The Growth of the Suburbs - and the Racial Wealth Gap
Developed by David M. Seiter

ACTIVITY 5: Deepening Understandings of Race and Family
Wealth Accumulation: Six Jigsaw Readings

READING F

But aren't there cultural factors that affect performance and have nothing to do with wealth?

Dalton Conley: Many social observers point to outcome differences between Blacks and whites, say in education, where the college graduation rate for whites is double that of Blacks. Or in occupational achievement, where whites are twice as likely to have a white collar or managerial job as Blacks. Or in income, where white family income is on average about double that of the African-American unit. Or family structure, where whites are much more likely than African Americans to delay childbearing past their teenage years and until marriage. In almost any realm of life you can think of, there are racial disparities.

Usually when policymakers or social scientists want to compare the outcomes between Black and white kids, they'll look at kids who come from families with the same income level. And when you make that comparison, you'll find that there's still a racial gap. People often point to this as something cultural or innate.

But often when we're talking about these racial disparities, we're comparing apples and oranges, because there's still an enormous wealth gap between those families with the same income level.

And I find that when you make the right comparison - when you compare a Black kid from a family with the same income and wealth level as the white kid from the similar economic situation - rates of college graduation are the same; rates of employment and work hours are the same; rates of welfare usage are the same.

So when we're talking about race in terms of a cultural accounting of these differences or a genetic accounting of these differences, we're really missing the picture, because we're making the wrong comparison. We're not comparing Blacks and whites on an equal footing if we don't take into consideration these wealth differences in addition to the income differences. The real issue is inequality.

How do the racial differences in family wealth affect life opportunities?

john a. powell: The wealth gap between Blacks and whites is a crucial factor in the relative health and stability of the communities they live in. Obviously wealth has a lot to do with where people are going to live. Where people live has a lot to do with the kind of schooling their children will have. And the kind of schooling available has a lot to do with the opportunities their children will have. Wealth creates the opportunities that set the next generation's life chances.

One of the difficulties that African American families have is the constant stress that comes from barely being able to make it from paycheck to paycheck. People who have wealth can rely on it during difficult times. When there's a crisis that requires unforeseen health care expenditures, when there's an investment that has to be made in a child's schooling, when there's an opportunity to provide for a son or daughter so that they can purchase a home - all of these things are dependent not on having sufficient income but having the kind of assets or wealth that you can draw upon.

It's hard to overstate how important wealth is. We live in a capitalist society. Often, we focus on income or how much money somebody makes, but really the thing that buys opportunity is wealth. If you make $100,000, and you have $120,000 worth of debts a year you're in trouble. So, you really have to look at disposable income or wealth.

It's not just individual wealth; it's also collective wealth. If you live in a community where the whole community is poor or strapped for money, it can't buy the amenities; it can't make the kind of difference. Traditionally, Blacks have been located where there's high need and very few resources, while whites have often been located where there are low needs and high resources. Given a choice, most people would prefer to live in a place where there are higher resources and fewer needs. That choice simply has not been available to Blacks.

Where you live also determines what kind of school your children are going to go to, whether you're going to be close to transportation, and whether you're going to live next to a toxic dump site or not. There was also a recent article in the New York Times about heart attacks - it showed that where you live, what kind of community you live in has a tremendous correlation with whether or not you have a heart attack.

So, the way space is arranged actually impacts our health and opportunities in fundamental ways, and wealth is one of the best indicators of that.

Questions for READING F:

1. What happens if you compare outcomes and performance (e.g. graduation rates) of racial groups after correcting for income? After correcting for wealth?
2. How does lack of wealth negatively affect performance and health among African Americans?

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