Birmingham Could Be the Southern City That Gets It Right

Today, we are pleased to repost a piece from Comeback Town, a blog that aims to “begin a conversation about a better Birmingham.” We’d like to thank Comeback Town’s editor, David Sher, for featuring our 2018 State of the South report on his blog–especially since the guest writer is a former MDC intern, Natalie Pickett. Natalie is an Alabama native who just completed her Master of Social Work degree from Appalachian State University. She is now a community social worker in Durham, North Carolina.

I am a proud native of the Birmingham area. I grew up in Hoover until I moved out of state for college.

I live in North Carolina now, but I visit Birmingham frequently to see my parents and siblings.

Downtown Birmingham was beginning to change

When I moved away in 2011, downtown was starting to change. Railroad Park and Good People had just opened. The Barons were moving downtown. The Lyric underwent exciting renovations and Iron City was on the way. My family and I went from going downtown only for dance recitals and the McWane Center to frequenting Pepper Place and WorkPlay.

When I introduced myself to new college peers, I proudly said I was from Birmingham—mostly because it’s more recognizable than Hoover, but also because I wanted to belong to a cool city like Birmingham.

My view after seven years

Seven years later, I now have a degree in social work and the beginnings of a career in nonprofit services with historically marginalized populations. I’ve lived in four metropolitan areas across the Southeast, including Birmingham.

Professionally and personally, I am interested in how urban areas, particularly in the South, are currently experiencing periods of rapid growth and development. I am further intrigued by the issue of equity—who is benefiting from revitalization? Who might be harmed by it? And most importantly, what will it take for all residents to have the opportunity to benefit from and contribute to their city’s revitalization?

Birmingham, Baton Rouge, Nashville, Durham—the wonderful Southern cities I’ve called home—they are all asking these questions. I don’t know of any city that is not. We are all grappling with how to revitalize and prosper without unintentionally pushing out our long-term and historically marginalized residents (i.e. our neighbors who are people of color, low income, elderly, disabled, etc.).

Birmingham has a chance to get it right

Birmingham is still young in the life cycle of urban revitalization in the 21st century. It could be the Southern city that gets it right—that invests in developing its native talent as much as attracting new talent from out of state or over the mountain.

But these solutions do not happen by accident or by good intentions alone. It takes innovation, commitment, and courage—three things I know Birmingham has.

The state of the South

I live in Durham, North Carolina, and just finished an internship with an organization called MDC, which recently released its State of the South 2018 report.

MDC’s President, David Dodson, presented it to the Birmingham Rotary Club recently, where its findings were well received—and also eye-opening. The report found that in every state in the South there are more people coming from out of state who have college degrees than the number of people who were born there.

In Alabama, based on 2016 American Community Survey estimates, just over 20 percent of folks born in Alabama have a Bachelor’s Degree, compared to nearly 35 percent of people who moved to Alabama from somewhere else.

If we are going to create a prosperous and equitable Alabama, we must commit to strengthening public schools, community colleges, and universities within our state, rather than fostering a heavy reliance on imported talent.

The report looks back at what things were like in the 1960’s and finds that the South is doing better, but has a long way to go to put everyone on an equal footing.

In 1970 in Alabama, fewer than 5 percent of African Americans had a bachelor’s degree, compared to around 10 percent of Whites. By 2016, the number of African Americans with a BA had risen to nearly 20 percent, while the number of Whites was nearly 30 percent (the U.S. average in 2016 was over 20 percent for African Americans and nearly 40 percent for Whites).

For African Americans, the result was an increase in household income of over 50 percent in that period, but the increase still needed for African Americans to have Black-White parity is over 150%.

Improve educational attainment

In other words, we’ve made great progress, but we still need to address persistent disparities and improve educational attainment for everyone if all Alabamians are to be competitive in a national and global marketplace and earn family-sustaining incomes.

We are not alone in these challenges. “Few Southern cities are achieving growth, prosperity, and inclusive economic outcomes that improve conditions across the socioeconomic spectrum,” the report finds. “[R]egional growth and prosperity, matched with limited inclusion of historically disadvantaged populations, will likely exacerbate social fissures produced by shifting demographics and increased income inequality.”

The State of the South report uses three lenses to address these issues facing the South: belonging, thriving, and contributing.

Belonging means full participation in civic and economic institutions by all Alabamians, especially as rising generations are becoming more racially and ethnically diverse.

Thriving means removing the structural barriers and building the support systems that will generate wealth for everyone and spread its benefits.

And contributing means the engagement of once-marginalized voices who can define their own priorities.

Alabamians must find courage

That means Alabamians must find the courage to recommit to action that will engage progress, not backsliding. As the report says, we must build an “infrastructure of opportunity”—clear pathways to connect young people with educational credentials and jobs that pay a family-sustaining wage.

We must create relationships between our cities, suburbs, and countryside that can connect them and provide opportunities for everyone, regardless of where they live.

We need to make it so our education systems and employers work together so both can be competitive in the marketplace. And we need to recognize and address the shifting demographics of increasing racial and ethnic diversity.

Everyone must enjoy the fruits of new revitalization

Like I said, I’m from Hoover. My family could afford to live in the suburbs, in the “Birmingham Metro Area.” I’ve never lived in the City of Birmingham. My privilege allows me to claim the Magic City as my hometown, and its revitalization has only made me more excited to do so. My upbringing was largely unaffected by anything that happened in downtown Birmingham. We visited when it was convenient and fun.

Since then, downtown has become more convenient and fun for more people, which is a good thing.

But for the downtown natives (and Avondale natives, Crestline natives, Southside natives, and so on), the city of Birmingham is home, through thick and thin. If these folks don’t enjoy the fruits of the new revitalization, if they can’t access opportunities to contribute to Birmingham’s thriving, Birmingham will lose its way just as so many other metro areas—in the South and across the country—have begun to do.

 

Who Counts? Whose Voice is Heard?

The Trump Administration’s recent request to add a citizenship question to the upcoming 2020 Decennial Census has revived a contentious debate concerning the rights and privileges of political voice and power in our democracy. This debate, and the ugly compromises embedded in our country’s founding documents, are often centered around a simple question: In a representative democracy, who counts, and whose voice is heard in the halls of Congress or in our state and local governments?

Though the current answer to this question is more inclusive since our founding, the intentions of this latest effort, particularly in the backdrop of rhetoric and a contentious debate surrounding the issue of immigration, should cause us to reflect seriously upon what values and principals will guide the future of our democracy.

All this points to the importance of having an accurate 2020 Decennial Census.

The significance of the results is hard to overstate: a comprehensive count of all the people in the U.S. portends a shakeup of political power and voice that affects every facet of our lives. Through a process known as apportionment, 435 seats in the House of Representative will be allocated across 50 states in time for the 2024 presidential and congressional elections (U.S. territories and the District of Columbia have a representative, but not an actual vote in Congress). Some states are aggressively pursuing strategies to avoid the loss of a congressional seat, while other states are eagerly and confidently anticipating one or more new seats.

The factors influencing the potential shakeup of congressional apportionment are complicated; they include recent natural disasters (e.g. Hurricanes Harvey, Irma, and Maria), immigration and migration patterns, the lingering effects of the Great Recession and the housing crisis and, increasingly, the availability of jobs.

Defending its request to add a citizenship question to the Census, the Trump administration defends its efforts by suggesting it needs more data to properly enforce the Voting Rights Act; skeptics and immigration rights advocates suggest that the natural consequence will be lower response rates (leading to a more expensive survey) and heightened distrust and anxiety among both legal immigrants and undocumented populations. Most controversial, however, is the idea advanced by a small contingent of congresspersons that it would wholly exclude the count of undocumented residents for the purposes of apportionment—a debate that combines hardline immigration policy with a political calculus driven by an effort to curtail the influence of more urbanized and coastal communities that are home to substantial portions of immigrant and undocumented populations.

To tackle the complex intersection of issues that are core to the work we do at MDC, this post will serve as the first in a five-part series about the 2020 Census, and more broadly an examination of country’s history of who gets counted and whose voice is heard.

The five themes covered will include a Southern perspective on congressional representation (through apportionment) and political power, gerrymandering, immigration, and race. The final post will discuss how the continually eroding trust in our core institutions, like the Census, threatens to jeopardize community-driven efforts to build an inclusive and an equitable Infrastructure of Opportunity. In each of these pieces, we aspire to offer a positive vision for how the South can acknowledge its unique role as home to our country’s most painful history, and more importantly, how we can emerge as a region that is increasingly characterized by equity and opportunity for all.

In this first post, we’ll discuss the controversial origin of the South’s political power (e.g. congressional representation) and how the continued growth of the region portends considerable influence in shaping the country’s direction for decades to come.

How the institution of slavery propped up the South’s political power

In prioritizing the formation of a stable government over addressing the issue of slavery following the Revolutionary War, our country’s founders came to what is now commonly called the “Great Compromise.” To win over a powerful contingent of Southern representatives to the Constitutional Convention, our country’s founders created a bi-cameral legislature with a House, where membership was determined by state population, and a Senate that would have two representatives regardless of population.

Underlying this compromise, however are the origins of our country’s original sin—a twisted logic that counted slaves (as well as women) as persons for the purposes of congressional apportionment, without conferring the same rights or privileges as white men. The relevant section of the Article 1, Section 2 of the Constitution reads:

Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three fifths of all other Persons. [italics added]

 The first census in 1790 was a count of the U.S. population by U.S. marshals who recorded the name of the head of household and the count of persons using only five categories: the number of free white males (under and over age 16), free white females, all other free persons, and slaves. The Census results produced the first clear portrait of the institution of slavery—a system of oppression and economic dependence that the South, which was home to the clear majority (78 percent) of slaves living in the U.S., was desperate to keep in place.

With only 65 House seats at play for apportionment, the region ended up securing 23 (or 35 percent) of the seats—a result that solidified a voting block that effectively rejected sustained efforts to dismantle the institution of slavery. It took another 73 years, with the election of President Abraham Lincoln, and the secession of Southern states from the Union, that ultimately led to the Civil War and the formal end to slavery. It required three Constitutional Amendments (the 13th, 14th, and 15th amendments) to officially mark the end of slavery, craft a new definition of citizenship and equal protections under the law, and the right to vote regardless of race, color, or previous condition of servitude (the voting franchise wasn’t guaranteed for nearly 100 years).

Even though the South would go on to lose more than 6 million African Americans during the Great Migration of 1910 to 1970, and the simultaneous rapid westward expansion and formation of new states, the region’s political representation in the House of Representatives never fell below 27 percent of the current chamber size of 435 representatives.

The South’s distinct and ugly history during the period of Reconstruction, Jim Crow, and the Civil Rights era (and perhaps beyond) can be summarized by a struggle for the heart and soul of the region (often overtly violent, but also backed by a multiplicity of forms of de jure segregation) and its position on of equal rights and representation of African Americans and other oppressed populations.

The portrait of today’s South eloquently described by MDC’s Senior Fellow, Ferrel Guillory, as a place that “has a contradictory economy, polarized politics, an anxious populace, a divided head, and a conflicted heart” is precisely why the upcoming 2020 Census, and the resulting apportionment,  are an important benchmark for the region’s future. With substantial population growth since 1970 (accounting for 49 percent of the country’s population growth), the states of Georgia, Florida, North Carolina, Texas, and Virginia have accounted for the net increase of 26 House seats since the 1913 reapportionment. Alternatively, the states of Tennessee, Louisiana, Alabama, Arkansas, West Virginia, Mississippi, and Kentucky accounted for a loss of 21 seats during the same period (South Carolina held constant at seven seats).

Projecting the impact of Congressional Apportionment on the South

Election Data Services, a political consulting firm, recently completed analysis of the specific states that are likely to be gain or lose seats through apportionment following the 2020 Census. Based upon their latest analysis, the South and West are estimated to add a net of four congressional seats, while the Midwest and Northeast are projected to lose a net of four and three seats, respectively. As shown on the map below, the core states of the Rust Belt (including the states of New York, Pennsylvania, Ohio, West Virginia, and Michigan) are all currently expected to lose at least one seat. Meanwhile, the Southern states of Florida (+2), North Carolina (+1), and Texas (+2-3) are all expected to gain seats..While unforeseen circumstances (legal challenges, natural disasters, and unreliable or suppressed counts) may still affect the outcome of the final Census count, and the state-by-state tallying of congressional seats following the 2020 Census, one reality seams all but certain – the South is going add seats to its congressional delegation. The big open question is what affect our polarized politics, and conflicted heads and hearts, will have on how the maps for new congressional districts are drawn.

With no shortage of challenging issues to tackle on the horizon, recent evidence suggests that the principals and practices (let alone the art and science) of crafting new congressional maps will either work to strengthen or harm the region’s ability to embody a place where all people can belong, thrive and contribute. In our next post, we’ll examine the process and history of drawing congressional maps and how these they can be used as a tool to better represent the diversity and character of the modern South.

Hidden Figures and Hidden Talent: Why We All Lose When Exclusion Reigns

“Society benefits when everyone succeeds.”

This is the slogan that proudly faces passersby on MDC’s front window on Main Street in Durham. I’ve seen pedestrians stop in front of MDC’s windows, visibly pondering the meaning of the above statement. This sentiment undergirds our work; despite tried and true examples of trickle-up gain resulting from initially targeted policies, the idea that “society benefits when everyone succeeds” can seem abstract at best and untrue at worst. A scarcity mentality tempts us to dismiss collective benefit and cling to the belief that for one group to succeed, to matter, and to be recognized means that another group loses something. So what does MDC’s mantra, the antithesis of scarcity, really mean, and how do we know it’s true?

This past Sunday night, a 98-year-old African-American woman appeared on stage at one of the most prestigious awards ceremonies our nation celebrates. She was greeted by a standing ovation as the crowd of stars gathered for the 89th Academy Awards cheered her legacy, the inspiration for one of the year’s highest grossing films. But Katherine Johnson’s achievements are far more profound than the narrative of a blockbuster. Looking out at a sea of glamor and elitism, Katherine Johnson proudly exemplified why success and opportunity are not a zero-sum game.

Her story, as many have come to know it, is portrayed in the recent film Hidden Figures, adapted from Margot Lee Shetterly’s true account of four black women who played a key role in 1960s Space Race through their work at NASA. Though the film collapses the historical timeline and creates composite characters, the film has been acclaimed as an impressively accurate account of the struggles and triumphs of black female mathematicians relegated to backstage yet critical work at NASA. The film follows the work of Mary Jackson (Janelle Monáe), Dorothy Vaughn (Octavia Spencer), and Katherine Goble Johnson (Taraji Henson) at the height of the nation’s anxiety over Russian advances in space—and the U.S.’s lagging pace. In a time of looming threat from a foreign power, U.S. residents across region and identity had a vested interest in putting all hands and minds on deck to maximize talent and progress. But Jim Crow laws in Virginia, where NASA was working to send the first American into orbit, stubbornly and systemically inhibited equal inclusion of all American talent. Though Jackson, Vaughn, and Johnson had the skill, intellect, and passion needed to make a difference in America’s voyage to space, the narrative of white and male superiority is clear and biting: “We don’t need your talent. We can go farther without you.”

Except: yes, they do, and no, they can’t.

Jackson, Vaughn, and Johnson, who start out in the film as human “computers” in the all-black West campus of NASA know the worth and necessity of their talent, and choose to persist against unjust obstacles to make their vital contributions. (Their stories are examples of personal heroism that, as we’ve discussed here on the State of the South blog, can come at a high cost and ought not to be placed on individuals to begin with.)

Janelle Monáe as Mary Jackson attending engineering courses at an all-white school. Source: https://www.theaterbyte.com/tb_env_gly_/hidden-figures-2016

Janelle Monáe as Mary Jackson attending engineering courses at an all-white school. Source: https://www.theaterbyte.com/tb_env_gly_/hidden-figures-2016

Mary Jackson notices a defect of the heat shield surrounding the capsule that will carry John Glenn into space. But without the credentials offered by the whites-only school in Hampton, V.A., Jackson is barred from contributing her talent. Engineering in Virginia, therefore, is structurally maintained as a white field, for white talent. The American people are eagerly awaiting Glenn’s journey to space; little do they know the progress of U.S. space advancement is tied to the progress of integrating their schools—a measure met with opposition from large segments of the Southern white population. Jackson petitions the city of Hampton to allow her entry to the all-white school and breaks the barrier that had been erected to keep people of color from accessing opportunity and actualizing their talent. What is seen by opponents of integration as an advantage for people of color and a loss for white students and families is, actually, a gain for the entire nation.

Octavia Spencer as Dorothy Vaughn teaching black female mathematicians about the IBM 7090. Source: https://ladybusiness.dreamwidth.org/2017/01/09/hidden-figures-brings-the-excellence-of-historic-black-women-to-2017.html

Octavia Spencer as Dorothy Vaughn teaching black female mathematicians about the IBM 7090. Source: https://ladybusiness.dreamwidth.org/2017/01/09/hidden-figures-brings-the-excellence-of-historic-black-women-to-2017.html

Dorothy Vaughn similarly asserts herself in NASA’s work to accelerate progress in space travel. With the arrival of the IBM 7090, a machine that can rapidly compute calculations, Vaughn realizes that the new IBM could displace the black female computers she unofficially oversees. She throws herself into learning about the machine to ensure a place for her talent in the transition to using the IBM. But of course, the literature that would help her learn about the machine is in the whites-only section of the library. In the film, Vaughn’s character “bends” the rules by taking the book from the library, even though it is not approved reading for African Americans. From this book, she teaches not only herself, but also her all-black team of female mathematicians. By educating herself, which required covert studying and disobeying Jim Crow laws, Vaughn becomes the first person to successfully operate the IBM—something that made everyone’s work easier, more efficient, and ultimately made the U.S. more competitive.

Taraji Henson as Katherine Johnson, the first black female members of NASA’s Space Task Group Source: http://www.hollywoodreporter.com/behind-screen/how-hidden-figures-got-1960s-kodachrome-look-963042

Finally, Hidden Figures tells the story of Katherine Johnson, who faces discouraging messages and procedures at every turn. She’s needed on the Space Task Group to calculate high-level equations to ensure Glenn’s safe orbit—the first black female to serve on the prestigious team—but she’s resented by her white counterparts. Her colleagues undermine her abilities and her contributions—everything from installing a “colored” coffee maker and excluding her from critical meetings. When Katherine spends critical work time walking miles to the “colored” bathroom, when she’s given partial information because she’s not deemed trustworthy, the nation falls further behind in the Space Race. But when segregation of facilities is no longer enforced and Katherine demands and is provided a seat at the table during top-secret meetings and knowledge-sharing, only then does the U.S. emerge victorious in sending the first American into orbit. Our whole nation benefited when Katherine succeeded, and she had the opportunity to fully contribute her talents only when intentionally exclusive, white-supremacist barriers came toppling down.

Jackson, Vaughn, and Johnson’s stories teach us about the collective cost and unnecessary drain caused by Jim Crow policies in the South, as well as raise the question of why so many defended these policies in the first place. In hindsight, it seems obvious that structural and micro-level racial discriminations divided critical talent and held the whole country back. Stories like this always cause me to think: What kinds of harmful inequities will seem obvious to us fifty years from now? Instead of experiencing this history lesson and blockbuster film as a voyeuristic trip to the past, Americans can use the insights gained from Hidden Figures to sharpen our understanding of current barriers to opportunity—and consider what we all might be losing in defense of policies and structural practices that make it harder for those suppressed by disadvantage to maximize their full potential.

And surely there is much unsupported talent trapped in the lowest income quintile, particularly here in the American South, where a child born to parents with earnings at the bottom of the rung has only a 0-6.4 percent chance of entering a career with earnings in the top income quintile as an adult. The researchers who unearthed these alarming data found that this stalled mobility was associated with lower quality schools, high rates of racial residential segregation, lack of connection to social capital, lack of two-earner households, and high rates of income inequality. These factors exacerbate one another: income inequality combined with racial residential segregation creates inequitable quality of schools, negatively affecting students of color at a disproportionate rate, given local school funding formulas that often rely on property taxes. These economic mobility toxins plague the South at a higher rate than any other region in the U.S.—the same region, of course, that clung to racial segregation and Jim Crow legal discrimination for so many years. These exclusive policies were designed to bar people of color from accessing the same degree of opportunity and success as the white population, and the data show us that historical educational and economic suppression carry long-lasting symptoms that have intergenerational effects on families and entire communities.

Source: New York Times, based on Equality of Opportunity Project data

Source: New York Times, based on Equality of Opportunity Project data

But the stories shared in Hidden Figures tell us that when the walls of exclusion are lifted, when white superiority is debunked as talent across identities is valued, we all go farther together. Our nation houses an abundance of unique passion and talent. The choice is ours: Will we make room for our collective potential and insist on equity for all, from childhood to the workforce? Or will we pay the price of our own scarcity mentality? Like the film’s character Al Harrison (played by Kevin Costner) tells a white NASA worker, who is disgruntled by Katherine Johnson’s presence and recognition of talent, “We get to the peak together, or we don’t get there at all.” Or—as we like to say at MDC: “Society benefits when everyone succeeds.”

First Comes Love, Then Comes Marriage, Then Comes Economic Mobility?

Love is in the air! As you celebrate Valentine’s Day with your bae or your friends, consider that just 50 years ago, some marriages were illegal. The ban on interracial marriage was found

The Edelmans in 1968 Source: New York Times

The Edelmans in 1968
Source: New York Times

unconstitutional by the U.S. Supreme Court in the Loving v. Virginia case of 1967. This recent story on Peter Edelman and Marian Wright Edelman got us thinking about love and marriage…and economic mobility. (It also reminded us of that day Peter came to visit MDC.) Marian Wright, founder of the Children’s Defense Fund, and Peter Edelman, Carmack Waterhouse Professor of Law and Public Policy at Georgetown University Law Center, were the third interracial couple to be married a year after the Loving case. This union was the beginning of a powerhouse couple in the civil rights arena. At the time of their marriage, Marian was an accomplished Yale-educated civil rights lawyer and the first African-American woman admitted to the Mississippi bar. Peter had been an aide to U.S. Sen, Robert F. Kennedy and was working in policy and law. No doubt, Marian and Peter Edelman’s mutual support and encouragement contributed to their many successes. Similarly, one can speculate that some financial benefits of marriage helped in strengthening their partnership and the prospects of their three children as well. Just a year earlier, the marriage would have been unlawful.

And sure, love and commitment are great, but marriage historically is an economic engagement, too. Conventional wisdom points to financial benefits like having a dual income, the ability to share expenses, tax breaks, and lower rates on health insurance. The U.S. Supreme Court used the precedent set by Loving for reasoning as such in Obergefell v. Hodges (2005), which protected the right of same-sex couples to marry, making the institution available to even more people. There is research that suggests some economic benefit to some people who tie the knot. However, there is much debate about how marriage and financial benefits are associated with one another. While some argue that this link is direct and causal, others argue that the relationship between the two is more nuanced. For example, dual-earner households have higher household incomes and, therefore, more resources at their disposal that can be used for personal enrichment, creating a financial safety net, or investments in their children’s future. Proponents of this perspective suggest that strategies to improve upward economic mobility should focus on improving “the security of poor people and their children,” which will in turn “also tend to improve the stability of their relationships.”

But still, the moral of the story is: more marriages and the wealth gap closes, right? Sorry to ruin your honeymoon, folks, but the racial wealth gap persists regardless of family structure. As you can see in the figure below, the median, single-parent white family had roughly twice as much wealth as the median, two-parent black or Latino families.

Source: Demos. The Asset Value of Whiteness: Understanding the Racial Wealth Gap

Source: Demos. The Asset Value of Whiteness: Understanding the Racial Wealth Gap

This recent Demos report argues that “family structure does not drive racial inequity, and racial inequity persists regardless of family structure.” In short, the financial benefits of marriage are failing to close the racial mobility gap.

Chief Justice Earl Warren wrote in 1967: “The freedom to marry has long been recognized as one of the vital personal rights essential to the orderly pursuit of happiness by free men.” So, considering factors such as personal rights, happiness, and disparate benefits to different people, the Facebook status of the relationship between marriage and economic mobility might just be: “It’s complicated.”

Bootstraps vs. Blockades: Closing the Growing Racial Wealth Gap When Doing the “Right Thing” Doesn’t Work for Everyone

Conceptions of the American Dream often frame upward mobility as an ideal best accomplished through individual effort and perseverance. However, persistent racial disparities despite similar inputs demand a reconsideration of the story we tell ourselves about the degree to which success is available to everyone. A recent report using data from the Survey of Consumer Finances shows that, in 1983, white households held, on average, 5.3 times greater wealth than black households and 6.1 times greater wealth than Latino households. By 2013, those rates had increased to 7.7 and 6.7 times greater, respectively. This is a growth of 85 percent for white households, but only 27 percent for black households, and 69 percent for Latino households.

Source: CFED and Institute for Policy Studies. The Ever Growing Gap. August 2016

Source: CFED and Institute for Policy Studies. The Ever Growing Gap. August 2016

What is more striking, however, is that even if the wealth of black and Latino households had grown at the same rate as white households or even as drastically as those on the Forbes 400 list (a 736 percent increase in wealth between 1983 and 2013), their wealth would still not match the wealth held by white households. Black households would fall short by $181,000 and Latino households would fall short by $270,000. The report concludes that:

“If average Black family wealth continues to grow at the same pace it has over the past three decades, it would take Black families 228 years to amass the same amount of wealth White families have today. That’s just 17 years shorter than the 245-year span of slavery in this country.”

Catching Up: The Racial Wealth Gap is Unlikely to Narrow

In order to catch up to white families, black and Latino families would need to find a way to increase their wealth by over 700 percent. But traditional drivers of wealth creation do not produce as much value for people of color relative to their white counterparts (with the exception of Asians). For example, education has long been described as the great equalizer and, while there are significant economic returns to a college degree, there are large earnings and wealth gaps by race even among those who have earned postsecondary degrees. Similarly, homeownership is the largest expenditure for many families and represents a large portion of their total wealth, but non-whites are less likely to own their own home and, when they do, their property values are significantly lower. Given the extent to which homeownership is constrained by income and student loan debt (which is accumulated in larger amounts by non-white students), these racial disparities are not surprising.

Source: Georgetown University Center on Education and the Workforce. The College Payoff. 2011

Source: Georgetown University Center on Education and the Workforce. The College Payoff. 2011

 

Source: St. Louis Federal Reserve Bank. The Regional Economist. Unequal Degrees of Affluence: Racial and Ethnic Wealth Differences across Education Levels. October 2016.

Source: St. Louis Federal Reserve Bank. The Regional Economist. Unequal Degrees of Affluence: Racial and Ethnic Wealth Differences across Education Levels. October 2016.

Intergenerational transfers of wealth are another major contributor to wealth creation, but for black families, this strategy is much less successful. Black children born into moderately wealthy families (the middle wealth quintile), are more than twice as likely as white children to fall from the middle to the bottom quintile as adults (33 percent vs. 14 percent).

This trend is especially concerning in the South, with deep racial divides in economic opportunities and a long history of excluding racial minorities from sources of wealth accumulation. For example, the high degree of residential segregation found in the South further exacerbates the gap in wealth created by home ownership; neighborhoods with higher concentrations of non-white residents often have significantly lower property values. Coupled with lower rates of intergenerational income mobility, this suggests that an even greater challenge exists for black and Latino families hoping to build wealth and economic security.

New Outcomes Require New Systems

If black and Latino families are pursuing the same strategies for upward economic mobility as white families, why aren’t they reaping similar rewards? As we’ve written before, our history, particularly in the South, of economic dependence on forced and exploitative labor limited opportunities for wealth creation for those outside the economic elite, and particularly for people of color. Unequal investment in community resources that are beneficial to the entire population, like schools, transportation, and healthcare compounded these issues. This history and it’s continued legacy, apparent in current disparities, undermines a pillar of our proclaimed American ideal that upward economic mobility is available to all who are motivated, persistent, and hard-working. If we believe that closing the racial wealth gap is an issue best solved with strategies implemented at the individual level, what then, is a viable pathway for black and Latino families to catch up, if not through education, income, or homeownership? If we do not have a good answer to this question, we cannot continue to tell ourselves that the only thing standing between poverty and prosperity is a strong work ethic. Instead, we must commit to systemic changes at the institutional level, which focus on the racial disparities among major drivers of wealth creation and create an infrastructure of opportunity that is prosperous for everyone.