THE BLOG
05/16/2014 02:15 pm ET | Updated Jul 16, 2014

Newark, New York and Seattle: Recovering From Decades of Growing Inequality

Since 2009, economists have hinted that the Great Recession was behind us. Some even declared that the American economy had "recovered." But for a majority of every day Americans, this declaration is not only premature but misleading. Economic inequality existed before the Great Recession and it continues after. Middle- and working-class Americans continue to face decades of rising expenses that outpace their stagnant wages while double-digit unemployment lingers throughout African American and Latino communities.

However, for the first time in decades, there are signs that the country might have turned a corner with strong progressive economic promises and action that uplifts middle-income and working-class Americans instead of the wealthy few.

The most recent example is Ras Baraka, the newly elected mayor of Newark. Baraka's campaign promise included targeting the chronically unemployed and appointing a "Deputy Director for Full Employment." This goal is demonstrative of a real focus on high unemployment in most of our urban centers, and in African American and Latino communities in particular.

And change is happening not just in Newark. In both New York and Seattle, city leaders are taking steps to remedy the housing and wage crises that are wreaking havoc in the lives of low-income and working-class city dwellers. In a nation gripped by partisanship and political gridlock, these new municipal-level progressive efforts offer models that other cities can look to to help stabilize communities and reduce poverty.

This month Seattle agreed to raise the city's minimum wage from $9.54 per hour to $15 an hour -- the highest in the nation. The Seattle plan came out of unusual but not unique circumstances: a politically strong mayor, a highly visible worker organizing campaign, a progressive city council, and a private sector that saw short-term bottom-line costs as only one among many considerations. The phased-in increase starts with businesses employing more than 500 workers and then moves on to smaller businesses that will have five to seven years to put the new minimum in place. In a highly crucial component, the plan does not allow employers instituting the new minimum to cut worker benefits, and wages going forward will be indexed to inflation.

Although some economists argue that raising the minimum wage will decrease jobs, others contend that it will promote spending and stimulate broad economic growth.

In New York City, the strong economic boom now underway on Wall Street has brought little in the way of economic gains for working and middle class people. In fact many families are going in reverse. Housing costs have risen rapidly as affluent professionals return to the city and compete for limited space. In the last decade median monthly housing costs in New York rose 18.6 percent for renters and nearly 10 percent for homeowners. In the borough of the Bronx, 57 percent of households are rent burdened.

In one of the most adventurous plans of its kind, newly elected Democratic Mayor Bill DeBlasio has proposed to use thousands of acres of largely vacant, city-owned public housing land to build as many as 200,000 units of affordable housing to accommodate the city's increasingly strapped working families. Under De Blasio's plan, 50 percent of the units would be sold at below market rate prices -- 30 percent for moderate-income households and 20 percent for lower-income residents.

These units would be separate from city public housing projects. A plan to build lower-price supermarkets and community facilities is also part of De Blasio's vision.

Although De Blasio's plan will run into the billions of dollars, it will no doubt be a public-private collaboration, providing benefits to both. A strong body of research shows that stable housing and access to steady work benefits neighborhoods and communities. Strengthening affordable housing in New York City, raising the minimum wage to a living wage in Seattle, and attacking chronic unemployment in Newark are the types of policies that benefit the have-nots in a time when the haves seem to be getting and keeping it all and is what this country needs before we can declare that the economy has truly recovered.