Average Black Family Needs 228 Years To Build Wealth Of A White Family Today, And The Gap Is Widening
The wealth gap is real and it’s getting bigger despite MAGA claims that Black workers have benefited financially under the Trump administration.
Rather than shrink, the wage gap between Black and white Americans has grown nearly 33 percent from 2000 to 2019, according to the Economic Policy Institute.
It will take the average Black household 228 years to accumulate as much wealth as its white counterparts have today, The Nation reported.
A new study of the racial wealth-gap released recently by the Institute for Policy Studies and the Corporation For Economic Development (CFED), found that the average wealth of white households increased by 84 percent from 1983 to 2013 — three times the gains African-American families saw.
“If those trends persist for another 30 years, the average white family’s net worth will grow by $18,000 per year, but Black and Hispanic households would only see theirs grow by $750 and $2,250 per year, respectively,” The Nation reported.
Everybody knows that people of color are at an incredible economic disadvantage, but few realize it’s as bad or worse than it was before civil rights, said Karen Petrou, managing partner of Federal Financial Analytics, according to The Washington Post. “Black Lives Matter has shown that we don’t have Selma Bridge anymore, but the situation today is profoundly troubling.”
The study defined household wealth as salaries, homeownership, stocks, inheritances and other assets, New Jersey Today reported. White families pass these assets on from one generation to the next. It has been nearly impossible for Black families to do the same due to factors ranging from redlining to lack of generational wealth.
The coronavirus pandemic has exacerbated the wealth gap, affecting Black workers disproportionately.
Less than 49 percent of Black adults were employed, compared to numbers above 50 percent for white and Latino workers in the U.S., according to the Washington Post.
However, U.S. billionaires continued to increase their riches during the pandemic. The combined billionaire wealth has grown by $792 billion, or 27 percent, since the start of the coronavirus lockdown on March 18, Common Dreams reported.
The country’s wealth remains in the hands of a few. More than a quarter of the $3.7 trillion owned collectively by 650-or-so U.S. billionaires is held by just the top dozen billionaires. Heading the list of richest of the rich is Amazon’s Jeff Bezos. He enjoyed a two-thirds jump in wealth during the covid-19 crisis with a net worth of nearly $195 billion on Aug. 20. Elon Musk’s fortune has more than tripled to $85 billion.
There are growing calls to tax the wealthy.
“The pandemic profiteering of America’s billionaires shows taxes on the wealthy must go up substantially to narrow the wealth gap and raise revenue vital for our big climb back from disaster,” said Frank Clemente, executive director of Americans for Tax Fairness (ATF), in an interview with Common Dreams. “By demanding even more tax cuts for the rich at this crucial moment President Trump shows he is as out of touch with our nation’s needs as America’s billionaires are disconnected from our nation’s misery.”
There was a time when the wage gap shrank substantially. From 1950 to 1980, Black workers benefited from a boost in blue-collar jobs along with civil-rights laws, strong unions, and rising minimum wages.
This advancement reversed as the minimum wage remained nearly static in some areas of the country, and the federal minimum wage hasn’t increased since 2009. “This idea that we’re all in this together is sort of a false statement to make,” said Valerie Wilson, director of the Economic Policy Institute Program on Race, Ethnicity, and the Economy.
“Even when taking age, gender, education and region into account, Black workers on average are still paid nearly 15 percent less than white workers,” New Jersey Today reported.
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A variety of factors drive the growing wealth gap. “The racial wealth gap continues to grow not only because of income inequality — whites have more dollars to sock away — but because accumulated wealth is a mechanism for transmitting economic success from generation to generation,” The Nation reported. “It’s a vicious cycle — poor communities have limited tax bases to fund their public-school systems, which lead to sharp disparities in educational quality. So if a family has assets, it can help their kids pay for an education or put a downpayment on a first home or even give them seed money to launch a small business. This helps the next generation climb the economic ladder. Very few Black families are able to accomplish this.”