Open Mic: Reparations and Addressing the Racial Wealth Gap

by Annette Case, Asset Funders Network

September heralds a fresh start of sorts – the beginning of a new school year (true it started in August for lots of kids) and back to work after Labor Day honoring workers for making the prosperity of the country possible. We like to tell a deeply held story in this country about education and hard work as the route to the American Dream. If you stay in school, work hard, and, even better go to college, you’ll land a good job. You’ll be rewarded with and deserve financial and personal well-being. This story implies we all have an equal chance to direct our lives and futures so, if you are not economically secure, the fault is your own. We might recognize these narratives in how we design services to support people with low incomes by requiring work in order to receive food, or financial education programs that assume that people with low incomes must not know how to budget or save and/or judge how a person spends their money. This story is also demonstrated by the resources charities or public policy invests in these types of programs as solutions as well as in how we celebrate both the benevolent provider of resources and the success of the individual who proves worthy of support by overcoming obstacles. 

In reality, facts and experience show that even as we value work and education, demonstrating hard work and achieving increases in education do not necessarily lead to equality and economic security. Among women, Black women have the highest labor force participation rate, yet the more Black and female an occupation becomes, the more the pay decreases such as in care work. Education is not the great equalizer nor does it guarantee economic security.  Black-headed households with a college degree own less wealth than a household headed by a White person with no high school diploma.1 Racial wealth inequity remains high – at the national level, Black and Hispanic-headed households hold 2.9% and 2.8% of wealth and represent 15.6% and 10.9% of the population respectively while White households hold 86.8 % of wealth and account for 68% of the population.  

The racial wealth gap is the cumulative measure of how we’ve designed systems and institutions to produce and perpetuate inequities. Despite our egalitarian ideals, our country was founded on the intentional unequal treatment of Black and Indigenous people, women, and immigrants among others. The story of wealth as a measure of hard work and worthiness ignores the policy choices we’ve made, which are rooted in racism, and have created the largest wealth divide in our country’s history. Policies such as the Oregon Donation Land Law, Dawes Act, and the Western Oregon Indian Termination Act  intentionally stripped Tribes of federal recognition and forcibly took resource-rich land from Native Americans and transferred this wealth to primarily White households.  We facilitated wealth escalators through redlining which provided 98% of publicly backed low-cost mortgages to White segregated communities and free college education through the GI bill.  These same resources were denied to segregated communities of color and eligible Black veterans.  Language designed to exclude Black people from living or owning a home in Oregon remained on the books until 2001.  Private and public institutional disinvestments in segregated communities of color, blocked Black and immigrant families from equal amenities and access to public resources such as schools and parks for which everyone paid taxes.  We denied unemployment insurance to certain occupations which appeared race-neutral but, due to discrimination, were the only jobs available to Black and immigrant workers.  These represent only a few examples of intentional unequal treatment that have and continue to contribute to wealth divides, harming communities and families. 

Wealth has always been used as a lever to maintain hierarchy and power over non-dominant groups. This “wealth as worthiness” narrative is used to justify the ongoing unequal distribution of private and public resources which perpetuates inequities. Philanthropic resources, often accumulated from discriminatory and exploitative practices, recently tipped over $1 trillion dollars.  Out of the fraction distributed to communities, only 4% went to organizations led by Black and Latinx leaders, replicating and contributing to wealth divides.  At the federal level we reduce taxes on the wealth of already wealthy people so they can accrue more wealth.  In Oregon, the Kicker reflects this same pattern by putting more money into the hands of the already wealthy.  

The good news is, if we intend to live up to our ideals of equality and liberty, we can make new choices, tell a more complete story about our past, and write a new script for the future. Given its relationship to the generation and distribution of wealth, the philanthropic sector has a unique role to play in addressing root causes of economic inequities and investing in a new future including supporting the infrastructure of movement building that moves policy change forward. The Asset Funders Network is a national network and membership organization of grantmakers working for equitable wealth building and economic mobility.  Alongside Neighborhood Partnerships, we serve as a co-convener of the Oregon Economic Justice Roundtable, a shared table of funders and advocates and other community-based organizations collectively advancing racial and economic justice. OEJR was launched recognizing that real progress is possible when we work together differently.   

A focus on justice that shifts power and resources to fix inequitable systems, rather than fixing people, is how we will close wealth gaps. A justice framework asks us to understand and acknowledge how and why our systems treat people unequally, which leads to unequal outcomes.  Justice seeks reparations for unequal treatment by government and the institutions responsible for generations of inequities and wealth stripping.  Justice fundamentally works for equality within our system of law, policies, and practices, and liberty in self-determination free from discrimination. The most direct route to justice in our systems is to prioritize the voices, decisions, and solutions of those most impacted by unjust decisions. Our vision and work for Oregon is to create systems of abundance designed by and for Black, Indigenous, Latinx, Asian, and all communities of color so that all Oregonians live beyond basic safety and security, and into the freedom to actualize dreams, and the power of communities to control their own financial and economic destiny.  We collectively work to uproot inequity in our public systems and support bold transformative policy ideas such as equitable tax reform, guaranteed basic income, and the Equity Investment Act, which funds community development efforts led by Black, Brown, Indigenous and Tribal communities.  We work to root a culture and community in Oregon that nourishes a sense of belonging, dignity, and respect among and between communities and people. This type of work and reimagining can feel daunting and is also necessary. To be sure there is no quick fix. We convened OEJR with the explicit goal of advancing inclusive funding practices.  Through the shared OEJR table, which prioritizes community voice and funders co-create the work, we’ve taken important steps forward. We have a long way to go toward simply and substantially increasing funding to organizations led by people of color for longer periods of time as community-led organizations determine solutions.  

The past two years of pandemic-related economic shocks and racial reckoning after George Floyd’s murder proves we can make different choices. The expanded Child Tax Credit and unemployment insurance extended their reach to previously excluded people and provided unrestricted cash and breathing room to millions of families. Many foundations suspended long-held practices in order to move money quickly in response to COVID and are beginning the journey to reconcile their past for a different future.  By intentionally educating ourselves to understand how we arrived at this moment and carefully considering and asking questions at the individual and institutional level about who is and should be at the decision-making table and how decisions we make will undo or effect harm or advance liberation, we can each begin to play a role in the collective movement for economic justice. 

If you are interested in learning more about OEJR or participating in this statewide work for community-centered economic justice please reach out! 

Annette Case, Pacific Northwest Program Officer  

Asset Funders Network  

1 Hamilton et. al. Building an Equitable Recovery: The role of Race, Labor Markets, an Education, pg. 16.  Institute on Race and Political Economy, The New School. 2021.

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