Schools That Serve Poor, Minority Students are Systematically Shortchanged, But Disparities Are Closing

How Philanthropists Can Impact Wealth Inequality

Financial security impacts all aspects of our lives—education, health, employment, homeownership and passing on a legacy to future generations. Inequality By the Numbers According to the Prosperity Now Scorecard, nearly 37 percent of households in the United States are liquid asset poor, meaning they lack the savings ($6,150 for a family of four) to live at the poverty level for three months in the wake of a financial crisis, such as a broken-down car, job loss or medical emergency. It’s far worse for people of color, 50 percent of whom live in this financial red zone. Our data shows that if wealth in the U.S. were to grow at its current rate, it will take the average black household 228 years to accumulate as much wealth as white families have today and the average Latino family 94 years to match their white counterparts. Without any economic or policy intervention, families of color will have to endure nearly a century or two more of economic inequality and injustice. Inequality Past and Present The racial and wealth divide is the product of centuries of policies and practices that keep people of color from getting ahead. Our deepening understanding of the institutional and structural barriers that shaped today’s unconscionable wealth divide guides how we craft policies and programs that reduce wealth inequality and promote economic inclusion. For example, last year, Congress had a tremendous opportunity with the Tax Cuts and Jobs Act (TCJA) to help low-income and middle-class families—particularly those of color—build the wealth needed to secure their share of the American Dream. Instead, Congress adopted policies that seem likely to exacerbate economic inequality rather than mitigate it.