|During segregation, they wouldn’t let me in the door. Now, they’ll let me in, but I can’t afford the tab.
During the 1950s, the effort to improve the status of blacks in America had to focus on ending racial segregation and discrimination. Sophisticated civil rights leaders fully understood that economic inequality was an inevitable consequence of the nation’s racism. However, they knew it was premature to push for economic advantages at that time when blacks could not vote at many places in the South or even sit at a segregated lunch counter.
The early economic battle was not so much to build wealth as to find jobs. Income from employment is the original source of wealth, except for those fortunate enough to benefit from an inheritance. While Dr. Martin Luther King Jr. is recognized as the leader of the Civil Rights Movement, he was always aware of the importance of economic issues. The proper name for his march on Washington where he gave his famous “I Have a Dream” speech is “The March on Washington for Jobs and Freedom.”
The media ignored the “Jobs and Freedom” part of the title, but King never relented on his commitment to improve the economic status of the poor. After enactment of the Civil Rights Act and the Voting Rights Act in 1964 and 1965, respectively, King dedicated the rest of his life until his death on April 4, 1968 to the Poor People’s Campaign. In fact, that is what brought him to Memphis, where he was assassinated. He was there to support the demands of garbage workers for pay increases.
The heavy lifting needed for blacks to gain civil rights in America is over. Now is the time to work aggressively for economic progress. That effort is far more complex than the sustained civil disobedience that achieved success in the Civil Rights Movement. To succeed economically, blacks must have the discipline to acquire valued skills and qualifications as well as the perseverance to remain politically active to influence public policy that will enable their progress.
Civilized societies oppose discrimination based on race, religion and gender, but in the business and professional realms, such abuses are often so subtle that they are not recognized. It is critical for blacks to have a basic knowledge of the economic system if they are to have the power to police their interests.
The annual report of United for a Fair Economy provides basic information on the nation’s racial wealth divide. This report is timely because blacks and Latinos suffered a serious loss of wealth during the Great Recession from 2007-2010. In fact, black families have not yet recovered from that debacle.
The report focuses on wealth, the value of assets minus outstanding debt. As a result of the recession, black and Latino families lost 27.1 percent and 41.3 percent of their net worth, respectively. White families lost only 6.7 percent. This disparity resulted because minorities have a greater portion of their wealth in the value of their homes. When the real estate bubble burst, they lost value in their assets.
According to the report, “White families hold far more wealth in assets that are easily accessed than do black and Latino families. White families on average have over 10 times more financial assets (held in bank accounts, stocks, and bonds) than black and Latino families.”
While the report suggests changes in the tax code to ameliorate the wealth disparity, the primary responsibility for building wealth rests with families to adjust their budgets to provide for retirement saving and education expenses. This will be difficult because of the stagnation in salaries but there is no alternative. Every individual must work to become a wealth creator.