How The Recession Affects Minorities

Lost in the heated discussions of recessions versus depressions, bailouts versus bankruptcy, and Main Street versus Wall Street, is how this economic downturn affects those already at the margins of society.  It is important to understand how the recession affects minorities.  Compared to whites in America, black Americans fare considerably worse during boom periods.  During periods of recession, blacks bear an even larger share of the negative effects.  This is due to systemic structures that have made it traditionally difficult for minorities to advance in American society.  Thus, while the architects of our financial collapse receive billions in bailout monies, Congress vigorously debates the merits of extending unemployment benefits for a few extra weeks.  Learning how the recession affects minorities will allow policymakers and legislators to develop a plan of action that will provide economic parity for all citizens. 

The statistics are disturbing.  Between 2000-2007, poverty increased by 2.8%, real income declined 9%, and black home ownership decreased to 47%.  Bear in mind that these statistics cover the time before the recession started and the housing bubble truly burst.  Anecdotally, we hear people admonishing their ability to weather tough times and sayings such as, “It’s always a recession for black people.”  Perseverance, patience, and stoicism in the face of adversity are admirable traits.  However, American owes its citizens more than meaningless platitudes and ineffectual policy.  While many minorities have made tremendous strides into every aspect of American life and culture, far too many are disproportionately represented at the lower end of the socioeconomic spectrum.

Unfortunately, nothing in the proposed stimulus plan or in Obama’s rhetoric gives me confidence that he truly appreciates the unique relationship between the recession and its effect on minorities.  Obama is choosing a class-based approach towards finding solutions.  However, studies have demonstrated that middle-class minorities are the primary beneficiaries of these class-based programs.  The poor are left destitute and hopeless.  These problems could be addressed by funding policies and programs, from education to job training, that provide the least advantaged among us the education and skills necessary to compete with everyone else.  Similar to any problem, these solutions will only be effective when those in power are willing acknowledge and directly address these institutionalized inequalities.