Perhaps if President Abraham Lincoln hadn’t been assasinated and President Andrew Johnson hadn’t reversed the “Special Field Order No. 15,” which redistributed about 400,000 acres of confiscated land from Confederate landowners to newly freed slaves, the wealth gap that exists today between Black and White families wouldn’t exist.
But, alas, it happened, it was, and it does.
With staggering effects on Black individuals, families and communities, specifically, and the U.S. economy, more generally. (Side note: I really wish more people understood how increasing Black wealth would benefit everyone. But it seems the mindset of scarcity, gluttony, and entitlement is a strong drug.)
As Greg Rosalsky of NPR’s Planet Money recently wrote, “…progress Black Americans made in politics, business, and culture in the mid-to-late 20th and early 21st centuries, the economists find there’s been very little progress in closing the average racial wealth gap since 1950. By 1950, the ratio of white-to-Black wealth fell to 7 to 1. Today, it’s 6 to 1.”
In other words, not much progress (or narrowing) in 72 years.
According to the Federal Reserve’s 2019 Survey of Consumer Finances, White families had a median wealth of $188,200, compared to $24,100 for Black families.
In 2017, Prosperity Now, a D.C.-based advocacy and research organization and the Institute for Policy Studies released a study with an incredibly disheartening statistic: By 2053, the median wealth of Black Americans is projected to be zero.
I don’t know about you, but that takes my breath away.
It also makes me angry.
I get angry…
- When I think about those who lived, died, and survived being enslaved;
- When I think about those who thrived during Reconstruction, having created something from nothing, only to have it stolen from them or destroyed;
- When I think about the devastating impact of Jim Crow apartheid;
- When I think about the racism that is deeply embedded in some of our institutions and governmental policies;
- When I read about the persistent disparity between the wealth of Black and White families, and how it’ll reportedly take 228 years for the wealth of Black families to reach that of White families today!
So yeah, I get angry for a host of reasons.
But, it’s a good anger.
“Good anger” fuels action. It can spark creativity. It’s often the seedling for innovation. I’d even go so far as to say it can even increase optimism about what’s possible.
And we each need to tap into some of our good anger in order to address the mammoth task ahead for us all.
I also believe it will necessitate a mental reframing when it comes to building, maintaining, and passing on Black wealth. A shift in mindset where people recognize this to be a collective effort that requires something of us all and benefits all of us, too.
But, Forget Catching Up
As everyone who has done my Financial Wheel exercise knows, when I talk about investing I do so in a multi-dimensional way. Focusing on these dimensions of wealth: financial, social, time, physical, and emotional, mental and spiritual well-being.
And, when I talk about the financial dimension of investing, I highlight how there are three ways to build financial wealth: own a business, invest in the stock market, own income-producing property.
Because the exercise is all about (re)connecting with your financial vision – aka: what you want money to do for you – I ask folks to decide how they want to build the financial dimension (via all three ways or a combination of two). Additionally, I ask them what valuation would make them feel wealthy. After nearly twenty years of walking people through this exercise, what I find is that very few people are intentional about these two factors of their financial wealth.
As you know, building and maintaining financial wealth is what enables individuals, families, and communities to plan for the future and respond to financial setbacks and emergencies with ease.
Similarly, being able to pass on wealth is what fosters generational financial stability.
However, because of the history of the United States, Black Americans haven’t been able to build, maintain, and pass on wealth unimpeded.
It’s why I commemorate today, Juneteenth, thinking about economic justice. Or, the idea that “an economy will be more successful if [everyone] is treated fairly.”
Juneteenth is one of those holidays that is both celebratory and somber.
It reminds us of how far we’ve come, as well as how far we still have to go.
If we can do a better job of closing the income gap, we stand a greater chance of closing the opportunity gap.
If we close the income and opportunity gaps, the pathway to building, maintaining, and passing on wealth is less constrained.
And by we, I do mean it in the broadest sense of the word.
So, to our allies:
- If you’re responsible for making hiring decisions, be intentional about the salaries or rates you offer.
- If you own a business, be intentional about making sure you pay your Black vendors on par with other vendors.
- Diversify your network, so you can spread the word about opportunities to an even broader group of people.
- When you vote, make sure the policies your candidates support by way of how they vote (not by how they campaign) don’t exacerbate the history of racism and Black wealth.
- And if you’re already doing any or all of the above, talk with your inner-circle to see if they are doing the same. As the proverb goes, “Each one teach one.”
To my fellow Black Americans, remember this: We have a history of building something from nothing. So, we know deep in our bones it’s not impossible for us to do this over and over and over again. Despite the odds.
However, the journey has been and can be a doozy. The prospect of overcoming the odds can sometimes feel overwhelming and cause you to become dispirited. Particularly given the magnitude of the numbers: a head start of White families of about 160 years; “228 years;” and “zero by 2053.”
But please don’t lose hope!
Our ancestors, contemporaries, and the generations behind us are counting on us to pass the baton. To press forward with the fight for economic justice and financial freedom.
So, today, let us all celebrate. Tomorrow, let us all get back to work.
p.s. Next week, I really will be back to talk about helping the elders in your life manage the current financial volatility.