Authors: Rebecca Tippett, Avis Jones-DeWeever, Maya Rockeymoore, Darrick Hamilton, and William A. Darity Jr.
Abstract: Despite overwhelming evidence that the racial wealth gap persists in the U.S., it remains a taboo topic in mainstream policy circles, and most officials studiously avoid offering targeted solutions to help close this gap. Beyond Broke: Why Closing the Racial Wealth Gap is a Priority for National Economic Security uses the most recently available data from the U.S. Census Bureau’s Survey of Income and Program Participation (SIPP) along with the National Asset Scorecard in Communities of Color (NASCC) to highlight the current state of America’s racial wealth gap. The report also provides an in-depth analysis of housing wealth and liquid wealth, while also evaluating how wealth disparities manifest both across racial and ethnic categories and within racial and ethnic subpopulations in four geographically diverse U.S. cities.
This report was prepared by the Center for Global Policy Solutions in collaboration with the Carolina Population Center at the University of North Carolina, Chapel Hill, the Research Network for Racial and Ethnic Inequality at Duke University, and the Milano Graduate School of International Affairs, Management and Urban Policy at The New School. This is a publication of the Closing the Racial Wealth Gap Initiative, a national collaborative effort managed by the Center for Global Policy Solutions in collaboration with the Insight Center on Community Economic Development and with generous support from the Ford Foundation. The program seeks to build awareness and support for efforts to address racial and ethnic wealth inequalities based on structural factors. To achieve this goal, more than 180 scholars, advocates, practitioners, and other experts of color have come together to inform the national economic debate with diverse perspectives and to provide policy solutions to create an inclusive and equitable future for all Americans.
Key Findings
- As of 2011, African Americans had a median liquid wealth of only $200; Latinos had a median liquid wealth of only $340. For Whites and Asians, the corresponding wealth figures were orders of magnitude larger: $23,000 and $19,500, respectively.
- Moreover, for most African Americans and Latinos, checking accounts are their only liquid asset.
- The Great Recession affected people of color significantly more than Whites, with African Americans, Asians, and Latinos all losing a larger percent of their home equity between 2005 and 2011.
- Asians and Latinos are twice as likely to live in one of the five states hit hardest by the housing crisis.
- Hispanic households experienced the largest drop in net worth following the recession.
- African Americans (38 percent) and Latinos (35 percent) are over twice as likely as whites (13 percent) to hold no financial assets at all and to have no or negative net worth.
- More than half of whites own four or more tangible assets; the same is true for only one in five African Americans and Latinos.
