JACKI LYDEN, host:
The gap between the personal wealth of white and black Americans has grown wider. That's the takeaway from a report released this week by the Insight Center for Community Economic Development.
For more, we're joined in our studios by Julianne Malveaux. She's an economist and president of Bennett College, a historically black women's college in Greensboro, North Carolina.
Welcome to the show.
Dr. JULIANNE MALVEAUX (Bennett College): Good to be here, Jacki. Thank you.
LYDEN: This report really made the rounds of the various blogs in the nation this week. It specifically outlines the stark economic realities facing women of color and finds that single black women own a fraction of a penny of wealth for every dollar owned by their white female counterparts, and it basically says that prior to age 50, women of color have virtually no wealth. Or to put it another way, Dr. Malveaux, a median of $5 of net worth compared to over $40,000 for white women. And one wonders after decades of concern about income disparity why we're still seeing these dramatic numbers.
Dr. MALVEAUX: Well, income disparity and wealth disparity are really two different things. Income, of course, is the money you make every week, every month, but wealth is the money youre able to accumulate. And if you look at the economic realities of African-American women, obviously the ability to accumulate is constrained before age 50. With most African-American children being raised by women, 45 percent of African-American households headed by women, these children sometimes going to college and so on, mothers are investing in their children instead of in their wealth.
I see it every day as a college president: a young lady whose mom is a single mom, literally, if she had a 401K, and some government workers do, raiding that to make sure that her daughter has an opportunity for a future life. But if not, borrowing and pulling everything together to make sure that young person has that opportunity.
LYDEN: I just also would like to point out that these are federal statistics taken from a federal survey and they were taken in 2007, before we even had the economic downturn we have now.
Dr. MALVEAUX: Precisely. The Survey of Consumer Finances is done every three years and it's been released on a two-year lag, so we won't get new data - 2010 data will be release in 2012. But you look at the wealth data, the year-to-year variations are not so important as the total picture. This is a story of accumulation.
LYDEN: Five dollars still seems like a shockingly paltry amount. It is a shockingly paltry amount.
Dr. MALVEAUX: Well, it is an extraordinarily, shockingly paltry amount, but again, I think you have to look at where people are coming from, the kinds of jobs they have.
Many of these women, African-American women disproportionately, work in service occupations. Sometimes they work in jobs where there are not sufficient benefits. African-American women, I believe one in three, have a defined pension plan compared to nearly half of white women.
So if your employer is deducting and matching, that's an opportunity again to accumulate, and here's the biggest problem, though, Jacki: Assets mean access. So if you don't have assets, there are a whole range of things that you simply do not have access to.
LYDEN: You mean, if you don't inherit wealth, for example, if you dont inherit the house, you're less likely to be able to borrow unless you have the kind of job that...
Dr. MALVEAUX: Precisely. Many people have used their homes as a pipeline to stability. You borrow on that, although that's got us in a lot of trouble, but you borrow on that accumulated equity to send your child to college, to take care of emergencies, to deal with things like health care when you don't have the health care.
So you have people who have no access. The only access they have are those government programs that are out there.
LYDEN: So you're saying that minority women don't have access to what's sometimes called the wealth escalator, but let me ask you this. The report also makes very plain something that conservatives point out, and that's that marriage seems to be a key to building wealth or at least some kind of life partner, whether even if you're divorced later, there is far more disparity, and if you're not, never been married, and African-American women are far less likely to ever have been married.
Dr. MALVEAUX: Well, I hope that people don't think of marriage as a wealth accumulator, but certainly when you have two earners in a household, it is easier for that household to accumulate.
LYDEN: Does the argument of pull yourself up by your bootstraps apply here? What about individual responsibility?
Dr. MALVEAUX: You know, that's a really interesting question. When you look at the ways that our tax system allows some people to accumulate wealth - for example, if you get a tax deduction because of home ownership, or you get an employer to match because you have a pension fund, then those who are situated properly are getting literally a subsidy for their wealth accumulation.
On the other hand, if you want to talk about pulling people up by their bootstraps, I would challenge anyone to look at a single mom who's raising kids or going to school and doing well and sometimes working two jobs, sometimes without health insurance. I can't think of anyone who works harder than that, and so what more work can they do?
There are things that we can do. Why not give renters some of the same opportunities that we give homeowners, some kinds of credits to get them into the housing market? We reward the wealthy. We reward the middle class. We don't reward these hardworking African-American women, single moms, who basically have almost no way of accumulating.
LYDEN: You are mentoring, yourself, a lot of young minority women. You're a college president. You're an economist. Were you surprised or angered? What was your emotional reaction to this?
Dr. MALVEAUX: Well, I was intuitively, I knew that this was the case. I didn't know the numbers. But, you know, the last time I looked at this data, which was three years ago when it came out, one in eight African-American people have no assets at all - people, not women, men and women. So you know that there are some things that are going on.
These data are extraordinarily stark, and they really are a call for people who talk about women's empowerment. We've got to put a spin on that and not only talk about the income gap but also talk about the wealth gap and talk about creative solutions to closing that gap.
LYDEN: Julianne Malveaux is an economist and president of Bennett College for Women in Greensboro, North Carolina. Thank you for stopping by.
Dr. MALVEAUX: Thank you.