Financial literacy speaker discusses gender, race and wealth
What do race and gender have to do with wealth in the United States?
A lot, according to Dr. Rose Brewer, professor of African and African American Studies at the University of Minnesota. She explored that question in depth recently in a financial literacy presentation hosted by St. Kate's Money Management Program.
Brewer, co-author of The Color of Wealth: The Story Behind the U.S. Racial Divide, was the latest speaker in the program's "Money Doesn't Grow on Trees" speaker series.
While past speakers have focused on subjects such as financial aid, budgeting and credit card debt, Brewer's presentation, "Sex, Color and Money: What is the Relationship?", traced the country's roots of economic inequality, from the founding of the country to the present day.
Wealth vs. income
"We're in a situation where wealth has continually moved upward," Brewer said, referring to the concentration of wealth among privileged individuals, who then pass that wealth on to the next generation.
While studies of financial inequality often center on income, Brewer's book explores the gap in wealth. She explained the distinction between the two.
"Wealth is very different from income," she said. "Income centers on wage. Wealth refers to assets -- what you own minus what you owe."
Top wealth holders have been able to expand their wealth, and wealth has been unequally distributed outside communities of color, she said.
To illustrate that point, Brewer shared a number of sobering statistics from her book.
For example, in 2004, the median net worth for white families was $140,700, but for African American families it was $20,000, and for Latino families it was $18,600. In 2004, 75 percent of whites were homeowners, while only 48 percent of African-Americans and 50 percent of Latinos owned their own homes. (Brewer noted that now that has dropped to under 40 percent for African Americans and under 50 percent for Latinos.) In the Twin Cities, only 28 percent of African-Americans were homeowners in 2004.
Among the most shocking data Brewer revealed was that the median net worth of a single African-America woman ages 18-49 was only $5 in 2004 — compared to $32,000 for a single white woman.
Five points of view on wealth
Written by five authors who each portray the economic history of five ethnic groups: Native Americans, Latinos, African Americans, Asian Americans, and European Americans, The Color of Wealth: The Story Behind the U.S. Racial Divide is a comprehensive history of wealth-building in the United States.
"Our sense was that facts may be painful, but facts matter," Brewer said about the authors' mission for the book. They are all members of the national nonpartisan organization, United for a Fair Economy, that campaigns against economic and wealth inequality.
She said the book has a lot of meaning for her, and is connected to her story growing up in Tulsa, Oklahoma. The city, which was racially divided between the North Side and the South Side, erupted in a race riot in 1921.
As she notes in the book, “I grew up in Tulsa, Oklahoma, but the elders rarely spoke of that time when homes went up in flames. There was a large Klan membership in post-World War I Tulsa, and the state of Oklahoma incorporated the racial practices of the Jim Crow South: segregated schools, housing and public accommodations. A prosperous entrepreneurial sector called Greenwood emerged in North Tulsa. But the symbols of Black prosperity did not sit well with white supremacist thinking. So the Greenwood neighborhood was destroyed."
In her presentation, Brewer delved into how government actions and inactions have created racialized barriers to asset-building throughout the United States' history— including the exclusion of many people of color from benefits of the New Deal in the decade preceding World War II and unequal access to GI Bill benefits and home loans following World War II. She noted that many African-Americans couldn't even get access to education.
Looking forward, Brewer said changing public policy is essential to closing the racial wealth gap, as is providing equal access to educational resources.
More about Money Management
Educating students from all socio-economic backgrounds is a key part of St. Kate's mission. Because money issues continue to be the number one reason students drop out, financial literacy is a focus of the university's retention efforts.
In addition to the speaker series, the Money Management Program offers an on-campus debt counselor for students and Peer Money Mentors, St. Kate's students who can meet with students individually to discuss tips for saving, understanding credit cards, financial goal setting and other topics related to finances.