Category: Social Topics
The racial wealth gap is an important distinction as it is a compound disparity over and above breaches in income and wealth - something we refer to in social work as intersectionality. All three idiosyncratic and divisive in their own right, yet, collaborative in creating the cohesive synergistic effect that is economic inequality.
Intersectionality is a theoretical framework which asserts that people can and most often are disadvantaged by multiple sources of oppression (i.e. race, class, gender, religion, sexual orientation and other identity markers).
Synergistic effect suggests a change in the result as a consequence of an action or other cause which arises out of the interaction between two or more agents, entities, or factors and produces an effect (result or product) that is greater than the sum of their individual weight or forces.
The wealth gap refers to the accumulative assets (net worth) including income, real and personal property, etc. which define the upper and lower classes.
Examples of the wealth gap (Eitzen, 2010):
The definition of the racial wealth gap is dynamic in that it is inclusive on all these related dimensions and sets forth inequities regarding social mobility denoting significant differences in the social, political, and economic functioning between ethnic groups in the form of opportunities, ownership, quality of life, and so on.
The U.S. racial wealth gap has implications of enormous consequences as the pervasive trend endures beyond pushing people to the economic margins of society. Social disparities continue to escalate including homelessness, hunger, family disruption, crime rates, civil unrest, deteriorating mental and physical health, drug abuse, and democracy itself. According to D.S. Eitzen (2010), political author and Emeritus at Colorado State University, inequality erodes the social contract when the promise for a higher standard of living is limited to a few weakening the sense of community and common purpose essential to a democracy.
The Racial Wealth Gap by Design
Barriers to the adoption of more generous social welfare policies and equitable distribution of resources that would, in effect, close the racial wealth gap are two-fold: the first is political; and, secondly, America’s fundamental belief in competitive individualism.
Social policy is not an arbitrary activity but is deliberate in its intent and means to accomplish a goal. Political conservatives in both federal and state legislatures seek to reduce various dimensions of the welfare state. As such, social policies are crafted to accomplish that end within the context of historical events, budgetary constraints, and the like.
The goal of eliminating income safety net programs has strong implications for social spending:
The high value placed on competitive meritocracy has strong implications for economic inequality:
Causes of the Racial Wealth Gap – Systemic Factors
Disparities in homeownership, a key factor in creating wealth, implicates housing discrimination dating back to the 1930s which either locked minorities out of legitimate loan eligibility and equity-building. Furthermore, minority families are less likely to benefit from intergenerational transfers (family inheritance) due to the lack of ownership and depressed home values which persist to this day in predominately black or Hispanic neighborhoods.
While graduating from college lends to higher earnings in the future, wages for college drop-outs and those who never attend college have deeply declined over the years. Studies show decreased college completion rates for blacks and Hispanics with only 30% of all working age adults (age 25 to 64) holding a bachelors degree or higher.
Student loan debt is another major factor in the racial wealth gap. While whites are more likely to hold bachelor degrees, blacks are more likely to have student loan debt and at larger amounts, according to the Urban Institute. College dropout rates and student loan debt translates into lower future earnings and net worth which disproportionately affects blacks and Hispanics contributing to the racial wealth gap.
Education was once said to be the single-most effective means of escaping poverty. But that sentiment has become nothing more than an idiom when we look at another economic domain – employment, the purported path to self-sufficiency and financial security. The reality is that black unemployment is two times the white unemployment rate at every level of education. Therefore, education has failed to equalize economic outcomes as it relates to financial stability and building wealth.
Income and Poverty statistics also show the median net worth of black households below white households with less than a high school education. At last reporting in July 2017, the U.S. Census Bureau shows a $59,039 median household income in 2016 for all Americans (individuals and families). More specifically, real median income for white households was $61,858 and $65,041 for whites (non-Hispanic). The median household income was $39,490 for black households and $47,675 for Hispanic households.
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Redefining Social Welfare…Again
Eitzen, D.S. (2010). Solutions to Social Problems: Lessons from Other Societies (5th Edition), Allyn/Bacon, MA
Black families have 10 times less wealth than whites and the gap is widening—here's why
America’s Yawning Racial Wealth Gap, Explained in 9 Charts
Income and Poverty Report 2016 (U.S. Census Bureau)
Welcome to The Community Advocate Network. My name is Deborah Mitchell, I am a graduate in Social Work and Registered Social Work Technician. My human service background began in 2007 which includes medical case management and service navigation for the indigent population, outpatient mental health counseling with substance use and abuse disorders, supportive employment and job development for mental health consumers, and structured living domicile management.