Give thanks Gman. This article was sent to my email today. It is interesting to note that uropeans always like to think that they do not still benefit from wukking our ancestors from sun up to sun down for 400yrs without paying any wages. So I suppose this article will be very telling in that Light.
- Study finds gaping racial divide in household assets
- Economic policies blamed for growing inequality
By Chris McGreal in Washington
The Guardian (UK)
May 172010
http://www.guardian.co.uk/world/2010/may/17/white-people-95000-richer-black/prinA huge wealth gap has opened up between black and white
people in the US over the past quarter of a century - a
difference sufficient to put two children through
university - because of racial discrimination and
economic policies that favour the affluent.
A typical white family is now five times richer than
its African-American counterpart of the same class,
according to a report released today by Brandeis
University in Massachusetts.
White families typically have assets worth $100,000
(£69,000), up from $22,000 in the mid-1980s. African-
American families' assets stand at just $5,000, up from
around $2,000.
A quarter of black families have no assets at all. The
study monitored more than 2,000 families since 1984.
"We walk that through essentially a generation and what
we see is that the racial wealth gap has galloped, it's
escalated to $95,000," said Tom Shapiro, one of the
authors of the report by the university's Institute on
Assets and Social Policy.
"That's primarily because the whites in the sample were
able to accumulate financial assets from their $22,000
all the way to $100,000 and the African-Americans'
wealth essentially flatlined."
The survey does not include housing equity, because it
is not readily accessible and is rarely realised as
cash. But if property were included it would further
widen the wealth divide.
Shapiro says the gap remains wide even between blacks
and whites of similar classes and with similar jobs and
incomes.
"How do we explain the wealth gap among equally-
achieving African-American and white families? The same
ratio holds up even among low income groups. Finding
ways to accumulate financial resources for all low and
moderate income families in the United States has been
a huge challenge and that challenge keeps getting
steeper and steeper.
"But there are greater opportunities and less
challenges for low and moderate income families if
they're white in comparison to if they're African-
American or Hispanic," he said.
America has long lived with vast inequality, although
40 years ago the disparity was lower than in Britain.
Today, the richest 1% of the US population owns close
to 40% of its wealth. The top 25% of US households own
87%.
The rest is divided up among middle and low income
Americans. In that competition white people come out
far ahead.
Only one in 10 African-Americans owns any shares. A
third do not have a pension plan, and among those who
do the value is on average a fifth of plans held by
whites.
Shapiro says one of the most disturbing aspects of the
study is that wealth among the highest-income African-
Americans has actually fallen in recent years, dropping
from a peak of $25,000 to about $18,000, while among
white counterparts of similar class and income it has
surged to around $240,000.
In 1984, high-income black Americans had more assets
than middle-income whites. That is no longer true.
"I'm a pretty jaded and cynical researcher in some way,
but this was shocking, quite frankly, a really
important dynamic," said Shapiro. "This represents a
broken chain of achievement. In the United States
context, when we are thinking about racial equality and
the economy we have focused for a long time on equal
opportunity.
"Equal opportunity assumes that some people who have
that opportunity are going to have pretty high
achievements in terms of their jobs, their work, their
income, their home ownership.
"The assumption in a democracy is that merit and
achievement are going to be rewarded and the rewards
here are financial assets. We should see some rough
parity and we don't."
The report attributes part of the cause to the
"powerful role of persistent discrimination in housing,
credit and labour markets. African-Americans and
Hispanics were at least twice as likely to receive
high-cost home mortgages as whites with similar
incomes," the report says.
Although many black families have moved up to better-
paying jobs, they begin with fewer assets, such as
inheritance, on which to build wealth. They are also
more likely to have gone into debt to pay for
university loans.
"African-Americans, before the 1960s, first by law and
then by custom, were not really allowed to own
businesses. They had very little access to credit.
There was a very low artificial ceiling on the wealth
that could be accumulated. Hence there was very little,
if anything, that could be passed along to help their
children get to college, to help their children buy
their first homes, or as an inheritance when they die,"
said Shapiro.
Since the 1980s, US administrations have also geared
the tax system to the advantage of the better off.
Taxes on unearned income, such as shares and
inheritance, fell sharply and are much lower than taxes
on pay.
"The more income and wealth people had, the less it was
taxable," said Shapiro.
There were also social factors, the study found. "In
African-American families there is a much larger
extended network of kin as well as other obligations.
From other work we've done we know that there's more
call on the resources of relatively well-off African-
American families; that they lend money that's not
given back; they help cousins go to school. They help
brothers and sisters, aunts and uncles, with all kinds
of legal and family problems," said Shapiro.
c Guardian News and Media Limited 2010
Author
