Race, Ethnicity & Income Inequality
It is a fact of American life that income is not distributed evenly. Along with sex, race, and ethnicity are key determinates in income distribution. Myriad reasons are presented to explain this phenomenon. Many sociologists look to historic patterns of discrimination that are responsible for lower levels of wealth accumulation, leading to stunted cultural, human and social capital. Also considered are group threat theory and failures of great society-based welfare programs. While there isn't agreement on cause, there is widespread agreement that lower income levels set up a cyclical pattern, making it equally difficult for the next generation to escape from poverty.
Keywords Accumulated Wealth; Civil Rights Act of 1964; Cultural Capital; Fragile Family; Group Threat Theory; Human Capital; Poverty; Segregation; Social Capital; Undocumented Workers; War on Poverty
It has been said, "Logic dictates that if opportunities and resources were available equally and freely to all US residents, the proportional distribution of representatives of various ethnic cultures would be spread across economic levels, throughout occupations, across educational levels" (Cuyjet, 2006, cited in Strayhorn, 2008, p. 52). Fifty years after the passage of the Civil Rights Act of 1964, which was designed to end discrimination in employment, black unemployment rates are almost twice as high as they are for whites. In 2012, white families earned approximately 58 percent more than black families (US Census Bureau, 2012a). There is widespread agreement that income inequality between races exists; there is less agreement about the causes.
A net result of income inequality is that far more black than white families live in poverty. Increasingly, there are calls for more federal spending to combat the effects of poverty. The term poverty is often used in a broad sense to describe deprivation, but the federal government has a specific definition: in 2012, an individual under sixty-five years of age with an annual income of less than $11,945 was considered poor. Officially, 15 percent of Americans were poor by this definition in 2012 (US Census Bureau, 2012b).
Glazer argues that American opposition to the welfare state and support for patterns of small government go back many generations and can be traced back to the end of the nineteenth century. This could be the result of the structure of the US economy, its political system, or other behavioral characteristics, which include uniquely American belief systems. One might be the idea that it is possible to achieve upward mobility. While there is some evidence that this mobility is more easily achieved in Europe than in the United States, "71 percent of Americans, but only 40 percent of Europeans, believe that the poor have a chance to escape from poverty" (Glazer, 2005, p. 9). One aspect that seems to separate Americans from Europeans is 'racial fractionalization.' Comparing welfare benefits across states, there is a direct correlation between the percentage of the black population and the size of the welfare benefit: "Race seems decisive in explaining indifference to inequality" (Glazer, 2005, p. 9).
Alesina, et al., puts it bluntly:
Americans redistribute less than Europeans for three reasons: because the majority of Americans believe that redistribution favours racial minorities, because Americans believe that they live in an open and fair society, and that if someone is poor it is his or her own fault, and because the political system is geared toward preventing redistribution (cited in Glazer, 2005, p. 10).
Since the late 1970s, sociologists have employed various measures to determine whether class or race has the greater impact on life chances. Even a suggestion that class is the more salient factor is controversial (Wilson, 1980). What is clear though, is that blacks still lag on many critical scales. In 2010, for instance, high school graduation rates showed that 83 percent of whites graduated from high school while 66 percent of blacks graduated. That same year, 62 percent of whites were enrolled in accredited post-secondary institutions while only 15 percent of blacks were enrolled (National Center for Education Statistics, 2013). Blacks face unemployment rates have been almost double those of their white counterparts since the US government began keeping track of such data in 1972 (Fletcher). In 2012, 33 percent of blacks held professional or managerial positions compared with 39 percent of whites Bureau of Labor and Statistics, 2013). Median family income for blacks was 66 percent that of white median family income (US Census Bureau, 2012a). Conley (2001) argues that one significant reason for the glacial pace of change concerns differing rates of accumulated family wealth.
Accumulated wealth is one of the most salient factors that determine socioeconomic status. Its impact ranges from family stability to educational options and all areas of employment as well as welfare dependency. The twentieth century witnessed a modest dispersal of wealth, but the Great Recession in the first few years of the twenty-first century widened the gap considerably. According to the US Census Bureau, the median household net worth for black families was $4,995, while the median white family held a household net worth of $110,729 (Luhby, 2012).
Because accumulated wealth multiplies in a way that wages do not, the gap has continued to grow, even after the victories of the civil rights era (Conley, 2001). As a result, even blacks with similar incomes to whites are far less likely to own their home; a critical step for amassing wealth.
Conley looks to a history that deprived blacks of all ownership, even of their own bodies and labor. The stated goal of Reconstruction was to help blacks toward "economic self-sufficiency." Since plantations were never divided, this did not happen. Eventually, share-cropping forced many former slaves and their descendants into a vicious cycle of debt and dependency on white landholders. When Social Security was created in 1935, agricultural and domestic workers were excluded, thus ensuring that 42 percent of black workers would be excluded from the system of old age pensions, compared to 22 percent for whites (Conley, 2001). Reflecting Glazer's argument, Contez (1992) contended that Franklin Roosevelt knew that the only way he could get the insurance plan past conservative southern Democrats was if a substantial portion of blacks were excluded. Without Social Security, blacks had to spend what little they might accumulate supporting themselves in old age rather than passing on an inheritance. Even more frequently, elder and destitute blacks were a financial drain on the next generation.
One of the landmark achievements of the civil rights movement was passage of the Civil Rights Act of 1964. The two most important segments of the law outlawed discrimination in public accommodations (Title II) and in employment (Title VII). In the two decades following its passage, the Supreme Court interpreted Title VII quite broadly, finding that along with intentional discrimination, practices that have a "racially disparate impact" were also banned (Hall, 2005, p. 172). This had the effect of invalidating many employment tests and requirements that kept minorities out of the workforce. The Equal Employment Opportunity Commission was created and charged with investigating possible cases of discrimination. As the composition of the Court changed during the Reagan Administration, increasingly, decisions in discrimination cases favored employers; none more so than Ward's Cove Packing Co. v. Atonio 490 U.S. 642 (1989). As a result, Congress passed the Civil Rights Act of 1991. The goal of this legislation was to clarify Congress's support for consideration of disparate impact. Both laws helped to open up the employment playing field; yet neither has succeeded in creating a completely level field (Conley, 2001; King & Wheelock, 2007; Strayhorn, 2008).
Residential segregation between blacks and whites is a persistent problem that can be seen in many areas of the United States. Substantial research documents show that predominately black communities provide very different social environments than their white counterparts, with higher levels of unemployment, unwed motherhood, dilapidated housing, and crime common features of African American neighborhoods. In addition, these neighborhoods are marred by higher taxes and substandard schools (Peterson & Krivo, 1993).
Sociologists Blau, Blau, Logan and Messner (1987) describe how residential segregation limits opportunities:
Racial segregation imposes a significant barrier to black upward mobility and quality of life. Places of residence locates people not only in geographical space but also in networks of social opportunities — it influences prospects for employment, for public services, for educational advancement, …Residential segregation by race accordingly implies that opportunities for achievement are limited for certain groups, and it conflicts with basic American value commitments which encourage members of all groups to strive for socioeconomic success. Such a 'disjuncture' between structural arrangement and fundamental cultural values…. tends to undermine the legitimacy of social norms and thereby promotes deviant behavior (cited in Peterson & Krivo, 1993, p. 1004).
One of the most immediate consequences of segregated housing patterns is schools that are further separated by race and poverty. Orfield (2012) reports that in the first decade of the twenty-first century, 43 percent of Latino and 38 percent of black students attended schools that contained 0 to 10 percent white students. Additionally, blacks typically attended schools that were over 60 percent low income, whereas white or Asian students were found to attend schools that were on average just above 35 percent low income. Consistently, high poverty schools are connected with the problems of high turnover rates, less qualified teachers, and removal from mainstream society (Orfield & Eaton, 2003).
The implications of segregated housing patterns leading to diminished educational opportunities plays a role in income inequality at virtually all levels of employment. Since many black and Latino families find themselves in the inner city, they have been particularly hard hit as industrial jobs, once the mainstay of the cities, have disappeared. This has had a devastating impact on the employment options for many non-white men, indirectly contributing to an equally dramatic decline in the norm of a two parent household (Woldoff & Cina, 2007). Children born to single parents have a significantly higher chance of living in poverty than do children born into two-parent households.
Occupational segregation for black and white men began moving in opposite directions in the 1980s. On one hand, more than ever before, black men were entering elite professions that had long been dominated by whites; on the other, the wage gap was growing when measured for all...
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