Your Recession Ain’t Like Mine

Our economic jitters are anything but "short-term."

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Few words are dirtier in American politics than the word "recession." To utter it is to defame our national ethos of boundless possibility, of economic ambitions that never must meet a horizon. Politicians, even lame duck leaders, speak it at their peril. In times like these, even the suggestion of a recession is dangerous. So President Bush's acknowledgement, during his quixotic State of the Union address, that our economy faces "a period of uncertainty," should have signaled to anyone listening, real trouble.

Don't worry, he quickly cautioned, we're on it. The current jitters are but a short-term problem. "In the long run," Bush assured us, "Americans can be confident about our economic growth." Perhaps. But tell that to the hordes of black Americans who are still waiting for recovery from the last recession, seven years ago.

Many of us remember the 1990s as an American boom era. By 2000, African Americans had pulled closer to racial income equality than ever before. The median black family earned 64 cents for every dollar earned by their white counterparts, According to an Economic Policy Institute recession analysis. There was still quite a gap, to be sure, but it was 20 percent smaller than it had been at the decade's outset. The black poverty rate also hit an all-time low that year (though it remained three-times that of whites), and black unemployment dropped alongside the overall rate, hitting 7.4 percent.

Then came the 2001 recession. Everybody took a hit, but what's striking is how little ground African Americans have made up since then.

By 2005, according to the Economic Policy Institute, all the historic progress toward closing the racial income gap had eroded, pushing the disparity back up to its early-1990s level. Ditto for joblessness. Black unemployment shot up to nearly 11 percent, and it's still not back down to what it was when the 2001 recession began.

Those are important numbers to remember as Washington races to chalk up its response to a looming 2008 recession. The stimulus package the administration and House Democrats are so eager to pass famously split their ideological differences: The Dems got their income cap on the tax rebates and Bush got to block an extension of unemployment insurance benefits, which he dismissed as "unnecessary spending."

It's a good enough deal, politically, but it leaves the black recession still waiting for a recovery. Indeed, the Economic Policy Institute predicts black unemployment will once again hit 11 percent by year's end. The Congressional Budget Office has said that lawmakers would actually provide both the strongest and the fastest economic boost by making unemployment insurance last longer and by boosting the value of food stamps. So if the concern, as Bush and others have insisted, is truly getting money into consumers' hands "as soon as possible," then these benefits are far wiser moves than a tax rebate that won't begin rolling out until May at the earliest.

But joblessness is just part of the picture. The economic recovery between 2001 and 2008—such that it was—came on the back of consumer spending driven by an inflated housing market. We now know that predatory, high-risk mortgage loans were the crutch propping up that market—loans disproportionately held by black families. African Americans at all income brackets were three times as likely to be issued such mortgages in 2006, according to the community group ACORN. They'll bear the brunt of the foreclosure wave that has yet to crest. So all the way up the income ladder, things have remained a lot worse for black families than they appeared in recent years.

It may be true that America's sagging economy desperately needs help, and that policymakers must act fast if they want to avoid hearing the dreaded R-word. The tax-rebate solution on the table now will by all accounts offer some help. But it's going to take a good deal more to brace the economic storm black America has weathered since 2001.

Kai Wright is a regular contributor to The Root.