The systemic plundering of Black wealth continues 

The Black-white wealth gap remains consistent and persistent. Despite some gains in assets, homeownership and investments, African American families continue to lag far behind their white counterparts. This is not new information, but perhaps it’s time to provide additional context so policymakers and thought leaders can collaborate on a plan. 

The lack of wealth retention among Black families has little to do with individual choices, poor savings and investment strategies, or a lack of effort. Researchers, historical data, and current statistics continue to show there are systematic tools in place to ensure that African American generational wealth will continue to be aspirational rather than forgone conclusions. 

Despite gains in education, managerial, and corporate careers, African American economic growth continues to be stymied by policies such as redlining, unfair taxation, and neighborhood disinvestment. Blue lining has emerged as another form of discrimination impacting Black families. While redlining is a discriminatory practice where financial services, such as mortgages, insurance, and loans, are denied to residents based on race or zip code blue lining refers to the practice of the same financial and insurance institutions withdrawing services or increasing prices in areas perceived to be at high environmental risk due to climate change or other factors. 

Homeownership is one measure of U.S. wealth. A January 14 study by the National Association of Real Estate Brokers (NAREB) revealed that Black landowners continue to face significant challenges, with heirs’ property issues being a major contributor to land loss. Heirs’ property, where descendants hold fractional ownership, makes the land vulnerable to legal challenges and forced sales. This has led to the loss of 90% of the land held by Black families since 1910, the group said in “Heirs’ Property in the United States – Its Destabilizing Structure and Contribution to Black Property and Wealth Erosion.” 

As this comprehensive study demonstrates, public policies have aided private and public entities in the unscrupulous and predatory acquisition of land owned by Black families, creating a long history of land theft from the Black community,” said Courtney Johnson Rose, NAREB’s president in a televised interview. “Heirs’ property issues disproportionately impact Black households, thereby making the need for urgent reforms as important today as they were a century ago.” 

The loss of property isn’t the only issue African Americans must contend with. Black homeowners could find their properties devalued and lives at risk if their neighborhoods are subjected to blue lining. If for example, a municipality declares it doesn’t have enough public safety resources, such as fire trucks or environmental workers. The practice might also occur if an area is hit with an environmental disaster that has health repercussions. 

For example, in predominantly Black municipalities of Flint, Michigan; Baltimore, Maryland; Jackson, Mississippi; and Milwaukee, Wisconsin, residents were subjected to lead-poisoned drinking water. Chicago also has significant concerns about lead in drinking water, particularly affecting young children, most of whom are Black. A study by researchers at Johns Hopkins Bloomberg School of Public Health and Stanford University School of Medicine found that an estimated 68 percent of children under six in Chicago are exposed to lead-contaminated tap water.  

If financial institutions engage in blue lining, people impacted by lead-contaminated water pipes or other “environmental” factors might find it harder to obtain private and affordable health insurance or loans to repair damage to their property due to perceived risks. 

Despite any wealth accumulated by Black families in New Orleans in the 1990s, most of it was wiped out in 2005 in the aftermath of Hurricane Katrina. Insurance companies faced significant criticism for refusing to pay out claims. Many homeowners found that their policies did not cover the extensive damage caused by the hurricane. In a classic case of blue lining, the insurers argued the damage was due to flooding, which was not covered under standard homeowners’ policies, rather than wind damage, which was covered. Over 100,000 African Americans were forced to leave New Orleans and start over elsewhere. 

It should be noted that Black farmers have lost approximately $326 billion worth of farmland over the past century due to discriminatory lending practices, eminent domain, zoning, housing, unscrupulous corporate practices, and heirs’ property laws. 

You can’t pass on what you no longer have. 

In “The Plunder of Black America,” by Professor Calvin Schermerhorn, the continued loss and hindrance of Black wealth is the result of policies, economic practices, and barriers that prevent its accumulation and retention. “African Americans did not lose or squander wealth on the ongoing road from enslavement to equality,” he wrote. “Black people did not invest unwisely or fritter away the fruits of their labor. Instead, each time the American economy changed, the agents of that change have dispossessed, disinherited, or decapitalized African Americans.” 

Schermerhorn teaches history at the School of Historical, Philosophical and Religious Studies at Arizona State University. “The Plunder,” released this year by Yale University Press, says each generation of Black families faces their own hurdles of fundamental racial inequality and economic violence. And each generation finds it increasingly difficult to retain or redistribute familial wealth. 

“Racial disadvantages changed over time; as soon as African Americans overcame one obstacle, another fell into place,” Schermerhorn wrote. “A nation founded, in large part, on ransacking African Americans’ work product—and seizing Native Americans’ lands—never gave up stealing. The last hundred years have seen a nimble shift in that theft and wealth stripping.” 

This systematic wealth stripping continues, and it has very little to do with a lack of personal effort. 

The Federal Reserve Bank’s Institute for Economic Equity shares quarterly data on racial, generational, and educational inequality based on the average U.S. household wealth. A recent report showed that the top 10 percent of households by wealth had an average of $6.9 million. As a group, they held 67 percent of total household wealth. By contrast, the bottom 50 percent of households, by wealth, had an average of $51,000. As a group, they held only 2.5 percent of total household wealth. 

The Federal Reserve also noted that in 2024, Black families owned about 23 cents for every $1 of white family wealth, on average. Hispanic households owned about 19 cents for every $1 of white family wealth, on average. 

The nation’s racial wealth gap increased during the COVID-19 pandemic. Between 2019 and 2022, median wealth increased by $51,800. Still, the racial wealth gap increased by $49,950—adding up to a total difference of $240,120 in wealth between the median white household and the median Black household. 

According to a recent study by the Institution on Taxation and Economic Policy, the typical white household in the U.S. held five times more non-Social Security retirement wealth ($176,900) than the typical Hispanic household ($35,000) and seven times more than the typical Black household ($24,300). 

For researchers, this information may not be new; it is ingrained in American history. However, the general public and the new generation may indeed need a reminder of how and why this has happened. With new presidential mandates against “Black History,” diversity, equity, and inclusion projects (DEI), and the seizing of the National Archives, data and information on this wealth grab may be lost within two generations. History, therefore, bears repeating. 

In a nutshell: After the end of 244 years of forced labor (Black slavery) in the 19th Century, in 1863, the federal government embarked on policies to ease the burden of 4 million newly emancipated people now free to charge for their labor in America. Before President Abraham Lincoln was assassinated, his administration created a federal authority that would work with Black freedmen and influencers, like Frederick Douglass, to quickly stabilize those people. The nation then went about its healing and reconstruction process—after all, a lot of stuff got blown up, destroyed, and plundered during the Civil War. Citizens demanded their reparations as they figured out what to do with “their Blacks.” 

Meanwhile, Black churches, missionary societies, and schools in the Free States worked in concert with the U.S. Freedmen’s Bureau to get the emancipated people housed, educated, jobs, and able to fend for themselves and contribute to the national economy as taxpayers. Black leaders successfully advocated for “40 acres, a mule, and other supplies” to be given to emancipated households to help them jump start their new citizenship. Whites, who had fought against the federal government, didn’t like this, so after 56-year-old President Lincoln was murdered, the new president reversed the process and gave all federal support to whites impacted by the Civil War.  

In addition to realizing the president who had gone to war over their right to freedom and with no particular place to go, the inability to read and write, yet brimming with trade skills, creativity and high intellect, Black people were given the option to return to their former slave communities where they would continue to work—except their pay would be in the forms of meager wages which in turn would be repaid to their white employer for housing, food and supplies they used. Some of the ancestors took the bait and remained in the “employ” of their former masters, who still paid them nothing but instead charged them for living expenses. 

That means that shortly after emancipation, four million Blacks found themselves in debt, unemployed, and fearing for their lives. After all, the Black Codes, affected during the Nat Turner Rebellion of 1831, had morphed into policing laws. Slavery was still legal as a means of incarceration, and Black men understood the quickest way to wind up in chains was to be caught on a road at night “without papers.” 

For the greater part of the 19th through the early 20th century, most African Americans owned little to nothing or, according to Schermerhorn, “one-half of one percent of national wealth despite representing 14 percent of the population.” During Reconstruction, Black people, armed with dignity, education, the partial right to vote, the right to pay, and pure self-determination, began to carve out a life of economic prosperity for themselves. Things began to look up. 

However, the more progress poor Blacks gained, the angrier their poor white neighbors became. Anti-Black propaganda scared people into believing all Black men were rapists, criminals, drunkards, lazy and their females weren’t any better. Racial violence, lynchings, and sexual assaults increased, and the destruction of homes, businesses, and other Black-owned property became rampant. Ida B. Wells, then a publisher of a Black-owned newspaper, tried to call attention to the injustice and sheer brutality down South, but her press was burned down, and she escaped to Chicago with little more than her life. Little else was done to punish the white perpetrators of violent crimes against African Americans. Therefore, Black churches, fraternal groups, publishers, entertainers, and others in the Northern states began advocating for a mass exodus from the South.  

After the first Great Migration kicked off in 1900, Blacks found modest success in some northern areas or out West but faced familiar racial hostility, unjust arrests, unfair courts, and segregated conditions. President Woodrow Wilson, who served from 1913 to 1921, made sure African Americans would not mistake the federal government for an ally. During his tenure, the racist president mandated the segregation of federal offices, which led to the separation of Black and white employees in workplaces. This included separate lunchrooms, restrooms, and workspaces. 

Wilson also appointed southern Democrats (from the old Confederacy) to positions of power and influence in his administration. Under the president’s authority, the federal government imposed hiring restrictions that made it difficult for qualified Black candidates to obtain federal jobs and limited access to white-collar positions. Most Black workers found themselves in menial, low-wage positions such as cooking, cleaning, delivering, or chauffeuring white officials around. Other African Americans joined the U.S. military, which had its own set of segregation and racist practices. 

In less than two generations post-Reconstruction, Blacks went from being the most skilled and desired laborers in the U.S. to being the most unemployed, unskilled workers in the nation. Black youth not born in bondage had few options for employment—so many wound up on chain gangs. Booker T. Washington founded two universities and the National Negro Business League as a solution. His character-building and morality-type commentaries to Black youth and his access to whites earned him a false characterization of being a sellout. Mary McCloud Bethune, another great leader, also founded universities and medical schools to educate Black women, future doctors, nurses, social workers, military leaders, and other professionals who would go into service to the race.  

Black progress took hold, and African Americans began building and owning their own homes and businesses. Some founded their own cities and elected mayors to lead their progress. Black Wall Street was located in the Greenwood neighborhood in Tulsa, Ok, before a crazed white mob living across the tracks burned it down in a fit of rage, killing 300 people and destroying 1,500 Black homes and businesses. This riot, like many others in the years preceding, evoked fear, violence, trauma, and stress in people trying to live peacefully and to the best of their collective abilities with little outside assistance. 

Still, African American wealth-builders prevailed between the period of 1920 and 1940. A.G. Gaston opened his first business, the Booker T. Washington Burial Insurance Company, in 1923. Binga State Bank opened in Chicago in 1921, after starting its first financial institution in 1908. According to the Black History Research Project, in 1955, there were approximately 34,000 Black-owned businesses in the United States. Each spanned various industries, including retail, services, and manufacturing. 

By 1960, there were over 200 Black-owned newspapers. The Chicago Crusader was founded in 1940 as an advocacy tool for Black labor leaders. In 1942, John H. Johnson founded Johnson Publishing Company, and within two decades, he became the largest Black publisher in the nation, with Jet and Ebony magazines. 

Yet, in 1960, less than 1 percent of the managerial jobs in the U.S. were held by Blacks, with most of those being in the federal government. Limited opportunities and outright discrimination prevented African Americans from careers in the private sector, including in banking and finance, retail, insurance, and transportation. Traditional careers in teaching, nursing, the ministry, and law offered the most secure lanes of upward mobility and wealth generation. The vast majority of Blacks continued to make a living in farming,  service, and trade occupations or through domestic labor.  

Black business titans garnered great wealth during the first half of the 20th Century, in part because of segregated policies that restricted the Black dollar from the Black economy. While those leaders established banks, insurance firms, transportation, media, entertainment, and real estate companies, African Americans gained additional access to higher education in white universities and international programs.  

The ”Talented Tenth” of African Americans—an ideology coined by the Rockefeller Foundation and popularized in 1912 by Dr. W.E.B. DuBois—began to strengthen and promote themselves to lead the other 90 percent of their unfortunate, downtrodden brethren. A new social class of the “American Negro” emerged, often representing a colorized aesthetic of the great American (white) family with a nice home, two children, a nice car and money for two-week vacation rentals. 

Sociologist E. Franklin Frazier enraged the “Talented Tenth” when he authored “Black Bourgeoisie,” a research study that purported that Black wealth, upward mobility, and economic success had been greatly exaggerated by African American leaders and white liberals if but for different reasons. 

Frazier’s research showed that Black leaders may have exaggerated African American economic success as a means to shore up support for sociopolitical remedies that would aid the movement against inequality. White liberals, the professor believed, amplified the falsification of Black progress to demonstrate that America had moved beyond its racist past, rooted in slavery, Jim Crow and white mob and vigilante violence. 

The Nation of Islam, following in the footsteps of Marcus Garvey’s Universal Negro Improvement Association and Father Divine, maintained the most significant religious and Black-owned business movement in the 20th century. 

The second Civil Rights Movement, this time headed by Rev. Martin Luther King, Jr., and leaders of the five other biggest African American organizations, secured voting rights, housing rights, access to white-collar jobs and blue-collar union employment, as well as protections against discrimination in nearly all aspects of American life. King, perhaps influenced by Frazier’s work, died trying to end the cruel and unjust poverty that impacted the majority of Blacks in the U.S. His “Poor People’s Campaign,” ended shortly after his murder by either Memphis police officers, U.S. military snipers, or a lone assassin in April 1968. 

Following the Black Power Movement and selective patronage programs being run in Chicago, Philadelphia, and elsewhere, Black Americans began to focus on political power as a means to secure economic power. The presidential campaigns of U.S. Rep. Shirley Chisholm (in 1972) and Rev. Jesse Jackson, Sr. (in 1984 and 1988), and the U.S. Senate campaign of Carol Mosely Braun and the legacy of U.S. Senator Roland Burris blazed a trail for the election of  Barak Obama to the presidency in 2008. Hundreds of African Americans were elected to local, state and federal offices over a 40-year period after 1970. 

In his book “Why Should White Guys Have All the Fun,” Reginald Lewis, a pioneering African American billionaire and lawyer, talked about the obstacles he faced during his acquisition of TLC Beatrice International Holdings Inc. in 1987. The title of the book comes from a question he asked as a child when he overheard his grandparents discussing employment discrimination against African Americans: “Why should white guys have all the fun?” 

Yet the more Blacks gained politically, the more African American enterprises and entrepreneurs struggled to maintain and pass along their wealth. Despite Reginald Lewis’ success, scores of legacy Black-owned companies, manufacturing plants and brands folded or were bought out by giant corporations they competed against. President Ronald W. Reagan’s era throughout the 1980s ushered in the crack cocaine, gang, and gun violence and AIDS epidemic that ravaged predominantly Black communities from coast to coast. That devastation led to the rise of the prison-industrial complex and unfair sentencing laws via the 1994 Clinton Crime Bill, which was supported by members of the Congressional Black Caucus. 

Today’s 13 Black billionaires have emerged from entertainment, media, and sports and as high-paid brand ambassadors for multi-national clothing, liquor, and technology companies. Despite those individual successes, today’s Black unemployment rate hovers near 7 percent and approximately 37 percent of the people in prison or jail in the United States are Black, despite Black Americans making up only about 14 percent of the U.S. population. Black wealth continues to lag far behind. 

Each year, the National Urban League chronicles the successes and obstacles impacting Black America in an annual report to remind the nation of how far we have come and how far we have yet to go. No report by any group has yet to be written touting the closing of the Black-White wealth gap. Instead, each year, it continues to widen. 

Hundreds of books by new writers and those of the past document the reasons why. They agree that the U.S. has yet to end policies and practices that hinder and plunder Black wealth.  

In addition to historical and systemic political and social policies that aid inequality, financial deregulation, U.S. trade and tax policies that disproportionately benefit the wealthy, and declining labor protections for middle – to lower-income workers has exacerbated the issue. Cuts to social welfare programs designed to stabilize families until they are able to strengthen their households, and disinvestment in public services, including schools, also leads to economic inequality.