Vision needed to rebuild Philadelphia's middle class

Posted: March 03, 2014

It is tempting if one lives, plays, or works amid the skyscrapers, apartments, and buzzy restaurants of white-hot Center City, to think that all is gangbusters in the nation's fifth-largest city.

Redevelopment has reignited downtown Philadelphia as a destination for the urbane and upwardly mobile. This energy has helped rejuvenate such once-fallow surrounding enclaves as Northern Liberties, Fishtown, Fairmount, Graduate, and others.

Carving out more bike lanes and high-end retail are among the wish-list items discussed among the tens of thousands of old-timers and newcomers whose high incomes and lifestyle aspirations have drawn big investment to these pricey zip codes and helped reverse some of the city's decades-long population loss.

But venture beyond this gilded core - to the vast expanse of neighborhoods where more than a million other people live - and a fuller measure of Philadelphia's health can be taken.

The findings of a recent Pew Charitable Trusts report make this undeniably clear: The middle class of Philadelphia has declined in astonishing numbers between 1970 and 2010, dropping 17 percentage points while the nation's share fell only 10 during roughly the same period.

The share of lower-class households increased sharply, while upper-tier households remained roughly flat as a percentage of overall population.

Most of this has happened in neighborhoods well beyond Center City. And although the worst of the losses had ended by 2000, Pew's data did not look at what additional impact the 2008 global financial crisis and Great Recession may have had since 2010.

None of this was shocking when revealed on Monday. For decades after World War II, this rust-belt city shed its once-breathtaking manufacturing sector, torching also the middle class whom those factory jobs once produced. Everyone with a Philly relative living in the suburbs knows this went down.

But capturing it on paper, as Pew has done, means no one can underplay the fiscal scourge that this massive and enduring loss of taxpayer heft represents for the city - even with the impressive big-ticket turnaround that is the Center City Story.

"I'm certainly worried about Philadelphia," is how Michael Masch put it when I spoke with the former City Council wonk, mayoral budget chief, and state budget director under Ed Rendell, and most recently, ex-financial overlord for the troubled Philadelphia public schools.

"My fear is that in recent years it may be that a brief window of positive improvement has closed and we may be back in the battle days," said Masch, now vice president for finance and chief financial officer of Manhattan College.

Many of the census tracts that lost their middle-class majorities were in neighborhoods in the Northeast, the Southwest, and in smaller pockets throughout - even North Philadelphia went from majority middle class to majority lower class.

Think about how much of the city we're talking about here.

"You're covering Northeast Philadelphia - a place the size of Pittsburgh," an old city editor told me in 1998, in explaining my first assignment to cover that unwieldy, and huge, amalgam of postwar homes bisected for miles by unbridled Roosevelt Boulevard.

Pew's analysis dovetails with other recent Census data showing a spike in poverty in the Northeast and even, to be fair, postwar suburbs like it bordering the city. Imagine a report showing that a city the size of Pittsburgh had slid into significant impoverishment, with only a few sections remaining majority middle class. And the Northeast is only one of the neighborhoods covered in the Pew report.

What's happened beyond Center City, in other words, is no mere footnote. Each lost middle-class household means the city has less money to pay its bills. That means higher taxes, worse schools, and an even tougher climate for attracting businesses.

Masch is a native of one of the hard-hit neighborhoods, Kingsessing, in Southwest Philadelphia. But his consternation is rooted in more than street-level knowledge of how much these places have grown impoverished.

In the 1980s, as an aide to then-Council President Joseph Coleman, Masch crunched tons of numbers, he recalled, to grasp and respond to the large-scale population and job losses that were killing the city's revenue collection efforts.

"We had gone through several decades of higher taxes and reduced city services because the tax base kept shrinking," he said. "As it did, the number of people that needed city services, if anything, was increasing."

When Rendell began his first mayoral term in 1992, the city was on the precipice of bankruptcy. Rendell's middle-class replenishment strategy was to breathe new life into Center City while cutting taxes.

His successor, John Street, reoriented policy to emphasize the neighborhoods. As soon as he took over in City Hall, Street sent a fleet of tow trucks across the city to haul away abandoned cars. His two terms were highlighted by blight initiatives focused on redeveloping neighborhoods beyond downtown.

Today, a huge problem confronting the Nutter administration is the state of public schools. Tens of thousands of students have fled the problem-plagued district. And in survey after survey, including the latest on the middle class, Pew has found the schools remain a major factor as people consider moving out of the city.

Mayor Nutter's top commerce official, deputy mayor Alan Greenberger, said his focus has been on replacing the city's lost industrial jobs with more middle-class jobs in such sectors as clinical practice, biomedical research and energy. Just as important, he said, is attracting more hospitality jobs - he cited casino workers as one example - to open the door to employment for poorer residents.

Greenberger also was encouraged by the migration of highly educated twenty- and thirtysomethings into downtown in recent years. He said those residents could help lure suburban employers to relocate to Philadelphia, if only to replace their aging Baby Boomer ranks with younger employees unwilling to live in the faraway suburbs.

"If you convince yourself the situation is hopeless and beyond repair, you don't do anything," Greenberger said. "We have to do what we can do."



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