Scenario No. 2: Compromise Reached and Fiscal Cliff Averted

Taxes: While the president has indicated that he is open to bipartisan compromise in regard to the fiscal cliff, he has also made it clear that he is unwilling to compromise on tax increases for those earning more than $250,000 annually. While the U.S. Census Bureau does not collect data on the number of households earning $250,000 a year, it calculated the number earning more than $200,000 as 3.8 million.

Census data reveal that while the median net worth for blacks is $4,995, for whites it is $110,729. Additionally, analysis has also found that African Americans make up around 1 percent of the so-called 1 percent, while whites make up more than 96 percent of them. This means that only a small proportion of black Americans will be affected by a tax increase on those making more than $250,000 a year. 

Medicaid: While the president and Democratic leaders such as Nancy Pelosi have been adamant that any deal must include tax increases for those earning more than $250,000 a year, Republicans have been adamant that any compromise must also include cuts to so-called entitlement programs, among them Medicaid. Established in 1965 as part of an amendment to the Social Security Act, Medicaid provides government-funded coverage of medical services for low-income Americans.

In 2006 the Joint Center for Economic and Political Studies released a report titled "Medicaid: A Program With Special Significance for African Americans." Noting the extreme health disparities between black and white Americans, the report concluded, "African Americans have a particularly large stake in Medicaid." As of 2010, just over 20 percent of black Americans were uninsured, compared with 11.7 percent of white Americans. It appears that cuts to Medicaid would disproportionately affect African Americans.

Medicare: Medicare, a program providing medical care for those over 65 and some with disabilities, is also facing potentially steep cuts or changes because of fiscal-cliff negotiations. According to a 2005 report from the Kaiser Family Foundation, African Americans on Medicare are usually in worse health than their white counterparts, and two in three African Americans on Medicare have incomes of less than 150 percent of the poverty designation. Cuts would have a disproportionate impact on blacks.

Social Security: Despite protests from progressives, Social Security is another program from which Republican leaders have demanded cutbacks as part of a fiscal-cliff compromise. Any cuts would disproportionately affect black Americans because a higher proportion of them rely on Social Security.

According to the Center on Budget and Policy Priorities, Social Security represents 90 percent of income for 35 percent of elderly white beneficiaries, but it represents the same amount for 49 percent of black beneficiaries. Additionally, although black Americans made up just over 12 percent of the population in 2010, 23 percent of those claiming Social Security survivor benefits were African American.

Keli Goff is The Root's special correspondent. Follow her on Twitter.

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