Author: Larry Littlefield

The U.S. Census Bureau released the second set of 2006 American Community Survey (ACS) data last week, and thus far I have had time to look over some of the housing data (see attached spreadsheet). There are plenty of interesting tidbits there, but one statistic jumped out at me. The median gross rent as a share of household income, meaning half of the households paid more of their income in rent and half less, was 30.5% in New York City, 30.5% in the New York metro area as a whole, and an almost identical 29.9% for the entire United States. The median gross rent (rent, plus the estimated average monthly cost of fuel and utilities) is 23.9% higher than the U.S. average in New York City, 29.1% higher in the New York Metro as a whole; the median contract rent is 35.2% and 40.6% higher than average respectively. Yet it appears that the higher median rents in the New York area are offset almost entirely by the higher median incomes, even for renters. Looking the larger metro areas around the country one finds little variation, with percentages above 33% and below 28% virtually absent (South Florida and the Inland Empire of California are slightly more expensive than that). From a public policy perspective, 30% of income is the share recipients of housing benefits under Section 8 and Public Housing must pay, and that appears to be the national average. Looking at the total rent/income ratio, one wonders how expensive is New York City?

But of course, this is not the whole story.

To me, that’s what the Tribute in Light is. Since I lack standing as an art critic or even frequent visitor to art museums, perhaps I should say that it is the one I find most meaningful. Certainly if the purpose of art is a deeper, more abstract means of communication, then its enormity cannot be denied. Everyone can grasp many of the meanings of those two beams. That it was conceived and implemented so quickly makes it all the more amazing. I have no idea who did this, but those who did have my thanks.

No memorial that will ever be conceived will convey as much as having those two beams of light cast to the sky each year on this date. Nothing could do as much to help people remember 10, 20, 50, or 100 years from now. I agree with an early Bloomberg comment that the city should not be a cemetary, and wish the city had healed around the wound already. But I hope that into the far off future the ghost of the towers will continue to rise as a memorial to what happened that day and those lost.

Referring to Coney Island, the NY Post reported today that Kansas Fried Chicken king Horace Bullard said "the city has waited far too long to rezone the district – putting boardwalk property owners such as himself at risk as they face a declining economy, and potentially setting back future redevelopment many years." The city is stalling because, for good reasons, it does not want to accept mega-developer and current primary property owner Joseph Sitt's plan for yet more condos in a high-traffic entertainment area served by eight subway tracks. But this begs the question — if the city knows what it wants, why doesn't the current C7 zoning, mapped there and nowhere else, already reflect this? Why wasn’t this the case years ago, so that any prospective property buyer would have known what they were getting into up front, and could have just gone ahead and built?

I read today that the State Comptroller is cutting the pension contributions required of local governments outside New York City. Can more pension enhancements be far behind? It’s like 2000 all over again. Does anyone remember what happened next? More importantly, has the Comptroler been reading the financial press about what is happening now? It’s scarier than anything I can remember — all the crap that happened over time, rather than blowing up over time, seems to be blowing up at once.

In honor of Labor Day, I have appended the latest median household income and poverty data from the American Community Survey (for New York City, the boroughs and the U.S.) to the attached spreadsheets showing this data over the long term. I have data going back to 1970 for poverty (actually 1969, because the census asked about income the year before), and back to 1949 for median household income, so this presents a longer-term view than what you might have read in the newspaper. Certainly this is a different city, and a different country, than it was in 1969, when the city hit its highest payroll employment level, and 1950, when most historians believe New York City reached its pinnacle of national importance. Over that length of time, national economic changes overwhelm in importance anything specific to New York, and inflation makes dollar figures meaningless – the U.S. median household income was $2,619 in 1949, and a penny was actually worth something. By comparing New York City to the national average at each point, however, we can see how New York City residents have fared relative to the rest of the country. And the data show that the average New Yorker, in the time between 1999 and 2006, finally recovered from the early 1990s recession, though remaining worse off, relatively, than in the city’s pre-1970s heydays.

Following a link from Gotham Gazette, I found that the Center for an Urban Future has released a report on free outer borough tourist “trolleys” such as the Heart of Brooklyn trolley running around Prospect Park. The report can be found here http://www.nycfuture.org/images_pdfs/pdfs/ABumpyRide.pdf . Brooklyn’s trolley gets riders around the park and to the Brooklyn Public Library, Brooklyn Botanic Garden, Prospect Park Zoo, Brooklyn Museum of Art and over to the Brooklyn Children’s Museum. The report finds that the trolleys have added little to the attendance at these institutions, and blames infrequent service and poor marketing. The group is also concerned that the Brooklyn trolley rarely has more than a few passengers on board, and given that it only gets six miles per gallon, it is a poor environmental choice per passenger. The group suggests replacing the vehicles with more fuel efficient models, increasing signage and marketing, and running the service more frequently (even though it is currently underutilized). As a person who has trouble thinking inside the box, needless to say I have a more radical suggestion.

After reading my equity and eligibility posts, perhaps you have reached the same conclusion I that have: as government has become increasingly complex, it has also become increasingly unfair. More and more, we find that eligibility rules (or decisions made outside formal rules) favor the better off, the better organized, and the better connected – and those with a greater sense of entitlement. Once the growth of government, as a share of the economy, stopped, the trend has been for the number of beneficiaries to fall even as the benefits available to those in a position to access the system – through direct benefits or tax breaks – increases. And as the debts and pension promises of the past continue to bite, it is basic services for the majority and basic needs for the worst off that suffer, not extravagances for the influential. Equity, fairness, even decency requires that this trend be reversed. Some services and benefits should be made universal. Others should be eliminated. And younger generations have to be treated fairly. Otherwise, we are going to see general strikes in this country by a majority of people with nothing left to lose. That is why equity and simplicity in government was one of my four main themes when I became disappointed enough to run as a protest candidate for state legislature several years ago, as I described in this essay http://ipny.org/equalpro.html .

Virtually every method of restricting eligibility comes together in the public health care finance system of the United States. Medicare, and part of Medicaid, have eligibility restricted based on age. Other parts of Medicaid, and public health and hospitals, allocate benefits based on means and need. The exemption of health insurance premiums from taxable income allocates benefits according to the “golden rule,” while the publicly mandated right of those with tax-subsidized private health insurance to keep it (under COLA laws) allocates money based on feudal tenure. Scarce vital organs available for transplant are, theoretically, allocated based on “merit” criteria by quasi-public groups backed by federal and state regulations. When all the direct and indirect (tax subsidy) public spending on health care is added up, it turns out that the federal, state and local governments were already funding approximately three-quarters of all third party (not out of pocket) health expenditures in the country in 2000. Excluding non-vital services the government share was 80 percent. That share is certain to rise as the nation ages, and Medicare and Medicaid account for more of nation’s health care. This entire health care finance system is profoundly inequitable — if it didn’t already exist, would anyone dare to suggest it? Yet politicians continue to propose adding to it rather than scrapping it altogether, so numerous and powerful are the beneficiaries of that inequity.

We have now reached the bottom of the barrel from the point of view of equity and eligibility – public services and benefits that are rationed, and have eligibility restricted, not on the basis of need, or age, or means, or tax liability, or tenure, or queue, but by a “fair and through evaluation” of “merit.” In public applications and eligibility criteria, merit is sometimes determined by quantitative measurement, sometimes by qualitative criteria evaluated by a panel of “experts,” and sometimes by the whims – or political deals – of individual legislators. Deciding someone’s “merit” presents all the same liabilities as deciding their “need,” but with an added objection – in the United States of America, what business does the government have in deciding one’s merit at all?

The “Thin Edge of the Wedge” outcome and “American Feudalism,” discussed in earlier posts, provide greater public benefits to those who have more, but do so by stealth or accident rather than by design. The provision of public benefits and subsidies through the tax code, on the other hand, clearly and unambiguously follows the “golden rule” — he who has the gold makes the rules. Tax subsidies are preferences are the opposite of means-tested benefits. Under means-tested benefits, the less you have the more public assistance you get, at least in theory. Tax breaks provide greater public benefits to those who have more, not those who have less. And more and more, tax breaks are the public policy of choice for allocating public benefits.