Low Prices, Blighted Suburbs 

Contra Costa County wants to ban Wal-Mart's biggest store. The future of retailing and a new kind of poverty are at stake.

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There's a certain irony in Safeway's support for the Supercenter ban. Gioia waded into this fight partly because he wants to preserve and restore downtowns and smaller malls, where shopping is conducted on a more human, intimate scale. Yet few companies have done as much to destroy inner-city downtowns as Safeway has.

The 1980s were a great time for KKR Associates, that merry band of Wall Street suits who invented the leveraged buyout. In 1986, KKR added Safeway to its list of acquisitions. Amassing vast amounts of debt, KKR shuttered less-profitable stores in poor neighborhoods across the county to get back in the black. Over the next decade, Safeway closed more than 1,100 stores -- and even redlined the entire state of Oklahoma. Millions of inner-city residents lost access to cheap food, and ghetto liquor stores rushed in to fill the void. Making common cause with the likes of Safeway in order to confront a company that specializes in keeping its prices low seems a bit awkward to say the least.

But Gioia will take his friends where can get 'em. Because just as Safeway once helped catalyze the death of urban commercial life, Wal-Mart's Supercenters threaten the very world Safeway helped create -- the older suburban shopping mall. And the decline of these malls is a prime indicator of one of the least-noticed but most unsettling phenomena of our times: the rise of suburban poverty.

Once upon a time, urban economic disparity followed a simple, bipolar formula: impoverished inner cities surrounded by white, middle-class suburbs. The burbs were uniform bedroom communities with prefab housing, strip malls, and no parks or cultural amenities, but residents gladly moved there to get away from crime, poverty, and black people. Now a new generation of middle-class professionals is recolonizing inner cities, pushing the poor out into this first generation of suburbs. We are witnessing the emergence of a new, tripolar disparity, with the poor moving into a band of older suburbs, surrounded by the middle class in the cities within and gated exurban communities without. The first line of Levittowns -- bereft of parks, public transportation, and any revenues other than property and sales taxes from decrepit old shopping malls -- are fast becoming the new face of poverty in America.

Myron Orfield, a social demographer and senior fellow for the Brookings Institution, has been tracking the growth of suburban poverty for Amerigis, a think tank he founded two years ago. According to Orfield, minority families either move into older suburbs and trigger a new round of white flight, or into growing bedroom communities with no economic diversity. Either way, poverty begins to concentrate in overcrowded, underfunded schools, which dramatically depresses the property values and locks the suburbs into a cycle of blight. "When poverty concentrates in the schools, the middle class moves away from them," he says. "Schools are powerful social motivators, and they're nowhere becoming more segregated than in California. A lot of times, this is occurring without a broad awareness of it."

Here in the East Bay, areas such as San Pablo, Rodeo, and Bay Point embody this phenomenon. According to Amerigis, San Pablo's tax base dropped more than 40 percent between 1993 and 1998, right in the middle of the boom years. Rodeo and Bay Point lost a significant percentage of their household tax capacity during the same period, while Oakland's grew modestly and Pleasanton's grew more than 18 percent. During the 1990s, the number of elementary students eligible for free lunch programs spiked in Pittsburg and West Contra Costa, even as it held steady in Oakland. All because middle-class families were leaving the older burbs behind for exurbs such as Hercules and American Canyon.

Wal-Mart has been one of the most dynamic engines of this trend all across the country. By placing Supercenters on the exurban fringe, the company has stimulated sprawl and helped wipe out older suburban shopping malls. One by one, anchor tenants such as Kmart and Albertsons have picked up and moved out, turning once-thriving malls into desiccated ghost towns. "Almost all the older suburbs in the US have dead malls in them," Orfield says. "That's really common. There are dead malls in almost every suburb in the US, because newer malls compete with them. And other cities compete with the older suburbs, especially in California, where sales tax is king. The richer suburbs almost always beat the poorer suburbs."

When Albertsons moved out of the El Sobrante mall on Valley View Road two years ago, blight infected the facility with dismaying speed. Officials with the Richmond Redevelopment Agency worked to find a replacement store, but within months, people were dumping their garbage in the parking lot. RVs began to camp out at the mall. A fire damaged the old Albertsons site, and the few commercial tenants who haven't left are now on a month-to-month lease, waiting to see if a Walnut Creek developer will buy the land, tear down the mall, and replace one of El Sobrante's two commercial districts with, yes, more housing. In San Pablo, the El Portal shopping center never recovered when its grocery store anchor tenant moved out, and now it, too, is the site of multifamily housing, once again diminishing the variety of the tax base and setting the stage for more suburban blight.

You can't lay all this at Wal-Mart's doorstep, but there's no denying that the company has been among the most energetic catalysts of the silent suburban ghettos. This is why groups like the community-based organization ACORN have suddenly decided that Safeway is their best friend. According to Doug Bloch, an ACORN organizer who's running their new Bay Point office and has joined the anti-Wal-Mart campaign, the new army of suburban poor has no public transportation, no social services, no free legal aid, no health care clinics. All they have, he says, is their shopping malls.


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