[Peace-discuss] Black and white…

[Morton K. Brussel]

The Destruction of the Black Middle Class

August 05, 2009

By Barbara Ehrenreich
and Dedrick Muhammed

Source: HP

Barbara Ehrenreich's ZSpace Page
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To judge from most of the commentary on the Gates-Crowley affair, you  
would think that a "black elite" has gotten dangerously out of hand.  
First Gates (Cambridge, Yale, Harvard) showed insufficient deference  
to Crowley, then Obama (Occidental, Harvard) piled on to accuse the  
police of having acted "stupidly." Was this "the end of white America"  
which the Atlantic had warned of in its January/February cover story?  
Or had the injuries of class -- working class in Crowley's case --  
finally trumped the grievances of race?

Left out of the ensuing tangle of commentary on race and class has  
been the increasing impoverishment -- or, we should say, re- 
impoverishment -- of African Americans as a group. In fact, the most  
salient and lasting effect of the current recession may turn out to be  
the decimation of the black middle class. According to a study by  
Demos and the Institute for Assets and Social Policy, 33 percent of  
the black middle class was already in danger of falling out of the  
middle class at the start of the recession. Gates and Obama, along  
with Oprah and Cosby, will no doubt remain in place, but millions of  
the black equivalents of Officer Crowley -- from factory workers to  
bank tellers and white collar managers -- are sliding down toward  
destitution.

For African Americans -- and to a large extent, Latinos -- the  
recession is over. It occurred between 2000 and 2007, as black  
employment decreased by 2.4 percent and incomes declined by 2.9  
percent. During the seven-year long black recession, one third of  
black children lived in poverty and black unemployment -- even among  
college graduates -- consistently ran at about twice the level of  
white unemployment. That was the black recession. What's happening now  
is a depression.

Black unemployment is now at 14.7 percent, compared to 8.7 for whites.  
In New York City, black unemployment has been rising four times as  
fast as that of whites. Lawrence Mishel, president of the Economic  
Policy Institute, estimates that 40 percent of African Americans will  
have experienced unemployment or underemployment by 2010, and this  
will increase child poverty from one-third of African American  
children to slightly over half. No one can entirely explain the  
extraordinary rate of job loss among African Americans, though factors  
may include the relative concentration of blacks in the hard-hit  
retail and manufacturing sectors, as well as the lesser seniority of  
blacks in better-paying, white collar, positions.

But one thing is certain: The longstanding racial "wealth gap" makes  
African Americans particularly vulnerable to poverty when job loss  
strikes. In 1998, the net worth of white households on average was  
$100,700 higher than that of African Americans. By 2007, this gap had  
increased to $142,600. The Survey of Consumer Finances, which is  
supported by the Federal Reserve Board, collects this data every three  
years -- and every time it has been collected, the racial wealth gap  
has widened. To put it another way: in 2004, for every dollar of  
wealth held by the typical white family, the African American family  
had only one 12 cents. In 2007, it had exactly a dime. So when an  
African American breadwinner loses a job, there are usually no savings  
to fall back on, no well-heeled parents to hit up, no retirement  
accounts to raid.

All this comes on top of the highly racially skewed subprime mortgage  
calamity. After decades of being denied mortgages on racial grounds,  
African Americans made a tempting market for bubble-crazed lenders  
like Countrywide, with the result that high income blacks were almost  
twice as likely as low income white to receive high interest subprime  
loans. According to the Center for Responsible Lending, Latinos will  
end up losing between $75 billion and $98 billion in home-value wealth  
from subprime loans, while blacks will lose between $71 billion and  
$92 billion. United for a Fair Economy has called this family net- 
worth catastrophe the "greatest loss of wealth for people of color in  
modern U.S. history."

Yet in the depths of this African American depression, some  
commentators, black as well as white, are still obsessing about the  
supposed cultural deficiencies of the black community. In a December  
op-ed in the Washington Post, Kay Hymowitz blamed black economic woes  
on the fact that 70 percent of black children are born to single  
mothers, not noticing that the white two-parent family has actually  
declined at a faster rate than the black two-parent family. The share  
of black children living in a single parent home increased by 155  
percent between 1960 to 2006, while the share of white children living  
in single parent homes increased by a staggering 229 percent.

Just last month on NPR, commentator Juan Williams dismissed the NAACP  
by saying that more up-to-date and relevant groups focus on "people  
who have taken advantage of integration and opportunities for  
education, employment, versus those who seem caught in generational  
cycles of poverty," which he went on to characterize by drug use and  
crime. The fact that there is an ongoing recession disproportionately  
affecting the African American middle class -- and brought on by Wall  
Street greed rather than "ghetto" values -- seems to have eluded him.

We don't need any more moralizing or glib analyses of class and race  
that could have just as well been made in the 70s. The recession is  
changing everything. It's redrawing the class contours of America in  
ways that will leave us more polarized than ever, and, yes, profoundly  
hurting the erstwhile white middle and working classes. But the  
depression being experienced by people of color threatens to do  
something on an entirely different scale, and that is to eliminate the  
black middle class.


Barbara Ehrenreich is the president of United Professionals and  
author, most recently, of This Land Is Their Land: Reports From a  
Divided Nation.

Dedrick Muhammad is a Senior Organizer and Research Associate of the  
Institute for Policy Studies.
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