Wealth Gap Among Races Has Widened Since Recession …Given the dynamics of the housing recovery and the rebound in the stock market, the wealth gap might still be growing, experts said, further dimming the prospects for economic advancement for current and future generations of Americans from minority groups. – New York Times
Dominant Social Theme: Government regs need to be rejiggered in order to do away with US inequity.
Free-Market Analysis: Another day, another analysis focusing on minority income inequality. The New York Times editors love these articles because they can position the old Gray Lady as beating her breast over the evil in US society without ever demanding substantive change.
Several ideas may arise from such articles. Certainly one of them is a sense of helplessness at how unfair US society actually is. This is usually blamed on US exceptionalism.
What that means is that a free society is just not able to cope with the racism that freedom inherently produces. And, of course, out of racism, inequity.
This is the real dominant theme, no doubt. The globalists behind horrible mainstream papers such as the Times and the Washington Post want to disseminate this sort of helplessness. The solution, of course, is government and more government, the bigger the better.
See for yourself. Here's more:
"The racial wealth gap is deeply rooted in our society," said Caroline Ratcliffe, one of the authors of the Urban Institute study. "It's here, it's not going away, and we need to care about it."
Many experts consider the wealth gap to be more pernicious than the income gap, as it perpetuates from generation to generation and has a powerful effect on economic security and mobility. Young black people are much less likely than young white people to receive a large sum from their parents or other relatives to pay for college, start a business or make a down payment on a home, for instance. That, in turn, makes their wealth-building prospects shakier as they move into adulthood.
Two major factors helped to widen this wealth gap in recent years. The first is that the housing downturn hit black and Hispanic households harder than it hit white households, in aggregate. Many young Hispanic families, for instance, bought homes as the housing bubble was inflating and reaching its peak, leaving them saddled with heavy debt burdens as house prices plunged in places like suburban Phoenix and inland California.
Black families also were hit disproportionately by the housing collapse, because heading into the recession housing constituted a higher proportion of their wealth than for white families, leaving them more exposed when the market crashed. Higher unemployment rates and lower incomes among blacks left them less able to keep paying their mortgages and more likely to lose their homes, experts said.
Discriminatory lending practices were also a factor. "We know that communities of color, their rate of subprime or predatory loans was twice what it is in the overall population," said Tom Shapiro, the director of the Institute on Assets and Social Policy at Brandeis University.
Black families also suffered bigger hits to their retirement savings, the Urban Institute found. On aggregate, the value of black families' retirement accounts shrank 35 percent between 2007 and 2010, while white families' accounts actually gained 9 percent over the same period. With lower earnings and higher unemployment rates leaving them with a thinner safety net to begin with, black families were more likely to take funds out of the market when it was depressed, leaving them out in the cold as the market recovered.
So many memes, so little time! By the way, there is no such thing as predatory lending. If someone urges money on you that you will eventually have to pay back, that person is a "bad guy?" For lending you money?
The larger issue with this article is that it glosses over the real reason for minority impoverishment and that's the berserker activities of the US Federal Reserve, a central bank that never saw an economy it couldn't blow up into a bubble and then pop, causing a great bust.
We're living through one such bust now. And analyses like this one in the New York Times that suggest wonkish solutions like additional regulations that can help "close" the perceived gap are fairly ridiculous.
For the most part, the article just bemoans what's taken place – the further impoverishment of the US – without suggesting tangible solutions … like, say … um … ending the Fed … There's one! But there is nary a whisper about monetary policy in this article.
And perhaps that's just the point.