Poverty and race

Significance: The poverty rate measures the fraction of families who do not have sufficient income and therefore lack a decent standard of living. When a large fraction of a particular racial or ethnic group finds itself in poverty, other people often place little value in that group.

When a large proportion of a particular racial, ethnic, or other minority group is poor, the group is generally looked down on by the majority of the population. This has negative consequences for race relations and for the entire society. This reaction perpetuates poverty and leads to feelings of resentment and hostility among the impoverished minority group. Aristotle, the ancient Greek philosopher, noted in his Politics that “poverty is the parent of revolution and crime.” The 1968 Kerner Commission Report pointed to inner-city poverty amid general affluence as a major cause of urban violence and rioting in the United States during the late 1960s.

In the early 1960s, Mollie Orshansky of the Social Security Administration developed the methodology that is used to measure poverty in the United States. Using Department of Agriculture nutritional studies, Orshansky found the minimum food requirements for households of different sizes and types. She then estimated the cost of purchasing this food. From surveys, Orshansky knew that households spent around one-third of their income on food. To derive a poverty line for a family of a particular size, Orshansky multiplied the cost of that size household’s minimum food requirements by three. Each year, poverty lines are raised to reflect the increase in prices during the prior year. The poverty rate is defined as the percentage of families or individuals who fall below the poverty line. Poverty rates have been calculated for different racial groups as well as the general population.

Estimates of Minority Poverty

According to US Census Bureau estimates, African Americans and Latino/Hispanic people of all races are two to three times more likely to be poor than non-Hispanic whites. In 2015, 9.1 percent of whites were poor, yet 24.1 percent of African Americans and 21.4 percent of Latinos were poor. This ratio has shifted very little over time. In 1980, 10.2 percent of whites were poor, compared with 32.5 percent of African Americans and 25.7 percent of Latinos. In 1970, 9.9 percent of whites were poor, and 33.5 percent of African Americans were poor; and in 1959, 18.1 percent of whites were poor, and 55.1 percent of African Americans were poor.

Native Americans have experienced some of the highest poverty rates in the United States. In the late 1960s, Native Americans had poverty rates of around 74 percent. However, federal antipoverty programs directed at Native Americans cut this figure to around 25 percent by the late 1970s, about the same as for African Americans and Hispanics. As of 2012, census data showed the poverty rate among Native Americans and Alaska Natives was still about 26 percent.

Causes of High Poverty among Minorities

Many scholars have attempted to explain why minorities have such high poverty rates. Their answers have included prejudice and discrimination in the job market, cultural or behavioral traits, single-parent families and illegitimate children, urban ghettos, a lack of adequate education or business skills, and language barriers.

Prejudice and discrimination in the labor market is one prominent explanation. Because African Americans and members of other racial minorities cannot get good jobs, they are forced to accept low-wage, menial positions. Moreover, these jobs provide little opportunity for advancement and for workers to develop skills. Many of these jobs are unstable, which means the workers often lack a source of income for part of the year. Gunnar Myrdal’s groundbreaking work An American Dilemma: The Negro Problem and Modern Democracy (1944) attributed high rates of African American poverty to a cumulative process in which prejudice and discrimination reinforced each other. Sociologist William J. Wilson updated Myrdal’s cumulative analysis by arguing that discrimination also leads to feelings of inferiority and causes African Americans to adapt in dysfunctional ways.

A second explanation focuses primarily on cultural or behavioral traits. The cultural explanation for poverty was first set forth in Louis Wirth’sThe Ghetto (1929). Wirth considered the urban mode of life too difficult for people with rural backgrounds. Therefore, when rural southern African Americans migrated to the urban North, crime and alienation became more prevalent as employment diminished. A similar thesis appears in Nicholas Lehman’s The Promised Land (1991).

A common view in the early twentieth century was that high rates of African American poverty were caused by the numerous single-parent families and large numbers of illegitimate children, which were usually blamed on African American racial characteristics. Edward Frazier’s The Negro Family in the United States (1939) countered this view and argued that the overall status of the black family was shaped by prevailing economic and social conditions. Slavery destroyed African cultural patterns, and emancipation maintained the matriarchal system that developed under slavery. The migration of African Americans to the North further undermined communal institutions and community pressure that helped keep African American families intact.

More recent work has focused on the problem of African Americans living in urban ghettos. Wilson blames this problem partly on historical discrimination. However, the real blame, according to Wilson, lies with economics and demographics. When the U.S. economy shifted from manufacturing to services, it produced high unemployment rates in urban cities. This exacerbated the problems generated by the flow of African American migrants from the rural South and the rapid growth of young minorities in central cities. Sociologist John Kasarda, likewise, sees the decline of manufacturing and the rise of the service economy as causing the poverty of urban blacks. However, he notes another aspect to the problem: African Americans are less likely to move to areas experiencing job growth. In part, he says, this is caused by racial discrimination, which keeps African Americans from moving to the suburbs, and in part, it is because African Americans lack the skills and education required by the new service jobs.

Since the Coleman Report (1966) documented racial segregation in American schools and proclaimed that education in the United States was separate but unequal, differences in the quality of education have figured prominently in explanations of why racial minorities are more likely to be poor. If minority children of any race receive a poor education, they are unlikely to leave school with the skills needed for high-paying jobs.

Another problem facing racial minorities is their lack of business experience and management skills. They also lack access to capital, making it hard for them to start their own businesses. Another problem is that businesses catering to racial minorities are less likely to be successful and make money when they cater primarily to low-income individuals.

Many Latinos face additional problems involving language and culture. The inability to speak English well reduces some Latinos’ ability to get jobs and receive a decent education. Cultural differences make some Latinos critical and distrustful of the values and interests of the dominant culture in the United States and suspicious of social institutions such as the government and schools. Their differences have led to discrimination against them in the job market.

Native Americans, like Latinos, have some cultural differences that may reduce their ability to obtain high-paying positions. However, their particular history of land loss and disruptive government policies, as well as racial discrimination, may contribute to their ongoing poverty as well.

Policy Solutions

There are probably as many suggestions for reducing the racial disparity in poverty as there are theories of why minority racial groups are more likely to be poor. Many scholars have looked to desegregation in education as a means of improving the incomes of minorities and thereby reducing their high poverty rates.

Another approach has focused on labor market policies to increase the wages of minorities, to help minorities get better or higher-paying jobs, and to improve the job training that they receive both before and after employment. This approach has supported affirmative action as a means of combating discrimination in the labor market. It has also supported raising the minimum wage so that those with jobs are more likely to earn wages above the poverty line.

A third approach has been to work on developing minority businesses and to teach minorities entrepreneurial skills. Another approach has focused on spurring economic growth, assuming that growth will lead to more jobs and higher incomes. Finally, beginning in the 1970’s, a great deal of debate arose over government welfare programs and whether they can be made an effective antipoverty tool. Some experts argue that government benefits reduce work incentives and hurt the very people they are intended to help. Others argue that government benefits have always been inadequate to bring families above the poverty line.

Bibliography

Bernstein, Jared. "What Racial Injustice Looks Like in America's Economy." The Washington Post, 11 July 2016, www.washingtonpost.com/posteverything/wp/2016/07/11/racial-economic-injustice-jobs-incomes-and-wealth. Accessed 27 Apr. 2017.

Coleman, James S., et al. Equality of Educational Opportunity. Washington, D.C.: GPO, 1966. Print.

Frazier, Edward. The Negro Family in the United States. 1939. Notre Dame: U of Notre Dame, 2001. Print.

Krogstad, Jens Manuel. "One-in-Four Native Americans and Alaska Natives Are Living in Poverty." FactTank. Pew Research Center, 13 June 2014. Web. 4 May. 2015.

O'Flaherty, Brendan. The Economics of Race in the United States. Harvard UP, 2015.

Orshansky, Mollie. “Consumption, Work, and Poverty.” Poverty as a Public Issue. Ed. Ben B. Seligman. New York: Free, 1965. Print.

"People in Poverty by Selected Characteristics: 2012 and 2013." Current Population Survey, 2013 and 2014 Annual Social and Economic Supplements. US Census Bureau, Social, Economic, and Housing Statistics Division, 16 Sept. 2014. PDF file.

Surowiecki, James. "The Widening Racial Wealth Divide." The New Yorker, 20 Oct. 2016, www.newyorker.com/magazine/2016/10/10/the-widening-racial-wealth-divide. Accessed 27 Apr. 2017.

Wilson, William J. The Declining Significance of Race: Blacks and Changing American Institutions. 3rd ed. Chicago: U of Chicago P, 2012. Print.