By Ellen McGirt
August 10, 2016

A new study, published Monday, states that the racial wealth gap is so wide, that it would take 228 years for black and Latino families to amass the wealth that white families currently have. My colleague, Chauncey Alcorn, has an excellent analysis here.

It’s worth noting two things. First, that by 2043, the year that people of color will become a majority in America, the gap will have doubled. And second, that the gap is driven entirely by public policy decisions, which are things we can actually control.

The Corporation for Enterprise Development and Institute for Policy Studies published the study, using thirty years of publicly available federal income, pension and other data, to shift the conversation about the well being of families of color from income, to a more significant marker of success – or failure – which is wealth.

“Over the past 30 years, the average wealth of White families has grown by 84%—1.2 times the rate of growth for the Latino population and three times the rate of growth for the Black population. If the past 30 years were to repeat, the next three decades would see the averagwealth of White households increase by over $18,000 per year, while Latino and Black households would see their respective wealth increase by about $2,250 and $750 per year.”

This report joins a growing portfolio of credible thinking on systemic barriers that that exist in the land of opportunity, ones that will not be solved by hiking up sagging pants or the shaming of hip hop fans.

But it also offers a history lesson on the development of the middle class in America, starting after The Great Depression and World War Two, when government investment in protecting the wealth of citizens was at a high point. “But the programs directing those public investments were either intentionally designed or implemented to create discriminatory barriers for households of color,” the report says.

As a result, there is no way forward unless we all become policy wonks and equity experts, and change the redlining in housing, finance, education, labor practices, and quite specifically, tax policies, that have favored white households for decades. The disadvantages “are impossible to overcome without racially-aware policy change.”

The report is a must-read, and a great way to kick-off your wonk journey if you’re new to policy talk.

But it occurs to me that this is also a design problem in disguise. Do we know how to build systems in which someone doesn’t need to lose for someone else to win?

 

 

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