Thousands of Americans descended upon the Washington Mall on August 28, 1963 to participate in the March on Washington for Jobs and Freedom.
With 1,651 carefully crafted and dynamically delivered words, the Rev. Dr. Martin Luther King raised a nation’s awareness to the atrocities of denying civil rights for all Americans.
As we commemorate this historic day, theGrio spoke to experts on jobs, poverty, housing and wealth to provide a status report and ideas to tackle major issues facing the nation today.
Fifty years ago, the national unemployment rate stood at 5.7 percent compared to 10.8 for blacks and other groups, according to the U.S. Labor Department. In July 2013, the latest figures available, the national unemployment rate was 7.4 percent versus 12.6 percent for blacks.
“There has been no improvement,” says Algernon Austin, director of the Economic Policy Institute’s Program on Race, Ethnicity, and the Economy. “African-Americans are still less likely to get jobs even if they have the same qualifications as whites.”
Experts say bias may be behind the disparities in employment, housing, wealth and poverty.
“There continues to be racial bias in the labor market. Some of it is overt in consciousness, some is not.” Until we acknowledge the presence of overt bias and subtle unconscious bias we will not be able to solve the problem of excessively high black unemployment, Austin warns.
Where are the jobs?
“The deficit our leaders should be talking about is the jobs deficit,” Austin laments. The U.S. needs 9 million new jobs to return to the unemployment levels of 2007, which was before the Great Recession. He estimates an additional 2 million jobs must be created to put a dent in black and Hispanic unemployment.
Infrastructure as a jobs creator
Repairing our nation’s crumbling infrastructure is one way to get all Americans back to work, Austin proposes. Infrastructure projects create construction, transportation and a wide range of supporting jobs.
Public sector job creation is vital to bringing down unemployment. Austin says the public sector is where blacks have succeeded in getting good jobs because it has had the strongest commitment to anti-discrimination policies for equal opportunity.
The wealth effect
Employment is a major contributor to wealth accumulation.
“We’ve seen a game change in blacks getting white collar jobs,” says Tom Shapiro, director of the Institute on Assets and Social Policy at the Heller School at Brandeis University. “The African-American middle class is no longer coming out of a service industry serving only the black community,” he says. These advancements are underplayed.
However, the wealth gap between whites and African-Americans has tripled since 1984. Shapiro’s research estimates the wealth gap for median white households compared to black households grew from $85,000 in 1984 to $236,500 in 2009.
Shapiro says the huge increase in the wealth gap suggests the historical legacy and past policies of Jim Crow and slavery. “Contemporary policies only help to exacerbate the racial gap over the past 25 years,” he argues.
“The wealth gap remains persistently stubborn,” says Darrick Hamilton, associate professor of economics and policy at The New School. He says African-Americans made strides in income and education until the 1970s, but has been stagnant since.
“Wealth is probably your best determinant of economic opportunity, well-being and security. The indicator for which blacks and whites are most disparate,” Hamilton says.
Critics may say the racial wealth gap exists because blacks do not save enough, make good financial decisions, or engage in entrepreneurial activities, Hamilton debates.
“Blacks are less involved in entrepreneurship because of assets,” Hamilton argues. According to the Pew Hispanic Center, in 2009 the median net worth for African-American households was $5,677.
“Market forces alone will not solve the wealth gap problems,” Hamilton warns. Post World War II and Depression-era policies created a middle class of white asset owners. He cites the GI bill and FHA as prime examples. “We need big ideas from the federal government to create economic opportunity for all races,” Hamilton advises.
Bridging the wealth gap
“We’re talking major lane changes and not simple policy reform,” Shapiro stresses. He suggests revamping the tax code, specifically the mortgage interest rate deduction. The tax code should be reconfigured to reach the public and not a tiny minority.
Hamilton recommends bold policies to increase economic security for all Americans. Hamilton and his colleague William Darity, professor public policy at Duke University, have proposed baby bonds.
Baby bonds would be given to children born into the poorest families. The average amount of a bond would be $15,000. Hamilton estimates an annual cost of $60 billion to $80 billion, which could be funded by making changes to the mortgage interest deduction. He argues these bonds would not create moral hazards such as fertility incentives or savings disincentives.
Housing: American Dream for some, nightmare for others
During the 1960s and 1970s critical housing legislation was passed. The Fair Housing Act as well as the Community Reinvestment Act of 1975 sought to improve access to housing.
As a result of legislation, homeownership rates rose for African-Americans, peaking at 49.1 percent in 2004, according to the Census Department. However, during the first quarter of 2013, black homeownership stood at 43.1 percent, compared to the 65.2 percent overall homeownership rate.
“Today, we are still fighting for the housing and mortgage lending equality being fought for back then,” says Nikitra Bailey, executive vice president at the Center for Responsible Lending. She says deregulation of the mortgage industry in the 1980s provided an opening for sub-prime mortgage lending. The lack of regulation made blacks a target for sub-prime loans.
“There was lots of progress made in black homeownership until 2006. It’s been a move backwards since then,” says Ken Rosen, chairman of the Fisher Center for Estate at the Haas School of Business at the University of California – Berkeley.
The housing bubble had has an especially bad effect on African-Americans, Rosen explains. Foreclosures wiped out a much higher percentage of wealth among African-Americans than other populations.
Bailey says since homeownership is a big contributor to wealth accumulation, all Americans who are qualified should have access. She estimates that by 2034 people of color will account for 70 percent of potential home buyers and warns locking out this group will be a catastrophe for the housing market.
Rosen echoes the importance of keeping credit accessible. “New rules are in place are meant to protect consumers but are making credit harder to access for 40 percent of the population. Housing is about 90 percent of net worth,” Rosen says. “If you can’t own a house in an area where housing is doing well, it’s hard to build net worth.”
Housing policy should allow for more mobility to own. Rosen says the U.S. should consider housing vouchers for homeownership as part of a comprehensive package of assistance which would include mortgage counseling and down payment assistance.
Poverty: The forgotten citizens
Poverty is still pervasive in the U.S. According to the National Poverty Center, one out of every three African-American children lives in poverty, twice the rate of white children.
“The overt barriers to equal opportunity have fallen,” says Ann C. Lin, associate professor of public policy at the University of Michigan. However, there are a lot of inequalities in society that have to do with structural disadvantages.
Lin says it is all about accumulated vulnerabilities. “If you start out in a more vulnerable position, it makes you more vulnerable to something bad happening. Race in America is part of the structure of accumulated vulnerability.” People with multiple problems need more than a little bit of help. Lin stresses we have to stop looking for a magic bullet to fight poverty.
“Unfortunately, we are still not making progress in various ways,” says Richard Buery, CEO, of The Children’s Aid Society in New York. Income inequality is at the highest level in decades, but social mobility is declining.
“Child poverty challenges the fundamentals of this country,” Buery says. The March on Washington was also a march for economic equality, jobs and justice. He says although the U.S. has made progress on the justice side, progress on the jobs side is still alarming.
He warns we have a country of a class of children who seem destined to remain poor. “More and more today, children born poor are likely to grow up poor and stay poor and have poor kids. This means the American dream remains elusive.”
Better health care and education
The health care law is a big social program that may help stem the effects of poverty, Lin believes. Improving a child’s health will not only reduce illness but can positively impact behavior and education.
Buery recommends the U.S. make a massive commitment to early childhood education. “It remains true that the biggest poverty-fighting program is education.”
Children who graduate from college are wealthier, healthier and live longer.
“What really drives the achievement gap between the wealthy and non-wealthy is the investment in [childhood] development programs,” he says.
Shartia Brantley is a producer and on-air reporter at CNBC. Follow Shartia on Twitter at @shartiabrantley