A Little Background
African American Political Disempowerment
Let’s take it back to the early 16th century when the U.S. was introduced to slavery. According to the Merriam-Webster dictionary, a slave is someone who is legally owned by another person and is forced to work without pay. Being that slaves were primarily from African descent and the owners were primarily white, this one definition automatically put African Americans at an economic and political disadvantage from White Americans. This was just a stepping stone for centuries of political and economic disempowerment to come.
More than 200 years later, from 1877 to the mid 1960s, African Americans in the south had to deal with what is commonly known as Jim Crow Laws. Jim Crow was more than a series of rigid anti-black laws. It was a way of life. This was a time when racism was seen everywhere. White everyday citizens, police, and politicians expressed their blatant hate for African Americans with anti-black laws, forming hate groups, lynching, police brutality, and and more. The laws at this time made it nearly impossible for any black citizen to vote. Laws like The Grandfather Clause were put inplace to allow potential white voters to get around literacy tests, poll taxes, and other tactics designed to disenfranchise southern blacks.
After endless protests and political movements initiated by Black Americans, the landmark Civil Rights Act of 1964 was passed which outlawed discrimination based on race, color, religion, sex, or national origin. It also ended unequal application of voter registration requirements and racial segregation in schools, at the workplace and by facilities that served the general public. This was a great step forward towards true equality between the two races but there was still much more to address.
African American Economic Disempowerment
Let’s take a closer look at the economic effects slavery and the discriminatory years ahead had on African Americans, keeping in mind that the literal definition of slave states that they work WITHOUT pay.
According to National Association for the Advancement of Colored People (NAACP) writer Nicole Kenney, in 1865, just after Emancipation, African Americans owned .05% of the nation’s wealth; by 1990 African Americans owned only 1%.
Throughout history blacks have been purposely put at a disadvantage from whites in the form of government programs and laws. For example, in 1944 the G.I. Bill was passed to help ease World War II veterans back into the working class by providing them with benefits like low-cost mortgages, low-interest loans to start a business, cash payments of tuition and living expenses to attend university, high school, or vocational education. It was supposedly available to every veteran who had been on active duty during the war years for at least one-hundred and twenty days and had not been dishonorably discharged. However, although the G.I. Bill did not specifically advocate discrimination, it was interpreted differently for blacks than for whites. Historian Ira Katznelson argued that “the law was deliberately designed to accommodate Jim Crow”. Of the first 67,000 mortgages insured by the G.I. Bill, fewer than 100 were taken out by non-whites. This unfair advantage gave white Americans the opportunity of property, wealth, and education that helped them develop their families and leave their kids with assets while giving minority veterans little to nothing. Veterans of color who were not given this opportunity had to fend for themselves and their families after the war and in turn struggled more and were unable to leave their kids with the same wealth the white veterans did. This one act of legislation left people of color at a unfair disadvantage once again to accumulate wealth and education over time.
According to a recent study called The Racial Wealth Gap: Why Policy Matters, by Demos, the typical black household now has just 6% of the wealth of the typical white household. In 2011, the average median white household had $111,146 in wealth holdings compared to $7,113 for the median black household and $8,348 for the median Latino household.
The graph above shows that the wealth gap between Latino Families and White families is around $102,798 and $104,033 between Black and White families. This sizable wealth gap among races leads to disproportionate homeownership rates, jobs, quality of education, and gaps in home values in white neighborhoods versus neighborhoods where people of color live.
Based on a survey conducted by the Survey of Income and Program Participation (SIPP), 73% of whites own a home, compared to 47% of Latinos and 45% of blacks. The average white homeowners’ house is worth $85,800 compared t0 $50,000 Based on a survey conducted by the Survey of Income and Program Participation (SIPP), 73% of whites own a home, compared to 47% of Latinos and 45% of blacks. The average white homeowners’ house is worth $85,800 compared t0 $50,000 for black homeowners and $48,000 for Latino homeowners.
Just as minority families are restricted by their inferior income and education, they are also restricted to their choice of quality neighborhoods. Research shows that black families making $100,000 typically live in the kinds of neighborhoods inhabited by white families making $30,000.
Effects on Neighborhoods and Education
Wealth gaps among races is a primary explanation to racially imbalanced neighborhoods. When you think of a “good” neighborhood you think of white picket fences and green lawns. These idealistic neighborhoods are usually inhabited by White families while colored people are subjected to lower quality neighborhoods because of their inferior incomes.
This is most concerning because the difference in neighborhood quality is proportionate with the quality of education given in schools there. It is proven that students in white neighborhoods receive a more resources and a better education than students in colored neighborhoods.
This not only affects their primary and secondary school learning, but also their chances of getting accepted and succeeding in four year colleges and universities. Figure 1 shows that in 2014 a little below 10 million white students enrolled in postsecondary institutions while 3 million Latinos and a little over 2 million African American students enrolled.
One obstacle is the dramatic increase in college costs over recent years, forcing households to take on significant debt in order to send students to college. Another sad reality is that obtaining a bachelor’s degree isn't enough for a black or Hispanic person to escape the racial wealth gap.
The graph above shows that an average white family can see a $55,869 return from receiving a bachelor’s degree. At the same time a Black family sees a $4,846 return and a Hispanic Family $4,191.