The Redistributive Power of City Government

At their best, cities are places where people of all income levels take the same train and play with their kids in the same park, bridging the gap and fostering a sense of community. In reality, the “tale of two cities” often seen in the differences between glittering downtowns and disinvested neighborhoods reveals the stark inequality found in our municipalities. In “City government and urban inequalities,” Professor Fran Tonkiss of the London School of Economics examines the ways that cities can reduce the inequities both exacerbated and created by the urban environment.

Investigating inequality in cities requires examination of what Tonkiss defines as pre-distribution: “the conditions which underlie any system of market distribution or state forms of redistribution.” What this means is that redistributive efforts don’t operate in a vacuum, and their efficacy is determined by the allocation of resources already in place. Food stamps, for example, are far less effective in promoting nutrition and reducing food insecurity for residents of food deserts than they are for people with greater access to fresh food.

In the urban context, the racial and socioeconomic disparities seen across the country are often amplified and accelerated by their particular pre-distribution of resources. Historic forms of discrimination and distribution have created the playing field we now inhabit. For example, cities across the United States have an enduring racial wealth gap and deeply segregated schools that were created by the housing policies of the twentieth century. Higher income residents tend to live in wealthier neighborhoods and receive more city services, easier access to public transportation, and higher quality public schools. In fact, Tonkiss finds that the benefits enjoyed by wealthy residents “outstrip their nominal income gains,” meaning that the value of living in a “higher quality” neighborhood is greater than the extra cost. Businesses are more likely to open new locations in higher income neighborhoods, which creates more jobs, providing benefits to the existing residents and drawing in more, which in turn spurs more investment. The flip side is true as well. Lower income neighborhoods often see public schools close when people move out of the neighborhood in search of better opportunities, which reduces the tax base and enrollment, making it more likely that more schools will close in the future. Unequal pre-distribution of wealth and resources provide the conditions for these cycles to continue, compounding and further entrenching income inequalities.

The inequities described above are not inherently urban, but the characteristics that can make cities appear to be great equalizers — density, ease of movement, municipal services — bring these disparities into sharper relief. The COVID-19 pandemic in particular has demonstrated the ways that pre-distribution compounds the relative advantage and disadvantage between neighborhoods; researchers have found that areas with the highest percentages of people living in poverty, crowded households, and under intense segregation experienced higher death rates than the country as a whole.

While it is true that city governments have limited ability, compared to state or federal governments, to enact policies that could meaningfully redistribute income, they have significant capacity in areas that affect the pre-distribution that reflects and entrenches income inequality. Equity-focused policies can level the playing field by providing the same quality of city services and public investment to all city residents, regardless of income. Tonkiss identifies four areas where city policy can make the most impact: distribution and deliberation, housing and planning, environment and infrastructure, and urban citizenship.

Though typically unable to tax income at the same level as the federal government, urban governments still have enormous power over the distribution and deliberation of spending the funds they do have. Cities can advance equity not just by where they distribute funds, but how: they can use processes like participatory budgeting to bring in underrepresented voices and new perspectives to challenge old, inequality reinforcing patterns of distribution. Cities also have significant leverage in their own economies; Tonkiss notes that “staff costs take the single largest share of subnational public budgets in the OECD, while city and regional governments are responsible for almost half of all public procurement,” making municipal budgets and expenditures a powerful pre-distributive tool to set higher wage and workplace standards in addition to using their redistributive legislative powers to raise their minimum wage or combat wage theft. These measures can ensure that the benefits of a “good” job — schedule stability, insurance, the right to a union — are available to every worker.

Municipal tax policy can also challenge some of the unequal forces of the larger economy; cities can retool potentially regressive utility taxes or implement new taxes designed to redistribute excess profits enabled by historical inequalities. A land value tax, for example, could recapture some of a developer’s profit made by building apartments next to a new subway stop. Such a measure could provide the city additional funds to reinvest in public infrastructure and redistribute the additional wealth in a more equitable way, improving quality of life for all residents instead of creating another “good neighborhood” at the expense of another.

Urban inequalities have been driven in large part by market trends in property values and rents, making housing another area where cities can influence the pre-distribution of wealth and resources. City governments can counter housing market forces by protecting and increasing the supply of affordable housing and passing legislation to protect renters or low-income homeowners by restricting evictions or providing property tax relief.

Environmental protections go hand in hand with basic city services, and policies surrounding city water, sanitation, recycling, and transportation have significant impacts on quality of life. Municipal governments can prioritize transportation development for underserved communities, use zoning policy to prevent the concentration of polluting industries in low-income neighborhoods, and promote urban agriculture in food deserts. Transportation in particular is a powerful force — one’s ability to be a full resident and participant of their city is supported or limited based on where they are able to travel to access resources.

Finally, an equity-minded concept of urban citizenship would promote fuller participation and embrace all of a city’s residents, regardless of national citizenship. Access to job opportunities make cities an attractive place to live, especially for recent immigrants, and while urban governments cannot unilaterally enact immigration reform or accept more refugees, they can pursue measures to more fully integrate immigrants into the community and reduce any inequalities originating from national policy. Numerous North American cities have declared themselves “sanctuary cities” and do not cooperate with federal deportations; some have gone further and set up structures for non-citizens to participate in municipal government, including city specific ID cards and participatory budgeting.

In her research, Tonkiss is frank about the potentially limited capacity of urban governments to combat the deep roots of the societal inequities that shape our cities. However, just because cities cannot eradicate the roots of inequality does not mean that they cannot meaningfully and materially reduce inequality and provide a higher quality of life for all residents. As policymakers look for ways to repair the immediate harm of the pandemic on the most vulnerable members of society, it would be wise to use the tools already at their disposal to change the pre-distribution of the urban environment and rectify the structural inequities that made the crisis so devastating, and build stronger, more equitable cities for the future.

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Tonkiss, Fran. 2020. “City Government and Urban Inequalities.” City 24, no. 1-2: 286–301. https://doi.org/10.1080/13604813.2020.1739931.

Berkowitz, Rachel L., Xing Gao, Eli K. Michaels, and Mahasin S. Mujahid. 2020. “Structurally Vulnerable Neighbourhood Environments and Racial/Ethnic COVID-19 Inequities.” Cities & Health: 1–4. https://doi.org/10.1080/23748834.2020.1792069.