January 16, 2023
In 1963, Dr. Martin Luther King Jr. introduced the world to his dream of a society that focuses on character, not on complexion. America has certainly come closer to realizing King’s vision. However, segregation and discrimination continue to persist.
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Ask the experts
Racial segregation and discrimination persist. In order to understand the driving forces behind such problems and possible solutions, WalletHub asked experts to share their thoughts and ideas.
Here’s what William A. Darity, a professor at Duke University had to say:
What are the major causes of the racial wealth gap between black and white households?
The primary source of wealth for any individual or household is access to resources made available to them by previous generations. American public policy has promoted the capacity of white Americans to make such intergenerational transfers to their children and grandchildren while actively damaging the capacity of Black Americans to do the same. Therefore, the racial wealth gap is a product of national policy.
What can state and local authorities do to help reduce racial gaps in wealth, employment, and education?
States and localities have the marginal capability to address the racial wealth gap. The Survey of Consumer Finances for 2019 sets the difference in net worth of the average Black and white household at $840,900. That leads, in turn, to an overall shortfall of at least $14 trillion in Black wealth relative to white wealth. The combined budgets of all state and local governments in the United States amount to less than $5 trillion, funds they use for all purposes to meet the needs of their constituencies.
While some states have begun to implement or are considering variants of the “baby bonds” proposal, the provision of a trust fund for every newborn infant, the amounts that they can devote to such a policy (and it is one that I helped develop so I definitely endorse it), will not approach the sums needed to erase the Black-white disparity in wealth. Elimination of the racial wealth gap necessarily is a federal project. Indeed, since federal policies created and maintained the gap, the federal government has the responsibility for remedy.
On the other hand, states and localities can take steps to equalize employment opportunities and educational outcomes. Regarding employment, states and localities could take steps to ensure that their contracts are equitably assigned to Black and white entrepreneurs, that anti-discrimination laws are fully enforced, and that a job guarantee is available for all. Regarding education, states and localities can confront the problem of racialized tracking, i.e., the overrepresentation of Black students in “slow learner” classes and their underrepresentation in gifted and talented, honors, AP and International Baccalaureate courses of study.