Connecticut has the third-worst income inequality problem in the United States, according to a survey released earlier this month by the U.S. Census Bureau.
While the state boasts a median household income of $73,433, the sixth highest in the nation, its Gini coefficient — the standard measure of income inequality — stands at 0.4945, second only to New York and Louisiana, according to the annual American Community Survey, which was released on Sept. 14.
But those statewide statistics do not tell the whole story, said Gerald Jaynes, an Economics and African American Studies professor.
Salient among the survey findings are stark regional divisions. Four out of the state’s five largest cities — Bridgeport, New Haven, Hartford and Waterbury — rank in the bottom quintile in median household income among the more than 600 American cities surveyed.
Seven of the eight counties in Connecticut have less income inequality than the national average. The lone outlier is Fairfield County. Located at the southwest corner of the state, the county is home to both the famed Gold Coast — glittering New York exurbs like Greenwich, Darien and New Canaan — as well as the struggling city of Bridgeport.
Such socio-economic divisions were embedded into the state’s residential pattern long ago, said New Haven Economic Development Administrator Matthew Nemerson SOM ’81. Connecticut’s abundant water power and waterways allowed manufacturing to flourish starting in the early 1800s, Nemerson said, attracting millions of unskilled European immigrants and later African-American laborers from the South.
At the same time, he said, Connecticut’s high-quality railroad and highway system, as well as its lack of an income tax, made the state a popular destination for wealthy New Yorkers and corporate headquarters, especially in the post-World War II period.
Moreover, Nemerson said, Connecticut also has a long-standing tradition of community autonomy. In the absence of county government, towns are allowed to manage their own tax, zoning, housing and school systems. Low-income people, often shut out from suburban communities, are more likely to concentrate in the urban centers, Nemerson said.
Jaynes said this pattern is a major problem, especially in the education system, where it contributes to a “failure to educate our children.”
As public schools are funded primarily by local property taxes, suburban communities with high property values often have lower taxes and greater revenue, whereas inner-city districts, even with higher tax rates, see their schools languish, Jaynes said.
As an example of education inequality in the state, political science and economics professor John Roemer pointed to a case last year involving the Connecticut Coalition for Justice in Education, in which the Connecticut Supreme Court declared that the stated had “[defaulted] on its constitutional duty” to give children in poor districts an adequate education.
The decision cited a 2013 report by the National Center of Education Statistics, which found that the state had the nation’s highest average reading score for fourth and eighth graders while poor students in Connecticut fell behind their peers in 40 states.
This urban-suburban divide has only deepened over the last 50 years because of the loss of high-paying manufacturing jobs, including the closing of the Winchester Repeating Arms Company in New Haven, Nemerson said. At the same time, he said, tax policies and the flowering of finance brought by globalization have greatly enriched the wealthy in Connecticut.
Jaynes emphasized that we must “come to grips with globalization” and start to truly educate disadvantaged children for new jobs in the technology era, while rejecting the “dogma of trickle-down tax cuts.”
For its part, the city has a duty to provide affordable housing and encourage local institutions — such as hospitals and the University — to work with local businesses, Nemerson said.
Malcolm Tang | jiawei.tang@yale.edu