Melissa Harris-Perry: This is The Takeaway, and I'm Melissa Harris-Perry, in for Tanzina Vega. Now here is something you might not know. When I'm not guest-hosting The Takeaway during summer break, I'm busy at my day job as a college professor, and today, we are indulging my professorial impulses by starting with a pop quiz.
?Speaker: What? [crosstalk]
Melissa Harris-Perry: I promise just three questions. Are you ready? Okay.
Now, the first question is multiple choice. For every $1 of wealth held by a typical white family, about how much wealth is held by a typical Black family? Is it A, 70 cents to the dollar? B, 50 cents to the dollar, or C, 12 cents to the dollar? Got your answer? Okay. Now, here is the next question. True or false? Getting a college degree is the best way for Black and Latinx families to close the racial wealth gap. All right, stick with me, we're almost done. The last question is also multiple choice.
Based on extensive research, which of these public policies would be the most effective tool for narrowing racial wealth gaps? Is it, A, tax incentives to promote marriage? B, to increase the mortgage interest deduction for homeowners? C, increase the minimum wage, or D, baby bonds? Pencils down everyone. With me now to give us the answers and help us make sense of them are my guests. First, we've got Dorian Warren, co-President of Community Change and co-founder of the Economic Security Project. He's also my co-host of System Check. Dorian, great to have you back.
Dorian Warren: Great to be back with you, Melissa. I'm eager for this pop quiz. I have some answers.
Melissa Harris-Perry: Look, I'm telling you. I know you do. We're also joined by Aisha Nyandoro who is CEO of Springboard to Opportunities, a Mississippi-based nonprofit providing direct support to residents of affordable housing. Aisha, I'm so happy to have you here.
Aisha Nyandoro: Hi friends, great to be here with you all.
Melissa Harris-Perry: Dorian, let me come to you on that. Let's go back up to that first question. Just how big is the racial wealth gap? Is it 70 cents on the dollar, 50 cents on the dollar, or 12 cents on the dollar of Black families to white families?
Dorian Warren: Melissa, I'm going to go with 12 cents on the dollar, and I actually think that's too high, depending on which study you look at, it could be 7 cents on the dollar, but it's nowhere near 50 cents or 70 cents. We know that for sure.
Melissa Harris-Perry: Yes, it's kind of wild. You're exactly right. I'm not surprised. Ding, ding, ding. Right. It's 12 cents on the dollar at best, as you point out, and has in fact, let's just go for a follow-up extra credit here, hasn't been growing or shrinking over recent decades.
Dorian Warren: My guess would be it's shrinking, and I think we have some data. If you go back to over a decade to the great recession, we know that during that economic downturn, white families' wealth fell about 26%, but the wealth of Black families fell by 48%, and for Latinx families, 45%. Given the pandemic we have been living through over the last year and this even worse economic downturn, I would suspect, you correct me if I'm wrong, that the gap is actually increasing.
Melissa Harris-Perry: All right. Aisha, you sort of inspired some of this, because the last time we talked, you gave me a pop quiz about what is the price of milk? Question number two, is college education the best way to close the racial wealth gap?
Aisha Nyandoro: My answer is false.
Melissa Harris-Perry: Why?
Aisha Nyandoro: I think that we have enough data that show that Black women are the highest educated in our demography as it relates to associate's degrees and bachelor's degrees, and graduate degrees, but when we're talking about the wealth gap in the economy, they are still at the bottom because, with wealth inequities and a lot of those realities. I think that college education is still a myth that we tell ourselves it's a way to go about closing the wealth gap, but I really think that's false.
Melissa Harris-Perry: Yes. Ding, ding, ding. That's right. That is false because although it has a big impact on income, as you were just talking about, it doesn't have a great impact on wealth. It turns out wealth is a lot stickier than income, which we're going to start digging into. Gosh, y'all are so good at this. All right. Final question now. I'll let you both in on this one. I offered some possibilities for policies that could make a big difference. Marriage incentives, higher mortgage interest deductions, raising the minimum wage, or issuing baby bonds? Which one of you wants to take answering that one for closing the wealth gap?
Aisha Nyandoro: I'll start first. My answer, I was like, this is really a pop quiz because I was like, I could go with either the third or the fourth option with this one, but I'm going to stay on brand and advocate for cash without restrictions, so I'm going to say baby bonds, and what that is just do some level setting, a baby bond would be every child receives a publicly-funded trust account at birth, and it's aimed at decreasing the wealth gap, and the amount that individuals receive at birth would be dependent upon on the income levels of their families. It's cash for families without restrictions, and I'm an advocate for that, so I'm going to go with baby bonds.
Melissa Harris-Perry: Dorian, you want to get in on this one?
Dorian Warren: I want to get in on this one, because Aisha stole my thunder. I was going to say baby bonds too, but how about this, Melissa? I'm going to add a fifth option, and that is power. Power to change the rules, the norms, and the practices that extract wealth, particularly from Black families. That's about organizing and voting and all the things that changes the rules of our country that have led us to this condition of a wealth gap. It's intentional policy choices, and we can make other choices, as Aisha just said, in terms of baby bonds, is one example.
Melissa Harris-Perry: All right. Dorian Warren and Aisha Nyandoro are both very much on brand today, and I think are giving us, both, right answers, although Dorian is of course going outside the margin, giving us an answer that wasn't an option, but that's right. It turns out raising the minimum wage would be great again for closing income gaps but not for wealth gaps. Dorian, let me go to you on this, just as Aisha said, to kind of level-set a little bit, make sure everybody is on the same page about what the difference is between an income gap and a racial wealth gap.
Dorian Warren: An income gap is when you might be working full-time. For instance, my sister-in-law who works as a cook at Whole Foods and struggles to make ends meet because she has volatile hours every week. She doesn't make that much, and so when it comes at the end of the month, rent, utilities, things for her baby, it's a stretch. We know that over half of Americans don't have $400 for an emergency.
Now, that's the pivot to wealth because what wealth is, is more like insurance. It's there, it's a buffer for when you come on hard times, you can draw from wealth to help cover an unexpected expense, and for those that have wealth, it is also a form of investment. You can invest in yourself, you can invest in your family.
We have to close for sure the income gap and especially the income gap between women of color and particularly white men. That's like the floor, but we have to go further and say, "Okay, but what is the wealth that people have and what are the wealth building policies so that people can afford an emergency expense or an unexpected expense, or they can invest in their child's education in terms of college or whatever it might be?"
Melissa Harris-Perry: I love the language you used of wealth being like insurance. I sometimes think of it as like how puffy is the mattress that you're going to fall back on when things go bad. If it's real thin, you still might get hurt if you fall down, but if it's nice and puffy, if you've got plenty of wealth there, even if it's not like billionaire wealth but if there's something good, if there's a cushion, then when you fall, it's going to hurt a lot less.
Now, Aisha, I want to talk with you a little bit about that kind of cushion because the program and folks who you work with have very little cushion, really no cushion at all. Talk to me about the women who are part of the programs that you work with and why you are to be on brand and advocate for cash without restrictions.
Aisha Nyandoro: Yes, I know, thank you for that, and you're exactly right. There is no cushion for the individuals that we work with at Springboard to Opportunities. On average, our families are making about $12,000 annually, and it goes to really what Dorian was saying. They are working, but they're working in jobs that are very volatile, and they're also working in jobs where they are now considered essential but we're not paying them as if they're essential.
Here in Mississippi, our federal minimum wage is still $7 and ¢25 an hour. We have individuals working full-time at that rate, and that doesn't allow you to build a cushion, [unintelligible 00:09:10] to just having income stability. We are seeing the individuals that we work with, working tirelessly and not having the bandwidth to actually begin to think about power-building or wealth-building or those pieces because they are caught in the trap of just survival.
In order to address that need, which is the very real need of making sure that you just have the resources to attend to your day-to-day pieces of your life based on what it is that you're saying that you need it. We launched the Magnolia Mother's Trust a few years ago, and what the Magnolia Mother's Trust is, it's a guaranteed income project that we started in 2018, and it provides $1,000 a month for 12 months, no strings attached to extremely low-income Black mothers that live in federally subsidized affordable housing. For us, it was so important to [unintelligible 00:10:01] Black women because we recognize. If we're talking about wealth inequities within this country, so much of the inequalities that we've seen have been shouldered majorly by Black women with our income disparities, with our wealth gap, with the way in which we roll out resources. We wanted to say, what would it look like if we put Black women in the center of joy and liberation and not so much pain and degradation, which is a lot of times the narrative in which this population have to live out.
Melissa Harris-Perry: I love that. I want to connect it back to Dorian's point about power. This idea that, which, again, you sort of moved us to this whole other space of thinking about how we engage as citizens, as residents in the context of a democracy, to change the rules of the game. Dorian, maybe talk to us a little bit about how middle-class wealth [unintelligible 00:10:59] in fact got built initially as a result of power and choices made by citizens and government.
Dorian Warren: Well, I'll give you two quick examples, Melissa. A federal policy that in many ways built white wealth in this country and extracted Black wealth. If you go back to right after World War II, and there's plenty of political science and historical research on this, the federal government advanced very low-interest loans but excluded Black folk.
An FHA loan, if you're white and you're working-class or low-income, you get that loan, buy a house, build your wealth, Black folks excluded, and then you add in the whole housing industry and the rules that structured the housing industry, so redlining that kept Black families out of particular neighborhoods, where they could have built wealth. That was federally sponsored legislation, or I know we've been talking about education a little bit, it's not the magic bullet, but the GI Bill.
The GI Bill, for veterans that came back from World War II and other wars and other conflicts, access to essentially free higher education that Black folks were also excluded from. Those are just two of many examples. I could go on, Melissa, we could add in the criminal justice system and mass incarceration, fines and fees in terms of local policing, it's wealth extracting, particularly from Black communities.
These are government policies, and policies are always choices, they're always choices. Therefore, we can make different choices, and that's what I mean by power in terms of civic engagement and having the power to change the rules, the norms, the practices that have extracted wealth from Black and Latinx communities and have benefited white communities.
Melissa Harris-Perry: Are these the plans that are going to make the difference in the racial wealth gap?
Dorian Warren: [chuckles] There's got to be more. It's a good start. It's a good start. We heard just this month that the Biden administration has promised to take action to address racial discrimination in the housing market. We've talked about housing as one of several pathways to build wealth, and we know that housing has been such a source, particularly housing discrimination by the industry of wealth extraction and preventing particularly Black families in building wealth.
It's a good start, but Melissa, there's no magic bullet here, we need all the options on the table. Universal health care, we know Black and brown people are more likely to hold jobs that don't offer health care or paid sick leave, risking them losing their jobs, and then people get bogged down with medical debt or student debt. We know that Black college graduates owe an average of $25,000 or more in student loan debt, we can cancel student loan debt.
Melissa Harris-Perry: Can the church just say amen on student loan debt? Okay, thank you.
Dorian Warren: Exactly. Just to toss out one more, public goods, we have grown up in the last 40 years with this notion that somehow the private market is better at providing public goods than government, and that is just false. If you take childcare, for instance, everybody should have access to high-quality affordable childcare. As a country, we have made the choice not to do that. Now, we can make a different choice in this moment, but imagine if parents and particularly working-class or middle-class parents didn't have to pay for childcare, that's more money that they could use to build wealth. There are a range--
Again, I'm just name-checking three of probably 18 different policies that will get at the roots of the racial wealth gap. It's not just about closing the racial wealth gap, it's about getting at the roots of how the gap comes to be in the first place.
Melissa Harris-Perry: Aisha, I want to come to you because the one piece, one of the reasons I really wanted you here in this conversation is, on the one hand, we can look at the power of public policy, federal and state, to make these kinds of policy differences that Dorian is talking about, but I also have always been a little suspicious of, a little worried about the ways that sometimes government-based programs and interventions also come with all of these moral/ethical strings.
These assumptions about who people living in poverty are or how that help ought to come with some rules associated with it. Aisha, talk to me about the other piece of this, which feels to me like how to also ensure that folks who are on the receiving ends of these policies are empowered to make the choices in order to build their own wealth.
Aisha Nyandoro: Yes, I know, thank you so much for that. That's the reality of it. So much of the federal support in a lot of instances comes with restrictions, is punitive, our social safety net is very punitive. What that means is that every time that you have an advancement in one area, there is an immediate decrease in other areas. We have gotten to the place with American people that we tie into that narrative that that's the way the system has to work, and it's also tied to this idea of deservedness, who deserves all of those pieces that Dorian was just talking about as it relates to decreasing the wealth gap.
The reality is, we associate poverty with moralism, we believe that individuals should be working-- built into this narrative of dignity as it relates to work and working really hard and that we have to put these restrictions and these limitations on how all of these services are utilized because poor people, is what we tell ourselves, do not know how to utilize the resources that they are given, so we feel as if we have to police these resources and tell them what it is that they need and how it is that they should use these services.
That's not the reality of it. The reality is that if we were to give individuals the resources that they need to not only support their immediate needs for themselves and their families, that will also lead to the greater outcomes and this power dynamic that we were talking about. Individuals will have the bandwidth in order to show up and be engaged in our local community in a way that's necessary to really seed community change and movement building, but without that, individuals are caught in a constant cycle of just having to survive.
If you are caught in that constant cycle of having to survive, where do you have the bandwidth to show up to your city council meeting or your school board meeting or to engage in any of the political movements that are necessary in order to get to effective change that's sustained. Just as if we know that the systems how we have them have been designed in a certain way based on this narrative of deservedness, we can redesign that, we can have conversations about why it's important that we don't allow these governors to take away the unemployment benefits.
We can design these systems in a way of how do we go about centering the conversations and the needs around those who are most impacted and making sure that they have that loudest voice and a lot of these pieces that are necessary to effect change. Right now, we're not seeing that, we're seeing that the narrative is continuing, aligned this deficit narrative based on this idea that individuals will use resources in a way that is not aligned to what it is that they need or that we have the police the resources.
Melissa Harris-Perry: That really just goes right to the heart of the reasons that I included, some of those not accurate answers, like marriage, for example. Sometimes we'll hear that if people just get married, it will solve all of those wealth gap problems, and certainly, two incomes help with rearing kids, but we can also see from the data that an African American household with two incomes still has less wealth than a white household rearing children with one income.
Something very similar happens around college education. Black households that are headed by someone with a completed college degree actually have less wealth than the households that are headed by white Americans who simply have a high school diploma. Here's the very last few seconds, if you had one thing you could change to help the wealth gap, what would it be? Dorian?
Dorian Warren: I would say make the rich people who don't pay taxes pay taxes and organize to change the rules.
Melissa Harris-Perry: Aisha?
Aisha Nyandoro: Organize to change the rules, guaranteed income for everybody.
Melissa Harris-Perry: Dorian Warren and Aisha Nyandoro. Y'all, this is why I love my friends. Dorian Warren is the co-President of Community Change and co-founder of the Economic Security Project, and Aisha Nyandoro is the CEO of Springboard to Opportunities. Check her out down in Mississippi. Thanks so much to both of you.
Dorian Warren: Thanks so much, Melissa. Great to be with you and Aisha for this conversation.
Aisha Nyandoro: Thank you both so much. This was a great conversation.
New York Public Radio transcripts are created on a rush deadline, often by contractors. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of New York Public Radio’s programming is the audio record.