Because of legalized segregation, job discrimination and racist housing policies, it’s not surprising that black and Latinx families haven’t had the same opportunities to amass wealth as white families have.
But a new study—and an accompanying op-ed by one of its researchers—reveal that black and Latinx families have actually lost wealth over the last 30 years.
“The Road to Zero Wealth: How the Racial Wealth Divide Is Hollowing Out America’s Middle Class” (pdf), published by the Institute for Policy Studies, reveals that the median wealth of a white household today is more than 68 times higher than the median wealth of black households.
It’s important to make the distinction between wealth—the accumulated assets of a family or household minus their total debt—and income, such as yearly salary. Looking at median wealth also ensures an apples-to-apples comparison that looks specifically at middle-class families across different races.
The median wealth of a black family was found to be only $1,700. In 1987, that number was $6,800—four times higher than it is now.
That pattern bears out similarly for Latinx families. In 2017, the median wealth of a Latinx household is $2,000.
White families, however, have accumulated wealth over the past 30 years. In 1987, their median household wealth was $102,000. Now it’s $116,800—a number all the more impressive considering that the rising tide of student loan debt likely cut into some of those wealth gains.
Josh Hoxie, one of the study’s authors, penned an op-ed for Fortune magazine that unpacks the study. Hoxie writes that if the current trend holds up, black families will own zero wealth by 2053. By 2073, the same would be true for Latinx households. Meanwhile, he writes, white families can still be expected to have wealth in the six figures, even as they become racial minorities in America.
Hoxie cites the role of the “enduring legacy of slavery and the Jim Crow era” in the growing wealth gap: namely, housing discrimination, as well as tax policy. As he notes, a family’s home is typically the biggest asset they own, and families of color were regularly denied the sort of heavily subsidized mortgages that were given to white families.
“This sort of federally sanctioned discrimination created a huge, intergenerational disadvantage for the black and Latino families left out,” Hoxie writes.
It’s a staggering conclusion—one that has to be acknowledged in order for there to be any meaningful discussion about economic equality and racial progress in this country. As Hoxie writes, policy experts and economists have recommended programs and initiatives that could significantly cut down—if not completely erase—these gaps. The question, he says, is whether we have the political will to enact them.