Madness

A recent story in the NYT documents the impact of the recession on different racial and ethnic groups. In percentage terms, Hispanics were hit the hardest, losing 66% of household wealth between 2005 and 2009 – with African-Americans similarly impacted. But the truly shocking numbers are the absolute figures. Black and Latino households have around $10,000 or less in household net worth – even after falling by more than 10% in the recession, white households have on average *ten times* the household wealth, over $100,000.

What the hell?! Even as we’re rapidly moving toward a “majority minority” society, wealth is so unevenly distributed across racial and ethnic groups. Reminds me of a line from an old Chris Rock routine – “we black people need to build wealth. I ain’t talkin’ ’bout rich, I’m talkin’ ’bout *wealthy.* Shaq is rich; the guy who owns the Lakers is wealthy.”

And now these clowns in Washington are falling over each other to drive our country’s future into a ditch. Holden Karnofsky of GiveWell has a really important piece on the SSIR blog about all the groups in line to help people before individual donors:

  • For-profit businesses
  • Governments
  • Local philanthropy and community
  • Big foundations
  • Other donors

It’s a really illuminating perspective. But what’s missing is scale. The groups in that “line” are not created equal – and if one falls, the ones behind it aren’t necessarily capable of filling the gap. So when government, the second in line after private business, shrinks suddenly – do you think those household wealth numbers will go up? Pell grants, funding to help people mitigate vulnerability? The main reason Hispanic household wealth fell so much during the recession is that much of what folks had been able to gain was in their houses – the value of which tanked. Our infrastructure is Third World already; looks like our social safety net is headed the same way, with what are sure to be disastrous consequences.

Madness, I tell you – madness.

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