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America's Most 'Unequal' Big Cities Exposed

Thanks in large part to Fed policies, if Neel Kashkari is to be believed, America as a whole has become a significantly more unequal country in the last five years. In fact, as a recent report finds, "if you look at the long-term trend, there's a really steady increase in inequality." But inequality is all about location, location, location; and, as Bloomberg reports, the idea that hard work leads to prosperity is increasingly becoming an American pipe dream, in some places more than others.

Bloomberg ranked big cities - those with populations of at least 250,000 - based on their inequality as measured by the Gini coefficients calculated by the U.S. Census Bureau (a Gini index of zero reflects absolute equality, while an index of one represents complete inequality).

New Orleans is the most unequal city in America, according to the Bloomberg ranking.

 

 

Areas with high levels of income inequality also often have diverse populations and high levels of residential segregation, according to a report last year from Mark Mather and Beth Jarosz at the Population Reference Bureau, a Washington-based non-profit group. New Orleans has both of those factors, with blacks making up 60 percent of the population in 2014 and often living in starkly different areas than whites.

 

"New Orleans has some very clear neighborhood segregation going on," Jarosz said in an interview. "The fact that it is the most unequal among the cities is not terribly surprising."

 

Inequality happens when there's a concentration of people at the highest and lowest ends of the income spectrum without much middle-ground in between. Big cities are often hotbeds for such conditions because they attract rich individuals who can afford the cost of living — think rents in New York City or Los Angeles — as well as lower-income households who need access to services that large municipalities can often provide.

 

"You get this concentration both of poverty and of wealth in the same space," Jarosz said.

 

Places with wide ranges of educational attainment also run into inequality issues, with higher levels of schooling linked not only to a person's ability to get a job, but what type of job and what they'll be paid.

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The U.S. as a whole has become a more unequal country in the last five years, with its Gini index climbing to 0.48 last year from 0.469 in 2009.

"The overall story is that inequality has been rising steadily for about the past three decades," Jarosz said. While changes from year to year are often small or nonexistent, "if you look at the long-term trend, there's a really steady increase in inequality."

Racially diverse cities also often exhibit higher levels of inequality, as minorities have lower incomes and higher poverty rates, Jarosz said. The median income for non-Hispanic white households was $59,622 in 2014, compared to $42,748 for Hispanic families and $35,481 for blacks, according to data from the Census bureau's American Community Survey.