In a previous article, we discussed how housing discrimination decades ago contributed to the racial wealth gap that exists today. Recent research from Brandeis University’s Institute on Assists and Social Policy (IASP) shows that over the last quarter century, that wealth gap has increased fourfold. In 2007, the average white family had assets (minus home equity) valued at $100,000, while the average black family had assets worth $5,000, a disparity of 20:1 (see Figure 1). As the IASP points out, “the current gap is so large that it would pay tuition at a four-year public university for two children, purchase or make a solid down payment on a house, or provide a nest egg to draw upon in times of job loss or crisis.” And once again, housing dynamics are at the center of this increase in inequality: “Consumers of color face a gauntlet of barriers—in credit, housing and taxes—that dramatically reduce the chances of economic mobility,” writes the IASP. For example:
African-Americans and Hispanics were at least twice as likely to receive high-cost home mortgages as whites with similar incomes. These reckless high-cost loans unnecessarily impeded wealth building in minority communities and triggered the foreclosure crisis that is wiping out the largest source of wealth for minorities.
In a recent article, Harvard Sociologist Orlando Patterson also discusses how current housing dynamics perpetuate and exacerbate inequality. As Patterson points out, while blacks have attained a high degree of integration into our nation’s public sphere, in the private domain “the nation is as segregated today as it ever was, with hypersegregated and growing metropolitan areas.” Moreover, this racial division is not some benign curiosity. Because of the way that location conditions access to social networks and cultural capital, residential segregation plays an important role in curtailing life opportunities and perpetuating inequality. Patterson writes:
In modern America, like all other major industrial societies, economic success stems as much from network location and access to cultural capital as from formal schooling. Getting a job, as sociologist Mark Granovetter showed in his pathbreaking work, is as much a function of who you know as what you know, and this holds as much for working-class as for high-tech and managerial positions. Of equal importance, however, is the finding of the late French sociologist Pierre Bourdieu: the transmission of cultural capital—the often tacit knowledge gained from family and friends that is reproduced in the extracurricular socialization of elite schools—is a critical factor in explaining economic inequality and other forms of social distinction. It is precisely such crucial networks and cultural capital that segregation excludes black Americans from.
As many commentators have long pointed out, place matters. Unfortunately, the geography of opportunity in our nation remains profoundly unequal.