Ethnoracial Inequality

The task force report deserves credit for noting that inequalities other than those associated with class (in particular, gender, ethnicity, and race) persist. It also impressively avoids the tired and erroneous conclusion that the increasing significance of one social factor (e.g., class) necessarily indicates the declining significance of other social factors (e.g., race or gender). Indeed, the report provides data demonstrating just how stark racial inequality continues to be. What remains underdeveloped, however, is its analysis of the interrelationships among demographic categories, that is, how factors such as race, ethnicity, and gender intersect with one another as well as with the growing class divide.

Understanding intersections is important because even when one factor (e.g., race) has no direct causal effect on an observed outcome, disparate effects within the population are still likely when groups are not distributed randomly across an intersecting demographic category (e.g., class). For example, although it has been well established that the relationship between race and voter participation nearly vanishes when one controls for education, this finding is mitigated by the fact that both blacks and Latinos continue to lag far behind non-Latino whites in educational attainment and other measures of socioeconomic success—key factors in determining rates of civic and political participation. The fact that blacks and Latinos also have relatively younger populations further increases the likelihood of disparate effects on racial groups—given the fact that young Americans' disinclination for political participation (especially voting) is notorious.

In short, by ignoring intersections among demographic categories, too little is learned about the complex connection between economic inequality and political power in general and about the socioeconomic correlates of participation, responsive government, and policy consequences in particular. A more nuanced study of what happens when rising class inequality is grafted onto preexisting inequalities could help explain recent trends in political inequality and, furthermore, highlight specific actions that the nation might take to reverse such trends.

Instead, the report generally treats race and class as discrete categories, in a tone implying that the problem of racial inequality might well already be resolved if not for the seemingly new “more subtle but still potent threat—the growing concentration of the country's wealth and income in the hands of the few.”¹

To buttress this point, the report points to factoids like “African American men have moved into the highest-income categories at an impressive rate over the last few decades” and “[p]ublic opinion toward African Americans and other minorities experienced a remarkable shift.”²

Such examples demonstrate the dangers of misinterpreting isolated facts. Indeed, other (uncited) facts demonstrate just the opposite trend. For instance, African American and Latino men have left the labor market at even more impressive rates than they have entered higher-income categories. While the rate of growth of African American and Latino men in high-income categories (here defined as $75,000 or more) was 1.2 percent between 1992 and 2001 for black men and 1.8 percent for Latino men, the rate of exit from the civilian labor force was 6.1 percent for black men and 2.4 percent for Latino men.³

Indeed, as unemployment statistics have consistently shown since World War II, when white Americans get a cold, African Americans get pneumonia. One can predict the unemployment rate of blacks by knowing that of whites, and vice versa, since, whether high or low, the black rate is usually twice (or recently more than twice) that of whites.⁴ The problem is—as data on unemployment, income, education, occupational deployment, industrial deployment, and wealth clearly demonstrate—that class and race remain tightly linked in the United States.

There are, of course, some members of every racial and ethnic group in every class, but blacks, Latinos, and particularly Native Americans demonstrate two important class patterns. First, they are at the bottom of whichever class they belong to. Second, they are much more likely to be in the working class, not the middle or upper classes. In 2001, for example, the proportion of blacks living in households with incomes of $60,000 or more was only about half the proportion of whites living at the same income level.⁵

In 2002, African American, Latino, Asian and Pacific Islander families composed 28.8 percent of all families in the United States, but 55.6 percent of families living in poverty; black families alone composed 27.1 percent of families living in poverty, although they made up only 12.1 percent of all families.⁶

Data on wealth provide another perspective on the extent to which blacks and Latinos remain both disproportionately in lower socioeconomic categories and at the bottom of whichever class to which they belong. In 2000 the median net worth of households with a black or Latino householder was, respectively, $7,500 and $9,740, compared to $79,400 for households with a non-Latino white householder. Although households headed by people of color composed less than a quarter of all households (24 percent), they composed nearly half (45 percent) of households with a net worth of less than $5,000. White households in every income quintile had significantly higher levels of median net worth than black and Latino households. In the lowest quintile in 2000, the median net worth for non-Latino white households was $24,000, for Latino households $500, and for black households $57. The corresponding figures for the highest quintile were $208,023, $73,032, and $65,141, respectively.⁷

Indeed, racial and ethnic gaps in wealth-holding appear to be not only large, but growing. In 1995, Latino and black median net worth were, respectively, 14.7 percent and 14.4 percent that of whites, while by 2000, Latino and black median net worth were only 9.5 and 9.3 percent that of whites.⁸ Thus, when rising class inequality in general occurs alongside existing inequalities based on other characteristics, such as ethnicity and race, those suffering double or triple disadvantages suffer more. Instead of the class divide replacing the racial divide or even just slowing down racial progress, the class divide tends to aggravate the racial divide because of the strong links between the two.

There are also problems in the task force report's public opinion examples. White commitment to the principle of racial equality is not matched by white support for standard government policies designed to implement programs that might secure equal opportunity. Indeed, across a number of national polls in the 1970s, 1980s, and 1990s, about 40 percent of white Americans believed African Americans were treated unfairly. This is almost exactly the number found in 1946.⁹

From the post–World War II era to today, white perception of the treatment of blacks has remained remarkably stable, not changing.

These issues are empirically and theoretically important to an adequately sophisticated understanding of the relationship between economic inequality and political power. Historically, regardless of the level of commitment to egalitarianism in principle or the shifting level of equality achieved among white Americans in practice, the nation has maintained a remarkably strong commitment to racial inequality. White America has avoided the dilemma posed by racial inegalitarianism in a supposedly egalitarian society by adopting, tacitly or explicitly, notions of racial superiority to explain the practice of racial dominance.¹⁰

As long as race and class remain inextricably linked, working-class whites are very susceptible to being diverted from their legitimate class concerns by leaders who point to race issues. In such a context, racist arguments claiming that inadequate population groups and workforces—not institutions, policies, and corporate power—reinforce inequality and poverty, flourish. Thus, while egalitarianism and de jure equality can oppose racism and inequality, they can also generate an increasing demand for “racism as a defense against what appears to be their failure in practice.”¹¹

Shopping for scapegoats to explain their worsening fates, downtrodden whites may be more likely, given developments in de jure equality, to blame people of color. In fact, albeit somewhat paradoxically, racism may become more, not less, necessary to explain heightening inequality in a society that espouses egalitarianism.

Certainly, important progress has been made in moderating racial inequality: significantly more people of color are in the middle and upper classes than prior to the 1960s; the overt daily horrors posed by white terrorist groups such as the Ku Klux Klan have declined dramatically; and at least some people of color are visible in positions of leadership, affluence, and influence in almost every sector of American life.¹²

Yet the current recognition of inequality growing in society at large must not naively prevent or hide recognition of the continuing American race dilemma.¹³ Since, as Gunnar Myrdal concluded, a study of racial inequality “must record nearly everything which is bad and wrong in America,” understanding racial inequality remains a route to understanding inequality more generally.¹⁴ Just as an idealized attachment to democratic egalitarianism historically limited the perception of racial discrimination, it also can nurture a culture of acceptance of persistent and deepening income and wealth inequality across the board. Now we must identify ways in which contemporary racism continues to blind Americans to the mushrooming inequality overtaking the nation as a whole. Indeed, as has already occurred, the glossing over (and among conservatives, at least, downright dismissal of) racial inequality as a serious problem, can be the foundation of the backlash against policies such as affirmative action and antidiscrimination law enforcement in areas such as fair housing and school desegregation—policies now couched in terms of color-blind egalitarianism and masquerading as a genuine concern for preventing any and all “racial preference” in policy and practice.

Finally, two additional concerns about the report's treatment of demographic categories other than class in bolstering rising inequality require further consideration. First, the report virtually ignores some ethnoracial groups. Although the oft-stated conclusion that race relations in the United States are no longer a black/white issue has become practically a mantra among representatives of the right, left, and center,¹⁵

the report only barely mentions groups other than blacks and whites. It also ignores the growing ethnic diversity within racial and ethnic groups, not only among Latinos and Asians, but also among blacks and whites.¹⁶ In particular, Latinos, a population growing four times faster than the nation at large—comprising an electorate projected to have grown 17 percent over the last four years¹⁷—are virtually a footnote in the report. Asian Americans, Native Americans, and Arab Americans are missing altogether in the analysis. This is a potentially large oversight, since it is increasingly clear that the old binary-style analyses do not adequately capture real-world economics and politics of many communities of color.

How, for example, might understanding the link between education inequality and political inequality be challenged when the highly educated but low-participating Asian American community is analyzed? Will shared political attitudes and reactions to common experiences of racialization in the United States lead Latino and Asian Americans to fully emerge as political forces, allowing ethnic leaders to organize and mobilize disparate elements around a pan-ethnic identity? In general, which structures in the nation's political system contribute to political inequality? What role, for example, do single-member districts, winner-take-all elections, balloting and voting procedures, naturalization requirements, and disenfranchisement of ex-felons play—apart from and interacting with rising economic inequality. A big part of the problem, of course, is the paucity of evidence for studying some of these issues and groups, and, to its credit, one of the three key recommendations in the report is for more and better collection of data “on the living conditions, attitudes, and political behavior and experiences of minorities, women, and less affluent Americans”—one of the areas that lacks “critically important data.”¹⁸

One can only hope that philanthropic foundations and the National Science Foundation accept this challenge.

Gender inequality, too, is given short shrift in the report, which concludes that after the rights revolution, “the number of women in managerial and professional jobs rose impressively.”¹⁹

As with race, the report finds that today's problem is mainly that rising inequality across the board is threatening women's gains and further progress. But what about the old gender barriers and their relationship to rising class inequality? Men remain both more likely to engage in volunteerism (even in neighborhood associations and churches) and more likely to participate in formal politics than women. The gender gap is widest at the level of psychological involvement in politics. Only voting and participation in organized protest (with low numbers in general) are outliers to the gender gap in civic engagement and political participation.²⁰ Yet it is not clear why rising class inequality in and of itself would retard women's political participation—given that women are born into families across the class spectrum. An analysis of continuing barriers arising from men's advantage with respect to jobs and income could shed light on the complexity of this situation in the United States today.

Despite the dramatic decline, for example, in traditional educational disparities between the sexes, white men made up 95 percent of professionals and managers in Fortune 500 companies in 1995, although only 37 percent of the adult population that year.²¹

Recent court cases resolved in favor of women complainants (for example, at Merrill Lynch, Smith Barney, and Morgan Stanley) demonstrate that women remain greatly underrepresented in key positions. Persistent gender-related economic inequalities do play a role in political inequality since, as some research shows, civic engagement and political participation is in part determined by job background; some kinds of jobs foster civic skills and propel individuals toward political activity more than others.²²

The interrelationships between continuing racial, ethnic, and gender inequalities deserve more careful treatment than the report was able to achieve. Such inequalities are not just curiosities in demographic and opinion research; they are directly associated with access to nearly all products and services associated with the good life.²³

One must not confuse egalitarianism legalized and egalitarianism practiced.

In sum, the report fails to go beyond dealing with class, race, and gender as discrete categories. The dynamics of how race, gender, and class intersect needs to be addressed if we are to fully understand today's mushrooming economic and political equalities.

Place Inequality

Where people work and live tends to amplify preexisting inequalities. Given the separation of political jurisdictions (especially at the level of municipalities and school districts), place inequality among the poor, middle class, and wealthy in the United States is an important component of rising overall economic and political inequalities. Some have more opportunities and some have fewer because they live in places that are sharply distinguished in terms of tax bases and the quality of public services. Suburban sprawl, concentrated poverty in central cities, and segregation (if not hypersegregation) have boosted inequality.²⁴

For instance, in 1960, per capita income in cities was 105 percent of suburban per-capita income. By 1990 this fell to 84 percent, where it remained in 2000. The race/place mix is evident: blacks disproportionately live in center-city neighborhoods (52 percent of African Americans and 21 percent of whites) while whites disproportionately live in suburbs (57 percent of whites but just 36 percent of blacks).²⁵ Meanwhile Latino/white segregation has increased in recent years.²⁶

Place inequality makes it hard to do anything about class and race inequality. For instance, declining segregation of African Americans, however slight, has not, apparently, translated into blacks being able to move into better neighborhoods. The median census tract or neighborhood income for the typical black household in 1990 was $27,808, compared to $45,486 for whites—a gap of $17,679. By 2000 that gap had increased to $18,112. Perhaps more problematic is the fact that similar patterns are observed in households with incomes above $60,000. For example, in 1990 the typical black household with an income of above $60,000 lived in a neighborhood where the median income was $31,585, compared to $46,760 for the typical white household in this income bracket—a gap of $15,175. By 2000 these figures changed to $35,306 for blacks and $51,459 for whites, for an even larger gap of $16,152. The same pattern holds for Latinos.²⁷

Further confounding the intersection of place and race is the fact that in 2000 poor blacks and Latinos were far more likely than poor whites to live in poor neighborhoods. While over 18 percent of poor blacks and almost 14 percent of poor Latinos lived in such areas, fewer than 6 percent of poor whites did.²⁸

Geographical mismatches between where people live and where they work and shop further exacerbate inequality.²⁹

Lower-income residents of poorer communities generally reside in or near city centers, while job growth and siting of discount shopping malls are more likely in outlying suburban communities. Those most in need of employment and bargains, therefore, have difficulty finding and getting to available jobs and low-cost goods. Once again this dynamic is not racially neutral. As of 2000, no racial group was more physically isolated from jobs than African Americans.³⁰ Racial minorities tend to search for jobs in slow-growing areas, while whites tend to search in fast-growing communities. The differences in the quality of these job searches is accounted for primarily by residential racial segregation even after taking into consideration racial differences in social networks and search methods.³¹ Compounding these troubles are the “mental maps” many employers draw in which they attribute various job-related characteristics (for example, skills, experience, and attitudes) to residents of certain neighborhoods. A job applicant's address often has effects beyond his or her actual human capital that make it difficult, particularly for people of color from urban areas, to secure employment.³² Such divergent employment experiences, of course, contribute directly to the income and wealth disparities discussed above.

Perhaps more important for the work of the task force, inequalities and economic segregation stemming from place make it easy to isolate people with similar economic and social backgrounds into the same political jurisdictions.³³

The more homogenous political jurisdictions become, the more “safe” districts become, and the more boring and predictable elections become, driving down levels of political participation, especially voting. Eric Oliver has explored the civic effects of economic segregation and found a curvilinear relationship: participation is the lowest in the most affluent homogenous cities, slightly higher in poorer cities, and highest in diverse middle-income cities because of varying levels of political interest. Oliver suggests that affluent cities have fewer social needs to promote citizen action. By contrast, heterogeneous cities have more competition for public goods, which stimulates citizen interest and participation. Unable to overcome their dire socioeconomic strait or to shape local policies due to fiscal constraints, the poor tend to lose interest in politics. Similarly in homogenous settings, political parties and activists have fewer incentives to mobilize new groups of voters or develop new issue appeals. In effect, place inequality increases economic inequality and decreases civic participation.³⁴

Since the literature on the contextual effects of place is large and growing, it is surprising that the task force report devotes virtually no attention to explaining its impact on inequality. A focus on the role of place in the evolution of inequality in all likelihood suggests greater attention to policies is in order, since the construction of place is clearly a concomitant of a range of policy decisions made by public officials and policy-related actions taken in the private and nonprofit sectors. From the interstate highway system to home mortgage deductions to zoning decisions of local government to taxation, tax credits, franchises, charters, banking, trade regulation, and research funding, policies at all levels of government have played an important role in fostering place inequalities. Since policy has played such an obvious role in determining who gets what and why, attention to place can lead us to look at policy decisions that could alter patterns of inequality. Inequalities nurtured by policy can also be altered by policy.

Policy Matters

The task force obviously believes that policy matters. The report concludes that while other nations face changes in technology, family life, and markets like those driving economic inequality in the United States, their regulatory, tax, and social policies have buffered inequality. Because of APSA rules, the task force could not offer policy recommendations. Still, one would have expected the task force to at least point the nation toward the policy arenas that might diminish inequality: jobs, wages, taxes, Social Security, Medicare/health, future deficits, energy and transportation,³⁵

or any other policy arena with enormous potential for ameliorating inequality. An analysis of alternative policy proposals in these areas or an analysis based on what could be gleaned from the experiences of the United States' international counterparts would have fallen within the APSA constraints. In short, much more could have been said about actual and specific policies' effect on economic and political inequalities. If it is important to point out that past policies, such as public education, Social Security, and Medicare encouraged “ordinary citizens” by helping to spread opportunity and boost civic participation, then it should also be important to point to the role more recent policies have had in producing the opposite effect, helping to attenuate opportunity and discourage democratic life.

Indeed, a sharper focus on the role of policies in rising inequality would also generate discussions on corporate power and the role of government. Although the report discusses business mobilization to gain greater ascendancy, how the federal government, as well as state and local governments, pursued policies—from trade to labor law—that strengthened corporate power and weakened labor power is not fleshed out. Nor are the Federal Reserve's financial bailouts since 1980 addressed. Tax cuts for the very top income brackets, regressive state taxes (heavily reliant on sales taxes), and a falling corporate share of paid federal taxes (down to approximately 7 percent, compared to 22 percent in the 1960s) were all policies worth our attention. Finally, the role of the corporate global trade regime—manifested in the rules of the World Trade Organization and other trade agreements—in freeing corporations to locate production anywhere in the world, thereby diminishing Americans' union base, worker power, and wages, might be explored. In sum, even within the APSA's constraints, a fuller focus on policy was possible. Focusing on the policies driving inequality might help to dispense the myth that growing inequality is inevitable. Recall that the concentration of wealth in the United States actually fell steadily from the period of the Great Depression until the early or mid-1970s.

Implicit in this last example is another blind spot in the task force's work. The report does not sufficiently analyze the 25-year attack upon the very idea of the affirmative state and related efforts to reduce the role of politics—distributive or productive—altogether. Further scholarly and public attention is due to the effects of deregulation, privatization, reduction of the social safety net, lack of enforcement of civil rights, retrenchment of civil liberties, and curtailments of domestic spending on increasing inequality.