In Depth - The Wealth Divide

The panel discusses causes for and possible solutions to the wealth divide between African-Americans and the rest of the US population. Features in-depth interviews with and bonus discussions Shawn Rochester (author of The Black Tax), Heather McGhee (author of The Sum of Us), and Congresswoman Sheila Jackson Lee.

Episode Transcript

(00:00):
The following show is brought to youin partnership with the Institute of Politics,
Policy and History, Blue Star Strategies, Bright Road Incorporated, Make It Plain
Podcast, and RPC Media from thecampus of the University of the District of

(00:34):
Columbia. This is State of Play. Welcome to State of Play. I'm
Sharon Pratt and with me are KarenFromintano and the Reverend Mark Thompson. And
today we're going to do a verydeep dive into the issue of the wealth
gap, the wealth divide with AfricanAmericans and the larger population and try to

(00:58):
understand and measurably why that divide exists. So we're going to have some great
conversation, I think today to figureout slavery, what the implications, the
measurable implications, Jim Crow, themeasurable implications, the Homestead Act and the
GI Bill, and how somehow AfricanAmericans completely miss or significantly miss those opportunities.

(01:23):
And you know, we talk aboutso many issues, the criminal justice
issue, health issues, all ofthese issues, education issues, almost all
of it in my opinion, justme you can attribute it to the wealth
gap that exists in America, institutionallyexist in America. And we tend to

(01:44):
treat it like a sound bite.Today we are going to do a deep
dive. So Karen and Mark,I certainly think you share my thinking that
this deserves a lot of attention.Oh, absolutely, Mayor, And I'm
really looking forward to our guests today, Sean Rochester. I mean, the
data that he has is extraordinary,and you know, we need data to

(02:10):
debunk the myths, the myths thathave been plaguing our nation for three hundred
plus years. And also, I'mreally really interested in Heather McGee. Her
work The Some of Us really talksabout how systemic racism hurts all of us

(02:35):
and how do we change the mindset, especially the mindset of white Americans.
I really want to hear her thoughtsabout that. I'm looking forward to the
conversation as well, because it's goingto be important to quantify a lot of
what people have yet to hear andunderstand about systemic racism. Systematic racism in

(03:00):
this country. But it's not hardfor people to know. I think most
people know that those of us whoare African American suffer disproportionately more from all
of the bad things, and thendo not enjoy disproportionately less all of the

(03:23):
good things, and there's a reasonfor that. It's not because of us,
it's not because of our behavior,it's not because of any shortcomings we
have. It's because of the systemsthat have been put in place. And
I'm also obviously looking forward to theconversation with Conerencewomen Sheila Jackson Lee on HR

(03:44):
forty, the reparations bill, becausethere is also an argument as to whether
or not we can ever resolve inof these issues with conversations on equity alone.
For some reparations a controversial word termas a matter of fact, But
I don't know that we can everdeal with all of the inequities that Sean

(04:10):
Rochester will lay out unless we getserious and finally accept that the answer is
reparations. So I'm sure Congresswoman andShila Jackson Lee will inform us about that
as well. This country has hada lot of policies that created a middle
class, but basically a white middleclass. So we're going to talk with
Sean Rochester, Heather McGee and thenCongresswoman Shila Jackson Lee to see just how

(04:33):
this wealth divide began. So don'tgo away. There's more. The state
of play welcome back to State ofPlayers. You know, our topic today
is the wealth divide in America,particularly as it impacts African Americans. We

(04:55):
have the perfect guests, Sean Rochester, the author of The Black Tack.
He does an excellent job, possiblythe best job I've seen, of really
quantifying why it is African Americans,who represent thirteen percent of the population only
represent two percent of the wealth.Thank you so much for being here.

(05:15):
Thank you Mary Pratford having me onthe program, and I'm looking forward to
the conversation. Well, what Ithink is so terrific about how you approach
it is you go through different juncturesin American history and the quantitative implications of
each of those junctures for African Americans. So can we do that? First,
there was slavery, about two hundredand fifty years of slavery. The

(05:39):
impact and import of that is aboutfifty trillion dollars. There's some estimates that
place the numbers high as twenty four, others that place it closer to ninety
seven. If you look at themidpoint between those two things, the highest
fifty trillion dollars. All right,then we go to the Jim Crow period.
I mean, there was emancipation,nothing for food, nothing but shelter,

(06:00):
nothing to start a farm or abusiness. But then we have Jim
Crow the implications of that period.But seventy five years was that correct?
Yeah, it's roughly from about eighteenseventy to about nineteen forty five or so
of really uncompensated labor. You know. The challenge associated with this construct is

(06:20):
that people left Emancipation with no economicresources. By eighteen seventy, black people
owned about zero point one percent zeropoint one seven percent of us well,
effectively nothing right, and they weren'tgiven the economic resources associated with forty acres
in the mule that we all knowabout. They were forced into a situation
of it's called slavery by another name, where they were reimposed one hundred percent

(06:45):
tacks was reimposed upon them, basicallythe food, to close the shelter,
everything that they needed to bring cropsto market. They had to borrow from
white landowners to be able to dothat at rates is high seventy percent of
a year. And they brought thecrops to the market, it was the
white landowner that set the price.So you've got a person who's setting your
call structure, they're setting your revenueor your income, which by definition means

(07:10):
that they're setting your profits. Sothat left them in a situation of one
hundred percent tax. So even whenwe get beyond that period, let's talk
about programs that were designed to basicallyextended a helping hand to all Americans,
such as the Homestead Act. Whatwas the opportunity for African Americans or lack
of opportunity for African Americans with respectto that act. Yeah, there was

(07:33):
almost no participation whatsoever. The HomesteadAct was passing eighteen sixty two, it
distributed about two hundred forty six millionacres diroughtly about one point five million or
so white families, right, isa pontestinally small amount of that that went
to any kind of black votes.If you look at that in today's equivalent,

(07:55):
and you just use farmland pricing orbreak out between dollars about three fifty
dollars per acre, it'll put youaround about one point six trillion dollars or
roughly a million dollars, right,per family, which is an extraordinary start.
Well, then we had World WarTwo, and we had the celebrated
Tuskegee Airmen. But when everyone returned. What about the GI Bill. I

(08:18):
mean, wasn't that supposed to makeitself available to all military personnel. It
was supposed to, and it's sowonderful piece of legislation to serve the needs
of people who gave so much.But you had about a million soldiers that
were black soldiers who were returning weren'table to benefit from this. So it
was a massive infusion of capital thatprovided job training, funds for college obviously,

(08:45):
funds for home ownership. Less thantwo percent of any of that went
through black soldiers. So if youhad the total therefore, I think you
came up with an estimate of aroundseventy three. And that's due that in
order to chief parody that is forAfrican Americans, how do you get non
African Americans? Since African Americans onlyhave two percent of the well to really

(09:07):
buy even accept this as a realitymuch, let's do something about it.
I think the first piece of itis that people just to become informed,
as opposed to spending time affirming kindof their belief system. Most folks think
that the reason why people in aposition that they're in is just because the
decisions that we've made are not madeover the course of time that had led
us here. They don't really knowabout the context that surrounds it. They

(09:31):
have no idea what the total amountof labor extractor from people was. They're
generally told that bad things happened fora period of time, it came to
an end, it was a newstart. And what you find is that
the form just changes and it's beencontinuous. And what I wanted to do
was to look at it from apurely economic standpoint, put the emotional aspect

(09:52):
of aside, and just show peoplewhat the numbers are so they could see
it in perspective. Well, Ithink that's very compelling because I think it's
so beyond and ism in terms ofthe African American experience. It was about
capitalism and our community with the capitalin that system. From where I said,
so don't go away, come backto a state of play. Welcome

(10:20):
back to state of play. We'revery lucky, indeed, to have Heather
McGhee join us for this part ofthe conversation. She is a great thought
leader and the author of the someof us. As you know, what
we're talking about is the wealth divide. How did it come to pass?
And then we're going to talk abouthow do you address it? But,
as Heather McGhee knows better than most, we live in the world of politics

(10:43):
and public policy, how do youget buy in to have people really want
to address this? Heather, whatare your thoughts? Oh, thank you
so much for this conversation. Inmy book The Some of Us, What
Racism costs Everyone, and how wecan prosper together, I lay out the
facts that the biggest impediment to economicprogress in our society is this zero sum

(11:07):
worldview, the idea that progress forsome people has to come at the expense
of others. It's a counterfactual idea, it isn't actually accurate. It's held
more often by white folks than peopleof color. We don't think that our
progress has to come at white folksexpense, and of course the data doesn't
bear it out. The racial economicdivides that you're talking about are actually costing

(11:30):
our overall economy trillions of dollars everyyear. We would all do better if
we were all doing better, Andyet it's that racist zero sum story that
keeps many white people actually voting againstand rooting against the kinds of investments and
public goods and public benefits that couldhelp them in their own families, just

(11:52):
because it might also help the peoplethat they see on the other side of
that zero sum divide. That's what'scosting us trillions of dollars for every one
and that's being driven, as Iunderstand it from your book, Heather McGee,
by a narrative, a public narrativethat you know, don't look to
government, that you should look tothe private sector. And that narrative kicked

(12:13):
in once the demographics of the publicbegan to change. Is that a fair
takeaway. That's exactly right, Mayor. It's this zero sum story that is
being sold for profit by people whoare benefiting economically and political politically by the
status quo. It's the stories aboutmakers and takers, taxpayers and freeloaders,

(12:33):
the derision of handouts, handouts thatI'll note used to be the way we
did business in the United States inthe nineteen thirties, forties, and fifties.
The United States invested tremendous amounts ofmoney in public goods, public benefits,
and public amenities, parks, schools, even public pools, which is
the metaphor at the heart of thesome of us the reminder that this country

(12:56):
was built based on massive government investments, white wealth building, and a high
standard of living for white Americans,and usually those benefits were racially exclusive,
like the public pools and so manycommunities across the country, And when the
civil rights movement demanded the integration ofthose public goods, including the pools,

(13:16):
many towns across the country opted todrain their public pools rather than integrate them.
I say that that's the metaphor atthe heart of my book, because
it feels like we're all living inthe bottom of a drained public pool now,
where we're short changing the basic investmentsin our infrastructure, which gets a
D plus from the American Society ofCivil Engineers. Where we don't have universal

(13:39):
healthcare or childcare or paid family leave. We've let our minimum wage stagnate,
We've let the government turn its backon the economic security of all of our
people. And that's mainly because ofa massive shift in public opinion by white
Americans who went from championing the NewDeal Democratic Party to turning their backs on
the Democratic part once it became theParty of the Civil Rights under Lyndon Johnson,

(14:03):
after which they never again voted inthe majority for a Democrat for president.
He that your metaphor is compelling.How do we begin to shift this
thinking? And in particular in yourconversations, do you hear a shift in
thinking among white Americans? Well,that was the question, that was really

(14:24):
the question that set me off onthe journey. I took three years traveling
across the country to write the Someof Us. I talked to Americans,
black, white, and brown,who shared their stories of triumph and of
struggle, of really taking on thetoxic mix of racism and greed in this
country. I'm reminded of time Ispent with a white woman named Bridget Hughes,

(14:45):
lifelong fast food worker, struggling withthree kids on a minimum wage paycheck
her and her husband. And shehad grown up with that zero sum story,
right, the idea of us andthem, the idea of immigrants coming
and stealing jobs, the idea ofblack folks committing crimes and being dependent on
welfare. And yet when she beganorganizing to make her own life better with

(15:09):
the fight for fifteen dollars in aunion in Kansas City, she began to
see herself in the lives of herblack and brown coworkers. For the first
time, she recognized that there wereso many more things that they had in
common than what held them apart.And as she told me, I no
longer see that it's an us andthem right now, I understand that for

(15:31):
us to come up, she said, we've all got to come up,
black, white, and brown.She said, as long as we're divided,
we are conquered. And that's reallyit. That's really the story.
I think that could help create amultiracial working in middle class coalition to refill
the pool of public goods for everyone, things like universal healthcare and childcare,

(15:54):
a decent minimum wage, the rightto collectively bargain, which is something I
tackle in the book that some ofus the way at the rate that racism
is used as a wedge to keepworkers apart, things like affordable college.
We used to pay for the costof college on the government tab back when
the college going population was white andmale. As it became more diverse,

(16:15):
government's cut back, and now we'vegot this debt for diploma system that impacts
black families worse because of the wealthgap that we've been talking about. But
also six out of ten white studentsnow have to borrow. So there is
this solidarity dividend, as I talkabout in the book, that I think
we can really unlock when we realizethat there are common solutions to our common

(16:36):
problems and that racism has a costfor everyone. If one is an everyday,
average working class African American listening toall of this alarming information, what
can she or he do in themeantime while we try to figure out some
policy answers to these questions. Youknow, that's such an important question.

(17:00):
I think that oftentimes we look forindividual solutions to what are actually public policy
problems. You know, we tellpeople to go back to school. Well,
you know that costs money because thegovernment has pulled back on supporting it.
We tell people to get a betterjob. There are some good jobs
out there, but they're harder andharder to come by, and the more
you work, the more you needchildcare and transportation. Right, we have

(17:23):
stacked the deck so hard against individualworking folks that I would say the most
important thing you can do is organizedbecause everywhere you look, there's someone else
who's got those same problems, andit's only through collective action that we can
really change our own life. Circumstanceshead the big game. You've been terrific,

(17:44):
your insights have been on it,and we're all the better for it.
So don't go away with state ofPlay. Next, we speak with
Congresswoman Sheila Jackson Lee where she'll talkabout the Commission on Reparations. Welcome back

(18:06):
to State of Play. We aretruly honored we have with us today the
honorable Shilla Jackson Lee. Thank youso very much for being with us,
and thank you for your tremendous leadershipon this important issue. Thank you,
and mayor thank you for your leadership. I was here in Congress doing your
stupendous leadership of the city. Congresswoman, are you providing great leadership on HR

(18:29):
forty this commission to study reparations?Is this about retribution for slavery? Or
is it about bridging the wealth dividein America? Thank you for giving me
the opportunity. HR forty is asAmerican as apple pie and sweet potato put
together. It is as American asAfrican Americans. Black Americans are to the

(18:52):
heritage and the institution building of thisnation. We modified HR forty because we
understood it had to be legislation forthe twenty first century. Yes, it
will deal with the original sin,which is an apology which has never been
done to those who were held inbondage for more than two hundred years.
And then we move to action,and that is that it funds the study.

(19:17):
You have to dig deep to beable to understand why there are such
stark disparities with African Americans in thetwenty first century, why it has transcended
centuries that we are still in thistime showing stark disparities. And so it's
studies, but then it acts upondeveloping reparation proposals, and those proposals may

(19:41):
reach a wide gamut of the issuesof concern in the black community, from
healthcare, to education, to scienceand to psychologies, to sociology, and
of course the big one the disparitiesin wealth. So you have this commission
who gets to decide who's on thiscommission, and you know, once they're

(20:03):
on the commission, what is theprocess for making decisions. So this gives
me an opportunity to say that wewill not be knocking on our neighbor's door
and asking our neighbor to give uscompensation or response to slavery. That's what's
so perfect about this legislation. Slaverywas government sanctioned, the slave codes for
how long families were separated, brutalized, beaten, and hung under the auspices

(20:32):
of the government. In one instance, it was the United States of America,
then it became the Confederacy. Sothis will be a government commission,
and it will be appointed by themajority Leader of the United States Sentence who
at this instance supports HR forty,the Speaker of the House, who supports
HR forty, and of course thePresident of the United States, who has

(20:55):
made it very clear that his willbe the administration of Racial Equity and Racial
Justice. And so those individuals willcombine to select this commission. It will
have a staff funding, and wehope also that it will be hearings,
will be fact finding. We'll givethe pros and the cons. We'll let
those who have deep disagreement be heard, but as well the scholars and the

(21:18):
historians and those that can bring realdocumentation that exist on what black people,
what slaves, and now the descendantsof enslave Africans went through during their time
here in the United States. Andagain, Congresswoman, I know this is
a sort of going to be atough one. But you know this decision
making process, I mean, isit going to be by majority vote?

(21:41):
Is it going to be inspired bythe current commission? How does it really
work? It will be by wehope consensus, but there will be votes,
and it will be votes that willbe taken by the majority. But
what will happen there is that theactual infrastructure of how it works will be
crafted by those who will be selectedto serve so that they can design with

(22:04):
the guidance of the legislation the weedsof how they will vote. Members being
absent the final report, but therewill be no letting up of this being
a very serious commission with official workthat will have to be done on behalf
of the American people. Congresswoman,I so employed your leadership on this particularly

(22:27):
difficult subject or challenging subject. Butyou know, it's such a polarized country.
Even if every single recommendation is byunanimous vote, how do you get
America to buy into it? Ithink we're moving towards that with the huge
numbers of young voters and minority voterswho voted in twenty twenty that will be

(22:48):
rising to be leaders. Young voterswere the ones that have challenged their universities,
Harvard and Georgetown for using slaves tohelp fund the institutions. In fact,
you probably could not find an IvyLeague school that might not have had
that exposure. I don't want tosay all, I just want to say
that it occurred. So many institutionsin the United States were funded and survived

(23:12):
because of slave work, which werecreated wealth. Certainly, the Transatlantic slave
trade was one of the components abuilding of the wealth in the South,
the landed wealth as well as theWall Street banks. I think as people
hear the facts, they will understandthere is a question of equity and fairness
and that we are not taking awayfrom my neighbor or my neighbor's child.

(23:33):
Congresswoman Shila Jackson Lee, you aresuch a wonderful leader, and we at
State of Play or have been sohonored to have you with us today.
Thank you so very much for allthat you do, so don't go away.
There's still more the State of Play, so welcome back to State of

(24:04):
Play. As you know, onthis episode, we've done a deep dive
around the wealth divide in America andwe have been enlightened by Sean Rochester,
who explained how various junctures in Americanhistory that divide just got deeper and deeper,
slavery Jim Crow even in the wakeof World War Two. And the

(24:25):
great thing about Heather McGhee is thatshe explained how these intentional policies, very
much designed to create a disadvantage forpeople of color, have hurt most Americans
and how we ought to get somebuy in from all of America to address
it. And Congress Roman Shila JacksonLee, who's doing a terrific job of
advancing an initiative to address and beginto deal with reparations by creating a commission,

(24:52):
was very very enlightening and compelling.So is there a hopeful path forward
you think, mayor I, youknow, I have to have as a
takeaway, how do we get SeanRochester's information and Heather McGhee's zero sum game

(25:12):
narrative that we have been oppressed byin this country. How do we get
that into everybody's psyche so that peoplecan pull the covers off of what has
been going on for literally hundreds ofyears and it's hurting all of us.

(25:33):
You know, is it our educationsystem that really needs to begin now?
Talking about the real these these realnumbers, and also the narrative, because
people are doubling down on this narrativeand it is going to hurt all of
us for another couple of hundred centuries. Karen, I think the way we

(25:59):
get it out there is about doingwhat we're doing right now. And I'm
honored to be here with both ofyou because we're doing right here what is
not happening as much as it shouldin the Beltway mainstream media. They need
to be talking about these issues aswell, rather than not covering real issues.

(26:19):
For example, you know, theBeltway media was loath to call Donald
Trump what he really was, aliar and a racist. They are loth
even at this moment to use theterm voters suppression, as if that's some
type of third real terminology. We'vegot to get media to follow the lead

(26:41):
of what this program you started asdoing, Mayor, to call these spays
exactly what they are. I thinkthat this helps. I am optimistic about
all of the guests and the conversation, especially about HR forty full disclosure,
and Mayor, you know this betterthan anyone we're caring. You do too.

(27:03):
I was married to the HR fiftyone bill for DC statehood. But
if I have a mistress as HRforty, and I've been very strongly supportive
of that piece of legislation. Wehave almost two hundred co sponsors. And
look, this Reparations bill addresses thatlegacy in that chronology that Sean Rochester pointed

(27:26):
out, all of those things,not just enslavement. So I think that's
very important. We're on our waynow. I think there's reason for hope,
and it's important that people be educatedthat people. You know, some
people weren't enterprising, others weren't,and there's a reason we're all feeling this
income inequality even today. Some ofthese intentional polity policies have hurt everybody.

(27:48):
So I'm very glad we drilled downon this wealth divide at State of Play.
So join us again next week.We're going to always dive deeply.