Wednesday, August 02, 2006

Minimum Wage and Maximum Wealth: Blacks In America

One reason that that President Bush and the GOP are so unpopular among black Americans is that they seem tone deaf to blacks' concerns on economic issues. When House Republicans voted for HR 5970, a bill that couples an increase in the minimum wage with a cut in the estate tax, they summed up their party's views on economic policy. If you want to do something about the minimum wage, you have to do something for the children of millionaires.
When George Bush finally decided to address the NAACP, he spoke about the importance of ownership -- of homes, businesses and retirement accounts. He also raised the issue of the "death tax" as one that blacks should be concerned about.
Why doesn't Republican talk about opportunity and wealth connect with black voters?
Many blacks are still lagging in terms of household income. According to the U.S. Census, 32.3 percent of blacks fall in the bottom income quintile, while only 9.4 percent have reached the top quintile.
More dramatic than the income disparity is the asset disparity. According to the National Urban League's report "The State of Black America 2006," the median net worth of African American families is only $6,166 compared to $67,000 for white families.
Why such a large disparity? Even for upwardly mobile families, it takes time to accumulate assets. And far too many black families are not upwardly mobile.
In a nutshell, Republican economic policies favor the accumulation and protection of wealth when many black Americans are still struggling to earn a living wage. With so many black families not achieving upward mobility, the issue of avoiding taxes on assets that seem unattainable just doesn't resonate.
Interestingly, Treasury Secretry Henry Paulson noted this difference in perspective in a speech reported in the New York Times:
“Amid this country’s strong economic expansion, many Americans simply aren’t feeling the benefits,” Mr. Paulson said in a speech at Columbia Business School on the Upper West Side of Manhattan. “Many aren’t seeing significant increases in their take-home pay. Their increases in wages are being eaten up by high energy prices and rising health care costs, among others.”
It was an unusual concession from a high-ranking official in an administration that has spoken only glowingly of recent economic gains and has generally joined with Republicans in Congress by dismissing Democratic concerns about growing economic inequality in the United States as “class warfare.”
He did not offer any policies to help those families that aren't doing better.


Anonymous Anonymous said...

What do you think the reasons are behind this income disparity between blacks and whites? Relatively speaking, it hasn't been that long since the civil rights movement gave them the right to even vote -- I think things have come a long way since then and are continually getting better. There's still a lot more to do but we are getting there, I believe. At some point, you have to start looking at what the individuals are doing for themselves too.

3:45 PM, August 04, 2006  

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