Report: African Americans Lose Economic Momentum New research suggests that many African Americans are worse off than their parents. Alfred Edmond, editor-in-chief of Black Enterprise Magazine, and Angela Glover Blackwell, CEO of the economic think tank PolicyLink, dicsuss the shrinking black middle class.
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Report: African Americans Lose Economic Momentum

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Report: African Americans Lose Economic Momentum

Report: African Americans Lose Economic Momentum

Report: African Americans Lose Economic Momentum

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
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New research suggests that many African Americans are worse off than their parents. Alfred Edmond, editor-in-chief of Black Enterprise Magazine, and Angela Glover Blackwell, CEO of the economic think tank PolicyLink, dicsuss the shrinking black middle class.


I'm Cheryl Corley, and this is TELL ME MORE from NPR news. Michel Martin is off.

Just ahead, the story of an unlikely friendship between a patrician white woman and a young black prisoner.

But first, the idea of moving up the economic ladder and earning more than one's parents may be more of a dream than a reality for many middle-class African-Americans. That's according to a new study from the Pew Charitable Trust. There is some good news in the report. Family incomes for both blacks and whites have risen since the 1970s. It also notes that African-Americans born into very poor families often do succeed in earning more than the extremely low wages of their parents. But for many black children born to middle-class parents in the late 1960s, it's been more of a downward spiral than upward mobility. Nearly half of those surveyed have a family income near or below the poverty rate.

Well, joining us to discuss what it all means is Angela Glover Blackwell. She is founder and CEO of PolicyLink, a think tank working towards social and economic equity. And she joins us by phone from her home in San Francisco. Hello, Angela.

Ms. ANGELA GLOVER BLACKWELL (CEO and founder, PolicyLink): Hello. Thank you for having me.

CORLEY: And thank you. And Alfred Edmond, the editor-in-chief of Black Enterprise magazine may be joining us well a little later.

But I want to start off first, Angela, by playing a clip of the study's author, Julia Isaacs. She appeared on NPR's TALK OF THE NATION last week. And here's what she had to say about what's happened to the generation of black and white Americans born in the late '60s to middle-income parents.

Ms. JULIA ISAACS (Economic Studies, Brookings Institution): We found that for white children in the middle, two out of three did better than their parents, just as we found for the society overall. However, for black children, only one out of three did better than their parents. In other words, a majority have lower family income than their parents. And back in 1968, their parents had income - well, let me put it in 2006 dollars. They had incomes of about -median income of about $56,000. So, these were not poor families. And you might expect that they would be passing along their economic advantages to their children. And some of them are, but a majority of them are not.

CORLEY: So, as Julia Isaacs puts it, white children are more likely to move ahead of their parents' economic rank, while black children of middle-income and upper middle-class parents are more likely not to do so. Of course, this was a sampling of, but, of - with a little bit more than 700 African-Americans at a sampling of about 2,000 people. What do you make of these findings, Angela?

Ms. BLACKWELL: They are certainly discouraging.

CORLEY: Mm-hmm.

Ms. BLACKWELL: One would hope with all of the legal progress and the stories that we've heard of black progress economically and educationally that this would not be the case. But it's one of those things that first, you're shocked, and then when you think about it, it makes sense. It's very hard these days to be able to make it. And I think the American people - black and white and others - are all feeling the pressure of staying in the middle class. And so as I reflected on the data, I thought, well, it's probably not so surprising after all. And there are a number of things that one could turn to in terms of explanation. But discouraging has to be the initial reaction.

CORLEY: Mm-hmm. Alfred Edmond is joining us now, editor-in-chief of Black Enterprise magazine. Do you agree? Kind of shocking but somewhat expected?

Mr. ALFRED EDMOND (Editor-in-chief, Black Enterprise Magazine): Well, it is expected, and I have to say that I'm not shocked, nor am I particularly discouraged. Income is a measure of wealth, but it's not wealth itself. And what we believe we're seeing here and what we focused on in Black Enterprise for the last 30 or so years is that it's what you do with your income that determines whether wealth will be accumulated during the course of your lifetime and passed on to future generations.

CORLEY: Mm-hmm.

Mr. EDMOND: And we're really talking about a generation of African-Americans that are first - are the first and largest group to achieve high incomes, but have not necessarily adopted the habits necessary to manage that income to acquire assets such as home ownership, for example - where we lag behind whites in rates of home ownership - that are necessary to actually pass on wealth to future generations.

CORLEY: Mm-hmm. So, it's the whole idea of being upwardly mobile then is tied to this idea of passing wealth on. That doesn't seem to be happening by the accounts of this study. What are some of the obstacles?

Mr. EDMOND: Well, a lot of it is really just adopting a certain cultural attitudes toward how money is handled. For example, if you look at the latest Ariel/Schwab survey of black investment habits and behavior, African-American families are far more likely to place investing in their kids education as the highest savings-investing priority, whereas White Americans focus on their own retirement. This is important because while your child can borrow to go to college, when you're in retirement, you can't borrow to finance your expenses in retirement.

CORLEY: Mm-hmm.

Mr. EDMOND: So, what ends up happening is parents - well-meaning black parents who are focusing on their kid's education - find themselves underfunded for retirement, and they're relying on those same children who are also trying to take care of their children.

CORLEY: Mm-hmm.

Mr. EDMOND: And so, we're really talking about having to change certain habits. One of the things that we focus on in our magazine is 10 principles of financial empowerment, of which retirement planning, home ownership as a means of building wealth and estate planning are three of the 10 components we focus on.

CORLEY: Angela, so then, is financial literacy one of the major keys here, then?

Ms. BLACKWELL: Absolutely. And the wealth issue is very important. Let's put some numbers on it. In 2004, African-American households' net worth was less than one-tenth that of whites. Eleven thousand for black families, just over -in just over 118,000 for white families. So, the wealth gap is very important.

CORLEY: Mm-hmm.

Ms. BLACKWELL: But let me try to put it in a broader context. The data suggests that two-thirds of white children did better than their parents. That - in the middle class. That means one-third did not.


Ms. BLACKWELL: And we know that in America that when white America sneezes, black America gets pneumonia. And the reason I think we all ought to be concerned and discouraged is because I think we're just seeing the tip of the iceberg of this slippage out of the middle class on the part of black families that worked so hard to get there.

I agree with Alfred 100 percent that it takes time. It actually takes generations, as we know, to have secure status in the middle class. But a number of things are contributing to it being harder for black people to stay there. Education and student loans, absolutely one of them. I think the fact that so many middle-class families got there because of one wage earner, so many of the families are headed by a single black woman. The poor quality of urban education probably has a lot to do with it, as well as the impact of the crack epidemic in the 1980s and the 1990s.

CORLEY: Hmm. Mm-hmm.

Ms. BLACKWELL: Let's not forget that. And the fact that where you live if you're black is likely to be an area of poor urban education, living in a home, if you own it, where you can't pull out the equity in an emergency. So, there are a lot of things that we need to be concerned about in the broader society.

CORLEY: If you're just joining us, this is TELL ME MORE. I'm Cheryl Corley, in for Michel Martin, and we're talking about African-Americans and the downward financial mobility they're experiencing with Alfred Edmond, editor-in-chief of Black Enterprise magazine, and Angela Glover Blackwell, founder and CEO of PolicyLink.

It's interesting that you talk about single parent households, Angela. So, I want to talk about a tricky conundrum, this whole question of marriage and how that impacts family income. There's been a decline in marriage across the board, as we know. The report notes that for African-Americans, the low personal income of black men may play a role in explaining that situation. But there also have been all these studies about single parent households, particularly those had it by women, which being the hardest hit financially. Should more black people be getting married?

Ms. BLACKWELL: First, let's celebrate how well black women have been able to under very hard circumstances.

CORLEY: Mm-hmm.

Ms. BLACKWELL: I always think when this issue comes up, we immediately turn to should black women be getting married more? And I always want to celebrate the fact that, alone, they had been able to bring so many of their families out of poverty into the middle-class.

CORLEY: Well, we - yeah. Well, we mean black men, too. They should be getting married, too.

(Soundbite of laughter)

Ms. BLACKWELL: Yes. But let me answer the question directly.


Ms. BLACKWELL: I think that we have a crisis facing black men in this country, and it is something that the nation needs to focus on. That it would be nice if there men making the kind of salaries that would make them marriageable. And so, I think that being married is a good thing if that's what one wants. But what we really want is for people to be able to have the ability to make a choice to get married. And very often, that means the stability of both people.

CORLEY: Mm-hmm. Mm-hmm.

Mr. EDMOND: Well, let me…


Mr. EDMOND: …weigh in as a kind of on a different level as a - the oldest child of a divorced single mother, raised on welfare. My mother had a high school education when I was a child. She did eventually get a GED and some college credits. But I was 8 years old in 1968, which is, you know, kind of the starting point for the Pew Charitable Trust study on the income analysis among races.

CORLEY: Mm-hmm.

Mr. EDMOND: One of the things that I think is important to note is that you don't necessarily have to make a high income if you do the right things with that income. And let me say - tell you what I mean by that. When you look at upward mobility across races, whether you're talking about black, white or ethnic groups, the big difference between to what degree income levels and wealth can slingshot from one generation to the next is to what degree people are taught what to do with the money that they have.

CORLEY: Mm-hmm.

Mr. EDMOND: Let's talk about financial literacy with regards to managing credit. Many of our parents didn't get in trouble with credit because they didn't have access to credit. Now we have a whole industry that targets lower income people, under educated people with credit products that, frankly, are usurious. And so, what we really find is a very critical in changing the tide of this from generation to generation is really educating our children in particular. How does credit - this is across-income levels.


Mr. EDMOND: How does credit work? Live within your means. Don't spend $1.20 for every dollar you get, because 10 percent of $20,000 and 10 percent of $200,000 is 10 percent. And if you spend more than you make, it doesn't matter what your salary is.

CORLEY: Well, one last question. We only got about 30 seconds. When we talk about the creation of the black middle-class, there were lots of jobs that help African-Americans reach that level of prosperity. What about the economic shift that we've seen in the last 30 years or so? That has to have something to do with it.

Mr. EDMOND: Well, a big part of the black middle-class come through the '70s and '80s was built on the manufacturing sector. If you look at places like Detroit, where a number of African-Americans rode the auto industry into the middle-class.

CORLEY: Right. And that's all…

Mr. EDMOND: And those jobs are the jobs that are being shifted overseas or being taken over by automation. (unintelligible)

CORLEY: All right. Well, thank you so much to both of you. I know we could talk about this much longer, but we're running out of time. There are more studies in the work. Our guests today have been Angela Glover Blackwell, founder and CEO at the economic think thank PolicyLink and Alfred Edmond, editor-in-chief of Black Enterprise Magazine. Thank you to you both.

Mr. EDMOND: Thank you.

Ms. BLACKWELL: Thank you, Cheryl.

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