Research Objectives. . The Racial Wealth Gap Is A Phenomenon

To some, it can be argued that segregation was ended in 1954 so if housing is a problem, why don’t African American people just move. The issue is due to several programs that were created in the twentieth century that has held back minorities from homeownership. This lack of ability to be able to purchase and own a home on equal terms with white homeowner had a damaging effect of impacting

In Thomas Shapiro’s “The Hidden Cost of Being African American”, Shapiro goes in depth on how wealth in America is disproportionately dispersed between different nationalities. Mainly between Caucasians and African Americans. Shapiro has helped paint the image of wealth inequality and has shown how this is even more staggering than the wage gap between African Americans and Caucasians. Some of the theories he indirectly uses in his book and that I will be exemplifying are generational wealth and support systems, education, and the idea of how poverty only begets more poverty.

Different areas of the private sector took control of the racial segregation. Areas such as real estate, banks, labor, and toxic waste locations have participated in some way to continue the segregation and inferiority of people of color. “African Americans and other communities of color are often victims of land-use decision making that mirrors the power arrangements of the dominant society” (Bullard [1994]2004:269). The land-use decisions are used by the real estate industry. The real estate industry along with the bank industry have worked together in order to make it almost impossible for people of color to acquire their own homes. When individuals of color do obtain their own homes the real estate industry corrals them all into one zone. Then the banks charge homeowners in these zones high interest rates on the mortgages needed to maintain their home ownership. “Zoning is probably the most widely applied mechanism to regulate urban land use in the United States” (Bullard [1994]2004:269). When people of color are corralled into a neighborhood the quality of the neighborhood is diminished. The

Racial discrimination is the main and ongoing problem in the social life of Americans. When we look at the gap of incomes between White and African Americans, we can see the inequality between these two groups. In general, whites have more annual earnings than their black counterparts in America. Lori Ann Campbell and Robert L. Kaufman emphasized that the wealth determinants, which are the indicators of socio-economic status, have effected more on Whites than Blacks. And even when society is organized, there is still some disparities on account of race and ethnicity. (Campbell and Kaufman, 2006). And income disparities between African and White Americans have definitely effected the peace of the social life. According to Campell and

America has a lengthy history on how it became the powerful country it is today, and although its history can be interrupted in many ways (depending who you ask) one thing that is for certain is that wealth has yet to be distributed equally amongst minorities. According to the article “Income inequality matter; Extreme gap in wealth makes society unstable.” Philip Meyer claims that the wealth gap between whites and minorities has existed since Ronald Reagans’ term of presidency (A9). Although Ronald Reagans’ term ended many years ago the mistakes that caused this imbalance of wealth (and its aftermath) while he was in office remains almost if not exactly the same as when the problem initially began (Meyer A9). The wealth gap continues to target minorities and is affecting our communities at an alarming rate, however, many attempts have been made to reduce its existence but the factors of income inequality, unemployment rates and discrimination before and after our recent 2007 recession prevents our country from eliminating such a toxic problem.

A major way the government accomplished this was through the use of government programs during the 1930s and 1940s (“Race- The Power of An Illusion: Explore 1905-1935”). One such of these programs subsidized loans for millions of home-buying Americans. As a result of this program, many were able to move into houses into the suburbs. However, in conjunction with this program, a national appraisal system was introduced which tied eligibility to receive a loan to one’s race (“Race- The Power of An Illusion: Explore 1905-1935”). This made it very difficult for nonwhites to utilize the government program, recieve loans, and therefore become homeowners.

The current stratification system of our society is such that whites hold the highest levels of wealth and power, leaving other non-white groups at a disadvantage. Thus, to close the wealth gap would mean to change the stratification of society, which seems unlikely as no group of people would willfully give up their privileged power. Also, the media and people’s generalizations about race might further reinforce this gap. For example, if constant news stories about African Americans committing crimes are presented to the public, then negative attitudes about that race will be generated—allowing the wealth gap to remain as no one would want to help these portrayed

Up until the 1960s many African-American could not own any homes or get mortgages instead they had to buy their homes by contracts. The Home sellers made African-Americans pay high rates for the homes through contracts, and when they failed to pay, their homes were taken away. These high rates were meant to prevent blacks from owning any properties. In the article, Coates talks about Clyde Ross who migrated to the north looking for the protection of the law; but like many others who tried get to mortgages legally through loans, they were told that there was no “financing available” (Coates 58). Financing was indeed there, but it was only offered to whites not African-Americans. A lot of whites went to extreme measure to keep

Race is commonly associated with poverty. It was found that "black and Hispanic family income has been approximately 60 percent of white median family income. Interestingly it was also discovered that their net worth was approximately one-tenth that of whites"(Squires and Kubrin , 51 ). Race can play a pivotal role in getting home loans and locations of neighborhoods in which you buy a home. Segregation still plays a major role in poverty.

What is wealth inequality? “It is the difference between individuals or populations in the distribution of assets, wealth or income.” [1] In sociology, the term is social stratification and refers to “a system of structured social inequality” [2] where the inequality might be in power, resources, social standing/class or perceived worth. In the US, where a class system exist, (as opposed to caste or estate system) your place in the class system can be determined by your personal achievements. However, the economic and social class that an individual is born into is a big indicator of the class they will end up in as an adult. [3] What are the effects of this wealth inequality in the US and what causes it as well as some possible solutions

This topic will shed some light to why some parts of the U.S are stricken by property. “Black wealth has taken an enormous hit from the implosion of the housing bubble and the ensuing recession, with the gap between the wealth of whites and blacks doubling.” (Covert, Bryce. Black Small Business Owners Get Left Out Of Loans). This will put more African Americans in a struggle to get a business loan because of their financial situation which is more likely that their credit with be affected. African American business owners are always facing a steep hill to get a loan. For example, In 2012 the federal government gave $98.2 billion for contracts to small businesses, African Americans was awarded only 7.2 percent of it even though African Americans make up 13 percent of the American population at that time.

Statistics shows that for every $1 in additional income to Latinos, white families will earn $5.37 more. Even if incomes were reduced by 50%, white families would still only have half of the wealth. Surprisingly we think that racial equity depends on equal labor market. Have we been thinking about this matter as inequality? We need to know that wealth comes from stocks and Income is a flow.

The racial income gap illustrates that the United States is not a meritocracy society. A meritocracy society would be an area where everyone no matter what color or background they are from have the chance to succeed based on their own ability. Although it is certainly appealing and a magnificent way of viewing our society, in reality no society can ever truly function as a meritocracy and therefore having no control at birth and the environment where we grow up, and who we get surrounded with puts major races, especially in the United States in disadvantage, a country that is far from meritocratic compared to other nation.

In the united states the racial wealth gap and looking at the overall median financial wealth of white, African American, and Latino households. The typical African American family has six cents in wealth, for every dollar in wealth that the typical white house hold has, overall the possessive investment as Liptiz describes as a measure to matian a possession of social power aka there invested interested in maintaining power over minorities and have taken action to protect that investment. Most of the time society thinks in terms of white vs black people, but in reality its often white people versus all minorities. Before Africans were imported for slavery, the colonists tried using Native Americans and force them into their slavery system. When using Native Americans didn’t work out due to the logistics, the colony’s turned to Africa and the slave trade. While at the same time keeping both Native Americans and African separated from one another, not only in terms of threats and payoffs, but also in terms of early system of white supremacy in the American colonies. After slavery was abolished America turned to Asian immigrants for their cheap labor and low wage cost in the growing industlized America. Even though Asian’s

This inequality in the political system that claims to be the fairest and most democratic in the world is unsettling in itself. However, the other inequalities still seen in US society are even more staggering. In 1968, when the Fair Housing Act put in place federal law to prevent racial discrimination in the buying and selling of houses, it was a stepping stone to a more integrated society. However, in 2005, the Federal Reserve Board conducted a survey that researched 5.3million mortgage applications, in 19 cities, from 9,300 financial institutions. Their conclusion was that African-Americans were 2:1 more likely to be turned down for a mortgage than whites, which is an overwhelming statistic.