rich get richer, poor get the picture

For richer and poorer

City faces the costs of a growing gap between haves and have-nots

The Georgia Straight

December 7, 2006

By Nick Rockel

Down Alexander Street, on the wrong side of Gastown, a popped umbrella lies flattened on the curb. Storms have delivered the heaviest rain in decades, and fierce winds rip through the Downtown Eastside, where Vancouver’s poorest are gathering on this sodden mid-November after­noon. Some have parked their shopping carts outside the Evelyne Saller Centre, a drop-in facility for low-income and special-needs people. Run by the City of Vancouver, the province, and local residents, it served 361,000 meals in 2005.

Those who need a warm, dry place to sleep head down the block to the Lookout Emergency Aid Society’s Downtown Housing Centre. And if they’re lucky, there might even be a vacancy. With 44 beds, the centre is one of four Lower Mainland shelters operated by Lookout, which took in 4,200 homeless last year and turned away another 5,500. "We don’t just house people at night and put them out on the street," says manager Al Mitchell in the modest lounge and dining room. Besides a couple of men sitting on sofas and some grizzled-looking types smoking out front, things are quiet. But, as always, by nightfall every bed will be occupied.

Lookout, founded in 1971, survives on a cocktail of federal, provincial, and private funding. Describing itself as "The housing safety net for the social-service system", it combines emergency accommodation with longer-term transitional housing. Looking in on one of his Spartan rooms, most of which sleep two, Mitchell tells the Georgia Straight that privacy for the homeless is a fairly new concept. "When this building was built in 1981, it was a radical departure," he recalls. "It took a lot of argument to get the government to agree to rooms. The idea was just put mats on the armoury floor."

Perversely, Mitchell relates, our mild winters mean the homeless die in hospital from exposure-related ailments rather than freezing outdoors, where they’d be counted as street deaths in other cities. Avoiding such tragedies takes much more than shelter.

"We have found that if all you do is give people a roof and a bed and some meals, in this community four percent will be dead the next year," Mitchell says. "Two people out of everyone staying here will be dead." But if his outreach team follows up with guests—getting them to their medical appointments, keeping them stabilized in their housing—that percentage drops to 0.4. "And that’s all I ask," he says of this 10-fold improvement. "I tell my staff, ‘Just keep ’em alive to be a problem next year.’"

Homelessness will be a problem in this city for years to come. But, sadly, it’s only the most visible sign that Vancouver is becoming a society of haves and have-nots. As well as causing pain and suffering for the very poor, that divide has left tens of thousands of other residents vulnerable to poverty too. So far, the provincial and federal governments have barely confronted the crisis, even though their policies help fuel it. Meanwhile, business groups say inequality makes Vancouver a less attractive place to live and to visit. It may also leave us a sicker city from top to bottom. International studies show that developed societies with a larger gap between rich and poor have worse overall health—even among the wealthy.

Throughout the region in 2005, the Greater Vancouver Homeless Count found 2,174 people living on the street and in shelters. That’s almost double the previous count in 2002, and the Social Planning and Research Council of B.C., which publishes the data, admits that it’s a conservative figure. The 2005 tally turned up more street than sheltered homeless: the former category swelled by 235 percent, or 800 people. One-third of those surveyed had been homeless for more than a year. Excluding transition houses, in October the GVRD had just 965 shelter spaces, 674 of them year-round.

Other grim statistics deflate Vancouver’s smug self-image as a land of opportunity. Yes, we’ve got solid economic growth, low unemployment, and the highest real-estate prices in the country. But in Canada’s least-affordable city for home ownership, the days of the cheap basement suite are long gone. In 2005, the average Vancouver two-bedroom apartment rented for roughly $1,200. The previous year, we topped all major Canadian cities for low-income earners: 17 percent of the workforce, versus 13.7 in second-place Montreal. The federal low-income cutoff for single residents in this group was $1,400 a month after taxes.

"If you can afford the latte lifestyle of a condominium on whatever floor, the West Coast is a great place to live," Mitchell says. At Lookout’s shelters, though, 20 percent of clients are working poor, many of them new in town. "We continually find people for whom moving out here has been a rude shock in terms of the expense, the difficulty of buying housing."

In other firsts, BC Stats reports that British Columbia—flogged by Premier Gordon Campbell as "The Best Place on Earth"—has the worst gap between rich and poor of any province. In 2004, the average market income (total income minus income from government programs) of poor families was $8,800, compared to $147,700 for rich ones. Topped up with government income, the poor still only earned 16 percent of what the rich did. Also in 2004—for the third year running—B.C. led the provinces in child poverty, according to a new ?report by BC Campaign 2000 and the First Call BC Child and Youth Advocacy Coalition. Nearly one in four kids was poor, versus one in six nationwide.

"The depth of poverty for people on income assistance, and particularly single moms, is just astoundingly shameful," First Call community-mobilization coordinator Adrienne Montani tells the Straight. In 2004, poor B.C. single-parent families headed by women were an average of $11,400 below the poverty line. Among the report’s recommendations: a 50-percent increase in welfare rates and an affordable public child-care system.

Want proof that the rich are getting richer while the poor get poorer? Between 1993 and 2004, Statistics Canada data reveals, the average annual wage of the poorest 10 percent of B.C. families with children fell from $14,824 to $14,475. The richest 10 percent got a big raise: their average wage jumped 47 percent, from $143,338 to $211,195.

The middle class is also taking a hit. In its recent 2007 budget submission to the provincial government, the local office of the Canadian Centre for Policy Alternatives noted that B.C. families had a 2004 median market income of $53,600. Adjusted for inflation, that’s $300 less than in 2000, right before the B.C. Liberals came to power.

With skeletal social spending, the B.C. Liberals have not only fuelled more homelessness but fallen out of step with concerned residents across the city.Politicians beware: average voters are anxious and resentful. Last month, the CCPA released the results of an Environics Research poll of 2,000 Canadians, half of whom said they’re always a paycheque or two away from poverty. Three-quarters of respondents believed the rich-poor gap has grown since a decade ago, and 65 percent said the benefits of Canada’s economic growth have gone mostly to the rich. Seventy-five percent worried that a widening gulf between rich and poor will lead to more crime and make Canada like the U.S., where gross inequality is entrenched.

As these troubling stats grab public attention, it’s tempting to regard the B.C. Liberals’ low profile as no coincidence. Campbell recently said the province will raise its welfare shelter allowance—now $325 a month for single recipients—for the first time since 1994. But he also cancelled the fall legislative assembly, curtailing debate over his government’s other welfare policies, which discourage the needy from seeking help.

City of Vancouver politicians haven’t escaped so easily. Mayor Sam Sullivan and his Non-Partisan Association are scorned by activists, who accuse the NPA of dragging its feet on poverty and homelessness. In a recent Web poll by the mayor’s office, 84 percent of some 2,500 respondents said public disorder—including people sleeping and defecating in the street—has become worse in Vancouver over the past five years.

On November 27, Sullivan announced Project Civil City, whose marquee pledges are minimum 50-percent reductions in homelessness, open drug-dealing, and so-called aggressive panhandling by 2010. "I believe that I’m the first mayor to actually set targets for homelessness," Sullivan tells the Straight. However, the Pivot Legal Society fears Vancouver will hit a different target in its Olympic year. Barring a plan that tackles root causes, Pivot says, a combination of scarce low-income housing, rising rents, and new immigration will push the city’s street-homeless population to 3,000, triple its 2005 number.

At its roots, Lookout’s Mitchell says, Vancouver inequality is a housing issue. Elsewhere in the province, people can still find accommodation for the welfare rate, meagre as it is. But here, where real-estate prices have doubled in five years, there’s no motivation for developers to build or maintain rental apartments when they can turn them into condos instead. Marc Lee, senior economist at the CCPA’s B.C. office, agrees with Mitchell. "The reality is that the private market doesn’t do a good job of building housing for low-income people and middle-income people," he tells the Straight.

Sam Sullivan has more faith in the marketplace. City Hall owns or has options on 19 vacant lots earmarked for social housing and plans to create 500 new units in the next two years. Sullivan notes that because of Vancouver’s small municipal tax base, funding must come from the provincial and federal governments. As far as overall affordability goes, he hopes residents will spur developers to build cheaper housing by embracing the city’s EcoDensity initiative. "The price of anything is related to supply and demand, and if we can dramatically increase the supply of housing, we will have downward pressure on the price," Sullivan says.

Still, the mayor doesn’t believe Vancouver should copy Richmond by banning the conversion of rental suites into condos. "It might be possible as a short-term solution, but you’ll drive away investment," he claims. "We need more housing, and if you simply prevent conversions in that way, you ensure that prices will go up even higher."

Greater Vancouver Regional District research shows that one-third of its households have trouble finding and keeping affordable housing. The 2001 census spotted more than 126,000 Greater Vancouver residents at risk of homelessness. Last month, the GVRD released a draft $250-million-a-year housing strategy that calls for $100 million each from the feds and the province.

How much the federal government will help is debatable. In 1993, then–?finance minister Paul Martin stopped all funding for new affordable housing, a move he followed by gutting social-service transfer payments to the provinces and eliminating national welfare standards. Ottawa stayed out of housing until 2002, when it began offering limited cash. Diane Finley, federal Minister of Human Resources and Social Development, did not respond to an interview request.

And Victoria? B.C. has no comprehensive, publicly accessible anti­poverty plan. After getting elected in 2001, the B.C. Liberals axed the Homes BC program, which used to construct new affordable housing annually. Since then, the provincial waiting list for available units has climbed from 10,000 to 14,000. It takes three to five years to reach the front of the line.

In October, Rich Coleman, the minister responsible for housing, announced another new strategy, the long-awaited Housing Matters BC. It will provide $40 million in rental assistance to working families who earn less than $20,000 a year, and it commits to building 450 more units of supportive housing provincewide.

NDP housing critic Diane Thorne admits that rent supplements will help some people, but she is disappointed by the strategy. "It falls far short of both what we need and what we expected," Thorne says, pointing out that in addition to its strict income rules, the subsidy is off-limits to people without children or a fixed address. Besides, she adds, this cash doesn’t address the real problem: long waits for shelter.

Thorne chastises the B.C. Liberals for diverting federal affordable-?housing cash into the health-care system, where it builds assisted-living units for seniors. She also refers to a June 2005 draft discussion paper by the Housing Ministry’s policy branch. It says that during the next decade, B.C. must build 3,150 new units of affordable housing a year to keep up with demand. In 2007–08, the provincial target is 925 units. "So the minister knows that the strategy is not going to do anything to address this issue," Thorne charges. Coleman did not reach the Straight by deadline.

Mitchell thinks the current system does little to break the cycle of homelessness. "Nobody on the street gets a place to live unless somebody else is kicked out," he says. And if Vancouver expects its vaunted economy to keep growing, Mitchell cautions, it must invest in affordable housing like it does in highways. "You’ve got to house your workers somewhere," he bellows. "My goodness, plantation slave owners understood this."

Cheryl Prepchuk, executive director of the Greater Vancouver Food Bank Society, has seen some revealing patterns emerge in Lower Mainland food lines. For one, the region’s overall food-bank use dipped slightly in 2005, but increased outside Vancouver proper. "So that tells us that people are moving out of the city if they can and trying to go to the suburbs, where housing is a little more affordable," Prepchuk tells the Straight.

She also says a drop in food-bank clients on welfare has coincided with an upswing in hungry working people. "In terms of that sector of the population growing, we could go further to say, ‘Yes, things are getting worse,’" Prepchuk ventures. "Because now people are no longer on social assistance: they’re working and they’re no further ahead." The Canadian Association of Food Banks reports that 81,248 British Columbians used its services in March 2006, up 7.7 percent from the previous March.

First Call’s Adrienne Montani ?accuses the B.C. labour market of failing to provide a whole underclass of workers with a living wage, enough hours, or both. "The line often is, ‘A job is better than welfare,’" says Montani, who wants the $8 provincial minimum wage raised to $10. "And that’s not true for some families, particularly for single-parent families, most of whom are women."

To make things even tougher, she says, working families with low annual incomes find themselves ineligible for child-care subsidies and other benefits. "They’re living in poverty compared to the actual expense of living here," Montani explains. B.C.’s Minister of Employment and Income Assistance, Claude Richmond, did not make himself available for comment.

Craig Meredith is the executive director of the Federation of Child and Family Services of B.C., and he believes the province is counting on cash-strapped charities to pick up the slack. In his opinion, the B.C. Liberals are hung up on fixing social problems like crime and drug addiction rather than preventing them in the first place.

On October 16 in Victoria, Meredith warned the government it must spend an extra $2 billion annually to rescue the social safety net from ?collapse. (B.C. had a $3.1-billion surplus last fiscal year.) He tells the Straight that in the 1980s, the conservative Socreds spent 20 percent of their budget on social services. When they left office in 2001, the NDP had pared that down to 15 percent. Today, under the B.C. Liberals, social spending is nine percent of the provincial budget.

Meredith’s group represents more than 100 social-service agencies, and he says most of those with provincial­-government contracts haven’t had their funding revisited in a decade. "These folks that are running these nonprofit agencies around the province are trying to do the same thing with 10-year-old dollars."

He adds that the B.C. Liberals are out of step with business, their biggest booster. "The government still believes that it’s the business community that’s pushing for more reduction in government spending," Meredith says. "The sense I get out there in the business community is that they still believe that they have social responsibility."

The Vancouver Board of Trade has repeatedly urged the Campbell government to be tightfisted, even as it decries homelessness, panhandling, and other unsightly problems made worse by social-service cuts. But the board’s chief economist, Dave Park, says both the province and the feds need to get more involved in affordable housing. He also tells the Straight that inequality is relative: when wealthier people see their incomes soar during prosperous times, those left behind feel worse off, even if that’s not the case.

"I think there will be more money for the social priorities," Park predicts of next February’s provincial budget. However, unlike Montani, he argues that hiking the minimum wage will increase unemployment. The B.C. wage is already Canada’s highest, Park says. "How far out in front of the crowd do you want to get?"

Another question: what far-reaching effects will the rich-poor divide have on our city? Richard Wilkinson is professor of social epidemiology at the University of Nottingham medical school. His 2005 book, The Impact of Inequality: How to Make Sick Societies Healthier (The New Press), gathers together a large number of public-health studies from developed countries. The evidence is overwhelming: no matter how wealthy a society is, even a small increase in inequality causes more social dysfunction. Worst-off is the United States, the richest and most unequal of all industrialized nations. It leads its counterparts in violent crime, obesity, and teenage pregnancy and ranks about 30th worldwide in life expectancy.

After hearing some statistics about inequality in this province, Wilkinson tells the Straight that if such conditions persist, the impact may be long-term. The one in four B.C. children who is poor will have a stress-plagued family life, which in turn affects school performance and carries lifelong health consequences. "I would be very surprised if as a result of this you don’t have more violence by the time these kids are in their 20s," Wilkinson adds. Although life expectancy will continue to rise, he anticipates that increased infant mortality will be among the first health effects.

Well-off Vancouverites could be putting themselves at risk too. This past May, Wilkinson’s colleague Michael Marmot, professor of epidemiology and public health at University College London, coauthored a study in the Journal of the American Medical Association. It showed that the wealthiest Americans aged 55 to 64 had more diabetes, cancer, and high blood pressure than the poorest Britons in the same age group.

Wilkinson has no doubt that inequality and its attendant "social pollution" are the main culprit. "It damages social relations right across society and seems to make the whole social structure more stressful," he says. "I think it leads to more status competition, more insecurity about your status and how you’re seen."

Wilkinson and Marmot challenge the cherished belief that big income disparities are okay if economic benefits trickle down the social ladder. And as B.C.’s stagnant median ?income and growing concentration of wealth show, the trickle-down part isn’t working either.

Bedeviled by the social and economic fallout of failed government policy, the NDP’s Diane Thorne says, groups like the Vancouver Board of Trade will start leaning on their B.C. Liberal pals. "Who’s going to go downtown?" asks the Coquitlam-Maillardville MLA. "I already know people who don’t want to go downtown because they don’t like what they see. And they don’t have to go downtown anymore. There’s plenty out in the suburbs now."

Cheryl Prepchuk reminds Lower Mainland taxpayers that they foot the policing, justice, and health-care bills that come with poverty, hunger, and homelessness. "We’ll be paying for the aftermath, when I think dollars are better spent to pay for the prevention."

And latte lifestyle or not, a frayed safety net puts many cash-strapped and house-poor residents of our growingly lopsided city that much closer to the street. "It could happen to anyone at any given time," Prepchuk says. "They could be a car accident or a loss of job away from being homeless." Not to mention being a problem next year.