What has changed in the last decade that causes tent cities to spring up?

Question

As a regular visitor to the United States (Texas and Oregon, mostly) I can see that a lot of slum-like encampments have sprung up during the last decade, probably even the last few years. Some are so large that one could call them "tent cities".

This anecdotal evidence is supported by extensive media coverage, both about the phenomenon as such and about attempts to address it by the respective local, regional and federal governments.

Of course there have always been homeless people in the U.S.; one could always see the occasional tent or sleeping bag in a corner.

But the recent development feels like a seismic shift.

The principal reasons for homelessness are clear: Lack of income, often in connection with mental illness or drug addiction, combined with a lack of affordable housing. Both factors must coincide to cause high levels of homelessness: Poverty alone, like in West Virginia, is not sufficient if at the same time affordable housing is available. But in places like the Bay Area or Portland housing has always been so expensive that it likely was out of reach for those at the economic bottom. Further rising prices do not change much for them (they rather affect the economic tiers above them, the poor and average working class).

Sure, we went through economic crises, but the economy has mostly recovered. The GDP per capita is now higher than ever, and federal stimuli like the Biden child tax credit actually reduced poverty. The average poverty rate of 11.6% in 2021 was lower than the average rate in the decades preceding it, except for 2018 and 2019. Poverty alone, at least as measured by the government, cannot be the reason.

What has changed?

Answer 1

The answer is already in your question: "[rising prices] affect the economic tiers above them, the poor and average working class".

Basically, inflation and shortages have lead to a significant increase in the cost of living - especially housing prices - but wages haven't moved. Therefore, people who used to be able to afford a home either no longer can, or are one major unexpected expense (medical bill, car repair, etc) away from it.

Some quotes from this article from the WSJ, which was written last July, just as the Fed began raising interest rates:

“We’re in a very precarious moment, where the cost of living is going up so quickly — through the price of gas and food and rent — that more people can’t afford a place to live anymore,” said Meredith Greif, an assistant professor at Johns Hopkins University whose work focuses on homelessness and inequality. “Everywhere you turn, prices are rising, but wages aren’t keeping up.”

[T]his time around, shelters say they’re seeing a rise in families who still have steady, even good-paying, jobs but cannot find a home they can afford.

An estimated 13.7 million Americans were behind on rent or mortgage payments in early June, up 7 percent from April, according to the Census Bureau’s Household Pulse Survey. Of those, 4.6 million adults say they are “somewhat likely” or “very likely” to lose their homes by eviction or foreclosure in the next two months, a 32 percent increase from early April.

This other article covers some reasons that rent has been going up, but it basically comes down to a combination of fewer new homes being built (due to various factors from the pandemic) and people with money buying up what they can (either to move out of a city into, or as an investment). Lower supply + higher demand = higher prices.

Answer 2

There's a lot to unpack here, so let's start at the beginning.

Too many people assume that homelessness is mostly/mainly/completely because of mental health issues or drug use issues. That's simply not true. There are many more reasons that those, and they aren't even the leading causes, even though they are part of the problem. Here are the 10 root causes of homlessness and mental health plus drug use are a combined one of these causes.

• Stagnant wages
• Unemployment
• Lack of affordable housing
• Lack of affordable healthcare
• Poverty
• Lack of mental health and addiction treatment services
• Racial inequality
• Domestic violence
• Family conflict
• Systemic failures

Wages haven't really increased in decades, as research shows, and buying power has similarly remained stagnant.

Covid-19 cause something like 14 million people to lose their jobs. Even with the unemployment rate at the lowest rate in 54 years, it takes time for people who lost their homes to get housing again. Just because someone has a job, it doesn't mean they can afford housing. The working poor have been in the news since at least 1999. And IT layoffs are happening again.

Housing prices have risen dramatically, showing that from 2000 to 2020, house prices went from $203k to $375k, and are currently at $536k. Rent is just as bad, going from 2000 to 2020 at $182 per month to $340, and is now at $391 a month.

Healthcare spending has gone up in the last 80 years. There are a lot of factors that go into these issues, but much of it is ever increasing and unregulated medicine costs.

The US is currently at around 7.8% of the population in poverty, or 26.5 million people. The 2022 poverty line is $27,750, and the minimum wage is $7.25 as it's been since 2009.

Mental health statistics show that a huge amount of people are suffering mental health issues, and only about half of them are getting treatment for them. And only 10.3% of people with substance abuse issues are getting treatment for it.

And inequalities in racial wealth are a very well researched topic.

Domestic violence is a major factor, and isn't anything new, unfortunately, with 25,795 homeless domestic violence victims in shelters in 2022, 16,147 unsheltered homeless, and another 6431 in transitional housing.

And then you have cases where people are simply kicked out of their house, unrelated to issues of domestic violence. Around 28% of LGBTQ youth reported experiencing homelessness or housing instability at some point in their lives. There are also at least 4.2 million young people who are homeless, some due to single parents, but others due to getting kicked out of their house or running away from home, and some being single parents/pregnant.

Much of this stems from or culminates into system failures with the history of the US, from racial generational wealth gaps to reducing the funding for public housing to reducing SNAP benefits which many people rely on, and even all that is just scratching the surface.

When people talk about homelessness/the poor/etc... and then try to ask about the GDP, it's often because there's a disconnect between the two that most don't understand.

The GDP is a measure of what's produced in the country.

Gross domestic product (GDP) is the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period. As a broad measure of overall domestic production, it functions as a comprehensive scorecard of a given country’s economic health.

https://www.investopedia.com/terms/g/gdp.asp

There is a massive gap between what C-Suite level management gets paid and what their employees get paid. Just over the past couple years, billionaires have gained $2.1 trillion in wealth. In the last 30 years or so, CEO pay has risen from making 70 times their average employee to making 340 times their employees average pay. Some studies say that might be as high as 670 times, also stating that CEO pay has risen 1460% since 1978.

If you look at how they are doing it, there's a lot of ways, but much of it has been through stock buybacks. So, instead of paying their employees more, they are just raising the stock market values and their own income with the recent record profits and loans they've been getting.

Combine this with the stagnant wages mentioned earlier, you'll see that GDP has little to do with how the lowest paid and/or homeless are gaining wealth.

I didn't concentrate much on "the last decade", as the question asks, but there's been quite a bit just in the last 3-5 years that has contributed to people being homeless, and looking at the large amount of graphs in the articles linked here show a significant amount of the problem has happened in the past 10-20 years. Also, actually seeing homeless people has been due to higher visibility in the news as well as the homeless population being more dense in urban areas than in rural areas with 50% of homeless people being in urban areas, even though only 25% of people in this country living in urban areas. If you are more aware of the problem, you are more likely to actually notice the problem when it's present.

And while all that I mentioned is a problem, there are cities that are banning tent cities without addressing the root causes listed above. Homelessness is a tricky problem on more than one front, but there's a lot we as a country aren't doing to prevent this problem.

Answer 3

This chart from Wikipedia explains it:

When you see four decades during which shelter cost growth is significantly higher than that of other items, you will also expect significant demographics no longer being able to afford it.