Sent: Tue, May 18, 2010 1:45:50 AM
Subject: Re: USA Africa Dialogue Series - A $95,000 question: why are whites five times richer than blacks in the US?

I will answer this to the best of my ability(ies)

 

1.  Black educated professionals typically seek degrees and employment in the "helping" sectors.  These degrees cost the same but yield much lower salaries.  Examples would be teaching, nursing, undergraduate degree in accounting (without MBA, etc.), non-terminal degrees in humanities.

2.  Once degreed, Black professionals confine their search for employment, typically in their home town or not far from their home town.

3.  Black families generally do not leave much in terms of inherited wealth such as homes, stock, etc.

4.  Black families generally have life insurance from employment but do not seek additional life insurance.  Generally, there are debts that cannot be settled.

5.  Single-parent families earn less than two-parent/wage earner families.  African Americans experience an illegitimacy rate of about 67 to 70 percent.

6.  Black families generally do not educated their children in regards to simple home economics, investing, etc. and neither do a lot of White families.  But!  In White culture there is a larger opportunity to acquire this knowledge.

7.  Black professionals have organizations which are social in networking capabilites.  I will cite Black fraternal and sorority organizations which do a great job at ensuring other Blacks are college graduates, contribute to charitable causes, and provide community support; none of which are calculable items in terms of wealth. 

8.  Urban schools do not prepare children, adequately, for science and math careers.

9.  Urban neighborhoods offer very little opportunity to meet, know, or be mentored by a Black professional - there is a real estate gap between the haves/have nots that is intra-racial.  The Black professional has earned the right to live where he/she chooses - who can argue with that?

10.  Refer to a study done by a Nigerian (Yoruba) academic.  It is called the, "Shaker Heights Study."  A group of affluent, Black parents in Ohio brought in Doctor of Education to assess racism in their children's education.  The study went against their suit completely.  The first thing the doctor did was go inside the homes of Whites and Blacks in the district.  He found something astounding:  without regards to socio-economics Black parents spoke to children in referential vs. experiential terms.  White parents were the polar opposite. 

 

Examples:  A poor White family has three children and the youngest cannot talk - a baby.  The mother sits down to feed the child the only breakfast they can afford which consists of ice water and plain oatmeal.  The White mother talks to the baby the entire time and asks questions such as, "is that water good, "is it cold," "does your tummy feel good."  By contrast, the affluent Black parents tell their children, "come and eat," "sit down," "go to bed."  Any questions were given as statements, "you did your homework, didn't you." 

 

The Nigerian doctor of education was released from his work because he gave the answer the Black parents didn't want to hear.  He told them WHY poor White children score higher on standardized tests than their affluent Black children.  The answer lies in communication patterns formed while the child was in infancy. 

 

What does that have to do with your question?  You cannot hope to become anything but a "worker" if your brain is not wired for innovation.  Workers earn salaries and hourly.  Wealth is not created by workers.  Wealth is created by innovators.  Wealth is created by multiple streams of income.  Wealth is created by ignoring transitory bliss.  Wealth is created by taking advantage of networks which are concerned with economics and not a yearly cruise or get together.  I learned these lessons - almost too late.  Hopefully you all will take what I have said to heart and use this information appropriately. 

 

La Vonda R. Staples

On Mon, May 17, 2010 at 4:03 PM, Hetty ter Haar <[log in to unmask]> wrote:

A $95,000 question: why are whites five times richer than blacks in
the US?

- Study finds gaping racial divide in household assets
- Economic policies blamed for growing inequality

Chris McGreal in Washington
Tuesday May 18 2010
The Guardian


http://www.guardian.co.uk/world/2010/may/17/white-people-95000-richer-black


A huge wealth gap has opened up between black and white people in the
US over the past quarter of a century ? a difference sufficient to put
two children through university ? because of racial discrimination and
economic policies that favour the affluent.

A typical white family is now five times richer than its African-
American counterpart of the same class, according to a report released
today by Brandeis University in Massachusetts.

White families typically have assets worth $100,000 (£69,000), up from
$22,000 in the mid-1980s. African-American families' assets stand at
just $5,000, up from around $2,000.

A quarter of black families have no assets at all. The study monitored
more than 2,000 families since 1984.

"We walk that through essentially a generation and what we see is that
the racial wealth gap has galloped, it's escalated to $95,000," said
Tom Shapiro, one of the authors of the report by the university's
Institute on Assets and Social Policy.

"That's primarily because the whites in the sample were able to
accumulate financial assets from their $22,000 all the way to $100,000
and the African-Americans' wealth essentially flatlined."

The survey does not include housing equity, because it is not readily
accessible and is rarely realised as cash. But if property were
included it would further widen the wealth divide.

Shapiro says the gap remains wide even between blacks and whites of
similar classes and with similar jobs and incomes.

"How do we explain the wealth gap among equally-achieving African-
American and white families? The same ratio holds up even among low
income groups. Finding ways to accumulate financial resources for all
low and moderate income families in the United States has been a huge
challenge and that challenge keeps getting steeper and steeper.

"But there are greater opportunities and less challenges for low and
moderate income families if they're white in comparison to if they're
African-American or Hispanic," he said.

America has long lived with vast inequality, although 40 years ago the
disparity was lower than in Britain.

Today, the richest 1% of the US population owns close to 40% of its
wealth. The top 25% of US households own 87%.

The rest is divided up among middle and low income Americans. In that
competition white people come out far ahead.

Only one in 10 African-Americans owns any shares. A third do not have
a pension plan, and among those who do the value is on average a fifth
of plans held by whites.

Shapiro says one of the most disturbing aspects of the study is that
wealth among the highest-income African-Americans has actually fallen
in recent years, dropping from a peak of $25,000 to about $18,000,
while among white counterparts of similar class and income it has
surged to around $240,000.

In 1984, high-income black Americans had more assets than middle-
income whites. That is no longer true.

"I'm a pretty jaded and cynical researcher in some way, but this was
shocking, quite frankly, a really important dynamic," said Shapiro.
"This represents a broken chain of achievement. In the United States
context, when we are thinking about racial equality and the economy we
have focused for a long time on equal opportunity.

"Equal opportunity assumes that some people who have that opportunity
are going to have pretty high achievements in terms of their jobs,
their work, their income, their home ownership.

"The assumption in a democracy is that merit and achievement are going
to be rewarded and the rewards here are financial assets. We should
see some rough parity and we don't."

The report attributes part of the cause to the "powerful role of
persistent discrimination in housing, credit and labour markets.
African-Americans and Hispanics were at least twice as likely to
receive high-cost home mortgages as whites with similar incomes," the
report says.

Although many black families have moved up to better-paying jobs, they
begin with fewer assets, such as inheritance, on which to build
wealth. They are also more likely to have gone into debt to pay for
university loans.

"African-Americans, before the 1960s, first by law and then by custom,
were not really allowed to own businesses. They had very little access
to credit. There was a very low artificial ceiling on the wealth that
could be accumulated. Hence there was very little, if anything, that
could be passed along to help their children get to college, to help
their children buy their first homes, or as an inheritance when they
die," said Shapiro.

Since the 1980s, US administrations have also geared the tax system to
the advantage of the better off. Taxes on unearned income, such as
shares and inheritance, fell sharply and are much lower than taxes on
pay.

"The more income and wealth people had, the less it was taxable," said
Shapiro.

There were also social factors, the study found. "In African-American
families there is a much larger extended network of kin as well as
other obligations. From other work we've done we know that there's
more call on the resources of relatively well-off African-American
families; that they lend money that's not given back; they help
cousins go to school. They help brothers and sisters, aunts and
uncles, with all kinds of legal and family problems," said Shapiro.


guardian.co.uk Copyright (c) Guardian News and Media Limited. 2010

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