Income Inequality And Cities: Calgary's Two Faces Show Pitfalls Of Unbridled Growth

First Posted: 12/05/2011 4:47 am Updated: 08/07/2012 2:00 pm


THE THIN RED LINE

Under Calgary’s open skies, opportunity can feel as boundless as the city’s suburban sprawl, which flows from the downtown core into a veritable ocean of asphalt, starter homes and luxury estates.

And in many ways, it is: at more than $54,000, Calgary, which has become a magnet for young professionals, has the highest personal income per capita in the country, and the second highest average household net worth. The unemployment rate, meanwhile, sits at an enviable 5.6 per cent.

“I think Calgary is a very buoyant economy,” says Alvin Libin, a high-profile businessman and philanthropist, who made his fortune in oil and gas. “People that want to work have the opportunity to work. There’s opportunity – and when there’s opportunity, then everybody has a chance.”

But Derek Cook, a social planner for the City of Calgary, has a different take.

“Calgary’s really not old enough to have really old money, but if you’re not in [oil and gas] it’s actually very, very hard to break into it,” he says. “So there’s this perception that anybody can make it in Calgary, but I don’t think that’s the reality. It’s a very stratified city.”

More on income inequality at Mind The Gap: Canadians Earning Less As Inflation Outstrips Wage Gains.. What's The Difference Between Rich And Poor In Montreal? 11 Years Of Life.. Canada's Housing Market More Overvalued Than U.S.'s At Its Peak: The Economist.. Full Coverage..

Financial extremes, he says, have always been part of Calgary’s DNA; since the turn of the 20th century, when the wealthy began to cluster “away from the riffraff” in the enclaves of Sunnyside and Bowness, segregation has been a natural consequence.

It’s a trend that has intensified in recent decades, as an explosion of growth in the suburbs has quite literally split Calgary in two. For better or worse, Deerfoot Trail, the quasi-highway that runs north-south through the centre of the city, has become a kind of unofficial boundary, with more affluent Calgarians cloistered in the west, and the poor in the east.

Myles’s study found that, between 1980 to 2005, there was “a clear trend toward increasing economic segregation in virtually all cities.” But Calgary led the pack.

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WHICH CANADIAN CITIES ARE SEEING THE FASTEST GHETTOIZATION?

Percentages represent the difference that the income gap has grown between the richest and poorest neighbourhoods in Canada's largest metropolitan areas. The numbers indicate the degree to which residents of those cities are segregating themselves economically.

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  • 8: Quebec City -- 22 per cent

  • 8: Quebec City -- 22 per cent

    With a 22 per cent increase in the gap between its richest and poorest neighbourhoods, Quebec City has seen the smallest growth in neighbourhood inequality. However, the city also saw the largest proportion of neighbourhoods in decline. The numbers suggest some six in 10 neighbourhoods saw their income decline from 1980 to 2005.

  • 7: Winnipeg -- 31.5 per cent

  • 7: Winnipeg -- 31.5 per cent

    Winnipeg saw a 31.5 per cent increase in the gap between its richest and poorest neighbourhoods from 1980 to 2005, with its poorest neighbourhoods suffering a 7.6 per cent decline, while its wealthiest 10 per cent of neighbourhoods saw income grow 24 per cent.

  • 6: Montreal -- 34 per cent

  • 6: Montreal -- 34 per cent

    Montreal saw a 34 per cent increase in the gap between its richest and poorest neighbourhoods from 1980 to 2005, with its poorest neighbourhoods suffering a 10 per cent decline, while its wealthiest 10 per cent of neighbourhoods saw income grow 24 per cent. <em>Correction: An earlier version of this text misidentified Montreal as Winnipeg.</em>

  • 5: Vancouver -- 36.5 per cent

  • 5: Vancouver -- 36.5 per cent

    Vancouver saw a 36.5 per cent increase in the gap between its richest and poorest neighbourhoods from 1980 to 2005, with its poorest neighbourhoods suffering a 10.5 per cent decline, while its wealthiest 10 per cent of neighbourhoods saw income grow 26 per cent.

  • 4: Ottawa -- 37 per cent

  • 4: Ottawa -- 37 per cent

    Ottawa saw a 37 per cent increase in the gap between its richest and poorest neighbourhoods from 1980 to 2005, with its poorest neighbourhoods growing 1.3 per cent in income, while its wealthiest 10 per cent of neighbourhoods saw income grow nearly 36 per cent. Ottawa is unique in that none of its neighbourhood deciles suffered an income decline during the period.

  • 3: Edmonton -- 39 per cent

  • 3: Edmonton -- 39 per cent

    Edmonton saw a 39 per cent increase in the gap between its richest and poorest neighbourhoods from 1980 to 2005, with its poorest neighbourhoods suffering a 7.8 per cent decline, while its wealthiest 10 per cent of neighbourhoods saw income grow 31.5 per cent.

  • 2: Toronto -- 68 per cent

  • 2: Toronto -- 68 per cent

    Toronto saw a 68 per cent increase in the gap between its richest and poorest neighbourhoods from 1980 to 2005, with its poorest neighbourhoods suffering a 5.5 per cent decline, while its wealthiest 10 per cent of neighbourhoods saw income grow 62.5 per cent.

  • 1: Calgary -- 81 per cent

  • 1: Calgary -- 81 per cent

    With an 81 per cent increase in the difference between its richest and poorest neighbourhoods, Calgary wins Canada's ghettoization crown. It's worthwhile to note that Calgary's large increases in income in the wealthiest neighbourhoods has not pulled up its poorest areas, which have seen declines in income on the same scale as low-end neighbourhoods in other Canadian cities.

In Calgary, the city’s manager of social policy and planning John te Linde, attributes the segregation to a combination of market forces, wide open spaces and a “laissez faire” attitude toward regulation.

Whereas other major Canadian cities have implemented “inclusionary zoning” provisions, which mandate that a certain proportion of new developments constitute affordable housing, such policies have so far been rebuffed in Calgary.

According to Cook, planners were told by the city’s legal department that this kind of intervention contravenes the Municipal Government Act. But a spokesman for the province recently refuted this assertion, telling the Edmonton Journal that the MGA “allows municipalities to adopt this type of inclusionary zoning.”

“There’s a market for people who don’t want to be associated or mixed up with people of lesser means,” says te Linde. “The city tries to do things to minimize that, but in Calgary, we listen to developers more than we listen to the other parties.”

The potential pitfalls of the deepening divide have not been lost on Mayor Naheed Nenshi, who delivered a TED talk on the issue earlier this year, before he was elected.

Projecting a series of city maps onto an over-sized screen, Nenshi drew a red line to show how his hometown was evolving into “two separate cities” – with stark differences in ethnic make-up, household income and the availability of recreational facilities.

“I used a red line on purpose,” he told the audience. “It refers to the practice of certain real estate agents in the U.S. to ‘redline’ neighbourhoods, to actually say to people, ‘That neighbourhood is not for you.’ There’s ample evidence that that sort of thing happens in Calgary.”


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