Lost in debate
8/2/2011, 11:42 p.m.
Lost in debate
Recent polls indicate that many Americans are concerned about the quality of their retirement or whether they will be able to retire at all. The violent protests in Greece over the austerity measures imposed in June created an awareness in the developed world that one’s silver years could be tarnished by financial hardship. It was especially disturbing to witness that Greece, the mother of democracy, is unable to rely on the democratic process to meet the needs of the people.
Some Republicans in Congress, who arrogantly believe that America is inviolable, have refused to raise the debt ceiling. Without the capacity to borrow money, our government will be unable to pay debt owed to foreign creditors or Social Security checks relied on by our elders.
Even though an agreement has been reached, many of our fellow Americans now have every reason to be concerned about their future economic welfare. The recent recession has had a destructive impact. According to a recent study by the Pew Foundation, the median wealth of African American families fell by 53 percent during the recession. Between 2005 and 2009 the median net worth of whites fell by only 16 percent.
The recession also adversely affected other racial minorities. Hispanic median family wealth fell by 66 percent, the biggest drop of all. Asians declined by 54 percent.
Wealth is determined by adding the value of all assets, such as automobiles, real estate, bank accounts, stocks and bonds, and other valuables. Then subtract the amount of all debt — loans, mortgages and credit card debt. The balance is your net worth — your wealth.
The recession also increased the number of Americans with no wealth. For Hispanics the number rose from 23 percent to one-third. For blacks the percentage went from 29 to 35. For whites it rose to 15 percent from 11 percent. The median wealth of whites is now 20 times that of black households.
Wealth and income are not the same thing, but a disparity in income will often result in a difference in wealth. Unemployment will certainly retard the creation of wealth. In June the unemployment rate was 9.2 percent for the nation, but only 8.2 percent for whites. Blacks were double the rate for whites at 16.5 percent.
Unfortunately, the median black family income has been falling even further behind that for whites. In 1974, median black family income was 63 percent of whites’. By 2004 it had dropped to 58 percent.
Despite these disparities, African Americans have remained generally optimistic, but plans to end Medicare and a callous attitude toward raising the debt ceiling are creating a greater sense of insecurity.
Indeed, the government must control costs but it must also provide benefits for health, education, Social Security and the impoverished. A fair tax code will generate sufficient revenue to meet those burdens.
Now that the nation has witnessed the mean-spirited policies of the political extremists, it is time for the moderates to unite, without consideration of race, to meet their challenge. As we saw in Greece, democracy will not serve the interests of everyone without the active participation of all the electorate.