoples’ lives is directly a consequence of the quality of the neighborhood environment within which they live. While this may seem obvious, it is surprising how many public policies are adopted at the local, state and federal levels that do not consider neighborhood impacts at all.
Attacking poverty through neighborhood-based revitalization is far from a fool’s errand. Indeed, all things considered, it’s the most compelling approach we’ve tried. At Purpose Built Communities we have 10 examples of how it can work: a holistic set of housing, educational and wellness programs, with local, private sector leadership, an emphasis on accountability, and reliance on market forces to propel and sustain neighborhood revitalization. There are other successful place-based models out there, too. We share one central conceit: rather than being prisons of poverty that kids seek to escape, neighborhoods should be their launch pads to prosperity.
- Jargowsky, Paul (2011). “Concentration of Poverty in the New Millennium: Changes in the Prevalence, Composition, and Location of High-Poverty Neighborhoods.” A Report by The Century Foundation and the Center for Urban Research and Urban Education at Rutgers University.
- See: Mark Calabria’s chapter, “Rules, Not Resources,” page 294, in Investing in What Works for America (2012). The Federal Reserve Bank of San Francisco and Low Income Investment Fund.