By Jamie Smith Hopkins

February 22, 2022

WATERLOO, IOWA – ReShonda Young strode into a church too big for its congregation, in a still-segregated city where economic barriers often strangle Black ambition, on a mission to tackle a tenacious consequence of American discrimination.

If she could buy this sprawling property, she would be one step closer to opening the only Black-owned bank in Iowa — potentially the first in more than 20 years to launch anywhere in the country. If she could open the bank, she hoped it would provide more tools to shrink the yawning gap between the wealth held in the U.S. by typical white families and most everyone else, Black families especially.

Duke University’s Darity sums up the wealth gap with one big number: $840,000. That’s how much less net worth the average Black family had in 2019 compared with the average white family.

The average is skewed upward by massive wealth at the very top, part of a larger story of American inequality that cuts across race. But the very top is overwhelmingly white, which comes right back to Darity’s point.

Darity has spent decades studying the gap, seeing it however the numbers are sliced. Marriage doesn’t solve it, advanced degrees don’t close it, homeownership isn’t a magic bullet, his and others’ research shows.

And Black banks, he said, as helpful as they can be to the communities they serve, aren’t the solution.

Their assets combined were just shy of $5.6 billion at the end of 2020.

At that point the nation’s largest bank, JPMorgan Chase, was 541 times that size.

And even those assets fall far short of the extent of the gap.

“If we were to identify the amount of resources that it would take to bring the Black share of wealth into consistency with Black America’s share of the nation’s population, it would require approximately a minimum of $11 trillion,” Darity said. “It’s clearly not something that can be done by the existing apparatus of Black banks, nor can it be something that would be accomplished by incremental increases in the number or scale of Black-owned banks.”