The third chapter of Savage Inequalities takes place in New York; this chapter develops the theme of "competition" from the previous chapter, arguing that the public schools of New York City illustrate the unequal competition of American life. New York City's schools are divided in 32 school districts. The unequal division of resources is traced from materials and supplies to the quality of teachers; the students in poorer areas have worse teachers, typically.

Overcrowding is a key issue of New York City's public schools, which taxes already strained resources. In the Bronx, at Public School 261, class size is an issue: The school building's capacity is 900, but more than 1,300 children attend school there. There are not enough books to go around, and there is not enough space to hold recess. These already-overcrowded classrooms have no air conditioning in the summer or heating in the winter. At Public School 79, there are 1,550 students. The school is 29% Black, and 70% Hispanic; there is no computer lab, and there is no librarian. A school official describes the reasoning for this inequality as the intersection of race and class, using the nearby Riverdale neighborhood as illustration. Public School 24 is an elementary school in Riverdale, in the northwest of the Bronx.