eli5: Why do large cities always have a lot of very rich people and very poor people?


eli5: Why do large cities always have a lot of very rich people and very poor people?

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To run those massive cities and for those rich people to have staff.. they gotta be close. That probably accounts for like 10% of the poverty though. Most are just born into it unfortunately.

The question really can be abstracted to civilisations in general, of which cities are a main expression.

There are significant differences between civilisations, but one general trend over time is that power and wealth tend to be concentrated without balancing forces. One simple example is interest rates – it is unsustainable to have debt charges consistently larger than economic growth and wage increases over long periods. Even through ancient times it was well known that societies will collapse under too many people being sold into debt slavery – hence why every 50 years there was a Jubilee year of all ordinary citizen debt being forgiven and land given back to the original owner. The original Lord’s prayer actually referred to debt and was changed to sin centuries later. Source: Michael Hudson.

There are many factors other than this, but it’s a main one. When power is concentrated it’s easier to pay less, have less worker right laws, take advantage as much as you can, etc. Donald Trump, for example, has a history of not paying workers and then using lawyers to pay less than the initial contract. The system has checks and balances – if you’re rich enough to be able to afford a decent lawyer. Those with power and wealth tend to use that power to get more.

On a more superficial level: Cities can be a good place to be either rich or poor due to the breadth of resources available (jobs, community support, public transport so you don’t need a car, density of rental housing when you can’t afford to buy for the poor; investment opportunities, cultural and business opportunities, fellow rich people for the rich).

On a deeper level: The rich people need the poor people to work for them so they can stay rich and the poor can stay poor.

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