The Working Poor – One Million Strong in New York

There is a political battle brewing in Albany over $1.25. Raising the state’s minimum wagefrom $7.25 to $8.50 is a big deal for our politicians, but it’s an even bigger deal for the one million workers that would be affected.

These one million workers make just 82 percent of the federal poverty level for a family of three. Put differently, a person working 40 or even 45 hours a week at minimum wage still cannot break the poverty line. This should be unacceptable, especially among politicians who tout the importance of work in escaping poverty.

For nearly two decades prior to 1980, a minimum wage worker earned 108 percent of the poverty threshold and the purchasing power was 48 percent greater than it is today. And while 18 other states have minimum wages greater than $7.25, New York continues to lag behind, even as the gap between rich and poor in New York remains the highest in the nation.

New York needs to take this first step. And, to be clear, it should be just that – a first step. Because even if the minimum wage is raised to $8.50, those earners will still only make 95 percent of the federal poverty level—nowhere near a true living wage. While big banks continue to make millions for crashing our economy and vaporizing billions of dollars, the working poor are being left behind, with an hourly wage that does not match the true value of their work.

Data and statistics on the minimum wage can be found at the Fiscal Policy Institute.


FACT VS. SPIN: Who REALLY Lives in Rent-Regulated Housing?

The New York Times has a long history of virulent opposition to rent regulation, and its latest “news” article on the subject was predictably full of distortions.

While it has been relatively silent on the subject during the past decade, in the 1990s the New York Times editorial page relentlessly — and for the most part, dishonestly — attacked rent regulation in New York City and campaigned for its elimination.

Beginning with a 1992 editorial entitled “The Enduring Cost of Rent Control” — which, believe it or not, favorably cited former Vice President Dan Quayle on the subject! — the Times ed board has been obsessively, aggressively devoted to ending one of the major policies protecting affordable housing and tenants in New York City.

Indeed, in 1997, when then-NYS Senate Majority Leader (now convicted felon) Joe Bruno proposed abolishing rent regulation, the Times ed board cheered the effort on (see here and here and here) — and in the end voiced disappointment with the harmful compromise legislation that ultimately passed and which has dramatically weakened rent regulation.

So, it was no surprise to see the Times publish a “news” article this week that treated rent regulated housing as, of all things, a sort of vanishing perk for celebrities and well-heeled Manhattanites. Think we’re exaggerating?  Well, here’s how the piece begins:

Rent-controlled and rent-stabilized apartments carry mythic significance to New Yorkers starved for space. These are the high-ceiling homes featured in Woody Allen movies, the places secured by celebrities like Carly Simon, Cyndi Lauper and Ed Koch.

They are the reason that Monica on “Friends” was able to afford her apartment on a chef’s salary.

While the Times piece does go on to acknowledge that Monica “is a fictional character,” the rest of the article is a monument of distortions and fabrications, and very artfully leaves out virtually every important fact about rent regulation in New York City. To whit:

THE SPIN: The article portrays a New York City that consists almost entirely of Manhattan below Harlem, citing less than a half-dozen examples of tenants with low-rent apartments in Little Italy, the Lower East Side, and the Upper East Side – “awe-inspiring, teeth-clenching deals” culled from an “informal survey of some major landlords and real estate agencies….”

The only time the article refers to any part of New York City that is not in Manhattan, this astounding claim is made:

And outside of prime neighborhoods, the restricted rents are not such a great bargain, in many cases barely cheaper than what the apartments could fetch on the open market.

THE FACTS: The basic facts are that, the majority of rent-regulated tenants have low and moderate incomes; one out of four rent-regulated tenants is living in poverty; the large majority of rent-regulated apartments are located outside of Manhattan; and rent-regulated apartments remain much more affordable than non-regulated housing.

According to the U.S. Census Bureau’s 2008 Housing and Vacancy Survey (findings available here and here):

– Of the 3,327,078 housing units in New York City, nearly one out of three (1,023,248 units) is rent-stabilized and an additional 39,901 units are rent-controlled.

– In 2007 before the economic crisis, half of all rent-stabilized tenants earned less than $36,000/year.

– One out of four rent-stabilized tenants has an income below the Federal poverty line. In fact, more poor New Yorkers live in rent-stabilized apartments than in public housing.

– More than 70 percent of all rent-stabilized apartments are located outside of Manhattan.

– In 2008, the median rent for a aren’t-stabilized apartment was $925/month. While the median rent for a non-regulated apartment was $1,200/month, 30 percent more.

One way the Times article could have provided a more reality-based portrait of rent regulation would have been to talk to more tenants outside of Manhattan, and to talk to tenant advocates — but the article instead relies on real estate industry attorneys and other sources.

While the Times article attempts to portray rent regulated housing as a way that a few lucky, well-to-do Manhattanites have managed to cheat their way into paying fabulously low rents for vast, airy apartments — like Monica on “Friends” — the reality is far different. Rent regulation remains one of the most successful and effective policies to preserve New York City’s shrinking stock of affordable rental housing and to protect low-income and working class renters.

Mayor Bloomberg opposes living wage bill

Mayor Bloomberg has made it clear that he does not support a new bill being considered by the City Council–a bill that would require employers to pay living wages to all workers at city-subsidized projects. This idea would seem to make a lot of sense. When the City puts up taxpayer money to help developers, they should in turn be expected to pay their workers a living wage. In this situation, both parties benefit as well as the community. This is not rocket science. In fact, it is an all-around good business practice to pay your employees a decent wage.

Almost 20 other cities around the country have established some form of wage standards for city-subsidized projects. The mayor’s argument is, as usual, that this policy would hurt developers. But Mayor Bloomberg, what about the working poor? What about the people that are working over 40 hours a week and can barely feed and clothe their families? What about what hurts and benefits them? Oh right, I forgot. You don’t care.

We see the Mayor’s hypocrisy clearly when it comes to homeless policy. He will give developers every incentive in the book, but wants to charge working homeless families rent for shelter, which apart from being unusually cruel is also a disincentive to work. The new Department of Homeless Services Commissioner has been relentlessly promoting a “work first” approach to homelessness. Part of this new approach means that the City will now only give rental assistance (albeit short-term and inadequate assistance) to families who work at least 35 hours a week. But these families are working the types of low-paying jobs that don’t allow them to simultaneously take care of their families and pay their rent once the subsidy runs out. DHS’s own data states that these families make an average of $9.00 an hour.

Meanwhile, the majority of families won’t even qualify for this inadequate subsidy because they can’t find work (we do still have near 10% unemployment in this city), or they don’t work enough hours (a decision that is most often in the hands of their boss, not them).

This weekend I met a young homeless mother with two children, who were remarkably bright and social for their young ages. She has no high school diploma and not a penny to her name. The Mayor’s proposed solution to her plight: She should get a low wage job in order to receive a small amount of rental assistance for one or two years and then just hope for the best.

With the seemingly inexhaustible amount of money we have for developers, you would think we could come up with a more effective and humane policy than that.