Economic Consequences of Racism and Discrimination

The cornerstone of the American Dream is founded on the ideology of competitive individualism-the idea that the best way to achieve success is for every individual to compete amongst themselves for accolades and success, to "pull yourself up by your bootstraps". This idea that everyone must is responsible for their own success becomes problematic when one acknowledges that historically, the United States has barred certain social groups (primarily people of color and women) from gaining a solid economic footing in American society while privileging white men. This means that historically, white men have been able to own property (that for a long period of time in the United States constituted African Americans), acquire capital, hold prestigious positions of power, and even given governmental handouts that women and other people of color were not privy of.

Articles

A Long History of Racial Preferences - For White

"Many middle-class white people, especially those of us who grew up in the suburbs, like to think that we got to where we are today by virtue of our merit - hard work, intelligence, pluck, and maybe a little luck. And while we may be sympathetic to the plight of others, we close down when we hear the words "affirmative action" or "racial preferences." We worked hard, we made it on our own, the thinking goes, why don't 'they'? After all, it's been almost 40 years now since the Civil Rights Act was passed.

What we don't readily acknowledge is that racial preferences have a long, institutional history in this country - a white history. Here are a few ways in which government programs and practices have channeled wealth and opportunities to white people at the expense of others."

Worse Than Apartheid

"For every dollar in assets owned by whites in the United States, blacks own less than a nickel, a racial divide that is wider than South Africa’s at any point during the apartheid era.

The median net worth for black households is $4,955, or about 4.5 percent of whites’ median household wealth, which was $110, 729 in 2010, according to Census data.   Racial inequality in apartheid South Africa reached its zenith in 1970 when black households’ median net worth represented 6.8 percent of whites’, according to an analysis of government data by Sampie Terreblanche, professor emeritus of economics at Stellenbosch University."

The Racial Wealth Gap

"Whites’ share of the nation’s wealth is 31 percent greater than their share of the nation’s population. Blacks’ share of the nation’s wealth is 80 percent less than their share of the population. That is, to bring their share of the wealth in line with their share of the population, you’d need to increase black wealth five-fold. Hispanics’ share of the nation’s wealth is 72 percent less than their share of the population. To bring their share of the wealth in line with their share of the population, you’d need to increase it by 3.5x."

Pew Research Center: "Wealth inequality has widened along racial, ethnic lines since end of Great Recession"

"The Great Recession, fueled by the crises in the housing and financial markets, was universally hard on the net worth of American families. But even as the economic recovery has begun to mend asset prices, not all households have benefited alike, and wealth inequality has widened along racial and ethnic lines."

"Are Emily and Greg More Employable than Lakisha and Jamal? A Field Experiment on Labor Market Discrimination"

"We perform a field experiment to measure racial discrimination in the labor market. We respond with fictitious resumes to help-wanted ads in Boston and Chicago newspapers. To manipulate perception of race, each resume is assigned either a very African American sounding name or a very White sounding name. The results show significant discrimination against African-American names: White names receive 50 percent more callbacks for interviews. We also find that race affects the benefits of a better resume. For White names, a higher quality resume elicits 30 percent more callbacks whereas for African Americans, it elicits a far smaller increase. Applicants living in better neighborhoods receive more callbacks but, interestingly, this effect does not differ by race. The amount of discrimination is uniform across occupations and industries. Federal contractors and employers who list Equal Opportunity Employer' in their ad discriminate as much as other employers. We find little evidence that our results are driven by employers inferring something other than race, such as social class, from the names. These results suggest that racial discrimination is still a prominent feature of the labor market"

"African-Americans With College Degrees Are Twice As Likely to Be Unemployed as Other Graduates"

"Nearly five years after the Great Re­ces­sion of­fi­cially ended, the struggles and dampened ex­pect­a­tions of young col­lege gradu­ates have be­come a fix­ture of Amer­ic­an polit­ics and even pop­u­lar cul­ture. But amid all the fo­cus on the dif­fi­culties of col­lege-edu­cated mil­len­ni­als, one fa­cet of this up­heav­al has re­mained largely un­ex­plored: the con­tin­ued sig­ni­fic­ance of race."