According to a recent report by the Institute for Policy Studies, by 2043, the wealth divide between White families and Latino and Black families will double from about $500,000 in 2013 to over $1 million. Dedrick Asante-Muhammed, Senior Fellow, Racial Wealth Divide at Prosperity Now shares how his organization is addressing this racial economic inequality.
Traynham: For more than a third of all households and more than half of households of color, financial ruin, unfortunately, is only one crisis away. Earning a middle-class income does not guarantee middle-class economic security. Hello, everyone, and welcome to "Comcast Newsmakers." I´m Robert Traynham, and joining me to explain the racial wealth divide and efforts to ensure all Americans have a clear path to financial stability, wealth, and prosperity, is Dedrick Asante-Muhammad, Senior Fellow, Racial Wealth Divide at Prosperity Now. Dedrick, welcome to the program.
Asante-Muhammad: Well, thanks for having me.
Traynham: What I just said, unfortunately, is the unfortunate truth for a lot of people that look like you and I. Let me set the context here, and correct me if I´m wrong. Unemployment in this country today in 2018 is at record levels in terms --
Asante-Muhammad: Particularly for African-Americans.
Traynham: Particularly in African-Americans. But for our white counterparts, it´s at record lows. In many ways, you have the president, you have members of Congress, you have a lot of industry leaders out there that are saying, "This is great economically." With respect to how the fundamentals of the economy are humming, it´s pretty well. But what I mentioned a few moments ago in terms of people of color, nothing could be further from the truth. Why
Asante-Muhammad: Well, so, the the challenge is we are at a blip of, you know, strong, low unemployment for African-Americans -- 6.9%. but unemployment for white Americans is around 3.6%. So there´s still this big disparity. And when the country´s at 6.9%, people would be saying we´re in a recession. So, it´s -- I think the challenge is that record-low levels means that we´re -- that African-Americans is where the country would be in a recession. So, that just shows how bad unemployment is for African-Americans as a whole. But I think underlying all of this economic security is this lack of wealth. You know, wealth is what allows you to have economic opportunities, take advantage of economic opportunity, and deal with economic hardship. And when blacks have median wealth of $4,000 now, Latinos have median wealth of $6,000, but whites have median wealth of $140,000, you see this mass disparity, and you see how precarious the economic situation of African-Americans, Latinos are.
Traynham: Dedrick, let´s talk about wealth for a few moments. I think a lot of people may think, "Well, look, I´m not wealthy. I´m not a millionaire or a billionaire." I don´t think that´s what you´re talking about, right I think you´re talking about in terms of how much access to capital that you may have, in terms of home equity, in terms of your savings and so forth. Is that correct
Asante-Muhammad: Absolutely. Wealth isn´t having millions of dollars. Wealth is having $1,000 in the bank account when you need to get all your tires fixed or when you --
Traynham: Let´s pause there for a second, because I remember reading a very alarming statistic that said that most Americans, if they had to find $500, just $500, for a new tire, for a new washing machine or dryer, for, perhaps, maybe getting that new roof on their house, they couldn´t find it.
Asante-Muhammad: That´s right, and that´s why so many Americans are living off of debt, right, credit-card debt, and then constantly trying to pay that off. And again, it keeps people in economic insecurity, because you don´t have that wealth. And you see, obviously, if whites have a median of $140,000 and blacks and Latinos have $6,000 and $4,000, that the economic insecurity issue is gonna be that much more challenging for comminutes of color.
Traynham: So, I want to talk for a few moments in the two minutes we have left with respect to -- Let´s say I make $50,000 a year as an African-American, and my white -- and I have the same job as my white counterpart, and he makes $50,000 a year. Presumably, that -- my white counterpart actually has more wealth than I do because I´m an African-American, and from a generational standpoint, from an historical standpoint, I´m at a disadvantage. My question for you, Dedrick, is how do we bridge that gap How do we solve that inequity How do we solve that problem
Asante-Muhammad: Well, what a lot of people don´t understand is that, you know, we created a strong American middle class. It didn´t just happen, and it was a white American middle class in the ´40s and ´50s through massive federal investment after post-World War II. GI Bill, subsidies to home ownership -- these types of things. But, of course, in the ´40s and ´50s, this was racial segregation time period. That type of investment was never put into communities of color. And I think until we have again that type of massive investment of, "We´re going to make America great for the first time, ´cause we´re gonna be racially inclusive and bring in communities of color" -- We have to have that type of national-federal commitment to creating a new 21st-century American middle class.
Traynham: 30 seconds we have left. How do we have that conversation within our own community but also nationwide
Asante-Muhammad: Well, I mean, I think the way we have this conversation is we do these reports, "Road to Zero Wealth," "The Ever-Growing Gap" first to highlight this is a serious issue. This is causing serious divisions in our communities. It´s not allowing us to grow as a country together. So first raise the issue, and then once you get will to say, "Let´s address it," then let´s move forward and do what we´ve done in the past -- create a great American-middle-class economy, but this time, for everyone for the first time.
Traynham: And, Dedrick, how can folks that are watching this program now get more information for Prosperity Now
Asante-Muhammad: Sure. They can go to prosperitynow.org. They can check out the "Bridging the Racial Wealth Divide" Facebook page, and we have a race and wealth podcast that they can get on Stitcher or iTunes and SoundCloud.
Traynham: Dedrick, thank you very much for joining us. We really appreciate it.
Asante-Muhammad: Thank you.
Traynham: And thanks to you for watching. For more great conversation with leaders in your community and across the nation, visit comcastnewsmakers.com. I´m Robert Traynham.