Black Wealth/White Wealth offers a powerful portrait of racial inequality based on an analysis of private wealth. Taking issue with those who point to an expanding black middle class as evidence of greater racial equality, Black Wealth/White Wealth demonstrates how an analysis of wealth--total assets and debts rather than income alone--uncovers a qualitatively different story about race in America. Providing a comprehensive examination of how material assets are created, expanded and preserved, authors Oliver and Shapiro reveal the persistent and deep economic divide between blacks and whites.
Black Wealth/White Wealth charts the ways inequality has been structured over many generations through the same systematic barriers that have affected blacks throughout their history in America--the legacy of slavery, history of low wages, poor education, restriction of blacks as economic free agents. Oliver and Shapiro examine how and why low black entrepreneurship, limited access to capital, red-lining practices, local and state policy, the rise of the modern suburb and the making of the urban ghetto have discouraged and impaired the ability of many blacks to accumulate wealth and opportunities for a better life.
Combining quantitative data from over 12,000 households and in-depth interviews with a range of black and white families, the authors measure and conceptualize the racial face of wealth in America. The findings uncover vast differences between blacks and whites: 63% of black households have no financial assets, more than twice the rate of whites; nearly three-quarters of black children grow up in households without any financial resources; the white middle class could support its present standard of living for more than four months without a steady stream of income while the typical black middle class household does not have enough wealth to survive a month. The recent movement of blacks into middle class occupations and gains in educational attainment have not led to commensurate increases in wealth. The racial legacy of the past is etched in present day deprivation of wealth. The authors argue that black achievement at any given level not only requires a greater effort and provides fewer opportunities along the way, but also bestows substantially diminished rewards.
The final section of Black Wealth/White Wealth identifies and explores the factors, processes and structures behind the vast inequality between the two races and analyzes why wealth portfolios for blacks and whites of equal stature and accomplishment vary so differently. Pointing up the failure of current public policies to redress the problem--because they are based on a restrictive concept of income--the authors' analysis provides insight into some of the real reasons behind racial inequality and articulates ways to link opportunity structures to policies that promote asset formation and narrow the racial wealth gap.
Racial comparisons by income are misleading, argue these two sociologists, because the black middle class lags far behind its white counterpart in terms of assets that can expand choices and opportunities for generations to come. Their analysis provides telling insight into the causes and persistence of American racial inequality: government policies of suburbanization and redlining helped boost wealth for whites over blacks, while discrimination against blacks long kept them from developing assets through self-employment. The authors' study uncovers ``the buried fault line of the American social system,'' and they note that three times as many whites as blacks grow up in households with three months of financial reserves. Because of such intergenerational transfers of wealth, the authors make a philosophical case for racial reparations but also argue for more feasible policies, such as government-supplemented accounts to make education and home-ownership more available, as well as the modification of tax policies (mortgage deductions, capital gains) that subsidize the rich. Oliver teaches at UCLA, Shapiro at Northeastern University. Illustrations. (Oct.)