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louise seamster on black debt, white debt

Contexts has a whole issue debating various aspects of inequality. For example, Louise Seamster has a great article on racial difference in inequality. Sample quote:

Despite predictions that the racial wealth gap would gradually decrease, the gap doubled in the five years of the Great Recession. Going back further, wealth researchers Thomas Shapiro, Tatjana Meschede, and Sam Osoro found that, among college-educated families, the racial wealth gap tripled to a ratio of 15:1 between 1989 and 2013. Black families’ net worth dropped by half in the same period. So while many Whites assume that the racial wealth gap arises from cultural differences like “valuing hard work,” it has become clear to scholars that structural factors are to blame (see the prolific work of stratification economists Darrick Hamilton and Sandy Darity)—cultural values have no explanatory power when it comes to exponential change in such a short time. And these changes should cause great alarm for sociologists trying to understand racial inequality.

The situation is worse than even these examples show, as traditional measures capture only some of the meaning of “racial wealth.” In fact, because Whites have an easier time using debt as an asset, our current measures understate the true extent of the racial wealth gap. That is, the most common metrics of wealth consider debt the opposite of wealth, where net worth equals assets minus debts. But in an economy increasingly reliant on debt, studying debt is essential to understand the rapid widening of the racial wealth gap. In a recent Contexts piece (Winter 2018), Raphäel Charron-Chénier and I talk about how “good debt” can be enabling and “bad debt” can be a hindrance. But “good” and “bad” debt correlate highly with what I call “White debt” and “Black debt.”

Read the whole thing – download it here – free!

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Written by fabiorojas

March 18, 2019 at 4:01 am

Posted in uncategorized

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