How America’s Mayors Are Taking the Lead on Income Inequality

They're doing what they can on this challenging issue, but they think it's a problem Washington and state governments should solve.
March 24, 2016
By Bob Annibale  |  Contributor
Leader of Citi's partnerships with global, national and local organizations to support inclusive finance and community development

Earlier this year, Boston University's Initiative on Cities published its inaugural Menino Survey of Mayors, named in honor of Thomas Menino, the late urban visionary who served as mayor of Boston for two decades. The nonpartisan survey, conducted in partnership with the U.S. Conference of Mayors, took the pulse of nearly 90 mayors on many of today's most pressing urban issues. Press headlines understandably focused on the top policy priorities cited by the mayors, namely greater federal funding to fix crumbling infrastructure and the need for urgent reforms to community policing.

But the survey also contained valuable insights on a range of other topics including housing, municipal finance and the state of local governments' relations with state and federal lawmakers. As someone who works with mayors across the country on expanding financial access and affordability and bolstering household financial resilience, I was particularly interested in the perspectives of mayors on the issue of income inequality -- one that cuts across all levels of government.

So what did we learn? Compared to areas like crime or local tax rates, mayors believe income inequality is an area over which they have neither a great deal of control nor a great deal of accountability to constituents. While that might lead us to expect mayors to do less, the survey shows the opposite to be true: Many of America's mayors are aggressively pursuing a wide variety of policies and tactics that target household financial insecurity and income inequality.

The survey finds that mayors of larger cities have, on average, five programs dedicated to addressing income inequality (and many mayors have more). Even in smaller cities, mayors are pursuing an average of four programs deliberately targeting the economic challenges faced by their residents. Mayors rely heavily on job training and other workforce-development programs; affordable housing; and expanding access to federal social services such as the Supplemental Nutrition Assistance Program. Some mayors are going even further, with efforts to raise minimum wages in cities including Seattle and Los Angeles and tax-filing assistance campaigns aimed at lower-income households in New York.

With greater dynamism and innovation, mayors are taking the lead in addressing growing household financial insecurity among their constituents. But unfortunately, going forward there is growing evidence that their task is getting more difficult. Research conducted by the Corporation for Enterprise Development , for example, shows that 44 percent of the nation's households lack enough savings to sustain themselves -- at the federal poverty level -- for three months in the event of an unexpected interruption to income. For a growing number of households, a job loss, a medical bill or a car repair can have devastating long-term consequences.

It is essential that families build their savings so they are resilient in the face of the financial shocks we all expect but never seem ready for. Yet according to the Menino survey, across the country less than 40 percent of mayors are actively focused on financial counseling and education, and less than 20 percent have programs focused on expanding financial access.

As mayors know first-hand, the need for leadership at all levels of government in addressing rising household financial vulnerability is real and urgent. Through programs like Bank On, aimed at improving the financial stability of families that need banking services, and innovative college savings programs like San Francisco's Kindergarten to College program, cities are beginning to experiment with new municipal strategies that actively promote financial empowerment and inclusion. The rapid spread of financial vulnerability means we need to ensure that these efforts are successful and scalable.

As Mayor Menino once said, "Cities are full of energy and promise these days. But they are also full of challenges -- of environmental threats, of educational roadblocks, of growing inequalities." Until there is constructive consensus at the federal and state levels, we will continue to rely on mayors to be innovative and bold in their efforts to address these complex issues.