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How did the Great Recession impact racial disparities?
When the housing market collapsed in 2008, it sent all Americans into a spiral. People lost value on their homes, their stocks went down, unemployment went up, and many people had to dip into their savings accounts to help them. This time became known as the Great Recession, or as many like to call it, the worst economic time for America since the Great Depression. In a Utopian society, if something like this were to happen, everyone, regardless of their race or status, would theoretically struggle equally. However, that is exactly what did not happen in America during the Great Recession.
The Great Recession affected almost every single house owner in America, regardless of what …show more content…
There was a CBS News clip called “Great Recession Increases Wealth Gap” that highlighted how the Great Recession differently affected whites and blacks. It explained how a black family’s main asset is their home, so when home values plunged, so did their net worths. White families also are more likely own more stocks and retirement accounts, so when home values went down, white families did not suffer as much (CBS News). Fabian Pfeffer, Sheldon Danziger, and Robert Schoeni, researchers on economic and racial trends at the University of Michigan, explain in their article, “Wealth Disparities before and after the Great Recession” that “the least-advantaged families were less likely to have benefited from the post- 2009 recovery in stock prices because they had already withdrawn a substantial share of their market holdings (Bridges and Stafford 2012) and because they had relatively small savings prior to the Great Recession” (6). So, even those black families that did have stock market holdings, they needed to withdraw their money to help after their home values went down. They even go as far to say that wealth disparities “are likely to have resulted from and changes housing and stock prices, recession-related changes in employment, and savings behaviors” …show more content…
In the article, “Wealth Inequality has widened along racial, ethnic lines since end of Great Recession” by Rakesh Kochar and Richard Fry, researchers at the Pew Research center, they studied the wealth gap. They found that “the wealth of white households was 13 times the median wealth of black households in 2013, compared with eight times the wealth in 2010, according to a new Pew Research Center analysis of data from the Federal Reserve’s Survey of Consumer Finances. Likewise, the wealth of white households is now more than 10 times the wealth of Hispanic households, compared with nine times the wealth in 2010” (Kochar and Fry). As one can see, the gap is getting bigger and the housing collapse is the result of this. They also found that “the current gap between blacks and whites has reached its highest point since 1989, when whites had 17 times the wealth of black households. The current white-to-Hispanic wealth ratio has reached a level not seen since 2001” (Kochar and Fry). One of the most telling statistics in terms of how different races have been effected is that, “From 2010 to 2013, the median wealth of non-Hispanic white households increased from $138,600 to $141,900, or by 2.4%. Meanwhile, the median wealth of non-Hispanic black households fell 33.7%, from $16,600 in 2010 to $11,000 in 2013. Among Hispanics, median wealth decreased by 14.3%, from
How did the Great Recession impact racial disparities?
When the housing market collapsed in 2008, it sent all Americans into a spiral. People lost value on their homes, their stocks went down, unemployment went up, and many people had to dip into their savings accounts to help them. This time became known as the Great Recession, or as many like to call it, the worst economic time for America since the Great Depression. In a Utopian society, if something like this were to happen, everyone, regardless of their race or status, would theoretically struggle equally. However, that is exactly what did not happen in America during the Great Recession.
The Great Recession affected almost every single house owner in America, regardless of what …show more content…
There was a CBS News clip called “Great Recession Increases Wealth Gap” that highlighted how the Great Recession differently affected whites and blacks. It explained how a black family’s main asset is their home, so when home values plunged, so did their net worths. White families also are more likely own more stocks and retirement accounts, so when home values went down, white families did not suffer as much (CBS News). Fabian Pfeffer, Sheldon Danziger, and Robert Schoeni, researchers on economic and racial trends at the University of Michigan, explain in their article, “Wealth Disparities before and after the Great Recession” that “the least-advantaged families were less likely to have benefited from the post- 2009 recovery in stock prices because they had already withdrawn a substantial share of their market holdings (Bridges and Stafford 2012) and because they had relatively small savings prior to the Great Recession” (6). So, even those black families that did have stock market holdings, they needed to withdraw their money to help after their home values went down. They even go as far to say that wealth disparities “are likely to have resulted from and changes housing and stock prices, recession-related changes in employment, and savings behaviors” …show more content…
In the article, “Wealth Inequality has widened along racial, ethnic lines since end of Great Recession” by Rakesh Kochar and Richard Fry, researchers at the Pew Research center, they studied the wealth gap. They found that “the wealth of white households was 13 times the median wealth of black households in 2013, compared with eight times the wealth in 2010, according to a new Pew Research Center analysis of data from the Federal Reserve’s Survey of Consumer Finances. Likewise, the wealth of white households is now more than 10 times the wealth of Hispanic households, compared with nine times the wealth in 2010” (Kochar and Fry). As one can see, the gap is getting bigger and the housing collapse is the result of this. They also found that “the current gap between blacks and whites has reached its highest point since 1989, when whites had 17 times the wealth of black households. The current white-to-Hispanic wealth ratio has reached a level not seen since 2001” (Kochar and Fry). One of the most telling statistics in terms of how different races have been effected is that, “From 2010 to 2013, the median wealth of non-Hispanic white households increased from $138,600 to $141,900, or by 2.4%. Meanwhile, the median wealth of non-Hispanic black households fell 33.7%, from $16,600 in 2010 to $11,000 in 2013. Among Hispanics, median wealth decreased by 14.3%, from