The wealth gap between whites and blacks in America is wider than it has been in a generation, but it doesn’t seem to be hurting President Obama politically.
Whites now have 20 times the net worth of blacks and 18 times that of Hispanics, as compared to a ratio of 7 to 1 from whites to both groups in 1995, when the U.S.’s economic expansion boosted many underprivileged groups to the middle class, according to an analysis of Census data released Tuesday by the Pew Research Center. That’s the widest gap in 27 years, since U.S. government began recording the wealth gap between whites and minorities.
In terms of total decrease in net worth, Hispanics have been affected most adversely, with a decrease of 66% from 2005 to 2009. The net worth of black families decreased 53% in the same period, as compared to a 16% drop for whites.
Analysts of the data report that the white-minority gap can be partially explained by the fact that whites have invested more in stocks and corporate savings, while younger Hispanics and African-Americans have invested more in homes, and therefore have seen significant losses. With an exceedingly stalled housing market, this wealth gap may widen even further.
"The findings are a reminder, if one was needed, of what a large share of blacks and Hispanics live on the economic margins," said Paul Taylor, director of Pew Social & Demographic Trends. "When the economy tanked, they're the groups that took the heaviest blows."
These studies emerge in the midst of the debt ceiling debate, in which Obama and congressional leaders must arrive at a decision to cut deficits and raise the debt ceiling or run the risk of seeing the U.S. default on its financial obligations -- all by the deadline of August 2nd. Last week, the National Association for the Advancement of Colored People (NAACP) met with Obama and urged him to avoid making cuts to housing assistance or safety net programs, claiming such cuts would disproportionately hurt minorities. It remains to be seen if this plea, and the study presented by the Pew Research Center, will have an impact on the August 2nd decision.
Still, despite these data and Republicans, like Michele Bachmann and Mitt Romney pointing out how minorities have been adversely affected in this economy, blacks and Hispanics appear firmly in Obama’s corner. In the latest NBC News-Wall Street Journal poll, released last week, the president’s overall job approval was split with 47% approving and 48% disapproving. But those numbers spiked among Hispanics and African Americans. Hispanics approved 56%-39%, and blacks were an even stronger 88%-7%.
Those numbers have held pretty steady since the president took office. Provided they remain that way, that support could give Obama a measure of insulation in next year’s election that might not be enjoyed by other presidents in a similar economy.