Talks explore asset disparity between blacks and whites

The national news media has enthusiastically proclaimed the rise of a new "black middle class" over the last several years, but according to one sociologist, the economic picture for many African Americans is not so rosy. Nearly 50 community leaders, businesspeople and members of the University community turned out to join Melvin Oliver of the Ford Foundation for two discussions on "Asset Inequality and Social Policy" yesterday at the Faculty Club and the McNeil Building. Oliver, the foundation's vice president for asset building and community development, noted that while minority incomes have been rising, asset accumulation -- in the form of homes and businesses -- has been stagnant, creating financial insecurity and segregated neighborhoods. "Income feeds your stomach, but assets change your mind," he said. "You can't plan for the future the same way you can when you have assets available to you." Oliver blamed the disparity between white and African-American asset levels on a housing market that denies choice and keeps residents of suburbs and cities segregated. "Most people want to live in integrated communities," he noted. "If you unleash choice, you can settle the issue of segregation." History Professor Tom Sugrue took over the discussion where Oliver left off, focusing on the plight of black-owned businesses in Detroit, Philadelphia and other major cities. He noted how Market and South streets in Philadelphia -- formerly thriving homes to barber shops, taverns and bookmakers -- have seen businesses vanish along with infrastructure and urban renewal projects. Oliver said that the solution to this asset inequality lies in government action, though he admitted that it was an uphill battle. "The legal remedies are important, but they've been overwhelmed with the backlash, with affirmative action and all," he said. "They're being assaulted from all sides." Oliver called for further reform of the welfare system -- which "confines the poor to consumption," not "accumulating wealth" -- and of the Internal Revenue Service, which he labeled "discriminatory." Oliver also proposed the creation of an "individual development account," an IRA-style fund to which the government would match poor people's contributions. The funds in the account would go to home buying, business starts and higher education -- all forms of asset accumulation. The Ford Foundation -- the nation's largest grant-making philanthropy -- has pledged $6 million in contributions to test the effectiveness of the program. Before taking his position with Ford, Oliver taught at the University of California at Los Angeles and co-authored Black Wealth/White Wealth: A New Perspective on Racial Inequality in 1995. Oliver noted that his goals comprise more than just tax reform and housing subsidies. People have to start to "think long-term," he said. "They have to use their resources to plan for the future."