Black Wealth & White Wealth Explained With Data

Attorney Antonio Moore details the reality of wealth in America, and how it cuts across racial lines. The video relies on articles by Demos.org, that are based on data released by the Federal Reserve.

Moore’s Article from Inequality.org http://inequality.org/racial-wealth-gap-worse-thought/

A recent study by the Pew Research Center used data from the Federal Reserve Survey of Consumer Finance to show that the median white American household has 13 times the wealth of the median black household. But the data used to support this study’s bleak findings may have used accounting that actually understates the gap in wealth between white and black families.

New York University Professor Edward Wolff, one of the foremost economists studying wealth inequality, looks at the same Federal Reserve dataset that the Pew researchers used in a recent report he published in the National Bureau of Economic Research (paywall). Wolff points out that the Fed includes consumer durables in its net-worth estimates.

Wolff excludes these consumer durables from his net-worth figures because these assets — everything from automobiles and televisions to furniture and household appliances — cannot be readily converted to cash and their resale value typically far understates their consumption value.

According to Wolff’s calculations, the median black family is actually only worth ,700 when you deduct these durables. In contrast, the median white family holds 6,800 of wealth using the same accounting methods. Black household wealth, Wolff adds, actually fell during the Great Recession from ,700 to ,700.

Some historical context: In South Africa, during the atrocities of apartheid, the median black family held about 7 percent of typical white South African family net worth. Today, using Wolff’s analysis, the median African American family holds a mere 1.5 percent of median white American family wealth.