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The Great Recession in Black Wealth
from Dollars & Sense:
The Great Recession in Black Wealth
White wealth reaches historic high of twenty times black wealth.
By Jeannette Wicks-Lim
The Great Recession produced the largest setback in racial wealth equality in the United States over the last quarter century. In 2009 the average white households wealth was twenty times that of the average black household, nearly double that in previous years, according to a 2011 report by the Pew Research Center.
Driving this surge in inequality is a devastating drop in black wealth. The typical black household in 2009 was left with less wealth than at any time since 1984, after correcting for inflation.
Its important to remember wealths special role in supporting a households economic well-being. Even though income forms the stream of money that collects into a households pool of wealth, wealth and income are crucially different. Income pays for everyday living expensesthe groceries, clothes, and gas. A familys wealth, or net worth, includes all the assets theyve built up over time (e.g., savings account, retirement fund, home, car) minus any money they owe (e.g., school loans, credit-card debt, mortgage). Access to such wealth determines whether a layoff or medical crisis creates a bump in the road, or pushes a household off a financial cliff. Wealth can also provide families with financial stepping-stones to advance up the economic laddersuch as money for college tuition, or a down payment on a house.
Racial wealth inequality in the United States has always been severe. In 2004, for example, the typical black household had just one dollar in net worth for every 11 dollars of a typical white household. This is because families slowly accumulate wealth over their lifetime and across generations. Wealth, consequently, ties the economic fortunes of todays households to the explicitly racist economic institutions in Americas pastespecially those that existed during key phases of wealth redistribution. For example, the Homesteading Act of 1862 directed the large-scale transfer of government-owned land nearly exclusively to white households. Also, starting in the 1930s, the Federal Housing Authority made a major push to subsidize home mortgagesfor primarily white neighborhoods. On top of that, efforts by black communities to generate their own wealth by starting their own businesses were crushed by racial violence, or severely curtailed by Jim Crow Laws in effect until the mid-1960s. ................(more)
The complete piece is at: http://www.dollarsandsense.org/archives/2012/0112wicks-lim.html
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The Great Recession in Black Wealth (Original Post)
marmar
Jan 2012
OP
JustAnotherGen
(32,025 posts)1. While another du-er
Wants to pretend that the South did not "win the peace" - you post the facts that prove they did. How different the world might be had people who had farming skills had been given 40 acres and a mule as a good start. Most weren't eligible for The Homestead Act . . . It would have been a good start on the road to the American dream. And today - the economic disparity continues. Thank you for posting this!
xchrom
(108,903 posts)2. du rec. nt