Wealthy (2004)

Download wealthy_2004.pdf

4.1 Income 

In 1999, per capita income in Lake and LaPorte Counties lagged behind the state average of $20,397. In contrast, per capita income in Porter County stood at a significantly higher level. This does not, however, tell the whole story. This analysis examines differences across three dimensions: race, family structure and community.

The percentage of households in the region with total incomes of less than $20,000 per year should be alarming to policy makers. More than a fifth of all families in Northwest Indiana subsist on total household incomes of less than $20,000 per year, a modest amount by any calculation.

Table 30: Per Capita Income in Dollars (Tax Year 1999)

Lake		LaPorte	Porter	Indiana
Total	19,639	18,913	23,957	20,397
Source: NIRPC

A breakdown of this data along racial and ethnic lines is even more disturbing. More than one-third of all African-American families in Lake County report household incomes below this threshold. The comparable figure for LaPorte County is 32.6%. And nearly a fourth of all Hispanic families in Lake County subsist on less than $20,000 per year.

Table 31: Percentage of Households with Less than $20,000

Income (Tax Year 1999)
Lake		LaPorte	Porter	Indiana
White Householder(s)	17.5	19.6	14.9	19.4
African-American Householder(s)	36.8	32.6	14.5	34.8
Hispanic Householder(s)	23.4	21.0	12.4	23.3
Source: U.S. Census Bureau

Similar disparities can be found between households headed by married couples and single householders, particularly female householders. In 1999, the average income in female-headed households in Lake County stood at $25,122, less than 64% of the comparable amount for male-headed households. In LaPorte County, the average income in female-headed households was only $25,205; the difference between female- and male-headed households was somewhat less, however. In Porter County, the base for both female and male-headed households was significantly higher; nevertheless, the disparity between the two was even greater than in Lake County. Family income in female-headed households is lower

– and in most cases much lower – than in households headed by males and in households headed by couples.

Table 32: Family Income in Dollars (Tax Year 1999)

Median		Mean
Lake County
Married Couples	59,619	68,957
Male Householders	39,435	47,445
Female Householders	25,122	31,595
LaPorte County
Married Couples	54,860	62,254
Male Householders	36,901	47,265
Female Householders	25,205	31,044
Porter County
Married Couples	67,052	79,117
Male Householders	44,810	47,271
Female Householders	31,710	37,392
Source: U.S. Census Bureau

These disparities are even more evident when median income is disaggregated by municipality. The $44,840 difference in the median incomes of St. John and the City of East Chicago in Lake County is noteworthy. The median household income in East Chicago is less than 38% that of St. John. In LaPorte County, the $37,632 difference between Long Beach’s median household income and the median for Michigan City is also significant. The median in Michigan City is less than half that in Long Beach. As might be expected, the distribution of household incomes in Porter County is more homogenous in nature. Nevertheless some differences do exist.

Table 33: Median Household Income (Tax Year 1999)

Location $

Dune Acres 94,843 Ogden Dunes 76,924 St. John 71,378 Long Beach 71,364 Winfield 65,641 Munster 63,243 Dyer 63,045 Schererville 59,243 Beverly Shores 59,107 Chesterton 55,530 Burns Harbor 53,929 Crown Point 52,889 Highland 51,297 Wanatah 50,625 Porter 50,625 Kouts 44,850 Cedar Lake 43,987 Trail Creek 43,750 Hebron 42,103 Town of Pines 41,875 Pottawattamie Park 37,500

Table 34: Poverty Rate (Tax Year 1999)

Lake Station	36,984
Westville	36,761
LaCrosse	36,667
Hammond	35,526
LaPorte	35,376
Whiting	34,972
Michigan City	33,732
New Chicago	32,759
Kingsford Heights	32,169
Gary	27,195
East Chicago	26,538
Source: NIRPC

It should be obvious that these dramatic differences in household income correspond closely with differences in the racial and ethnic makeup of Northwest Indiana’s towns and cities. As is noted above, Northwest Indiana remains the second most segregated region in the county. This is not to say that equality of economic opportunity should be confused with equality of economic outcomes. Indeed, it would be surprising if few differences among the mean household incomes reported by communities in Northwest Indiana were reported. Nevertheless, the feedback loop that exists between a lack of economic opportunity and economic outcomes has been well-documented. Schools that perform more poorly, limited access to jobs, high crime rates and inadequate transportation systems contribute in a significant way to poorer economic outcomes. As a community becomes poorer, the very infrastructure that is needed to assist individuals and families in lifting themselves out of poverty deteriorates. A self-fulfilling cycle can ensue.

The key question is this: Can a high quality of life be achieved in a region that manifests such a deep and growing divide between “those who have” and “those who have not”? The answer, we think, is no. Over time, a chasm of this sort can only rebound to the detriment of everyone who lives in Northwest Indiana.

4.2 Poverty

To this point, we have concentrated on income as an indicator of opportunity. Poverty can be understood as a complementary phenomenon. An absolute measure of poverty is used in the United States to establish eligibility for certain governmental programs. It was originally established in 1962 based on the concept of a market basket of food products and assumed that food costs represented one-third of a poor household’s total expenses. The poverty rate is updated every year to account for inflation. It now stands at $12,400 per year for a family of two that includes one child and $18,244 per year for a family of four that includes two children.

Lake		LaPorte	Porter	Indiana
All Individuals	17.5	19.6	14.9	19.4
Children under Age 18	36.8	32.6	14.5	34.8
Source: Indiana  Business Research Center

Although the poverty rate is widely criticized for a variety of reasons, most notably that it fails to account for persistent inflation in housing costs in recent years, it does provide a measure of stability to our ongoing assessment of the complex phenomenon of poverty. Alternative measures of poverty have been developed over the years. The Indiana self-sufficiency standard, for instance, subtracts certain federal subsidies from the local costs of housing, childcare, food, transportation and healthcare to calculate a county-specific self-sufficiency wage. In 2002, the self-sufficiency wage for a single adult and one infant residing in Lake County was $13.00 per hour or $27,446 annually. The comparable rates in LaPorte County and Porter Counties respectively were $10.86 per hour or $22,944 annually and $13.72 per hour or $28,967 annually. Developed by the Indiana Coalition on Housing and Homeless Issues, the self-sufficiency standard testifies to the conservative nature of the federal government’s poverty standard and the uphill nature of the battle that working families, in particular, face.

Three traditional measures of poverty are included in this section of the report: the poverty rates for all age cohorts and for children; poverty disaggregated by race per county and welfare assistance and food stamp eligibility. The pervasive nature of poverty is evident even in these more conservative indicators of poverty. It is increasingly commonplace in large urban centers and a phenomenon associated with minorities and children. In Lake County, 17.8% of children were poor at the close of 1999. The LaPorte County experience mirrors the experience of the state as a whole, with just over one in ten children living in poverty. Porter County fares much better in this regard.

African-Americans and Hispanic citizens experience much higher levels of poverty than do White citizens. At 25.6% and 21.7% respectively, the proportion of African-Americans in Lake and LaPorte County who live in poverty is comparable to the proportion for African-Americans statewide. As is the case statewide, the poverty rates for Hispanics in these two counties lies between the rates experienced by Whites and African-Americans. All races in Porter County fare better than do their respective counterparts in Lake and LaPorte Counties.

Table 35: Poverty Rate by Race (Tax Year 1999)

Lake LaPorte  Porter Indiana

White 6.5 7.1 5.7 7.8 African-American 25.6 21.7 8.7 23.2 Hispanic 15.6 17.9 8.2 17.8

Source: U.S. Census Bureau

Eligibility for public assistance programs declined from 1990 (AFDC) to 2001 (TANF) by 21% in Lake County, 39% in LaPorte County and 36% in Porter County. Eligibility rolls in the state as a whole declined by 25% over this same 11-year time period. In all, 1.8% of Lake County residents, 0.6% of LaPorte County residents and 0.2 % of Porter County residents receive TANF benefits. Finally, the number of citizens who receive food stamp benefits in Northwest Indiana has been stable over the last 12 years. In all, 10.5% of Lake County residents, 5.7% of LaPorte County residents and 2.5% of Porter County residents receive food stamps.

Table 36: Temporary Assistance for Needy Families (TANF), Monthly Average (2003)

Lake LaPorte Porter Indiana

2003 (TANF) 10,145 877 497 52,478 1990 (AFDC) 11,245 1,121 507 52,732

Source: Indiana Youth Institute

Table 37: Food Stamps, Monthly Average, (2003)

Lake		LaPorte	Porter	Indiana
2003	61,313	8,699	6,362	452,654
1990	51,836	6,787	3,179	315,742
Source: Indiana Youth Institute

Poverty is a complex phenomenon. Several of the factors identified elsewhere in this report can be viewed either as causes or effects of poverty and sometimes both. It is essential, however, that we call attention to one factor that is closely associated with poverty: the incidence of non-marital births.

Table 38: Non-Martial Births as a Percentage of All Births

(2003)
Lake		LaPorte	Porter	Indiana
2003	49.0	44.9	29.1	36.5
1990	39.3	31.0	15.8	26.2
Source: Indiana Youth Institute

In fact, we are in the midst of a 30-year epidemic in non-marital births. Nearly half of all births in Lake County now occur outside of marriage. Nearly 40% of all births in LaPorte County are to single parents. Even in Porter County, which enjoys a significantly lower rate of non-marital births than do Lake and LaPorte Counties, one quarter of all births are to unwed mothers. The dramatic rise in the number of grandparents in all three counties who raise their grandchildren also testifies to this significance of this social challenge.

Table 39: Grandparents Responsible for Grandchildren

under Age 18, (2000)
Lake		LaPorte	Porter
Number	5,804	919	908
Source: U.S. Census Bureau

The close association of poverty and a whole host of adverse outcomes with out-of-wedlock births should sound an alarm among governmental officials, the nonprofit community, school systems and the religious community.

Grade: D Trend: Stagnant

The grade of “D” is assigned to this domain in recognition of the significant and growing divide that exists between “those who have” and “those who have not” in Northwest Indiana.

Goal: The Quality of Life Council recommends that nonprofit organizations in Northwest Indiana, including the religious community, intermediary organizations such as the United Way, and community organizations of various kinds, dedicate themselves to a 20% reduction in poverty among the region’s impacted populations, most notably African-American and Hispanic citizens and their children, by the year 2010. Income and poverty statistics should be used to track performance in this regard.

We have no illusions about the difficult nature of this task. As is noted above, poverty is a complex phenomenon that is deeply ingrained in the fabric of our society. We believe, however, that a focus on children and families can be successful. Regardless on one’s perspective on the fundamental cause of poverty – whether its is social or personal in nature – there is broad agreement that children living in poverty are not responsible for their disadvantaged circumstances and that children are generally best raised in the context of a two-parent household. We believe that this common ground provides a sufficient foundation for a community-wide crusade against the persistent poverty that plagues the region. Lacking progress on this issue, it will be difficult for Northwest Indiana to claim to be a true community of opportunity.

Actions: The above goal addresses two of the Quality of Life Council’s three fundamental concerns. Although specific action steps identified in other sections of this report promise to ameliorate, at least to some extent, the incidence and effects of poverty, three additional action steps are appropriate here.

The United Way organizations of Northwest Indiana should coordinate a sustained region-wide focus on the wellbeing of children and families. Although this effort should be led by the nonprofit sector, the support of the public sector and the private sector should be enlisted as well. Preliminary steps in this regard were taken in March 2004, when the Northwest Indiana Quality of Life Council joined the region’s three United Way organizations in sponsoring a conference on partnering which featured representatives of the National Fatherhood Initiative and the Indiana Youth Institute. A great deal more work will be required at the community level, however.

Innovative programs that promise to reduce the incidence of teenage pregnancy should be identified, funded, implemented, evaluated and, if successful, replicated throughout the region.