Racial wealth gap still widening in US
4 Min Read
The racial wealth gap in the United States is still widening after converging up to the 1950s, and Washington is yet to take any groundbreaking policy to help against racial discrimination.
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The racial wealth gap in the United States is still growing
Wealth inequality between White and Black people in the United States has always been shockingly vast, especially in 1860, before emancipation. However, due to certain actions taken by the union following the civil war, the wealth gap closed through the 19th and early 20th centuries, but it has not achieved any progress since 1950, ahead of the civil rights movement. Furthermore, since the 1980s, the gap has only been widening, a study conducted by Princeton economic Ellora Derenoncourt showed.
Ahead of emancipation, the enslavement of Black people prevented an entire community from amassing wealth, rendering owning properties or any form of capital an exclusive right for the White population of the United States. They were treated as a commodity passed through generations, while they could not pass anything down to their children.
Simply put, at the time, the ratio of White-to-Black wealth was 56 to 1, i.e., for every dollar the average White person had, their Black counterpart only had around 2 cents. This figure was more than halved in 1870, just seven years after the enforcement of the proclamation of emancipation, dropping down to 23:1.
The strides made by Black people were not only due to the government redistributing land taken from slaveowners, for while that hiked Black wealth, the racial wealth gap dropped due to the losses of the White slaveowners who had just lost massive wealth rather than government-subsidized gains made by Black people. Of course, however, the majority of the wealth gap was made up by the newly freed people's efforts, as they were now able to earn, save, invest, and amass wealth for the first time.
Then in 1920, the wealth gap massively shrunk, falling to 10:1, meaning that 100 years ago, for every dollar the average White American had, their Black counterpart had around 10 cents, which was massive taking into consideration the timeframe during which this was accomplished.
The vast progress made in such a short amount of time came to a near halt in the 1950s. By the mid-20th century, the ratio of White-to-Black wealth had reached 7 to 1. Today, it is 6 to 1, meaning that there was barely any progress in the past 70 years for the Black population. In other terms, for every dollar the average White person has, their Black counterparts have only about 17 cents, and the figure is even worse when looking at the median household income: Black households only have 10 cents on the dollar, Derenoncourt and her colleagues have found.
According to the economists, a scenario in which Black people would have been able to amass just as much wealth as their White counterparts under equal conditions would have required "overcoming segregation, discrimination in labor markets, scars from slavery and concentrated poverty, exclusions from social welfare programs, barriers to buying homes in nice neighborhoods, hurdles to obtaining bank accounts, loans, stock portfolios, and so on."
In this world and under this perfect scenario, White-to-Black would be 3 to 1, which is far from the 6 to 1 wealth inequality festered reality, and even then, the average Black person would only have a third of the wealth of the average white person.
If Washington really wanted a policy to completely abolish the racial wealth gap sooner rather than later, the Princeton economist explained, the only thing that would get this accomplished anytime soon is large-scale wealth redistribution.
