Obama's Recovery Increases Wealth Gap Between Whites, Blacks
According to a report from the New York Times on Monday, President Obama’s economic recovery – the weakest recovery on record – is creating more of a wealth gap between blacks and Hispanics on the one hand and whites on the other than there was before the recession. The Urban Institute reported that white families, as of 2010, earned $2 to each $1 earned by black and Hispanic families earned. That statistic has been unchanged for decades. But when assets like homes, savings, and retirement accounts are factored into the numbers, whites gain significantly more ground. As of 2007, white families were four times wealthier than non-white families. By 2010, white families had a 600% advantage: white families had $632,000 in wealth, against $98,000 for black families and $110,000 for Hispanic families.
Why did the gap grow? Part of it was that so many black and Hispanic families took a heavy hit from the real estate downturn – as a percentage, more blacks and Hispanics fell into foreclosure than whites. Naturally, the university professors think that this is a manifestation of banking racism, rather than a manifestation of forcing banks to give subprime loans to unqualified borrowers.
Overall, Hispanic families dropped 44% of their wealth in that three year period, and black families dropped 31%. White families lost about 11%. The Times’ answer: institutional racism. And, naturally, the Times wants more government involvement: “Even if blacks and Hispanics make progress in the years ahead as the economy improves, the persistence of the wealth gap has pushed many public policy scholars to recommend the adoption of more ambitious programs to help reduce worsening inequality.”