If 1 in 8 Americans is currently on food stamps then household budgets are clearly stressed enough to be affected by changes in the price of gasoline. Given that oil (and gasoline) made its biggest advances starting in 2004, it was revealing to see the latest study on poverty from the Brookings Institution. Their study showed what many in the peak oil community have been forecasting for years: poverty growth in the US between 2000 and 2008 was strongest in the suburbs:
By 2008, suburbs were home to the largest and fastest-growing poor population in the country. Between 2000 and 2008, suburbs in the country’s largest metro areas saw their poor population grow by 25 percent—almost five times faster than primary cities and well ahead of the growth seen in smaller metro areas and non-metropolitan communities. As a result, by 2008 large suburbs were home to 1.5 million more poor than their primary cities and housed almost one-third of the nation’s poor overall.
It’s equally unsurprising that many of the mega-suburban regions like Florida and Southern California were picked up in the Brookings study as being particularly hard hit in the 2007-2008 period. The price of oil started its march higher in 2004 but of course the most punishing gasoline prices came in in 2007 and 2008. Just as you would intuit, large populations tied to the automobile and with few public transport options took the biggest hits:
Western cities and Florida suburbs were among the first to see the effects of the “Great Recession” translate into significant increases in poverty between 2007 and 2008. Sun Belt metro areas hit hardest by the collapse of the housing market saw significant gains in poverty between 2007 and 2008, with suburban increases clustered in Florida metro areas—like Miami, Tampa, and Palm Bay—and city poverty increases most prevalent in Western metro areas— like Los Angeles, Riverside, and Phoenix. Based on increases in unemployment over the past year, Sun Belt metro areas are also likely to experience the largest increases in poverty in 2009.
Jeff Rubin has a very good post up on his new website, making the same case that many of us have made for years (and especially since the financial crisis hit). And that’s this: the unsustainable nature of the automobile complex has been known for some time but was revealed in spectacular fashion during the triple-digit-oil price period. And thus it’s really a form of craziness that the government went ahead and invested in Detroit Autos after the collapse of the credit bubble. | see also my May 2009 post: Lost Pearblossom Highway.
Photo: Ed Ruscha, 34 Parking Lots in Los Angeles, 1967
Document: The Suburbanization of Poverty: Trends in Metropolitan America, 2000 to 2008, Brookings.