Politics

Whites’ Wealth 20 Times That of Blacks; Financial Experts Tell Us How It Happened

Tue., Jul. 26, 2011 9:47 PM EDT
by Terry Shropshire

Researchers have concluded that the median wealth of Caucasians has grown astronomically to 20 times higher than African Americans and 18 times more than Hispanics. That represents the widest financial gap between whites and minorities in a quarter century, according to analysis conducted by the Pew Research Center.

The recession and economic meltdown has had a much more negative impact on ethnic minorities and, in many cases, completely wiped out decades of minority advancement. The gains have receded from a high of 7-to-1 in the white-to-black income gap in 1995, the study states.

But there are additional ingredients stirred into this toxic financial brew, says financial expert Jennifer Streaks. The marketplace crash stole from blacks the two largest components in wealth establishment. “Understand what happened during the [economic downturn]. You had minorities who lost their homes and also their 401k  [plans]. So many of us, as minorities, we were still a generation of first-time college graduates, first-time lawyers [and] first-time doctors. We were not prepared to take the hit that the recession brought upon us,” said Streaks, the executive director of the Financial Literacy Foundation.

There is another equally, if not greater, reason for this grotesque report: mass mortgage corruption. Several mortgage companies and large financial institutions, who are the subject of colossal fines and lawsuits for deliberately steering minorities into subprime loans, also played a big role in decimating minority communities and creating vast economic wastelands.

“They snatched the American Dream right from under us,” Streaks concluded grimly. “It’s like we’ve been dragged back to the starting line. We’re at zero [again].”

Of course, it helps that Caucasians had a long head start on minorities since the establishment of this nation. “Caucasians … they have generational wealth. We do not. So the recession came through and wiped out the foundation that many of us were building for our families – in terms of buying a house or investing in rental properties. That’s gone. In terms of savings, that’s gone because you’ve been out of work and unemployed for so long that you’ve had to go through your savings.”

The numbers bare out Streaks’ points. The median wealth of white U.S. households in 2009 was $113,149, compared with a paltry $6,325 for Hispanics and $5,677 for blacks, the Pew research revealed.

Another factor: Long-established institutional racism does factor greatly into the abysmal numbers, without question.

“Typically in recessions, minorities suffer from being last hired and first fired. They are likely to lose jobs more rapidly at the beginning of the recession and are far slower to gain jobs as the economy recovers,” Roderick Harrison, a sociologist at Howard University, told the media. “One suspects that blacks who lost jobs in the recession, or who have tried to help family members or relatives who did, have now spent whatever savings or other cashable assets they had.”

terry shropshire

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  • Lovellwgamble

    This is despicable & we are still enslaved. The educational achievement gap doesn’t help at all either because we lag behind globally. Do our children stand a chance? We must remain hopeful & keep our dreams alive.

  • Pingback: Whites’ Wealth 20 Times That of Blacks; Financial Experts Tell Us How It Happened | candacereese

  • SugaBeezyBaby!!!

    I am beginning to believe that most of the recession is in are heads. If you believe you are poor you will be poor, if you believe you are rich, it is more likely that you will not have money problems. This is still America, You can still be anything you want to be, please don’t let what happened to you in the past, or black people in general, shape the direction, in which we will move as a people. In closing I will say keep your spirits up, your head on a swivel, embrace being your own boss, ( real talk most people are afraid to run their own business, they would rather be hand fed, the problem with that is that you eat when the cook say’s the food is ready), and more importantly get rid of your hater’s, hater’s should be angry from afar never let them in close,  start to believe in yourself, and PLEASE DO NOT THINK YOU NO IT ALL!! Information is power !!!!!!! Blackthoughtzzz!!!!

  • White and smart

    I’m white, own a business and have owned it for 15 years and I’ll tell you why blacks are poorer. 
    Ready?
    Because they don’t trust each other, they aren’t as smart and they lack thinking beyond today. 99.999% of the blacks I do business with are selling their property to me under market value because they have roaches, they have a house that they don’t know how or care to maintain or just want some fast cash.  Once I bought a 45 acre farm from a black family for $120,000 and then sold it for 532,000 just 5 months later!!!!!  I’m rich and I’m white!

    • Steppersuccess

      Please delete white and smart but ignorant and arrogant.  His examples are one sided and anybody can take advantage of the ignorant and poor whether black or white. I have never met the people he refers to.

      so sad

  • White and smart

    I’m white, own a business and have owned it for 15 years and I’ll tell you why blacks are poorer. 
    Ready?
    Because they don’t trust each other, they aren’t as smart and they lack thinking beyond today. 99.999% of the blacks I do business with are selling their property to me under market value because they have roaches, they have a house that they don’t know how or care to maintain or just want some fast cash.  Once I bought a 45 acre farm from a black family for $120,000 and then sold it for 532,000 just 5 months later!!!!!  I’m rich and I’m white!

  • Steppersuccess

    Wow, as a former insurance agent who primarily worked with the senior market, I met with several African-American families who had nearly depleted their retirement to help their children who have lost jobs and homes.

  • Guest

    Too bad Jennifer Streaks is a fraud…she made good points though.