Baltimore Riots: Why it’s a bigger issue than it seems

The Baltimore Riots, as publicized by the media, are terrorizing communities within the city. Baltimore locals are on tilt following the death of Freddie Gray. Though many non-violent protests have risen following this tragedy they have been over-shadowed by law-less violence in the streets of Baltimore. These riots however symbolize a bigger problem then law enforcement issues in the U.S but instead serve as a product of income inequality in these communities. In neighborhoods were much of the violence is taking place, many of the working age population is unemployed. House hold incomes in these neighborhood are 25,000 dollars less than the median national average and equate to a median household income of just 33,610 for African Americans. Statistics from CNN illustrate that more than a third of these African american males between 20 and 24 were unemployed at 37% in 2013 which is 27% more than that of a white male in Baltimore. Outbreaks stemming from income inequality in Baltimore along with many other low-income communities around the U.S are having negative externalities on Unites states GDP as it only rose a fifth of what expected in the first quarter. Consumer spending in 2015 rose very meagerly in March (only .9%) and showed signs of negative rates in February. With only 126,000 jobs added in March, the hiring rate is slowing which doesn’t help the unemployment rates in these communities. Income inequality is creating a domestic war in the U.S and may have greater GDP affects as the Freddie Gray riots are more publicized nationally. One example of a loss in consumer will to spend is the Baltimore Orioles taking the lowest attendance record away from Worcester as citizens have decreasing desires to leave their homes and spend money. As the wealth gap continues to grow, particularly in Baltimore with at least 24% of population under the poverty line and an 8.4% unemployment rate,  the social issues will multiply as citizens express their frustrations with their living conditions.

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One solution by the Fed was to use quantitative easing to reduce interest rates and stimulate the economy especially in the lower income areas of the city but it hasn’t shown to improve this wealth gap in the U.S. The alternative solution of using more police officers has done little to help calm the city. In order to improve the violence in the streets of Baltimore and other cities in the U.S, I believe The U.S should attack poverty and economic opportunity by emphasizing education in these cities. They should work to improve the education system creating better classroom settings and technologies to make school a more valuable and promising option for the younger generations. As more children receive degrees and graduate from one level to the next the opportunity for obtaining higher paying jobs will increase as well. Though this idea maybe more long term, I feel it will be most effective both economically and socially.

-Kalif Raymond

http://money.cnn.com/2015/04/29/news/economy/roubini-baltimore-riots-inequality/

http://money.cnn.com/2015/04/29/news/economy/us-economy-first-quarter-gdp/index.html?iid=SF_E_River

http://www.economist.com/news/united-states/21650158-angry-youths-burn-their-own-neighbourhood-why-rioting-makes-things-worse

http://www.ibtimes.com/baltimore-riots-2015-city-residents-struggle-under-poverty-income-inequality-mass-1899732

http://www.forbes.com/sites/dandiamond/2015/04/28/why-baltimore-burned/

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4 thoughts on “Baltimore Riots: Why it’s a bigger issue than it seems

  1. jacobmedina2016

    This post is very interesting! I definitely agree about the underlying issues being larger than just the death of Freddie Gray and relations between the police and the community. It seems like the inequality divided on racial lines is a tinderbox waiting to explode. The unjust Freddie Gray death seems to have been a spark. The city of Baltimore is definitely in a tough situation because no short-term solutions will fix the underlying causes.

    Reply
  2. Victor Matheson

    A very timely post. Obviously, it is fairly rare to see rioting when people are doing well economically. Unfortunately rioting makes it even harder to do well economically.

    I would point out that the low attendance at last week’s Orioles game was not due to a lack of willingness to spend but instead on a government imposed ban on fans attending the game.

    Reply
  3. jerojas16

    The unrest in Baltimore is definitely a factor that’s affecting the local economy. Your proposed idea to have the Fed infuse struggling cities like Baltimore would work. In order to provide residents jobs companies could be incentivized with tax breaks in order to attract corporations to set up shop in the city. Adding new companies while promoting growth in human capital and technology is something that should be thought about strongly for Baltimore. It can be beneficial for all parties involved if implemented correctly.

    Reply
  4. kacoff17

    Another thing to look at here would be consumer confidence, which also must be effecting the economy. Because of the riots people may be less inclined to go out and spend money on entertainment, like the movies or a baseball game (even after the government lifted the ban). Also people may be less likely to invest in the city because of the riots because capital has been destroyed and there was little order and law during the time of the riots. But, since the actual riots were a short term event, hopefully there will be more investment in Baltimore and the economy can get back on track. Although bad for the city, it may be good for GDP because people will start to rebuild what was destroyed.

    Reply

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