(TriceEdneyWire.com) - African-Americans have been pummeled by the recent financial crisis, including facing the most adverse consequences of credit card debt, and higher interest rates, according to a recently released study by the NAACP and Demos, a U.S.-based research and policy center.

Findings from “The Challenge of Credit Card Debt for the African American Middle Class,” indicate that Black Americans suffered disproportionate economic losses since the Great Recession; weathering the highest jobless rates, steepest declines in income and deepest cuts into their assets and investments.

Additionally burdened by systemic discriminatory policies that left Blacks with fewer assets and lower rates of homeownership than Whites, many African Americans turned to credit cards as a “plastic security net” to help make ends meet, according to the report which is dated December 2013.

“Much of the disproportionate impact of credit card debt can be attributed to the fact that African Americans have fewer assets than other households to fall back on in emergencies,” said Catherine Ruetschlin, report co-author and Demos policy analyst, in a statement. “Unlike white households, more than half of African Americans’ wealth is held in housing, which was devastated in the financial crisis. We’re also seeing African Americans turning to credit cards to cover their household finances as incomes continue to stagnate and unemployment rates hover around twice that of White workers.”

According to the report, while Blacks owe less than they did in 2008, 42 percent—consistent with other groups—reported using credit cards to pay for basic living expenses like rent, mortgage payments, groceries, utilities, or insurance.

And, like other moderate-income Americans, middle-income Black also used credit cards to invest in their future, including higher education, entrepreneurship, and medical expenses.
Many of the Black entrepreneurs surveyed said they used a credit card to pay for the expense of starting a new business, and 99 percent have not been able to pay it off, compared to 80 percent of Whites.

Troublingly, while Black credit card holders were no more likely to be late on their payments than Whites, Blacks were nevertheless unevenly targeted by bill collectors—71 percent of African-American middle-income households compared to 50 percent of Whites—and were more likely to have their credit cards cancelled, credit limit reduced or be denied a new card.

Black families also reported lower credit scores and different causes of poor credit. Just 66 percent of African-American households report having a credit score of 620 or above, compared to 85 percent of White households. African Americans were more likely to attribute poor credit to late student loan payments or errors on their credit report, while Whites cited late mortgage payments.

“African Americans rely on credit cards to make ends meet and invest in their futures because they have faced (and continue to face) persistent structural and economic barriers that limit their ability to create wealth and build a solid credit history,” said Dedrick Asante-Muhammad, report co-author and senior director of NAACP Economic Department, in a statement.

“And when African Americans are engaging in the credit market, they are more likely victims to predatory and discriminatory lending which further increases their economic insecurity. Unless we want to maintain the nation's historic and contemporary racial economic divide, we must confront the reality of today's racial inequality and advance reforms that address these disparities, fairness and security around consumer credit,” he said.


The Credit Card Accountability Responsibility and Disclosure Act of 2009 has helped African Americans make strides toward that goal, the report concluded. Since President Obama signed the bill into law, it has helped African-American households in particular to pay down debt faster and save money by avoiding unreasonable charges.

After the act went into effect 37 percent of indebted African American households reported paying more toward their credit card balance in response to information in their monthly statements mandated by the CARD Act. Nearly one-third reported being charged over-the-limit fees less often since the act went into effect and one in four has been charged late fees less often. And 25 percent said they experienced a drop in the interest charges on their credit card.

(TriceEdneyWire.com) - Called upon to defend the Republican National Committee’s faux pas in describing racism as being dead, Orlando Watson, the RNC’s newly appointed Black communications director for Black media, instead launched into an attack against President Obama.

Long criticized for being more of an exclusive club rather than a big tent when it comes to African-Americans and other minorities, the GOP conducted an autopsy to figure out why they couldn’t connect with voters in the 2012 elections, and, under Chairman Reince Priebus, has begun making outreach to the communities they previously marginalized.

But the Dec. 1 posting on the RNC’s Twitter account was labeled “tone deaf” by an MSNBC show host and has many observers questioning whether the party can connect with minorities after all.

“Today we remember Rosa Parks’ bold stand and her role in ending racism,” the tweet read, referring to the 58th anniversary of the seamstress’ arrest for defying a Montgomery, Ala. bus segregation law that sparked the modern-day Civil Rights Movement with the 13-day Montgomery Bus Boycott in 1955.

The group followed up the message with a correction: “Previous tweet should have read ‘Today we remember Rosa Parks' bold stand and her role in fighting to end racism.’” But, the damage was already done.

“It speaks to the lack of connection and the fact that internally there is no objective oversight; there’s no one looking at that with a Black voice, if you will, who can say…this is historically incorrect and factually wrong, but more importantly, it’s dumb. It’s not going to resonate with the audience you’re trying to reach,” said former RNC Chairman Michael Steele, who is African-American, on MSNBC’s “Hardball.”

But Watson, speaking with MSNBC host Thomas Roberts on Dec. 4, dismissed the inaccurate tweet as “old news.”

Further pushed about Republican-led efforts to disenfranchise minority voters, Watson said, “That’s simply not true…. We’ve been engaging Black voters. We’ve been going into the community, showing up; meeting people in the places where they meet…work…[and] worship.”

For example, he said, RNC leaders have been going places where they may not have gone before. Last month, Chairman Reince Prieubus was in Detroit meeting with Black business and community leaders and also visited New Orleans, where he met with Black parents and students who are recipients of a Louisiana scholarship program that is geared toward low-income families.

The MSNBC host, however, continued to challenge Watson about the RNC’s commitment to African Americans, this time, in light of Republicans’ persistent attacks against the Affordable Care Act. Thomas cited a New York Times report showing that almost 60 percent of African Americans live in states led by Republican governors, almost all of whom refuse to expand Medicaid coverage under the ACA.

Asked if that position was “defensible,” Watson responded, “What I don’t find defensible is after five years of living under President Obama he has little to show for what he’s done for the Black community.

“And if you want to focus on his health care law,” he continued, “his health care law has cost jobs, particularly jobs in the Black community. And he’s done little to speed up the job prospects of millions in Black America and millions of Americans across the country. So while we’re focused on trying to create jobs—private sector jobs, good-paying jobs, career-making jobs—I would ask, 'What exactly has the president done for the Black community?”

Watson concluded, “The effects of President Obama’s policies haven’t matched his promises.”