Why do middle-class blacks have far less wealth than whites at the same income level? The answer is in real estate and history.
In contrast, my parents’ assets have provided them with a cushion of security and more than modest comfort, from that family room they built in the ’70s to the cottage in northern Michigan they built forty years ago and later renovated for their retirement. Along the way, my parents used their savings to help pay for three college tuitions. They helped me buy my first house because I didn’t have enough savings for the 10 percent down payment. When their health deteriorated, they drew from their assets to rent an apartment in a comfortable retirement community. Barring a medical disaster, which my mother could at least partially cover using her remaining assets, my sisters and I can expect a small sum from her estate. Last year, my mother sent me a check—she called it, rather morbidly, a “down payment” on my inheritance—that totaled more than twice the household assets of the median black family.
I have never thought of myself as a particularly wealthy person, and by the standards of the top 1 percent I’m not one. Despite the swings of the economy and a divorce settlement that drained my retirement account, I own a house worth more than twice its original purchase price. I have squirreled away some money in a mutual fund to help pay for my children’s educational expenses: college is just a few years off, and it won’t be cheap. I can also use some of my assets as collateral for loans to help pay their way. And, if my investment decisions prove to be wise, I will have a substantially larger retirement nest egg than my parents had. If I have extraordinary medical expenses, I have funds to fall back on. I also drafted a will, and hope that my heirs—my family and a few charities—will be able to benefit from my good fortune.
There are many white folks who are not as fortunate as my parents were, and even the modest legacy they were able to build may be becoming increasingly rare among younger generations of Americans of all races. Still, like most whites, I am a beneficiary of the racial wealth gap. And until that gap narrows, we can’t begin to talk about the dawning of a post-racial America.
Feed the Political AnimalDonate
Washington Monthly depends on donations from readers like you.