Michael, I do not think we disagree about the fundamental premise of that argument that good communities reduce crime. Haowever, I do not think it the poverty either absolute or relative (as I interpret your remark about treating people like animals) is what causes crime. There is a plenty of research showing that what counts is the stability of a community. Stable communities - less crime, unstable ones - more crime. That has been known since 1930 when the so-called Chicago school did their famous studies of "zones of transition" in Chicago (transient communities had much higher crime rates than established ones, even controlling for poverty).
The explanation of that phenomenon is really simple - people who live togetehr and interact develop shared ste of norm of values as well stakes in their community which prevents them from trnasgresing those norms.
It is easy to see that following this train of thought, crime problem is related to the land use policy pushed by developers and speculators, which aim at constant development of new areas, and induce people to relocate. In Baltimore it was called "block busting" where real estate speculators used suburban development coupled with manipulated raciacl prejudice to depopulate the entire city block, virtually forcing them to newly constructed suburbs.
The problem is further exacerbated by the fact that public housing created in inner cities is a textbook example of a transient community. People move in and out as soon as they can, noone has any stakes in their "communities."
The long term solution is quite simple as well - develop stable communities, and some efforts in that direction (such as federally funded project HOPE VI) is underway. But before that will have any effect (which is probably a generation to eradicate the effect of culture of poverty that developed in inner city "concentration camps") you must take some interim measures to protect those fledging communities from criminal elements that now plague inner cities. And here is where I see that zero tolerance policies (provided they are carried in a professional, nondiscriminatory manner and in cooperation with local communities) can have a role.
wojtek