The racial wealth gap is so wide it would take black families over two centuries to catch up to white families, a jaw-dropping new study found.
Unless public policy intervenes, black households wouldn't amass the wealth of today's white households for another 228 years, according to research from the Corporation for Enterprise Development and the Institute for Policy Studies.
The findings are part of a study, called "The Ever-Growing Gap," that examined the accumulation of wealth over the past 30 years and how wealth-building policies have disproportionately given white, already wealthy Americans a boost.
Over the past three decades, the average wealth of white families has grown by 84%, which is a staggering three times as fast as the rate for African-American families and 1.2 times the growth rate for Latino families.
At that rate, it would take until the year 2244 for the average black family to accumulate wealth that matches what white families have today.
"Even more unfortunate, the extreme rise in overall wealth inequality over the past three decades has only served to further compound and exacerbate this racial wealth divide," the study reads.
The authors of the study suggest that racial economic disparities go hand in hand with the social unrest in communities of color and tensions with the criminal justice system.
"In the last decade, we have seen the catastrophic economic impact of the Great Recession and an ensuing recovery that has bypassed millions of Americans, especially households of color. This period of economic turmoil has been punctuated by civil unrest throughout the country in the wake of a series of high-profile African-American deaths at the hands of police," the study reads.
The following are some of the study's most startling findings:
- Decades of discriminatory housing policies and market practices have resulted in homeownership among only 41% of Black families and 45% of Hispanic families compared to 71% of white families; homeownership still remains one of the greatest sources of Americans’ wealth.
- The 400 richest Americans own more wealth than the entire black population, plus one-third of the Latino population combined
- Black Americans have higher average unemployment rates, at 8.6%, than white Americans, at 4.4%
- Latino and Black families are paid up to $20,000 less on average per year than white households
- Over two-thirds of Black and Hispanic households lack the savings necessary to subsist at the poverty level for three months, compared to only one-third of white households
- Wealth returns on a four-year degree is much for valuable for white graduates than it is for black and Hispanic graduates
The group who put together the study is calling on Congress to consider policy options to help close the gap in racial economic disparity and "reduce the wealth concentration at the top."
This includes identifying policies that perpetuate the wealth divide through a government-wide audit, fixing tax policies to ensure they help families of color build wealth, and closing federal estate-tax loopholes and creating an annual net worth tax on high-wealth individuals.