Henry Louis Gates writes thoughfully about race issues in the United States. A professor at Harvard, he is one of those rare academics who can speak to the public at large and still make a lot of sense. He frequently shows up on the op-ed page of the New York Times. A couple of weeks ago I spotted an article by him there and was interested to see what he had to say. Forty Acres and a Gap in Wealth was timely for me, appearing just a day before the release of the Institute’s 2008 Hunger Report, Working Harder for Working Families. Gates's article concerns a subject we spend an entire chapter on in the 2008 Hunger Report: asset building.
I guess before I say anything more about Forty Acres, I should explain asset building, a new concept for most people involved with Bread for the World. Briefly, asset building policy is about helping poor families save and build wealth. Maybe you’re thinking already: Wealth, what does that have to do with poverty, right? Patience though. Assets are what make it possible for families to withstand debilitating financial shocks from sudden losses of income, like when losing a job or suffering a medical emergency. Assets come in a variety of forms, but we recognize them most commonly as a home, stocks and bonds, or a savings account -- anything generally that appreciates in value. Assets can be passed down from generation to generation, and that’s what makes them effective in undermining intergenerational poverty. Contrast assets with income. We use income to pay the rent and put food on the table and gas in the car. Income we use to get by, assets to get ahead. That may all sound very glib perhaps, but we take an entire chapter to flesh it out in the 2008 Hunger Report, so rather than recap the entire thing let me refer you directly to the chapter. Go here, please.
I intend to blog about most of what’s in the assets chapter of the 2008 Hunger Report during the coming months, but for now I want to refer to the Gates article because it helps to focus attention on a terribly important reason for boosting state and federal asset building policies -- the racial wealth gap.
We’ve all heard about income inequality. Well, asset inequality is ten times worse, especially when you start looking at inequality in regards to race. The difference in net worth between white households and black households, for example, is measured by a factor of ten to one. In his article, Gates cites the following: "According to a study by the economist Edward N. Wolff, the median net worth of non-Hispanic black households in 2004 was only $11,800 — less than 10 percent that of non-Hispanic white households, $118,300.”
Understanding wealth inequality is critical if we believe, and I think most of us do, advancements in racial equality are likely to have an impact on reducing poverty. “For the black poor,” writes Gates, “real progress [against poverty] may come only once they have an ownership stake in American society.” And that is why reducing the wealth gap and boosting asset building opportunities is so important. Asset building is about expanding the “ownership society,” bringing people in who have been excluded and therefore haven’t had a real chance to get ahead.
Gates is not the first scholar to idenitfy the racial wealth gap—that would be Melvin Oliver and Thomas Shapiro, coauthors of the 1995 book Black Wealth/White Wealth—but it sounds like Gates is doing some fascinating work on the subject.
I have been studying the family trees of 20 successful African-Americans, people in fields ranging from entertainment and sports (Oprah Winfrey, the track star Jackie Joyner-Kersee) to space travel and medicine (the astronaut Mae Jemison and Ben Carson, a pediatric neurosurgeon). And I’ve seen an astonishing pattern: 15 of the 20 descend from at least one line of former slaves who managed to obtain property by 1920 — a time when only 25 percent of all African-American families owned property.
Now fifteen to twenty families is not a definitive sample, especially when the researcher can cherry pick the families he wants to study, but the general point he makes in this article reinforces what other scholars have already said, including Oliver and Shapiro.
I like this article by Gates obviously because it raises an issue we deal with in the 2008 Hunger Report, raising it to the attention of a lot more people than we can ever hope to reach with our report. I also like it because it says something very important about asset building, and I appreciate that it is Gates who says it. As he puts it, “People who own property feel a sense of ownership in their future and their society. They study, save, work, strive and vote. And people trapped in a culture of tenancy do not.” This may sound like the classic conservative creed, but no one familiar with Gates is going to confuse him with George W. Bush. Asset building bothers a lot of prgressives because it sounds much like what conservative welfare reformers have always championed: greater personal responsibility. I've yet to meet anyone who actually works with poor people who doesn't think personal responsibility is important. My advice to stubborn progressives: "Get over it."
People who have studied the racial wealth gap closely believe it should move to the front of the civil rights agenda. That sounds right to me. Asset inequality is not exclusively a racial issue. It’s just the relationship between asset inequality and poverty is so much more striking when race is factored into the equation. Our discussion of asset building in the 2008 Hunger Report is a first step for the Institute in helping Bread for the World and its members expand their thinking about ways to help US families in poverty and families at risk of poverty—and it is a bold step forward.
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