Data: Survey of Consumer Finances, reproduced from Hamilton Project; Chart: Axios Visuals

The myth that Black Americans can close the racial wealth gap through "personal responsibility" comes in part from a misunderstanding of what wealth is.

The big picture: As noted by a report last year from the Cleveland Fed, the income gap between Black and white Americans is the result of "persistent systemic differences in economic opportunity," rather than a lack of responsibility.

  • But even if Black people could close the income gap through personal responsibility, i.e. working harder, it would not close the wealth gap.

By the numbers: Research from the Brookings Institution, led by Kriston McIntosh, shows "[T]he racial wealth gap remains even for families with the same income."

  • "For those in the top 10 percent by income (only 3.6 percent Black), the racial wealth gap is still quite large."

What happened: Efforts by Black Americans to build wealth have been impeded in a host of ways, McIntosh notes, "beginning with 246 years of chattel slavery and followed by Congressional mismanagement of the Freedman’s Savings Bank (which left 61,144 depositors with losses of nearly $3 million in 1874)."

  • Then there was the violent massacre decimating Tulsa’s Greenwood District in 1921 (a population of 10,000 that thrived as the epicenter of African American business and culture, commonly referred to as "Black Wall Street").
  • "And discriminatory policies throughout the 20th century including the Jim Crow Era’s 'Black Codes' strictly limiting opportunity in many southern states, the GI bill, the New Deal’s Fair Labor Standards Act’s exemption of domestic agricultural and service occupations, and redlining."

What it means: "Earnings and other types of income are not key determinants of wealth," notes a 2018 paper from the Samuel DuBois Cook Center on Social Equity.

  • "Deliberate acts of personal savings out of earnings and other types of income do not actually play the fabled role assigned to them in the process of wealth accumulation."
  • "The linchpin for wealth accumulation is the transfer of resources across generations, maintaining higher wealth positions among parents and grandparents for their children and grandchildren."

The bottom line: "[T]he fact that intergenerational transfer of wealth is lightly taxed means that historical gaps persist over generations," McIntosh writes. "Furthermore, inadequate investments in the public goods that facilitate economic mobility make it harder to erase past gaps."

Go deeper

Joe Biden: "I've benefitted" from white privilege

Biden at a Scranton, Pennslvanyia CNN town hall. Photo courtesty of CNN.

Joe Biden said at a CNN town hall on Thursday that he has benefitted from white privilege "just because I don't have to go through what my Black brothers and sisters have had to go through."

Why it matters: Biden's response stands in contrast to the Trump administration's moves to order government agencies to halt trainings on critical race theory and white privilege, referring to them as "anti-American propaganda."

Dion Rabouin, author of Markets
47 mins ago - Politics & Policy

Wall Street fears stimulus is doomed

Illustration: Sarah Grillo/Axios

The fight over a new Supreme Court justice will take Washington's partisan bickering to a new level and undermine any chance for needed coronavirus relief measures before November's election, Wall Street analysts say.

What we're hearing: "With the passing of Justice Ginsburg, the level of rhetorical heat has increased, if that seemed even possible," Greg Staples, head of fixed income for the Americas at DWS Group, tells Axios in an email.

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 7 a.m. ET: 31,346,086 — Total deaths: 965,294— Total recoveries: 21,518,790Map.
  2. U.S.: Total confirmed cases as of 3 a.m. ET: 6,858,130 — Total deaths: 199,890 — Total recoveries: 2,615,949 — Total tests: 95,841,281Map.
  3. Health: CDC says it mistakenly published guidance about COVID-19 spreading through air.
  4. Media: Conservative blogger who spread COVID-19 misinformation worked for Fauci's agency.
  5. Politics: House Democrats file legislation to fund government through Dec. 11.
  6. World: U.K. upgrades COVID alert level as Europe sees worrying rise in infections — "The Wake-Up Call" warns the West about the consequences of mishandling a pandemic.

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