Last week the Boston Globe dropped a bombshell about the state of black wealth in their city, showing that the middle black family in Boston had a net worth of $8.00. While their white counterparts were worth over $247,000. The city of Los Angeles is not too far behind these numbers. The median white family in Los Angeles has a net worth of $330,000, with nearly $110,000 of that in liquid assets. This contrasts with the $4,000 net worth — and $200 in liquid assets — held by the median U.S.-born black household. The median Mexican family in L.A. only has $3,500 in net worth — and a mere $7 in liquid assets. In a twist African immigrant in Los Angeles have a median liquid net worth of $60,000.
Economist Thomas Piketty, the author of Capital in the Twenty-First Century, recently observed that the level of inequality in the United States — for those who work for a living — “is probably higher than in any other society, at any time in the past, anywhere in the world.” In effect a median U.S.-born black family in Los Angeles, has just 1 percent of the wealth holdings of the city’s median white family.
This all comes out of a report done by several economists in conjunction with the Federal Reserve in 2015. The report exposed how the glaringly wide wealth gap impacted cities, and was one of the first of its kind to parse out native blacks, versus those that have migrated.
In addition, these numbers may actually understate racial differences in family wealth because they count some consumer durable goods as assets, like the family car. Many financial analysts don’t feel these durables should be included as assets when assessing net worth. Average families, for instance, can’t just liquidate a car for the price they paid for it and they can’t just sell it without adversely impacting their family’s well-being. Excluding the durable good of a family car from these calculations would leave the net worth for the median white family in LA largely unchanged due to asset transfers like inheritance, while both the typical U.S.-born black and Mexican families in Los Angeles would likely end up with net worths nearing nothing at all.
The groundbreaking Color of Wealth in Los Angeles report provides a lens into inequality that takes us deeper into the fault lines of wealth and helps us see how those divides are shaded with color.
Antonio Moore graduated from UCLA, and Loyola Law School. He is now a practicing Los Angeles based attorney. In recent years he worked as a producer on the Emmy nominated documentary entitled Crack in the System presented by Al Jazeera. Subscribe to his YouTube Channel @ Tonetalks Download the Dash Radio App and catch his weekly show on Dash Talk 7pm pst Fridays