Eradicating urban poverty was a priority for Obama when he was running for president in 2008, but it has not become a focus for the president during his first term. A look at what still needs to be addressed, and the neighborhood of Roseland, where Obama got his political start:
The reason for this shift in priorities, according to people in the Obama administration, was the economic crisis they inherited. As David Axelrod, Obama’s former senior adviser and current chief campaign strategist, described it to me, ‘We were essentially an economic triage unit, trying to prevent the country from sliding into a second Great Depression.’ The president’s economic team during the transition was staffed mostly with centrist economists — Lawrence Summers, Tim Geithner, Jason Furman — but one of their top priorities, early on, was to send aid to poor people. A central tenet of Keynesian stimulus spending is that in an economic crisis, you try to get as much money as quickly as possible into the hands of people who will spend it right away, and the less money people have, the more likely they are to spend every dollar they receive from the government. The previous summer, Mark Zandi, the chief economist for Moody’s Analytics, who was serving, at the time, as an adviser to the McCain campaign, testified before Congress on the need for an aggressive stimulus program. In his testimony, he included a handy chart, based on his own algorithm, that listed the ‘Bang for the Buck’ that various stimulus measures would provide. According to Zandi’s calculations, aid that went to wealthier Americans would not be very effective as stimulus: for every dollar that Congress cut from corporate taxes, the G.D.P. would gain 30 cents; making the Bush tax cuts permanent would boost it by 29 cents for every dollar added to the deficit.
Stimulus measures that gave money to poor and distressed families, on the other hand, would be much more productive: extending unemployment-insurance benefits would boost G.D.P. by $1.64 for every dollar spent. And at the top of Zandi’s list was a temporary boost in the food-stamp program, which he calculated would produce $1.73 in G.D.P. gains for every dollar spent.