Amid A Business Boom, A Wealth Gap Between Races Leaves Some In Boston Struggling The growing gap between America's rich and poor plagues many cities, including Boston, where the economy is flourishing. But a legacy of racial discrimination has left a huge wealth divide.
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Amid A Business Boom, A Wealth Gap Between Races Leaves Some Struggling

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Amid A Business Boom, A Wealth Gap Between Races Leaves Some Struggling

Amid A Business Boom, A Wealth Gap Between Races Leaves Some Struggling

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KELLY MCEVERS, HOST:

Presidential candidates are talking a lot on the campaign trail about the widening gap between rich and poor. As part of our series A Nation Engaged, we're going to go now to Boston. It's high-tech economy is flourishing, real estate prices are soaring, but a legacy of racial discrimination has worsened a huge wealth divide. Anthony Brooks of member station WBUR reports.

ANTHONY BROOKS, BYLINE: South Boston's waterfront is the heart of the city's Innovation District, the home to biotech and financial services companies, and proliferating steel and glass office towers and luxury condominiums. The U.S. Chamber of Commerce ranks Boston as the American city best positioned to lead the shift to a digital economy thanks to this innovation boom.

JAMES ROONEY: So I think it's a significant moment...

BROOKS: Jim Rooney is president of the Greater Boston Chamber of Commerce.

ROONEY: ...That says to anyone who's thinking about where they either want to do their startup, locate their company, that Boston now is the place to be.

BROOKS: But J'Neen Skinner and her husband represent another side of this economy. Not long ago, Skinner, who is African-American, and her husband, who's the son of Haitian immigrants, were both unemployed and counted on food stamps, cash assistance and public housing. Things are better now. They both have jobs at a non-profit in Boston.

J'NEEN SKINNER: Currently, we're looking to buy a home. And it is quite a struggle across the board.

BROOKS: It's a struggle because Boston has some of the highest housing prices in the country, and because when times were tough, J'Neen Skinner and her husband relied on credit cards to pay their bills and fell behind. Skinner also has more than $30,000 in student loans. So their credit score is too low to qualify for a mortgage.

SKINNER: We weren't educated on the importance of having a higher credit score. So we are diligently working on, you know, paying off past due balances.

BROOKS: And so that's a snapshot of Boston's divided economy. The city's Innovation District, building enormous wealth for some, and J'Neen Skinner, struggling to buy a house. Ana Patricia Munoz, an assistant vice president of the Federal Reserve Bank of Boston, says it's just one story about the dramatic disparity in wealth.

ANA PATRICIA MUNOZ: And when you get deeper into the data, you really realize that the racial differences and ethnic differences are immense.

BROOKS: Munoz is the author of a study called "The Color Of Wealth In Boston." Among the key findings, white households have a median net worth - that's the value of their assets minus their debts - of about a quarter of a million dollars. The median net worth of black households - zero. And almost 80 percent of white families own a home while just a third of black families do. Munoz says that means blacks have much less ability than whites to pass wealth onto their children, perpetuating that racial wealth gap.

MUNOZ: It's really the money that's passed down from generation to generation. Whites are more likely to get help to buy a house or more likely to get help to pay for education. And so then you see the cumulative consequences reflected in that number.

BROOKS: By contrast, consider the experience of Setti Warren, who inherited his home in Newton, a wealthy Boston suburb.

SETTI WARREN: I think about my story and how fortunate I've been because there's no way my wife and I would be able to afford to live in that house right now if not for the intergenerational transfer of our home.

BROOKS: Warren is not just a fortunate homeowner in Newton. He's the mayor, and he's African-American. But he's keenly aware of the racial wealth gap and that too few blacks are in his position. He says his father was a Korean War vet who bought the family home with the help of the GI Bill.

WARREN: This idea that if you work hard, you're able to take care of yourself and you're able to ensure that your child's life will be better off than yours - that story is something that we're losing.

BROOKS: The reasons for the wealth gap are many and complicated, including racially discriminatory housing and lending policies of the past. The report from the Boston Fed calls it a public policy challenge requiring immediate attention. For NPR News, I'm Anthony Brooks in Boston.

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