Widening Gap Damages Social Sustainability

Editor's note: This is an editorial I wrote for The Wanganui Chronicle. Feedback so far has been very positive. I reckon it will also draw criticism in the Letters section next week. - Estwing

Social Sustainability under Threat in the River City

Today is the vernal equinox. Following a long winter, it is the day when hours of daylight equal hours of starlight. It is a day to ponder balance, Yin and Yang, equality.

I’ve lived in New Zealand for five years, and the more I’ve learned about the nation, the more concerned I become about its future. Please understand, however, that I specifically chose to come here to earn a Doctorate in education at the University of Waikato, and my wife and I have chosen to remain here after the completion of my degree. We very much enjoy living here, so much so that we chose to have our first child in our home in Castlecliff, Whanganui with the assistance of two amazing midwives. We are proud that she is a New Zealand citizen.

Obviously our daughter is precious to us, and we breath a sigh of relief every time we hear news of another school shooting in our native America, knowing this little girl will never face such horrific circumstances. But while New Zealand and the States differ dramatically with regards to firearms, they are not so different in terms of prison population per capita, drug abuse, and other social problems.

I recently flew back from Boston, after having celebrated with my parents their 50 years of wedlock. As my flight approached the North Island, I was handed a small slip of paper that asked, among other things, what was my primary occupation. After some consideration, I chose to write researcher, because that’s what I’ve spent the last four years doing – albeit unpaid.

The point is I feel like a researcher. In other words, thanks to excellent supervision at Waikato, and four years of writing and re-writing and re-writing and re-writing, my brain works differently than it did when I stepped off a plane in Auckland in June 2008. As a researcher, I seek out the best available information on a topic, and then attempt to build an argument in a clear and unbiased manner. What follows is just that.

A large and growing body of evidence suggests that greater income inequality leads to greater social problems such as crime, drug abuse, domestic violence, and teen pregnancy. Based on research by British social scientists Richard Wilkinson and Kate Pickett, New Zealand is among the top nations in both income inequality and social problems (see The Spirit Level: Why More Equal Societies Almost Always Do Better). Wilkinson appeared briefly in the TV3 documentary programme, Inside New Zealand: Mind the Gap, on Thursday, 29^th August in an interview with documentarian Bryan Bruce. During his brief appearance, Wilkinson made the disturbing observation that the income gap in New Zealand had grown even wider since he and his wife published their findings in 2009.

Alongside Wilkinson, Bruce’s doco included interviews with a wide range of economists and researchers from around the world, whose words reinforced those of the Brit, and stirred within me anxiety about my daughter’s future in an increasingly inequitable nation. Some say all politics is local, so I’ll limit the rest of my commentary to the Wanganui District Council, and present an argument that the current rates structure exacerbates income inequality in our city, which will likely result in more anti-social behaviour.

Before I build that case, it should be noted that no one, rich or poor, wants to see more crime, neglect and abuse in the River City, but that is the likely outcome if the WDC continues its trend of taxing the poor significantly more than the rich.

Using data provided by WDC in the Draft Annual Plan 2013-2014 Summary, I took out a calculator and set to work. Using capital and land values provided in Table 3 on page 3, I was able to determine that for the bottom five properties (lowest combined values) rates average 1.1%, and that for the top five properties (highest combined values) rates average 0.55%.

Put simply, those living in cheaper houses pay twice as much as a percentage of combined land and capital value as those living in expensive houses.

In addition, the movement in rates in Table 3 indicates that the bottom five properties could expect a rates rise of 5.9% while the top five properties could expect a rise of 5.4%. Put simply, the gap in rates will continue to widen, with those living in modest homes paying more year after year.

Combined with trends of increasing costs for food, power and petrol – which disproportionately impact low-income families – it would be unlikely to find anyone, even from the far right, who would admit the trend in our rates structure is sustainable. Yet here we find ourselves.

In many ways Whanganui is a great city, but we also face many financial, economic and social challenges. My fear is that our political leadership will not have the vision and courage to address its role in the widening gap identified by Bruce and others. Social problems associated with income inequality affect all of us, and in the end we all pay for them one way or another.

I grew up on the outskirts of Detroit, and I know full well what weak leadership can do to a great city. Motown’s recent financial bankruptcy, in my opinion, was made worse by a moral bankruptcy that has existed in the mayor’s office for decades. In many ways it’s too late for Motor City, but it’s not for the River City. Can our political leaders evaluate the best available social science research and make the hard decisions that are in the best interest of all residents? Will they choose to reverse the trend in rates that disproportionately impact the poor?

And finally, will Whanganui be the type of place our daughter will want to live when she helps us celebrate our 50^th wedding anniversary?