Crystal Pinho
In the report, “The Roots of the Widening Racial Wealth Gap,” Thomas Shapiro, Tatjana Meschede, and Sam Osoro (2013) provide information on the following five factors that fueled the racial wealth gap in the U.S. as well as the policy approaches that will “set our country in a more equitable and prosperous direction”.
The first factor is home ownership. The study on home ownership is Americas largest form of investment. Home ownership is determined on the length of the investment return, offering the best pay out of wealth. Prior to the real estate crisis loans were pretty much handed out to African American families. However, once the crisis hit, tons of African Americans were forced to foreclose. Which furthered the rascal margin between African Americans and whites, and of the difference in wealth.
The next factor is between income and unemployment. During this study the income increase reflects a major role the accumulation of wealth. African Americans suffer from a history of filled with discrimination in their employment sectors. The implications revolving around their history dampers in the work place for African Americans today. They are faced with inequality in work benefits and stability unlike the Whites, who are not affected by these elements within the work place.
The following factor is of college education. Originally education acted as a neutralizer among the difference, but this is no longer the same notion it once was. With the increase of college tuition, African Americans have a greater chance to re-frame from attending and will eventually drop out in hope of steering free from debt. Whereas the Whites will experience the option to afford the completion of their education and benefits.
The forth factor is of inheritance. Statistically whites are five times more likely to inherit money and invest, more so than African Americans. Whereas African Americans are more likely to save it for a rainy day, just in case of emergencies.
Lastly, there is Social and Cultural factors. Marriage benefits the higher earning white families. The contribution of income acts as a platform of their current wealth. Whereas African Americans who are married does not reflect the same wealth as a white family does. Both African American spouses have low incomes that could never equate to a white household’s wealth.
This entire study is of a systematic cycle of unattainable wealth for the African Americans. The discriminatory history affiliated with this race creates huge setbacks. In many forms of wealth distribution.
