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The racial wealth gap, one of the fastest growing problems in the United States, is held at the center of American politics. From the left it’s framed as the issue that must be solved through rhetoric and intervention while the right is quick to dismiss it or espouse that the left’s policies would threaten the core principles the U.S. was built on. The racial wealth gap has existed since the arrival of European settlers and has endured for centuries, shaping economic opportunity along racial lines and continuing to influence American life today.
But what is the racial wealth gap exactly?
“The racial wealth gap [is] the difference in assets owned by various racial or ethnic groups (…) The term reflects disparities in access to opportunities, means of support, resources, and the transfer of intergenerational wealth,” Mollenkamp from Investipedia explains. “Racial wealth gaps exist in the U.S. between the minority and majority populations as well as within ethnic and racial groups.” In simple terms, certain racial groups in America are consistently in possession of more or less wealth than others. Even despite hard work or drive, some groups will never have access to the same opportunities that others do and this tends to hit racial minorities the hardest. However, not all minorities are affected the same way.
In the United States, it’s apparent that black and native groups (both American Indian and Alaskan) are significantly affected by the racial wealth gap. These two groups tend to hold less wealth in comparison to white and asian groups and therefore aren’t as easily able to access the same opportunities.
So why is there a racial wealth gap?
“[It’s] the consequence of discrimination (…) throughout American history and continuing to this day,” Williamson from Brookings writes. “Disparity is the product of societal racism, compounded over generations.” Black people in America have been systemically deprived of their money since day one. They were forcibly ripped from their homes and made to work without pay for nearly 300 years before finally being freed and still not given the same opportunities as white people. Even though they could be paid for labor, it was a significantly lower wage. Coupled with Jim Crow and government-authorized violence, black people were excluded from most public-programs and higher education. Only within the last century have black people been on “equal footing” with the rest of the population. By that point, however, generations of wealth accumulation had already been denied while white families benefited from uninterrupted access to property ownership and education. The racial wealth gap is not the result of individual failure, but the predictable outcome of centuries of exclusion and compounded disadvantage.
The same is true for native groups in the United States. “American Indians and Alaska Natives have been disproportionately harmed by race-based policies, beginning with policies that supported slavery and taking land,” Ramirez from the NICOA laments. “Broken treaties led to unemployment rates, Indian boarding schools led to high school dropout rates, slavery led to incarceration rates and redlining led to low homeownership rates.” From the moment of European arrival in the Americas, native people were coerced into labor, were stripped of their land, and were hunted and killed by the white population. “And the effect on Native American populations is devastating, “ Uballez from the AFN reveals. “Native American populations have the highest poverty rate, with one-quarter of Native Americans living in financial poverty, almost twice the national rate.” Together, these policies ensured that Native Americans were excluded from nearly every mechanism of long term wealth building, from land ownership to education and stable employment. The severe poverty rates observed today are the reflection of historical atrocities, state-endorsed displacement, violence, and broken federal promises.
The racial wealth gap has had a large seat in politcs from both sides of the spectrum, so how does each party view it?
For starters, there’s a disparity in how importantly the problem is viewed between the two sides. “Nearly three-quarters of Democrats (73%) say that racial inequality is a critical threat to the country,” Smeltz from The Chicago Council of Global Affairs records. “By contrast, just 23 percent of Republicans say that racial inequality is a critical threat.” The reason for this disparity lies in the roots and ideals of the two parties. For Republicans, there is a large emphasis on individualism. Within the party, it’s a wide held belief that, while certain racial groups have suffereed and been hindered in the past, equality exists right now. Therefore there should be no reason why certain groups are doing better or worse than others and any government interference to give another group a leg up in an already equal world threatens fairness. Democrats, on the other hand, are often associated with liberal values where it’s believed that minority or disadvanataged groups should be protected and advocated for. They argue that fairness would be giving everyone an equal chance. Therefore equality can only exist if we give those with less power a leg up.
Both sides want equality in the world, but the two of them have a different definition of what equality is. To the Republicans, it means that everyone has equal opportunities no matter where you start. The poor kid on the street has to follow through the same steps a wealthy billionaire would if they wanted to achieve the same status. While it requires more work, it’s technically possible and ensures that the best people get the best jobs with no cop outs. Democrats view equality as a fair outcome. They recognize that, while everyone may be on more equal footing now, there is still systemic damage that needs to be addressed. Rather than providing everyone the same resources and opportunities like Republicans would argue, Democrats acknowledge that different groups have varying needs. That means that even if you provide two groups with the same opportunity, the underprivileged group would be less able to take advantage of it due to a number of reasons from poverty to simply being too busy caring for a sick parent to even consider it. As a result of these divided definitions, policies aimed at closing the racial wealth gap are evaluated not on shared terms, but through fundamentally different understandings of what equality itself requires.
But what policies do we have in place now or have tried in the past to close the racial wealth gap?
To start, there’s been a significant increase in the amount of financial aid that has been provided for education in recent years. For many marginalized groups, high education may not even be an option due to the lack of financial resources. Providing financial aid opens this closed door for many black and native students who may not have been able to afford it otherwise. On top of that, there’s also been an increased minimum wage in several states to subtly level the playing field a bit more for lower skilled workers, fields that tend to be dominated by underprivileged groups.
However, the most commonly brought up method of closing the racial wealth gap is affirmative action. Affirmative action is designed to take a more proactive approach to increase the opportunities of historically marginalized groups, whether that be women or people of color. A significant number of Americans dislike affirmative action, claiming that it gives minorities a leg up which discriminiating against white men. However, this claim tends to lack the necessary proof. “Evidence demonstrates that discrimination against white men is rare,” Upstate Medical University clarifies, “Affirmative action provides the employer with the largest pool of qualified applicants from which to choose.” The idea of affirmative action isn’t to hire minority candidates over white ones, it’s to expand the opportunity of minority candidates to be able to be measured alongside others. Affirmative action ensures that the “cream can rise to the top” no matter what their background may be.
Unfortunately, the current administration has been rolling back affirmative action, limiting the opportunities presented towards marginalized groups. “President Donald Trump has eliminated the requirement for federal contractors to maintain affirmative action programs,” Burkhart from Holland and Knights writes. “His order (..) revokes [The] Equal Employment Opportunity [order] which was signed by President Lyndon Johnson in 1965.” As affirmative action continues to be dismantled, one of the most direct tools for addressing systemic inequality is being removed, reinforcing existing disparities rather than correcting them.
The racial wealth gap did not emerge by accident and simply can’t be attributed to individual drive alone. It’s the product of centuries of exclusion, exploitation, and policy decisions that consistently denied certain groups access to opportunities, crippling generations to come. Today’s political divide over the racial wealth gap doesn’t reflect a disagreement over equality but rather over how that equality should be achieved. If political debates continue to center around the idea that the unequal outcomes we see within our country now are unrelated to unequal starting points, the racial wealth gap will persist. To have any hope of closing it, we must not only acknowledge its origins, but come to terms with the idea that equality can’t be achieved without proactive measures to try to make up for damage that has already been done.
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