Wealth gap between whites and African Americans has tripled over last 25 years

[Street Knowledge]

During the Great Recession, the wealth gap between whites and African-Americans nearly doubled, leaving white with nearly 22 times as much in household wealth. According to a new study from Brandeis University’s Institute on Assets and Social Policy, this merely exacerbated a much longer trend during which the wealth of whites exploded while that of African-Americans stagnated:

In 2009, a representative survey of American households revealed that the median wealth of white families was $113,149 compared with $6,325 for Latino families and $5,677 for black families.

Looking at the same set of families over a 25-year period (1984-2009), our research offers key insight into how policy and the real, lived-experience of families in schools, communities, and at work affect wealth accumulation. Tracing the same households during that period, the total wealth gap between white and African-American families nearly triples, increasing from $85,000 in 1984 to $236,500 in 2009.

The report shows that the disparity is driven by “policy and the configuration of both opportunities and barriers in workplaces, schools, and communities that reinforce deeply entrenched racial dynamics in how wealth is accumulated.” For instance, whites are far more likely to receive familial assistance when buying a home (due to previously accumulated wealth), therefore allowing them to purchase a home earlier and hold it for longer. They are also more likely to live in a place where home equity rises more quickly. The same familial advantages allow whites to graduate college with far less student debt. All of this compounds on an already existing disparity, making it that much harder for African-Americans to catch up.


The Wealth Gap Between Whites And African-Americans Tripled Over The Last 25 Years | ThinkProgress

 

[daze23]

seems like the symptom of larger class issues

 

[Johnny Kilroy]

Quit buying rims and shyt and get some land.

 

[88m3]

seems like the symptom of larger class issues

I agree it's like a symptom of a symptom of a symptom of the root of the issue

 

[acri1]

I think the main reason is that blacks (and latinos to a lesser extent) usually aren't in a position to pass any sort of wealth down to their offspring, in fact often pass debt down. In white families wealth tends to flow from parent to child, in minority families it's usually the opposite.

For example, I know a white guy that graduated college with the same major and about the same GPA as myself. However, his family paid for most of his college, whereas mine didn't, so I had to take on more debt. Also, his grandfather was the VP of some IT company so he pretty much had a good job waiting for him even in the recession. Later on, his parents (or grandparents, I forgot) let him have their house when they retired.

I graduated with more debt (as did most other black people I went to school with), and didn't have a hookup so it took me a while to find a job (wouldn't be surprised if he made more). So far I haven't bought a house, but when I do I'll actually have to pay a mortgage, I'm definitely not getting one from a relative. In addition, I frequently have to let my parents/family borrow money, which reduces the amount of savings/wealth I can accumulate.

Don't get me wrong though, I'm not absolving black people of personal responsibility or anything like that, nor am I dismissing cultural factors, but the situation is a little more complicated than assuming that most black people waste their money on BS. Granted, some nyggas do but it's not the root of the issue.

 

[Marvel]

Quit buying rims and shyt and get some land.

The difference is over $100,000. What kind of rims are we buying?

This has a lot to do with wealth that is past down generations. Wealth takes time to build and time was taken away for us to build it because of discrimination. Its a lot harder to own land today than it was when whites were given free reign to do whatever they wanted while we suffered as a people and couldn't do shyt. On my team at work alone two white women...Both of whom have inheritance that they will be receiving through mineral rights (look it up). There family probably owned slaves back in the day too. Both of their families own land and farms in Texas. One of them has a step brother that will receive $500,000 in the next few weeks once he turns 25. He received about $100,000 when he turned 18, the rest which is larger, he will get when he is 30.

Home owning is the best way to build wealth outside of stocks. Most homes are under a 30 year mortgage. I just turned 30 last year so if you think from a wealth perspective. A black family that bought a home in 1982 will be able to pass some wealth down to their children when they die.

 

[Johnny Kilroy]

The difference is over $100,000. What kind of rims are we buying?

This has a lot to do with wealth that is past down generations. Wealth takes time to build and time was taken away for us to build it because of discrimination. Its a lot harder to own land today than it was when whites were given free reign to do whatever they wanted while we suffered as a people and couldn't do shyt. On my team at work alone two white women...Both of whom have inheritance that they will be receiving through mineral rights (look it up). There family probably owned slaves back in the day too. Both of their families own land and farms in Texas. One of them has a step brother that will receive $500,000 in the next few weeks once he turns 25. He received about $100,000 when he turned 18, the rest which is larger, he will get when he is 30.

Home owning is the best way to build wealth outside of stocks. Most homes are under a 30 year mortgage. I just turned 30 last year so if you think from a wealth perspective. A black family that bought a home in 1982 will be able to pass some wealth down to their children when they die.

Wasn't that serious but since you put so much effort into this I'll respond.

Wealth is built through spending, not by earning. Sure it's nice to have a six figure salary, but it's even better to make $50k and spend wisely. Spend money on things that appreciate and earn you more money. We tend to buy bullshyt.

So, no, not one set of rims is going to equal a house but when you develop a habit of spending your money stupidly, and then pass those poor habits on from generation to generation you see what you get.

Like my mother used to say "don't nickel and dime your money away". Waste a nickel once and you've lost a nickel. Waste a nickel 19 more times and you've lost a dollar. Even though "it was only a nickel" each time.

 

[Mowgli]

Yet these cacs stilll shootin shyt up. Money dont mean everything i guess.


Blame Obama though because since he got elected the cac suicide rate has increased sharply!

 

[acri1]

Here's a decent article on the subject -

Study ties black-white wealth gap to stubborn disparities in real estate - The Washington Post

Some excerpts:

The large and growing wealth gap separating white and black families is the product of stubborn barriers that disproportionately consign African Americans to less-valuable real estate and lower-paying jobs, according to a new study.

The report’s authors said black families in the study group rarely benefited from inheritances and gifts to help them make down payments on homes. The result was that black families typically bought homes eight years later than whites, giving them less time to build equity. Meanwhile, even when they were able to buy a home, the typical black family did not see that property appreciate as much as did the typical white family.

One reason, the authors said, was that blacks frequently moved into predominantly black neighborhoods, where few whites shopped for homes, limiting the sales market and depressing prices.

Researchers found that the African Americans also received little financial benefit from marriage, while it more often it put whites in a financial position to make investments that build further wealth. “Marriage among African Americans typically combines two comparatively low-level wealth portfolios and, unlike white households, does not significantly elevate the family’s wealth,” the report said.

Similarly, because they typically live so close to the financial edge, African American families were not able to leverage much wealth creation from pay raises. Whites were able to generate more than $5 in new wealth for each new dollar of income, while blacks generated 69 cents of new wealth for each new dollar of income. Shapiro said the difference was largely because blacks had to use the new income to douse financial emergencies rather than invest it.

Still, the biggest driver of the wealth gap between whites and blacks remains homeownership. “Blacks and whites have always had unequal access to the housing market,” said Thomas J. Sugrue, a professor of sociology and history at the University of Pennsylvania.

 

[Strapped]

I agree it's like a symptom of a symptom of a symptom of the root of the issue

Which may be classified as. Racism ,entitlements, or classism

 

[superunknown23]

Since the 1600s, white folks have passed on their wealth to their kids and the cycle keeps going...

 

[theworldismine13]

This is another reason why projects and public housing hurt black people and they should be eliminated

 

[acri1]

This is another reason why projects and public housing hurt black people and they should be eliminated

What exactly does public housing have to do with this?

And what do you think people who can't afford to pay more than what they do for public housing would do?

 

[theworldismine13]

What exactly does public housing have to do with this?

And what do you think people who can't afford to pay more than what they do for public housing would do?

what do you mean what does it have to do with this, wealth is connected to real estate, so therefore if a black family is living in public housing they are not building wealth, how is the connection not obvious


what do you mean what they would do? they would do the same thing they do when public housing is destroyed now, the people would move to where its cheaper to live and its more likely to be able to own property if its cheap

public housing is a distortion of the real estate market and it stifles the building of black wealth and in a roundabout way it violates the economic and individual rights of the residents

 

[acri1]

what do you mean what does it have to do with this, wealth is connected to real estate, so therefore if a black family is living in public housing they are not building wealth, how is the connection not obvious

What makes you think that a black family living in public housing can afford to pay a mortgage? You really think people living in the projects can afford to just buy a house if they want to?

Without public housing, most of these families would either be renting somewhere or on the street.

what do you mean what they would do? they would do the same thing they do when public housing is destroyed now, the people would move to where its cheaper to live and its more likely to be able to own property if its cheap

public housing is a distortion of the real estate market and it stifles the building of black wealth and in a roundabout way it violates the economic and individual rights of the residents

You're ignoring the fact that a lot of these people would be put out on the streets. Sure it's a "distortion of the real estate market", but in the same way that food stamps are a distortion of the food market. These things are definitely abused sometimes, and some people get dependent, but they still prevent a lot of people from being homeless/hungry. It's a necessary evil.