Michael Gerson

WASHINGTON -- This week the fiscal crisis was momentarily interrupted for a public service announcement.

The Pew Research Center issued a report showing that the racial disparity in net worth -- the wealth gap in America -- is growing. People of every background saw their assets decline during the Great Recession, but the liquidation was faster among African-Americans and Hispanics.

This is hardly surprising. Lower-income groups have more of their wealth concentrated in homeownership; higher-income Americans are more diversified in their assets. The housing collapse took a disproportionate toll on minority wealth.

The trend is less shocking than the baseline. In 1984, the ratio between white and black wealth was about 12-to-1. Now, the median net worth of whites is about 20 times that of blacks. According to the most recent figures, about 15 percent of white households have zero or negative net worth. The percentage is 35 percent among African-Americans.

Current economic distress is compounding a long-term problem. The possession of assets provides a measure of security during an economic shock, allowing a family to weather a nasty bout of unemployment. In the absence of assets, unemployment can lead to dramatic downward mobility. And the consequences accelerate over time, since wealth is often used to purchase quality education for children, a source of upward mobility. 

This kind of problem is the reason liberals were created. At its best, liberalism has been about something more than making a progressive tax code slightly more progressive. It brought equal opportunity to the forefront of American politics -- Robert Kennedy drawing attention to Appalachia, Sargent Shriver founding Head Start, Bill Clinton expanding the Earned Income Tax Credit. We can perhaps remember, said RFK, if only for a time, that those who live with us are our brothers; that they share with us the same short moment of life; that they seek, as do we, nothing but the chance to live out their lives in purpose and in happiness."

Few liberals talk like that today, though the flame still flickers in places such as the Asset Building Program at the New America Foundation, where Ray Boshara has conducted his long campaign to address the wealth gap. This challenge does not lack for proposed responses, including subsidies for savings, the promotion of financial education and increased access to financial services.

Conservatives, however, also have a contribution to make in addressing the wealth disparity, intended or not. They are the only ones currently calling attention to a massive structural problem that will make serious social policy nearly impossible in the future.


Michael Gerson

Michael Gerson writes a twice-weekly column for The Post on issues that include politics, global health, development, religion and foreign policy. Michael Gerson is the author of the book "Heroic Conservatism" and a contributor to Newsweek magazine.
 
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