The Pew Research Center has just released stunning statistics on the aggravation of inequality by race, ethnicity, class and gender since the onset of this depression. The study focuses one of the broadest measures of overall social and economic progress: wealth.
Wealth is the sum of assets (houses, cars, savings and checking accounts, stocks and mutual funds, retirement accounts, etc.) minus the sum of debt (mortgages, auto loans, credit card debt, etc.). Wealth is different from household income, which measures the annual inflow of wages, interest, profits and other sources of earning. It does not include wealth in public goods, which in some countries (and some US areas) might be substantial – subsidized health care, retirement, transportation, communication-media infrastructure, education, etc).
Wealth gaps between whites, blacks and Hispanics have always been much greater than income gaps. Nonetheless the changes have never seen the magnitude witnessed in the past few years.
Pew reports that the median wealth of white households is now 20 times that of Black households and 18 times that of Hispanic households, according to a Pew Research Center analysis of newly available government data from 2009.
“These lopsided wealth ratios are the largest since the government began publishing such data a quarter century ago and roughly twice the size of the ratios that had prevailed between these three groups for the two decades prior to the Great Recession that ended in 2009.”
The bursting of the housing market bubble in 2006 and the depression that has followed from late 2007 took a far greater toll on the wealth of minorities than whites. Plummeting house values were the principal cause of the recent erosion in household wealth among all groups, with Hispanics hit hardest by the meltdown in the housing market.
“From 2005 to 2009, inflation-adjusted median wealth fell by 66 percent among Hispanic households and 53 percent among Black households, compared with just 16% among white households.
As a result of these declines, the typical Black household had just $5,677 in wealth (assets minus debts) in 2009, the typical Hispanic household had $6,325 in wealth and the typical white household had $113,149.”
These numbers represent median wealth figures, thus tens of millions – concentrated in African-American, Latino, and Asian communities – are completely underwater, are insolvent, and bankrupt.
The foreclosed homes that most of this collapsed wealth represents stand abandoned and unused in cities and towns with no property income to sustain necessary school, public safety, or health services.
An underlying, perhaps more profound, message in the Pew wealth report is that it completely refutes any remaining hopes in the viability of the Bush “ownership society” as the path to popular wealth, at least as long as market fundamentalism holds sway or veto power over economic policy.
Combined with income statistics that also show recent aggravated overall inequality layered on top of 30 years of median income stagnation or decline – and Miles Davis Bitches Brew barely captures the bad mood swirling like mouse droppings in every corner of the land. There is no reason why gains in productivity (and thus wealth) should not be distributed so that, at least, the median, ordinary person’s overall wealth grew or declined in direct proportion. When working people’s income diverges downward from their rate of improved productivity – the math tells the truth. There is robbery taking place. Reagan told us it was so that later when we got pie in the sky it would trickle back down us.
Perhaps the media is not watching closely enough – but the chief victims of the unrelenting forces of austerity – minorities, youth, seniors, workers – are going to be descending on state and national capitols in multitudes of hunger, health care and jobs marches. Frankly, they got nowhere else to go to get answers. They are coming to say: Stop Stop Stop. Turn around Get Real and Tell the Truth!
