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.
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
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.
I’ve been guilty of it: celebrating something or someone as “classy,” or enjoying being described as “classy” myself. It seems fun and harmless, as if for a glamorous moment, I get to dabble in a sense of sophisticated belonging. But what does it mean to have “class?” Here on the State of the South blog, we talk a lot about wealth stratification and how a young person’s chances for economic mobility change based on family income and place, but these economic descriptors, while telling, don’t completely capture the cultural and social nuances of how we measure success and belonging in America. For example, I’m not just referring to economic success when I fix a shrimp and grits dish and brag to my friends, “this is some classy stuff.” So what do we mean when we describe people, places, and things as “classy,” and what does this imply about equitable access to opportunity if we also discuss economic success in terms of “class?”
Being “classy” isn’t exclusively about economic success—of course wealth and material comfort are associated with anything most people would describe as “classy,” but to be “classy” is also the ability to adequately prove that one belongs to a certain culture that confers status and power. To be “classy” isn’t necessarily to be hard-working, educated, or ambitious—the ingredients we hope, in an equal-opportunity capitalism, would be valuable tools to attaining upward economic mobility. Rather, having “class” has more to do with the family you grow up in and requires a type of informal training on how to belong to the higher-status culture. And because this culture is associated with whiteness and wealth, it isn’t equally accessible to all.
Twentieth-century sociologist Pierre Bourdieu articulated this in his theory of three forms of capital: economic, social, and cultural. In short, economic capital is what you have, social capital is who you know, and cultural capital is what you know. Bourdieu describes these forms of capital as tools that help individuals navigate society and access economic and social success. But there’s not an abundance of these tools—on the contrary, they find their value in scarcity, and they’re not exactly tools you can attain with hard work. So the inaccessibility of cultural capital in America becomes particularly problematic considering that, as Bourdieu found, having this form of capital equips you to take advantage of opportunity needed to succeed.
If you’re a regular reader, you know that we think it’s important to identify and limit barriers that keep people in underserved populations from taking advantage of opportunity. This includes increasing access to education, affordable housing, transportation, and healthcare. But there are other cultural and social dynamics at play that not only keep some people stuck at the bottom from one generation to the next, but keep some anchored at the top, as well:
Economic Mobility in Raleigh: What are the chances a child raised in a given quintile of the income distribution will move to another quintile as an adult?
Source: Equality of Opportunity Project
Because intergenerational “stickiness” is especially dire in the South, it’s important to take in the whole regional picture and the elements of Southern culture that could potentially contribute to inequitable outcomes. Sometimes this means turning the mirror on ourselves and seeking to change conditions by moving the lever not just on our economic systems, but on our cultural strongholds as well.
I came to understand one of these cultural strongholds better when I wrote my senior honors thesis on a dearly beloved Southern tradition that delineates the distinction between “class” and economic success: the debutante ball.
In my research, I looked specifically at the North Carolina statewide debutante ball that occurs in Raleigh once a year. About two hundred nineteen-year-old women from around the state are invited to partake in a summer of parties and dances, all culminating in a September weekend filled with luncheons, cocktails, dances, and—above all—a presentation ceremony, followed by a ball. Here, the symbolic purpose of the debutante ball comes to fruition, as young women are “presented to society” by an older man (most commonly their fathers) and presented on stage in long, white dresses while clutching a bouquet of red roses. One by one, the women are announced, until the whole group is asked to stand and is officially declared that year’s class of North Carolina debutantes.
To be invited to make your debut is an honor among the deb community, and indeed one must be invited in order to attend. The criteria for invitation remain largely mysterious, even after hour-long interviews with twenty-two debutante insiders. The most common answer is tradition—if your mother did it, or your father’s mother did it, and so on, you’re a shoe-in. Sometimes the answer to what merits an invitation is community contribution, yet the deb cohorts are consistently populated with white, affluent families, who are clearly not the only ones who contribute to the state’s well-being. It costs nearly $3,000 to merely accept an invitation to debut, and that’s doesn’t include the cost of the deb dress (often compared to a wedding dress), tuxedos, hotel rooms, limousines, and any other expenses that come along with the culture of participation.
The debutante tradition is largely about families, not the individual debutantes themselves, as the group of young women is lumped together without any substantial way to highlight their individual interests or accomplishments. Indeed, debutantes are introduced by their parents’ names, and many of the debutantes I spoke with told me that, although the parties were fun, they knew their participation was the result of their parents’ social connections and a desire to make their parents proud. Several debutantes I spoke with felt that family pressure meant that their not making their debut wasn’t even an option. For example, one young woman told me: “It was kind of a thing where I wasn’t physically forced to go, but [pause] I didn’t really have a choice not to go.” Parents have a vested interest in ensuring their daughters’ participation, because the debutante ball works, particularly in the South, to display families’ economic, social, and cultural assets and to reproduce elite status and social circles for the next generation. The result is that upper-class group boundaries are protected—children of elite families stay elite, and the deb ball does not welcome children of non-elite families to join “upper-class” ranks.
Again, there seems to be some ambiguity around what “upper-class” means. The term is bound up with all three types of Bourdieu’s capital, yet we like to talk about class in America as if it’s purely a matter of economic success and can therefore be attained with the right amount of persistence and hard work. But studying cultural phenomena like the debutante ball tells us otherwise. For example, during an interview with a man who had been attending the debutante ball since the 1940s, I asked him if it was possible for someone fairly new to North Carolina to be invited to debut. He told me: “Not unless they had money. If they had money, that other group would reach out to them, I guess. They figure, oh, they got money, so therefore they got class. But everybody who got money don’t have class, let’s face it [laughter.]” When I asked him to say more, he couldn’t quite articulate what he meant, and told me there was just a certain way of behaving that was understood among people who belonged to deb culture. Therefore, people with “new money” stuck out at these events and were not seen as valid group members. So could these families be described as “upper class?”
In a highly mobile society, young people would be able to navigate pathways to opportunity regardless of family wealth and connections. Instead, limited economic, social, and cultural capital—all closely guarded and reproduced within families—create extra hoops for young people to jump through in order to succeed. As Claire Cain Miller explained in an article for The UpShot yesterday, “Children grow up learning the skills to succeed in their socioeconomic stratum, but not necessarily others.” To build an Infrastructure of Opportunity in the South, we will need to take an honest look not only at our economic system, but also at our community culture and how that culture reinforces unequal access to opportunity.
Through a partnership with the John M. Belk Endowment, MDC is profiling eight North Carolina communities to learn how they are working to improve economic conditions in North Carolina and strengthen the systems and supports that boost people to higher rungs on the economic ladder. One focus area is a four-county region made up of Vance, Granville, Franklin, and Warren counties, where MDC has been holding enlightening conversations with education leaders, community foundations, and workforce partners about at mobility, current and emerging living-wage employment opportunities, and patterns of postsecondary persistence.
Even though MDC has roots in this area, like the Human Resources Development Program, the Rural Community College Initiative, and the Program for the Rural Carolinas our team has been fascinated to learn more about these counties. Coincidentally, two of our favorite news sources—CityLab and EdNC—have been talking about Warren County this month, and we want to share a little bit about what we’re learning about that county’s history of inequity and one way people there are building for a more equitable future.
Stretching along the Virginia border and the shores of Lake Kerr and Lake Gaston, Warren County remains distinctly rural despite I-85 running through it and its proximity to one of the state’s most economically dynamic metropolitan areas. The region’s economic history is archetypal North Carolina: tobacco and cotton farming, driven by slave-labor until the end of the Civil War. Tobacco and cotton are labor-intensive crops, and the soil in the area was well suited to their production. In 1860, 10,401 people in the county, or 66 percent of the total population, were enslaved African Americans. The slave population was twice that of the white population—the highest ratio in the state. When enslaved African Americans were freed at the end of the Civil War, many became sharecroppers in a system where land owners provided land and resources to croppers in exchange for a significant portion of the crop. The legacy of an agricultural economy, which created immense wealth for some by exploiting the labor of many others, and subsequent legalized segregation which barred African Americans from opportunity, presents unique challenges for broadening economic opportunity in the region today.
By the turn of the 20th century, Jim Crow laws were in full effect, and the legal, social, and economic rights of African Americans in the area were significantly constrained. The massive population shift of African Americans leaving the South, known as the Great Migration, was felt in Warren County: between 1950 and 1970, the African American population in the region decreased by 20 percent. While the prospect of jobs and upward mobility certainly pulled people to the North, many felt themselves pushed away from the communities they called home because of entrenched racism and legalized segregation.
After centuries of economic structures that allowed few chances at upward mobility and wealth building for the majority of residents, and particularly African Americans, the area continues to have high levels of inequality and poverty. Unemployment is high, and for those who do have jobs, median wages are low. Educational attainment, which was unnecessary for earlier agricultural and manufacturing employment, is much lower than state and national averages: only 20 percent of adults in Warren County have a two-year degree or higher. The area also faces significant health challenges. According to County Health Rankings, Warren County ranks 92nd in North Carolina (out of 100) in an index of health factors, including health behavior, access to care, and social and economic factors. One-fifth of people were uninsured in 2015, almost twice the national average (though that figure is down from one-quarter in 2013). Nearly a quarter of all people are food insecure, according to Feeding America.
Despite its challenges—or because of them—the area has a strong history of community organizing and activism, particularly civil rights organizing. In the 1970s, Floyd McKissick led the development of Soul City, a planned multi-racial community with an explicit mission of black empowerment, profiled here by Brentin Mock of CityLab. Ultimately, the economic downturn and political opposition prevented Soul City’s completion. “Oh, it was visionary, it was bold, it had the concept though not the financial backing as it turned out, to be a stimulus to turn around that kind of a rural area,” said Eva Clayton in a 1989 interview for the Southern Oral History Program. Clayton, who in 1992 was North Carolina’s first African-American woman to be elected to Congress, worked in the Soul City administration in the 1970s. While Soul City did not flourish into the thriving community that McKissick and others envisioned, the infrastructure continues to be used, and it created organizing energy that continued in the region, as Mock discussed in another article last week. For example, in the early 1980s, when the N.C. Department of Environment and Natural Resources decided to build a PCB landfill in Warren County, the community responded with organized protests due to significant public health risks. Hundreds were arrested. Because the area was predominantly African American and low income, and the conditions at other sites would have been more environmentally responsible, the decision to locate the landfill there led Benjamin Chavis, who later became executive director of the NAACP, to start using the term “environmental racism.”
Today, local institutions and groups are still thinking creatively about how to broaden prosperity in the region and improve wellbeing. In an article this week for EdNC, Nation Hahn interviewed Gabriel Cummings, founder of Working Landscapes, an organization that is working to improve access to healthy food in Warren County. Cummings is thinking about more than just health; the organization also wants to improve local livelihoods:
When people think about farm-to-school work, they probably mostly think first about the benefits to children — health, education, etc. — and rightly so. But farm-to-school work can also be a powerful engine for economic development. In fact, that is why we got into it. We were interested in opening up new markets for small, local farmers. In Warren County and other rural counties of our region, the school system is the largest purchaser of food. However, the school system was not buying any food from local farmers, so it was having zero impact on the local agricultural economy. We set about changing that. Our farm-to-school supply chain is small, but already it has created employment both on and off the farm, and it has spurred capital investment through the redevelopment of a building in Warrenton that would otherwise be sitting empty. And that is just from chopped collards and cabbage!
Farming may have created many of this region’s long-standing inequities, but a new generation of leaders is thinking about how to turn the region’s history and assets into a more equitable future. Many of the challenges Warren County has faced are emblematic of Southern history. Reflecting on the story of a place—who started there, who left and why, who tried to reinvigorate it, who has benefited from opportunity, and who has been left behind by economic and social change—is essential work for all communities as they build an infrastructure of opportunity.
If you’ve ever been a working student trying to make a living to support your family and your education, you’ve probably had moments where one unexpected challenge after another makes you feel that success is impossible. You don’t know how you’ll make it through the next crisis—your car breaking down or your doctor calling with troubling test results. You just can’t handle making one more choice between two bad options: like missing work or missing class when your boss knows your schedule but says they need you to come in, or waiting a few more days to buy your kid a backpack for school or risking your rent check bouncing. The reason all of this feels so impossible, like the deck is stacked against you, is because it’s not just about you and your choices: it’s about the policies, institutional practices, and systems that make it harder for low-wealth people to get ahead. There are so many things out of your control that affect your path to success, like the scheduling system your employer uses, whether or not you are eligible for paid time off, the timing of courses offered by your college, the reliability of public transit, and the availability of financial aid. And those of us who want to improve economic mobility, or to move people from economic stress to stability, need to understand that context when we design programs and policies.
From my window today, I’m looking out at what could be considered a forest (a hedge, really, at the edge of a small woodland), but recent wind and rain have diminished the forest and left me with mostly trees. And since I’m looking for a metaphor for the importance of understanding the context of a system before adopting a programmatic solution, “missing the forest for the trees” came readily to mind, looking at these bare branches and chill blue sky. When it comes to how we shape responses to economic mobility issues—income inequality, school segregation, college completion—we often get so tied up in our focus on individual success (trees) that we lose sight of the impact of community systems of opportunity (forest).
The philosophy behind why you do the work and the current (and, often, the historical) context it’s happening in, matter. Here’s a great example of a philosophy that changes service delivery: LISC Financial Opportunity Centers. The FOCs—in communities across the country—employ an Integrated Services Model—that’s jargon for offering financial coaching and products (like IDAs to make saving more feasible), education and training, and income supports (like public benefits and tax credits) all in one place, in a sequenced flow that helps individuals move from financial stress to survival to stability:
Taken together, these three core services help move low- and moderate-income families along a continuum of improvements aimed at ultimately increasing their net income (monthly cash flow), credit score, long term job retention and net worth.
FOCs want interim milestones, but they are driven by a big end goal: net worth. And more of it for low-wealth families. At an FOC, they don’t stop at helping someone get emergency funds for utility payments to avoid eviction [TREE]. They don’t stop at providing training and support for a new better-paying job [STILL TREE]. They form a long-term relationship that helps their clients build wealth, like home ownership and retirement plans—because financial stability is the forest made up of all those really important trees.
This long-range relationship and a programmatic orientation that moves from stress to survival to stability is key, especially when you consider the extreme disparities in financial stability and wealth creation in the United States. Recent data from the Pew Research Center reveal that the median net worth of for white households ($141,900) is 13 times that of African-American households and 10 times that of Hispanic households. (This staggering gap inspired CFED’s creation of the Racial Wealth Divide Project.) In Umbrellas Don’t Make it Rain: Why Studying and Working Hard Isn’t Enough for Black Americans , scholars from The New School, Duke Center for Social Equity, and Insight Center for Community Economic Development discuss how “an analysis of who holds America’s wealth makes clear how life outcomes can diverge radically, in particular for those subject to systemic historically rooted discrimination [FOREST], which is not related to the amount of personal effort exerted [TREE].” The analysis shows that neither income nor education is an equalizer when it comes to this wealth gap:
- The wealth gap persists at every income level, and “white families at the lowest end of the income distribution have a higher median wealth than middle-income blacks”
Source: Umbrellas Don’t Make It Rain
- The wealth gap also persists at every level of education, and “for families with household heads that have a college degree, the typical white household has $180,500 in wealth while the typical Black household has $23,400”
Source: Umbrellas Don’t Make It Rain
Less wealth mean less stability and more stress and struggle for black families, especially when it comes to investing in education, entrepreneurship, or retirement. The authors recommend a possible intervention—Child Trust Accounts—that would be based on the wealth (not income) of their parents. It’s an example of an intervention that takes into account the history and context of the issue being addressed—a short-term action with a long-term view, like the philosophy at the Financial Opportunity Centers. If we want to see real movement toward more equitable economic outcomes, that’s the kind of growth we need to cultivate.
It’s no secret: the quality of a child’s education is one of the most important factors in her future success. It’s also no secret that educational quality varies widely between schools and between districts, and that inequitable residential segregation and school funding formulas often concentrate students from low-wealth families in lower quality schools. The rate of poverty for public school students, like the overall poverty rate, differs across regions, states, and school districts, but it is generally higher in the South. EdBuild recently mapped the poverty rates in school districts nationally. In the map below, those areas in light blue are the ones where the student poverty rate is less than 10 percent and dark blue areas are more than 40 percent:
School poverty varies widely district to district, and in many areas districts with high levels of poverty are located right next to ones with lower levels. In places where countywide school districts were never formed, like Birmingham, Ala., you see that intense contrast:
The EdBuild map doesn’t tell us about the concentration of poverty at schools within districts, but other research does. In the South especially, school quality follows patterns of residential segregation by economic status and race. A recent Urban Institute study examined concentration of poverty in schools and found that a student from a low-income family is six times as likely as one from a high-income family to attend a high-poverty school. The study also found that students of color are far more likely to attend high-poverty schools—in the case of black students, six times more likely than white students to attend high-poverty schools. In Durham County, N.C., where 61 percent of students are from low-income families, 36 percent of black students attend high-poverty schools, while only 6 percent of white students do. In Jefferson County, Ala., where Birmingham is located, 65 percent of black students attend high-poverty schools, while only 2 percent of white students do.
While the South was less segregated than the rest of the nation during the 1980s and early 1990s, by 2009, Southern levels of segregation had risen quickly enough to catch up with the nation:
Source: Southern Slippage report from UCLA
The problem is not really about the concentration of low-wealth students—it’s the concentration of wealth. In a new episode of This American Life that you absolutely need to listen to, Nikole Hannah-Jones notes that school desegregation cut the national achievement gap between black and white students in half in less than two decades (it has widened again since 1988, when segregation began to increase). She explains:
It’s important to point out that it is not that something magical happens when black kids sit in a classroom next to white kids. It’s not that suddenly a switch turns on and they get intelligence or wanting, you know, the desire to learn when they’re with white kids. What integration does is it gets black kids in the same facilities as white kids, and therefore, it gets them access to the same things that white kids get: quality teachers and quality instruction.
We’ve talked a lot on this blog about the importance of where a person lives to educational and economic success, but that point requires context: where you live is often not about choice. Intentional policies and practices actively created residential segregation by race. Sean Reardon of the Stanford Graduate School of Education found that middle-class black families tend to live in lower-wealth neighborhoods than low-income white families:
While the economic resources of families matter tremendously to educational success (there’s a linear relationship between income and who goes to college: with each increase in the family income distribution, the rate of college attendance increases the same amount), low-wealth young people in some areas are much more successful than low-wealth young people in others. The place a young person lives in and the resources available there determine the type of opportunities and the quality of the person’s preparation for them. That’s why, as Peter Edelman points out (h/t Dylan Matthews), reforms to improve and equalize school quality are a necessary complement to antipoverty efforts:
There is a bogus debate going on that pits school reform against antipoverty advocates. School reformers, wanting to squelch teachers and others who have said over the years that they cannot teach children who come to school with multiple problems that stem from poverty, say (correctly) that there are no valid excuses for failing to teach low-income children. They point (as they could not until quite recently) to multiple examples of schools that excel in teaching low-income children. But to the extent they say or imply that reducing poverty now is somehow less important than school reform, they overstate their point. Antipoverty advocates, for their part, in some instances downplay the independent efficacy of school reform.
The real answer, quite obviously, is that both school reform and serious antipoverty policies are vital. Better schools in inner cities, both charters and traditional public schools, are crucial to children’s possibilities of having a better life. But far more inner-city children will succeed in school if their parents have better jobs and higher incomes and if the communities in which they are growing up are healthy. There is no either-or here. Good schools are a must for inner-city children, but they cannot achieve maximum effect unless the schools strategy is part of a larger antipoverty approach.
It may seem like an obvious point that both are important, but in an era of scarce public investment, we often overlook it. Poverty is not an intractable problem, and students from low-wealth families are not doomed, but we talk as though they are. School desegregation both narrowed the achievement gap and dramatically improved the intergenerational mobility of black students in the South. We know that mobility is higher in places with quality schools and lower levels of residential segregation. In those places, both low-wealth and affluent students have better outcomes. Despite all this, there is very little acknowledgement of the importance of desegregating schools. “We have this thing that we know works, that the data shows works, that we know is best for kids, and we won’t talk about it,” says Nikole Hannah-Jones. “It’s not even on the table.”