Poverty and Racism Aren't the Same, But Black People Are Getting Screwed by Both
Jan 25, 2016
Racial inequality and economic inequality are not synonyms, but they are as closely linked as it is possible for two things to be. They are the bread and butter of American problems.
The racial wealth gap. The racial wealth gap. The racial wealth gap. Let us focus here, for a moment, on the real enemy: The racial wealth gap. For an up-to-date picture of the economic discrepancies in America by race, here is a quick snapshot of facts taken from the newly released Assets & Opportunity Scorecard from the Corporation for Enterprise Development:
Unemployment: For whites, 4.9%; for Latinos, 7.5%; and for black people, 11.5%.
Poverty: 10.9% of white households earn incomes below the federal poverty line, versus 23.5% of Latino households and 26.1% of black households. Furthermore, we can see that there is a racial gap not only in income but in wealth; here is a racial breakdown of the asset poverty rate, defined as the Percentage of households without sufficient net worth to subsist at the poverty level for three months in the absence of income: for white households, 18.7%; for Latino households, 43.3%; and for black households, 45.6%. Perhaps the starkest measure of racial wealth inequality is median household net worth: for white households, $111,000; for Latino households, $9,000; and for black households, $7,000.
Business ownership: What percentage of the labor force are business owners? For whites, 19.1%; for Latinos, 13.8%; and for black people, 14.4%. And the average value of a white-owned business is 4.1 times greater than the value of a Latino-owned business, and 8.8 times greater than the value of a black-owned business.
Homeownership: 71% of white household are homeowners, versus 45% of Latino households and 41% of black households. And 57% of black households that rent are defined as “cost-burdened” (meaning they pay more than 30% of their income in rent), versus 56% for Latino households and 45% for white households.
Health insurance: 9.8% of white people are uninsured, versus 24.7% of Latinos and 14.9% of black people.
Education: The high school graduation rate for white students is 87.2%; for Latino students, 76.3%; and for black students, 72.5%. And 33.5% of white people have a four-year degree, versus 14.4% of Latinos and 19.7% of black people.
The facts tell the story: minority households, particularly black, are losing in virtually every measure of economic health. This sort of inequality is a trap that feeds itself. Black people are born with less family wealth, earn less income, have a harder time buying a home, and therefore have a harder time getting credit that might offer them a lifeline out of poverty. We can talk about The American Dream all we want, but this is the American reality.
The close correlation between race and poverty clearly has its roots in historic racism—and, for black people, the legacy of slavery, which was a very direct system of building white wealth at the expense of black people. The close correlation between race and poverty also means that if you attack poverty itself, you are by definition attacking the racial wealth gap. Nobody suffers from poverty’s effects in this country more than black people.
Ta-Nehisi Coates, who has long made the moral case for slavery reparations in America, has taken Bernie Sanders to task for failing to endorse reparations, saying that the candidate carrying the “radical” flag should support reparations specifically for black people, writing “treating a racist injury solely with class-based remedies is like treating a gun-shot wound solely with bandages. The bandages help, but they will not suffice.”
The racial wealth gap is the living, thriving manifestation of racism’s legacy. It does not represent the totality of American racism (rich black people can get shot by police, too), but it is the thing that captures the broadest picture of the real-world effects of hundreds of years of discrimination. Economics are not the only effect of racism. But economics do have the useful quality of being something that politicians are able to directly and meaningfully address through government policy, unlike some of racism’s murkier aspects. No one who is being honest can deny that America owes an enormous debt to black people that it has never even attempted to repay. The moral case for reparations is sound. What would those reparations look like? Coates doesn’t say. (I took a crack at imagining what an American system of reparations would like once, and came up with a system of payments to poor people.) It would certainly be healthy for America’s soul to have a debate about reparations in the mainstream dialogue. To do it, we need some idea of what those reparations would be.
I do not know the what the best system of reparations would be. But I do know that the racial wealth gap is real, and the correlation of race and poverty is real, and that those facts are responsible for destroying millions of black lives in America, and that those things can be addressed through government policies. By addressing income inequality, and wealth inequality, and predatory lending, and unemployment, and affordable housing, and lack of credit and good education and good health care for the poor, you do a whole lot to help black people, who suffer the effects of these things more acutely than any other group. So let’s fix the problems. “Does this count as reparations?” It doesn’t have to. It counts as fixing the problems that we know that we have and we know how to fix, right now, if only we can muster the political will to do so.