May 6, 2019

 

Nation’s Racial Wealth Gap Worsens with Federal Tax Cuts: Black Families Have a Dime for Every Dollar Held By Whites  

By Charlene Crowell

 

NEWS ANALYSIS

 

 

 

(TriceEdneyWire.com) - If you’re like me, every time you hear a news reporter or anchor talk about how great the nation’s economy is, you wonder what world they are living in. Certainly these journalists are not referring to the ongoing struggle to make ends meet that so much of Black America faces. For every daily report of Wall Street trading, or rising corporate profits, you’re reminded that somebody else is doing just fine financially.

 

To put it another way, ‘Will I ever get past my payday being an exchange day…when I can finally have the chance to keep a portion of what I earn in my own name and see how much it can grow?’

 

When new research speaks to those who are forgotten on most nightly news shows, I feel obliged to share that news – especially when conclusions find systemic faults suppress our collective ability to strengthen assets enough to make that key transition from paying bills to building wealth.

 

Ten Solutions to Close the Racial Wealth Divide is jointly authored by the Institute for Policy Studies, Ohio State University’s Kirwan Institute for the Study of Race and Ethnicity, and the National Community Reinvestment Coalition. This insightful and scholarly work opens with updates on the nation’s nagging and widening racial wealth divide. It then characterizes solutions offered as one of three approaches: programs, power, and process.

 

According to the authors, programs refer to new government programs that could have a major impact on improving the financial prospects of low-wealth families. Power refers to changes to the federal tax code that could bring a much-needed balance to the tax burden now borne by   middle and low-income workers. Process refers to changes to the government operates in regard to race and wealth.

 

“For far too long we have tolerated the injustice of a violent, extractive and racially exploitive history that generated a wealth divide where the typical black family has only a dime for every dollar held by a typical white family,” said Darrick Hamilton, report co-author and executive director of the Kirwan Institute for the Study of Race and Ethnicity at The Ohio State University.

From 1983-2016, the median Black family saw their wealth drop by more than half after adjusting for inflation, compared to a 33 percent increase for the median White households. Keep in mind that these years include the Great Recession that stole nearly $1 trillion of wealth from Black and Latinx families, largely via unnecessary foreclosures and lost property values for those who managed to hold on to their homes.

Fast forward to 2018, and the report shares the fact that the median white family had 41 times more wealth than the median Black family, and 22 times more wealth than the median Latinx family. Instead of the $147,000 that median white families owned last year, Black households had $3,600.

 

When Congress passed tax cut legislation in December 2017, an already skewed racial wealth profile became worse.

 

“White households in the top one percent of earners received $143 a day from the tax cuts while middle-class households (earning between $40,000 and $110,000) received just $2.75 a day,” states the report. “While the media coverage of the tax package and the public statements of the bill’s backers did not explicitly state that it would directly contribute to increasing the racial wealth divide, this was the impact, intended or otherwise.”

 

With the majority of today’s Black households renting instead of owning their homes, escalating rental prices diminish if not remove the ability for many consumers of color to save for a home down payment.  As reported by CBS News, earlier this year, the national average monthly cost of fair market rent in 2018 was $1,405. Recent research by the National Low-Income Housing Coalition on housing affordability found that more than 8 million Americans spend half or more of their incomes on housing, including over 30 percent of Blacks, and 28 percent of Hispanics

 

Homeownership, according to the Center for Responsible Lending, remains a solid building block to gain family wealth. But with an increasing number of households paying more than a third of their income for rent, the ability to save for a home down payment is seriously weakened. CRL’s proposed remedy in March 27 testimony to the Senate Banking Committee is to strengthen affordable housing in both homeownership and rentals. To increase greater access to mortgages, CRL further advocates low-down payment loans.

 

“The nation’s housing finance system must ensure access to safe and affordable mortgage loans for all creditworthy borrowers, including low-to-moderate income families and communities of color,” noted Nikitra Bailey, a CRL EVP.  “The lower down payment programs available through FHA and VA, provide an entry into homeownership and wealth-building for many average Americans.”

 

“Government-backed loans cannot be the only sources of credit for low-wealth families; they deserve access to cheaper conventional mortgages,” added Bailey. “Year after year, the annual Home Mortgage Disclosure Act data reveals how consumers of color, including upper-income Black and Latinx households are disproportionately dependent on mortgages that come with higher costs.  Our nation’s fair lending and housing finance laws require that the private mortgage market provide access for low-wealth families.  We need additional resources for rental housing to address the affordability crisis that many working families face.”

 

There’s really no point in continuing to do the same thing while expecting a different result. When the status quo just isn’t working, change must be given a chance.

 

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Charlene Crowell is the Center for Responsible Lending’s deputy director of communications. She can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..

May 6, 2019

Ebola Outbreak Not a Global Emergency, Says World Health Group

 

 

(TriceEdneyWire.com/GIN) - The World Health Organization has declined to declare the Ebola outbreak in Democratic Republic of Congo a global health emergency because the disease is currently limited to two provinces, reports Science.

 

On the same day, WHO reported the efficacy of an Ebola vaccine that is going through a preliminary trial to be 97.5 percent at preventing infection, reports STAT, a health-oriented news website.

 

The current outbreak began in August 2018, and 1,200 cases have been reported since then, reports STAT.

 

“It was an almost unanimous vote that this would not constitute a PHEIC (public health emergency of international concern) because we are moderately optimistic that this outbreak can be brought into control—not immediately, but still within a foreseeable time,” Robert Steffen of the University of Zurich said at a news conference, according to Reuters.

 

The previous Ebola outbreak in Sierra Leone, Liberia, and Guinea from 2014 to 2016 resulted in 28,600 cases, according to the Centers for Disease Control and Prevention.

 

Experts differ on whether making the outbreak an international emergency would help the current situation. “I do think conditions have been met for declaring it. It’s at least as serious as public health emergencies of international concern that have been declared so in the past,” Tom Inglesby of the Johns Hopkins Bloomberg School of Public Health was quoted to say. “And I think it’s a mistake because I think it could have drawn in more international attention, political will and support.”

 

But David Fidler of Indiana University says that declaring this outbreak a global emergency declaration “would not on its own change the trajectory of this outbreak,” reports STAT.

 

In the last two weeks, there’s been an increased rate in the number of new cases, to double digits per day, due to a lack of access to services and because the outbreak area is in a conflict zone, reports STAT. “WHO has noted it is woefully short of the $148 million it says is needed to fight Ebola for the next six months,” reports the Associated Press. After nine months, “the epidemic is definitely not under control,” Trish Newport of Doctors Without Borders tells the AP.

 

“Given the average number of cases we’re seeing now, this is not going to be over for at least another six months or more,” Tariq Riebl of the International Rescue Committee told the AP.

Global Information Network creates and distributes news and feature articles on current affairs in Africa to media outlets, scholars, students and activists in the U.S. and Canada. Our goal is to introduce important new voices on topics relevant to Americans, to increase the perspectives available to readers in North America and to bring into their view information about global issues that are overlooked or under-reported by mainstream media.

May 6, 2019

How Strong is Our Economy?
By Julianne Malveaux

(TriceEdneyWire.com) - The April unemployment rate, at 3.6 percent, is at its lowest rate since December 1969.  Payroll employment increased by more than 250,000, outperforming expectations and reversing the disappointing job creation numbers of last month.  First quarter growth was reported at 3.2 percent, a robust figure that exceeds estimates, earlier this year, that growth would be somewhat slower.  This perhaps gives the man who lives in the House that Enslaved People Built something to crow about since he so enjoys crowing. 

But many economists are waiting for the other shoe to drop, having workshops and forums about the coming recession. And as positive as the numbers seem, there are always gaps and inequities reflected in the fine print. Take the unemployment rate. It declined overall, and for adult men and women, Whites, Asians and Hispanics.  At the same time, the unemployment rates for African-Americans and teenagers were unchanged.  The Black unemployment rate, at 6.7 percent, is more than twice the white rate of 3.1 percent.  This ratio of 2.16 percent is higher than the usual 2:1 unemployment rate, widening inequality. 

Should African-Americans really celebrate a strong labor market when so many are sidelined from it?  Despite claims of economic improvement and an improvement in some of the indicators, the fact that others remain stagnant is telling.  For example, 1.2 million people have been out of work for more than half a year.  They represent one in five of the unemployed. 

The number may seem small, but the persistence of unemployment for some individuals should be troubling for those who make public policy.  The number of people who are considered "marginally attached" to the labor force, which means that they'd work if they could find work, but they've ceased to look, is the same as it was this time last year. 

These marginally attached workers include discouraged workers, and there are nearly half a million of them, again the same as last year. With these numbers being at the same level as they were a year ago, there is an indication that the 3.6 percent unemployment rate that is being hailed as so historic is a false indicator of progress. 

While employers are clearly hiring, they aren't hiring enough people to make those at the bottom confident enough to look for work!  The labor force participation rate is also falling, again suggesting that our "strong economy" is not pulling enough more people into the labor market.   

Instead, some are leaving!  Why?  Even though wages grew at 3.2 percent last month, which is more than they increased last year, they have not yet reached the 3.5 percent level that the Federal Reserve Bank would consider healthy.  Thus, the Fed indicated that they change the interest rate, although 45 has pushed for a full percentage point drop in the interest.  I'm not sure what part of the Fed's independence he fails to understand! 

The Fed's decision to hold interest rates constant is partly a result of weaknesses in the first quarter growth report.  It's always good news when the growth rate is more than 3 percent, but consumer spending is down for the third straight quarter.  While the words "government shutdown" have not been uttered recently, the 2018-2019 35-day shutdown clearly had some impact on consumer spending. 

Many expected that purchases deferred in January and February might be realized in March, but too many consumers who are still recovering from the shutdown and many, who are not government employees but contractors, who lost roughly 12 percent of their annual income.  They won't be doing much discretionary spending this year!  How strong is our economy?  It is undoubtedly stronger than it was a year ago, but it's not as strong as some claim that it is.  Labor market weaknesses and inequality are of particular concern to African Americans. 

Companies are hiring, but they aren't hiring enough African Americans to close the unemployment rate gap.  There is legislation that might improve the economic status of African Americans.  HR 7, the Paycheck Fairness Act, would provide remedies to close the gender pay gap.  Congressional Black Caucus member Bobby Scott (D-VA) introduced the Raise the Wage Act, HR 582. 

It would provide increases in the federal minimum wage to $15.00 by 2024.   According to the Economic Policy Institute, the legislation would give African American workers a 38 percent pay increase (compared to 23 percent for white workers).  And when workers earn more, they can spend more, strengthening economic growth.  Whenever you hear the words "strong economy," think of the folks at the bottom. 

While the top one percent are certainly benefitting from growth and expansion, those at the bottom haven't yet benefitted.  Indeed, some have yet to recover from the Great Recession.   Why aren't the needs of those on the bottom, those who are poor (the data says 40 million people, but Rev. William Barber says it's more like 140 million) significant enough to address?

Julianne Malveaux is an author and economist. Her latest project MALVEAUX! On UDCTV is available on youtube.com. For booking, wholesale inquiries or for more info visit www.juliannemalveaux.com