Racial Wealth Gap Quotes

In Where Do We Go from Here, King had said, “A society that has done something special against the Negro for hundreds of years must now do something special for him.

Ultimately, the FHA was an empty promise. The act allowed the country to publicly denounce segregation while never actually pursuing integration.

W. E. B Du Bois declared in 1948 that the problem of American democracy was that “we have not tried it.”20 Perhaps it is time to try.

Advocates of libertarianism and neoliberalism claimed to want more liberty for individuals and a smaller government, but in reality they only wanted less government for the wealthy and the white.

Instead of working to break down the walls of segregation and the poverty trap they had created, the ghetto would be sent entrepreneurs.

Then, as now, the public must be convinced that their own interests are aligned with the advancement of racial minorities or that they will not suffer when others are promoted.

freedom would be severely restricted without the ability to fully participate in the economy. Black leaders stressed that emancipation would have to be followed by the accumulation of wealth if the black community was ever to achieve meaningful political equality.

It is worth distilling this message in order to fully appreciate the irony. The story was that after decades of New Deal–era federal subsidies had created a white middle class, reinforced a segregated black underclass, and created cyclic poverty that made it difficult for many to find shelter and food without government aid, it was black people who were being unjustly enriched by the overly generous hand of the state.

We might want to apply the following short litmus tests to any policy proposal: does the program require some collective sacrifice or does it place the burden of closing the wealth gap entirely on the black community? If the latter, this is a cop-out that refuses to acknowledge that the black community did not create the problem in the first place.

Lifting people out of poverty can have trickle-up economic effects and raise all boats.

For black families, each dollar creates only sixty-nine cents in total wealth.25 This is why the wealth gap between blacks and whites can continue to grow even when de jure discrimination ended decades ago.

To put the gap in stark racial terms, in America in 2013, the average wealth per household was $81,000. But averages have highs and lows. When you disaggregate the numbers, white families average $142,000 in wealth, Latinos come in at $13,700, and black families bring up the rear at $11,000.

Alexis de Tocqueville, who came to marvel at America’s democracy, was shocked at the level of racial prejudice he observed in the North. “The prejudice of race,” he wrote, “appears to be stronger in the states that have abolished slavery than in those where it still exists; and nowhere is it so intolerant as in those states where servitude has never been known.”10

Slavery, “America’s original sin,” according to James Madison, created the foundation of modern American capitalism.1 It was slavery and the “blood drawn with the lash” that opened the arteries of capital and commerce that led to U.S. economic dominance worldwide.2 The effects of the institution of slavery on American commerce were monumental—3.2 million slaves were worth $1.3 billion in market value, almost equal to the entire gross national product.

Even with the bundling and splitting of tranches, Wall Street needed more mortgage borrowers, so it created the subprime market. These were loans to borrowers who did not meet the underwriting standards set forth by the GSEs, or “prime” loans. Subprime borrowers were riskier borrowers, either because they had fewer assets, lower credit score, or lower incomes. But in finance, higher risk is rewarded with higher yield, so mortgage brokers made even higher premiums from subprime loans.

Perhaps because the bank was identified with the endeavors of the newly freed negro, wrote historians Kindsor and Sagarin, anyone who dared to raise a cry against the mismanagement was charged with being anti-negro. In as much as the enemies of the negro were not interested in the bank, and the friends were effectively silenced with the anti-negro charge, there was no exposure of the condition of the bank. The belief that the failures of black institutions could not be accurately studied because of the sensitivity of the race issue, whether accurate or not, would be a recurring theme through history.

Today, black families have an average net wealth of $11,000 compared to a white family’s average of $141,900. Pew data reveals that white families have thirteen times more wealth than black families.20 The wealth gap exists at every income and education level. On average, white families with college degrees have over $300,000 more wealth than black families with college degrees. A third of black families have no assets at all.21 Moreover, studies reveal that the gap is accelerating—over the last thirty years, the average wealth of white families has grown at three times the rate for average black families.22 This growing divide perpetuates injustices hard to capture behind the latest news of riots and protests.

The scheme began to unravel following the Panic of 1873 when railroad investments failed. The bank experienced several runs at the height of the panic. The panic would not have affected the bank if it had been a savings bank, but by 1866, the business of the bank had become…reckless speculation, over-capitalization, stock manipulation, intrigue and bribery, and downright plundering…. In a last ditch effort to save the bank, the Trustees appointed Frederick Douglas as Bank President in March of 1874. Douglass did not ask to be nominated and the Bank Board knew that Douglass had no experience in banking, but they felt that his reputation and popularity would restore confidence to fleeing depositors….Douglas lent the bank $10,000 of his own money to cover the bank’s illiquid assets….Douglass quickly discovered that the bank was full of dead men’s bones, rottenness and corruption. As soon as Douglass realized that the bank was headed towards certain failure, he imposed drastic spending cuts to limit depositors’ losses. He then relayed this information to Congress, underscoring the bank’s insolvency, and declaring that he could no longer ask his people to deposit their money in it. Despite the other Trustees’ attempts to convince Congress otherwise, Congress sided with Douglass, and on June 20, 1874, Congress amended the Charter to authorize the Trustees to end operations. Within a few weeks’ time, the bank’s doors were shut for good on June 29, 1874, leaving 61,131 depositors without access to nearly $3 million dollars in deposits. More than half of accumulated black wealth disappeared through the mismanagement of the Freedman’s Savings Bank. And what is most lamentable…is the fact that only a few of those who embezzled and defrauded the one-time liquid assets of this bank were ever prosecuted….Congress did appoint a commission led by John AJ Cresswell to look into the failure and to recover as much of the deposits as possible. In 1880, Henry Cook testified about the bank failure and said that bank’s depositors were victims of a widespread universal sweeping financial disaster. In other words, it was the Market’s fault, not his. The misdeeds of the bank’s management never came to light.

This was just the first of several pivotal points in U.S. history when government reformers would choose to grant political rights instead of achieving real justice by addressing economic inequality

Wealth is where history shows up in your wallet, where your financial freedom is determined by compounding interest on decisions made long before you were born. That is why the Black-white wealth gap is growing despite gains in Black education and earnings, and why the typical Black household owns only $17,600 in assets. Still, having little to no intergenerational wealth and facing massive systemic barriers, descendants of a stolen people have given America the touch-tone telephone, the carbon filament in the lightbulb, the gas mask, the modern traffic light, blood banks, the gas furnace, open-heart surgery, and the mathematics to enable the moon landing. Just imagine the possibilities if—in addition to rebuilding the pathways for all aspirants to the American Dream—we gave millions more Black Americans the life-changing freedom that a modest amount of wealth affords. A 2020 Citigroup report calculated that “if racial gaps for Blacks had been closed 20 years ago, U.S. GDP could have benefitted by an estimated $16 trillion.

The climate crisis is entangled with other crises, named in the GND resolution: life expectancy declining; basic needs out of the reach of many; the greatest income inequality since the 1920s; a large racial wealth divide; a gender earnings gap; and systemic injustices that have been exacerbated by pollution, environmental destruction, and climate change. [The GND emerges from an analysis of the climate crisis that identifies it as a consequence of systems—neoliberalism, strategic racism, unfettered capitalism—and their interaction, rather than simply as a consequence of greenhouse gas emissions.]

This was in 1986. New York in the 1980s was one of the angriest, most racially divided places in the world. This was the time of subway shooter Bernie Goetz, the Howard Beach massacre, and the Central Park jogger case. It was a time when blacks protesting the beating of four teenagers by a mob of young whites in the Brooklyn neighborhood of Bensonhurst could be met by a crowd that, unfazed by TV cameras, waved watermelons at them and chanted, “Niggers go home!” The city was a war zone, a tinderbox of race hatred ready to blow at any time.

The civil rights revolution of the 1960s was vital, but it wasn’t a panacea, and the problems of today—from the racial wealth gap to the crumbling ghettos of the Midwest—stem from the racist policies of our recent past. Or, as Coates puts it, “White supremacy is … a force so fundamental to America that it is difficult to imagine the country without it.

King felt compelled to respond: “You don’t have to go to Karl Marx to learn how to be a revolutionary. I didn’t get my inspiration from Karl Marx; I got it from a man named Jesus.”193

Over the past fifty years, the racial income gap has not budged. In 1968, shortly after the passage of the Civil Rights Act, the median Black family income was 57 percent that of whites. In 2016, it was 56 percent. But the starkest racial divides are in household wealth, reflecting centuries of white privilege that have made it particularly difficult for people of color to achieve economic security. Today, the average Black family with children holds just one cent of wealth for every dollar that the average white family with children holds.15

But the foremost concerns of the Democrats’ most reliable voting bloc—affordable housing, clean water, police brutality, the racial wealth gap, and reparations for state-sanctioned discrimination (as has been accorded other groups discriminated against in the United States)—have remained on the back burner, or have even been considered radioactive issues for the party that African-Americans help to sustain. To those who say that this would be impractical, it would be the duty of the party representing and dependent on the subordinate caste to open the eyes of their fellow Americans and make the case for a more egalitarian country.

the FHA would not make or guarantee mortgages for borrowers of color,” she said. “It would guarantee mortgages for developers who were building subdivisions, but only on the condition that they include deed restrictions preventing any of those homes from being sold to people of color. Here we have this structure that facilitated…white homeownership, and therefore the creation of white wealth at a heretofore unprecedented scale—and [that] explicitly prevented people of color from having those same benefits. To a very large degree, this was the genesis of the incredible racial wealth gap we have today.

The consequences of systemic racism are vast—from the burgeoning racial wealth gap, political disenfranchisement, mass incarceration and racist immigration policies to micro-aggressions, racial profiling, racist media imagery, and disparities in health, education, employment, and housing.

James Forman was even more blunt: "If we can't sit at the table, then let's knock the fucking legs off!

The racial wealth gap produces a giving gap.

After Haitians led a successful slave revolt against the French, the former slaves refused to grow sugar and output halted.60 They grew crops they could eat instead. Subsistence farming meant that a family would grow what they could live on, diversifying their crops, with some portion going for sale and some going for consumption. There was every reason to believe that American blacks would also go this route.

Blacks had to be seen as subhuman so that they could be treated as chattel.

In all racial groups, students from wealthy households tend to score better than those who are poor, but income does not explain group differences. A study by McKinsey and Company found that white fourth graders living in poverty scored higher—by the equivalent of about half-a-year’s instruction—than black fourth graders who were not poor. These differences increase in high school. On the 2009 math and verbal SAT tests, whites from families with incomes of less than $20,000 not only had an average combined score that was 117 points (out of 1600) higher than the average for all blacks, they even outscored by 12 points blacks who came from families with incomes of $160,000 to $200,000. Educators and legislators have not ignored the problem. The race gap in achievement is such a preoccupation that in 2007, 4,000 educators and experts attended an “Achievement Gap Summit” in Sacramento. They took part in no fewer than 125 panels on ways to help blacks and Hispanics do as well as whites and Asians. Overwhelming majorities in Congress passed the No Child Left Behind Act in 2002 to improve student performance and bridge achievement gaps. The government budgeted $24.4 billion for the program for fiscal year 2007, and its requirements for “Adequate Yearly Progress” have forced change on many schools. This is only the latest effort in more than 25 years of federal involvement. The result? In 2009, Chester E. Finn, Jr., a former education official in the Reagan administration, put it this way: “This is a nearly unrelenting tale of woe and disappointment. If there’s any good news here, I can’t find it.

Between 1934 and 1968, 98 percent of FHA loans went to white Americans.30 In some cases, whole cities were ineligible for FHA funds.

By the 1950s, 85 percent of the homes sold to blacks in Chicago were sold on contract with exploitative terms.

The wealth gap is where the injustices sown in the past grow imperceptibly in the present.23 The cumulative effects of discrimination, segregation, and the economic detour for black businesses have created self-perpetuating forces that continue to make black wealth accumulation difficult.

fact, the dilemma faced by black banks is highlighted when contrasted with the viable banks created by Italian, Jewish, German, Irish, and Asian immigrants. Each of these immigrant groups faced discrimination and exclusion like the black population, but the key difference was that none of them was systematically, uniformly, and legally segregated to the extent and for the length of time the black community was. Many

In fact, the dilemma faced by black banks is highlighted when contrasted with the viable banks created by Italian, Jewish, German, Irish, and Asian immigrants. Each of these immigrant groups faced discrimination and exclusion like the black population, but the key difference was that none of them was systematically, uniformly, and legally segregated to the extent and for the length of time the black community was. Many immigrants eventually left their overcrowded ghettos and settled in suburbs where, through violence, zoning restrictions, and racial covenants, blacks were barred.

The economic oppression of slavery was justified in the eighteenth century by a corrupted version of Christian dogma that held that the white race had a divine right to subject the black one.

a group, blacks are more unbanked than any other race—60 percent of the black population is unbanked or underbanked, while only 20 percent of whites are in the same category.15 What this means is that blacks disproportionately rely on fringe banks, leading to a debt trap. Blacks pay higher interest on mortgages and small loans. They pay more fees on basic services than similarly situated whites and they are taken to court disproportionately by creditors for very small debts.16

The institution of slavery was so at odds with the liberal notions of equality avowed in America’s founding documents that a theory of racial hierarchy was used to explain away the dissonance.

In the antebellum era, Christian religious principles were exploited to provide the rationale for racial subjugation.4 Not only were slavery and white supremacy condoned by God, but it was seen as God’s will that white men exploit the labor of the black race. In The Christian Doctrine of Slavery, a Presbyterian minister concluded, “It may be that Christian slavery is God’s solution of the problem [of labor] about which the wisest statesmen of Europe confess themselves ‘at fault.’ ”5

Frederick Douglass remarked that “the history of civilization shows that no people can well rise to a high degree of mental or even moral excellence without wealth. A people uniformly poor and compelled to struggle for barely a physical existence will be dependent and despised by their neighbors and will finally despise themselves.

To take just one example, the 1862 Homestead Act gleefully gave away millions of acres of stolen land almost exclusively to whites.10 And, quiet as it’s kept, white people continue to be the number-one beneficiaries of affirmative action today. Race scholars are aware that white women are the top recipients of affirmative action, but few have considered that white women’s primary access to affirmative action helps maintain the racial wealth gap.11 Because these white women typically marry white men, their affirmative action benefits are channeled toward their white families.

New Deal programs that would have sent aid to build housing in the urban ghetto were instead used to create white suburbs that reinforced and perpetuated racial segregation for the rest of the century.

The value of white working- and middle-class families’ suburban housing appreciated substantially over the years, resulting in vast wealth differences between whites and blacks that helped to define permanently our racial living arrangements. Because parents can bequeath assets to their children, the racial wealth gap is even more persistent down through the generations than income differences.

Ocasio-Cortez calls herself a democratic socialist. What she seems to mean by the name is that we have in common the things we choose to share together, and these common things—good schools, good transport, public parks, good housing, and medical care for everyone—make a shared world. We should make them everyone’s. The name is also a way of claiming a long tradition of politics that asks not whether the world is good enough or getting better, but instead what is the gap between the world we have now and the better world that is within our power to make. It is a tradition that recognizes that economies do not just produce wealth: they produce human lives and relationships, which can be dignified or humiliating, mutual or exploitative, solidaristic or fragmenting, more frightening or safer. And economies, in turn, do not arise naturally, whether from the self-interest of “rational man” or from the disruptive imagination of entrepreneurs and the benignity of philanthropists. Political decisions give economies their shape, from labor laws and tax rates and public investments to questions of almost metaphysical significance. The journalist Kate Aronoff has observed that climate politics addresses the question of who will survive the twenty-first century. Environmental politics, like the politics of work and health care, answers in very concrete terms the ultimate question: What is the value of life? And whose life, which lives, will be valued? As I write, a hopeful, even heroic response to these questions is gathering under the heading of the Green New Deal. Maybe it will find another banner soon, or maybe it will succeed in transforming the meaning of the New Deal from the industrial, racially exclusionary, male-centered program of solidarity that it was to a truly universal reworking of its potential into a commonwealth of shared dignity and mutual care.