by Hiawatha Demby, Economic Justice Covenant Program Task Force
There is an increasingly widespread claim that class is a more significant than race in determining economic outcomes. This statement may be true in regard to income and earning ability. But it is not true for wealth and access to wealth building opportunities, the foundations of economic justice, that continue to be very strongly influenced by race. Our country was built on a foundation of race-based practices and behaviors. The justifications that supported and underlay those policies and actions persist as undercurrents in our current economic structures. The biased outcomes these structures produce are tragedies for millions of African Americans and other people of color.
- Past Injustices
- Current Injustices
- Wealth is more important than income
- Factors preventing non-whites from accumulating wealth
- Race and Class influence economic justice
- Additional Historic References
- Injustices to Native Americans
- Injustices to Mexicans and other Hispanics
- Injustices to Asians
- Injustices to Africans
- Injustices to Eastern and Non-European Caucasians
- Additional Resources
- ChristianFoundations of racial and economic justice
Our country was built and developed through race-based practices and behaviors including everything from seizing land from the Native Americans (for example, the Trail of Tears and westward expansion) and Mexico (the Mexican-American War) to destroying wealth and other resources owned by African Americans that had been acquired even under oppressive conditions, for example in Rosewood, FL; Oklahoma City; and Wilmington, NC.
Jim Crow laws tightly constrained African Americans in an effort to break their ambition and crush their sense of self-reliance. This was bigotry as public policy and there was no doubt that one’s race defined their class. The effects of that period continue to impact the economic status of African Americans today. Consider entering a game of monopoly that has been going on for hours and every property has been claimed. The tardy player enters at a distinct disadvantage with little hope of acquiring any wealth on the board, grateful for the occasional “Free Parking” or even “Go Directly to Jail” card that enables her to stay in the game for another round. There is little incentive to join the game at all.
The justifications that supported and underlay those earlier policies and actions persist as undercurrents in our current economic structures. Today they justify cuts in social programs and opposition to affirmative action and immigration reform. Racial injustices are seen in many economic and social measures:
- Higher levels of unemployment (April 2011). African-Americans: 16.1%. White: 8.0%. Hispanic: 11.8%. African American teens: 41.6%. Hispanic teens: 23.4%. White teens: 22.3%.
- Higher incarceration rates (per 100,000 people, 2008). Black: 2,531. Latino: 957. White: 393.
- Higher high school drop-outs rates (2008). Overall: 8.0%. Black: 9.9%. Hispanic: 18.3%. Asian: 4.4%. American Indian: 14.6%. White: 4.8%.
- Higher rates of teen pregnancy (per 1,000 women, 2008): Black: 62.8. Hispanic: 77.5%. White: 26.7.
- Lower rate of business ownership, 2007 (share of all non-farm business): Black: 7.1%. Hispanic: 8.3%. White: 83.4%.
- Lower rates of home ownership, 2010. Black: 45.4%. Hispanic: 47.5%. White 74.4%.
Other examples of racial bias:
- Discrimination against black farmers in the allocation of farm loans and assistance between 1983 and 1997 by the U.S. Department of Agriculture
- Environmental racism
- Unfavorable access to credit and loans, see here and here.
- Higher rates of substance abuse
- Higher rates of crime and victimization see here, here, and here.
- Lower return on investment in education
These biased outcomes represent tragedies for millions of African Americans and other people of color. Moreover, they often form the basis for the intergenerational transmission of poverty that stunts opportunities for future generations.
Unemployment is very high for people of color. A white man released from prison has an equal or better chance of being employed as a black man with no criminal record.
Unemployment, discrimination in promotion and pay and low returns to education make it difficult to inspire minority youth to invest themselves in the education and economic system either intellectually, financially or politically.
Income is important but it can be temporary since it depends upon potentially fluctuating economic circumstances: a job that provides income to an employee, or a thriving business that gives income to the owner. To become a permanent asset, income must be converted into wealth. Wealth provides the means to effectively participate in the economic system by cushioning against times of scarcity and providing resources to take advantage of opportunities. Significant wealth may be accumulated over generations but once lost may be gone forever. An early start at wealth creation provides an advantage that is hard for those without it to overcome.
Land can be a significant source of wealth. Historically non-whites have had their rights to own and benefit from land ownership limited by law or aggression. Even today, people of color are denied opportunities to build wealth through new more sophisticated schemes including payday loans, online gambling, lotteries, and subprime mortgages, and multi-level-marketing (otherwise known as pyramid or Ponzi schemes).
Many whites are also victims of these practices but research shows people of color are especially targeted. In poor communities, the opportunity to make a profit may take precedence over consumer protections or even legal restraints. This is seen in predatory lending and also in a community’s tolerance of drugs and crime. The political and economic power in those situations is mostly in the hands of the owners of those businesses and so law enforcement, investigation and regulation are not a priority. In areas with few bank branches, grocery stores, or other retail outlets, those that are present can charge higher prices and use more predatory practices. When people have few opportunities and few choices, they are sometimes willing to tolerate enterprises that would not be otherwise permitted.
Many whites are also victims of these practices but research shows people of color are especially targeted. In poor communities, the opportunity to make a profit may take precedence over consumer protections or even legal restraints. This is seen in the proliferation of predatory lending establishments and also in a community’s tolerance of drugs and other street crime. Much of the political and economic power in these communities is in the hands of business owners so investigation and enforcement of regulations by the authorities are not a priority. In areas with few bank branches, grocery stores, or other retail outlets, those that are present can charge higher prices and use more predatory practices. When people have few opportunities and few choices, they are sometimes willing to tolerate enterprises that would not be otherwise permitted.
Since before the nation was founded, minorities have been at an economic disadvantage, receiving little or no pay for their labor, stripped of their wealth, and used to undermine the economic progress of others. Racial scapegoating has been repeatedly used to achieve political aims or simply for profit. In some situations where minorities have managed to prevail despite the obstacles, their gains have been violently and dramatically suppressed, for example, in Wilmington, NC, in 1896; in Tulsa, OK, in 1921; and Rosewood, FL, in 1923.
The practice of red-lining and the resultant white-flight have continued to block people of color from overcoming the historic wealth disparities and also stopped many who wished to escape poor environments from doing so. The devaluation of minority-owned or -occupied properties persists and transcends class. Environmental racism has also been a constant threat to the value of properties owned by minorities and the poor. See the UCC’s 1987 ground-breaking report, Toxic Waste and Race. The placement of industrial zones and waste disposal sites near properties owned by people of color lowers the value the properties and limits their potential use.
If wealth creates economic opportunity and determines class, and if wealth remains strongly correlated with race, then race will remain a significant determinant of economic outcomes for the foreseeable future, and an important barrier to economic justice.
Will the economic system ever be fair? Perhaps not, but as individuals begin to understand the issues and to act with fairness, the disparities that now exist will begin to shrink. This will require change and moving past the status quo, but should result in a better and stronger community for all.
Simple principles of racial and economic justice:
- Everyone is entitled to justice
- A person is not a demographic
- One person’s loss is not another person’s gain
- Justice and security are illusions unless they apply to everyone
- Ignorance is everyone’s problem
- Blame is not a solution
Below is a selected list of references to notable race-based economic injustices in our nation’s history. This historical review is not intended to incite outrage or guilt but to generate a better understanding of how difficult it will be to overcome the past and create new systems that will assure these injustices never happen again. But these changes must happen if we are to ever achieve economic justice in the beloved community.
- Mistaken concepts of land ownership and treaty
- Negotiating conversion
- Christianity and the oppression of non-believers
- Seizure of tribal lands
- Living with less than nothing: the only immigrant group to officially arrive as slaves
- Treatment of slaves attempting to escape
- No right to self determination
- Unequal access to economic opportunities
The term 'white' changed from being a description of skin color to a term of economic status used to define those who would be allowed to participate in the economy and those who would not.
- When skin color is not enough
- Economic definition of white
- Classification of white
- Colonial classification of white
These links provide current facts regarding race and economic justice
- Race, Class, and Economic Justice, Civil Rights 101 from the National Leadership Council
- “Community Economic Development as Progressive Politics: Toward a Grassroots Movement for Economic Justice” by Scott L. Cummings, Stanford Law Review Vol. 54, No. 3, Dec., 2001, Page 399.
- The Heart of Christianity: Rediscovering a Life of Faith by Marcus J. Borg, HarperCollins, New York, 2003.
- A Textbook of Christian Ethics by Robin Gill, T&T Clark, New York, 2006.
 See It’s Class, Not Race! Stupid by C.B. Warsteane, Warsteane Realty, 2006 http://www.amazon.com/Its-Class-Not-Race-Stupid/dp/1419610562/ref=sr_1_4?s=books&ie=UTF8&qid=1284568685&sr=1-4.
 See here (http://en.wikipedia.org/wiki/King_Philip's_War) and here (http://www.historycooperative.org/cgi-bin/justtop.cgi?act=justtop&url=http://www.historycooperative.org/journals/ahr/112.3/br_40.html)
 See Nickel and Dimed by Barbara Ehrenreich and Racism without Racists: Color-Blind Racism and the Persistence of Racial Inequality in the United States by Eduardo Bonilla-Silva.
 See here (http://www.blackpast.org/?q=aah/wilmington-race-riot-1898) and here (http://1898wilmington.com/)