income inequality

In Your Face Income Inequality

Photo credit: Devostock

 

In Your Face Income Inequality

The delivery trucks have been driving on a driveway next to mine in the rural Berkshires of western Massachusetts for eight months. They drive home (no pun intended here) income inequality in a way that other experiences cannot.

The home that I write about here is a second home on well over thirty acres of farmland. There are two separate houses on the land and a gargantuan pool building beside an outdoor pool. The houses and land sold for about $1 million in 2013, and two major construction projects have gone on there since its purchase. This real estate is similar to scores of others in the area that are lived in for only  weeks out of the year. Many of these homes have the same pristine, well-manicured dollhouse appearance.

Compare the latter with the fact that the population of the Berkshires (the hills and small mountains in this part of Massachusetts) has been falling for decades. A perusal of the job ads in the area showed hourly wages for average people pegged at around $12.

Back to the house on the hill. The current remodeling that has gone on for the better part of a year must have cost somewhere in the neighborhood of $500,000 I am no expert at this cost guessing, but I probably am close in this estimate and this is the second time the homeowners have remodeled this real estate since 2013. Suppose the cost was $200,000 or $300,000, the point would be the same.

Even if my estimate is not accurate, readers can figure out the rough finances of people who can afford to spend such amounts on a house or houses they do not even live in full time. But the reconstruction is a boon to local craftspeople who have the skills because as mentioned earlier, average people are leaving the area due to the lack of economic opportunity and school enrollments are dropping, which create a whole other issue for financing school costs. Readers can conclude that it would be impossible to own the house on the hill, or any other house on a $12 an hour income. Rents are also high in the area, a fact that always follows on the heels of high housing costs.

There is a small professional class of people in the area besides the craftspeople and small business owners.

What matters here is that there is a class of people that has grown since the tax cuts of the Reagan administration with lots of disposable cash in their pockets. Trump’s tax cuts and the movement of money to those already wealthy will fuel more of the same, with more people coming to this area buying and building large homes that some people will live in and some with live in for only several weeks of each year.

The local taxes generated by these real estate sales is a great advantage for small towns because people who invest in these homes rarely use up a lot of local services. They do employ local craftspeople and spend money at small businesses.

According to the 2000 census, the median household income was $50,000 and family income was $60,104 in the Massachusetts town where the house on the hill is located. Sixteen years later, the estimated per capita income was $63,355 and the estimated median household income was $74,805. With much of the income “hidden” by out-of-state home owners, readers can easily grasp why people such as  the owners of the house on the hill and others are having a great time with more money in their pockets as opposed to paying for some of the programs of social welfare and social uplift upon which both the New Deal and the Great Society were based. Providing a hand up is passé; big homes are all the rage.

Howard Lisnoff is a freelance writer.

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