That’s nearly a third of ALL our current wealth, newly created and distributed to the richest 10%, who are mostly white millionaires. These fortunate takers profited mainly from the stock market, which has more than tripled in value since the end of 2008.
The stunning numbers
Wealth statistics since the recession are provided in the Credit Suisse Global Wealth Databook. A summary of relevant data can be found here.
Post-recession data shows that about $33 trillion went to the richest 10%, who are overwhelmingly millionaires (13 million millionaires, 12.6 million U.S. households!). That nearly doubled the wealth of each member of the richest 10%. Average net worth is now $14 million for each 1% household, and the greater part of a million for even the ‘poorest’ household in the top 10%.
In comparison, average net worth for the poorest half of America decreased from $11,000 to $8,000 since the recession.
A gift to rich white (and Asian) households
The conclusion that $30 trillion went to white households is based on various reliable sources. The Washington Post references Federal Reserve data that estimates combined Black/Hispanic households as about 7% of all millionaire households (about 2% of 40 million Hispanic and Black households), and thus accruing about $2.5 trillion of that total $33 trillion decade-long gain. Statista, on the other hand, estimates that Black/Hispanic households make up 15% of all millionaires, which would represent a $5 trillion gain since the recession. Asian-Americans, with just 7 million households, are millionaires at about the same rate as white Americans. By the best estimates, the ten-year gains by White/Asian households is close to $30 trillion.
Instead of reparations, an economic lynching
About halfway through the post-recession decade, in 2013, the National Association of Real Estate Brokers estimated that African-Americans had lost over HALF their wealth because of the sub-prime mortgage scandal and the loss of jobs. Although a Federal Reserve survey found that Black and Hispanic households had regained up to half their losses by 2016, Pew Research concluded that the median net worth in 2016 for middle-income Blacks and Hispanics and lower-income whites was still only half as much as in 2007. Other sources make it clear that the wealth gap between whites and the two main minority groups have grown significantly since 2008.
There’s no question that Blacks and Hispanics have lost more than white families since the recession. And it’s getting worse. A shocking recent report from Prosperity Now and the Institute for Policy studies calculates that based on current trends median wealth for black Americans will HIT ZERO in the next 35 years – Latino Americans two decades later.
A USA Today story says it best: “A century and a half of progress wiped out.”
How did it happen?
At least since Ronald Reagan the emphasis has been on individual gains, and on blaming poor people for being poor. Rich white Americans have continued to redistribute wealth to themselves through the stock market. People who relied on middle-income home ownership and savings accounts went backwards.
There is considerable evidence for the correlation between increasing wealth and decreasing empathy for less fortunate people. Privileged white Americans generally believe they deserve everything they have, because they feel they’ve worked harder than others; thus they’ve steadily lost the ability to see the great disparity in opportunity that has drained wealth from the bottom half of America.
What do we do?
Elect progressive candidates in November. Get Sanders and/or Warren in the White House in 2020. Help non-white and poor white Americans to understand that this is the only path to opportunity, and eventually to greater equality.
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