Benjamin Graber

11/22/05

Capstone

Trevor Bechtel

A Summary of the Causes of Poverty in Lima

Lima has not always been an impoverished city. It has been a chain of economic and social events that have led them to the place that they are. Corporate competition, racial discrimination and township strangulation are the three things that have led Lima into poverty and continue to keep them impoverished.

In the 1960s, the city of Lima was full of hope and prosperity. The city had survived the depression and two world wars and it, like America all around it, was at the top of the world. It was a union town with factories and an expanding economic base. Black people were beginning to move into the city and take up jobs. Most outright discrimination had stopped and affirmative action had managers hiring black workers.

Unfortunately, racial tensions erupted. Realtors would only sell houses on the south side of the city to black people. The justice system cracked down on people of color. The “black” schools had less funding, worse buildings and skeletal programs. When Lima Senior High was created to integrate the “black” and “white” schools, there was tension in the air. Violent outbursts on both sides climaxed in August of 1970 when the town was put into a state of emergency and the National Guard patrolled the city.

The racial tensions masked and lead into economic decline. Factories started moving overseas or into Mexico and jobs started going elsewhere. This was a nationwide trend. Prosperity remained in the service sector and retail became a mainstay for most Midwestern cities. Lima was the same. American Corporations were facing more and more competition from other areas of the globe and found that they were no longer willing to share their piece of the pie with their overpaid American workers. Added to this was the fact that corporations cared little about what the effect of their leaving was to do to the population that relied on them for their wellbeing. Decisions that were to affect Lima were not in Lima’s hands at all, but in the hands of a corporation who was mostly concerned about their bottom line.

Lima’s suburbs grew between the 1960s and the 1990s. This growth was mostly “white.” So while the suburbs flourished and grew, the city itself began to decline. The Federal Housing Authority (FHA) had a policy that encouraged middle-class city folks to move to the suburbs. This in turn encouraged poor people to move into the cities to take over the jobs of the fleeing middle class. Helen Bolden, a black resident, described the situation best saying “It was a matter of ‘they’re coming, let’s run.’” City income declined while suburbs and townships became areas for the wealthy or middle-class. The racial divide remained with black people mostly populating the city and white people mostly living in the suburbs and townships.

The problem with townships and suburbs is this: they do not bring their quota of wealth to the city itself. If the townships were part of the city, then money could be filtered off to the places that need it, but by staying outside of city limits, the incomes that would be generated in the township areas are either not taxed out of the populace or not given to the city. Even when Lima charged a 50% surcharge for water and sewage services to the townships, it was nowhere near what they would have made had they been able to apply city taxes to the townships.

For example, in 1969 there was an opportunity for Lima to annex Shawnee township. Originally, the proposal only included the annexation of a small part of Shawnee, but it was later decided to annex all of Shawnee. This would have resulted in an annual loss of $138,000 tax revenue for Shawnee but an increase in $47 million to the city of Lima. The proposal was shot down by county commissioners who ironically were voted into office mainly by the suburbs of Lima.

A disturbing economic trend continued to emerge. A factory would close and lay off workers. Then the building would be bought by a different company who would close it months or years later, laying off the workers again. Time and again, a company would promise to be there for its workers right before closing down shop, sometimes on the notice of just a few days. The workforce got more and more frustrated and more and more desperate to feed their families and to just make it by. This trend continues to this day.

-this has been a summary of

“Unpublished Text” Perry Bush; Bluffton University, Bluffton, OH. 2005