The Hidden Cost of Being African American: How Wealth Perpetuates Inequality

By Thomas M. Shapiro

Book Overview

Over the past three decades, racial prejudice in America has declined significantly and many African American families have seen a steady rise in employment and annual income. But alongside these... This description may be from another edition of this product.

• Format: Paperback
• Language: English
• ISBN: 0195181387
• ISBN13: 9780195181388
• Release Date: January 2005
• Publisher: Oxford University Press
• Length: 258 Pages
• Weight: 0.88 lbs.
• Dimensions: 0.7" x 6.2" x 9.1"

Customer Reviews

Every American needs to read this book!

I agree with Mr. Shapiro. He took my understanding of how tax policy and wealth transfers have widened the gap to a new level. His arguments are highly persuasive. However, I have an alternative view of why the value of homes in AA communities do not appreciate as fast. There is validity to his view but I believe another reason is because of the way AA's maintain their communities and not because they are segregated. I grew-up in an all black neighborhood but my father cut our grass; we didn't have broken down cars in the drive way, or couches on the front porch. Everyone worked together and we were proud of our homes. The way I see it, I don't care if the neighborhood is black, white, hispanic, or asian, if the people do not keep that community clean and well-maintained, the property values will stagnate or decline, inevitably. So let's not go too far to one side and say that "Because neighborhoods are racially segregated, African Americans' homes do not grow in value as fast as whites' homes do." There are other factors at play as well.

great book

I really learned why real estate in communities of color so often is worth less money than when the exact same housing or real estate is available in white communities. What a terrible price people of color pay for our nation's social cancer of racism. Our collective racism cloaks our underlying issues of pretending there is no classism in the USA. I appreciate Dr. Shapiro's honest assessment of the situation and his clarity in analyzing the actual numbers and statistics underneath the money and educational disparities that can keep some African American families from achieving the wealth levels they would otherwise easily be able to enjoy. Great reading and a fair minded resource for all Americans of any heritage.

Book Review

The book was very insightful. It offered me a chance to understand better how inherited wealth provides opportunity that many others do not have. Shapiro offered a few solutions to how we can begin to address the discrepancy in wealth. I would recommend this book to anyone who wants a better grasp of the inequality associated with wealth.

"The concept of a stakeholder society": A Look at Wealth, Inequality, and Innovative Solutions

Thomas M. Shapiro's _The Hidden Cost of Being African American_ (2004) is a powerful book that offers a unique look at economic inequality across racial lines. His discussion is not yet part of the mainstream discussion of race and government policy, but it should be, and his book makes an important contribution. His analysis is convincing, and the solutions he offers are worth serious consideration. Shapiro's methodology is engaging. He uses statistical data aggregated from the longitudinal Panel Study of Income Dynamics (PSID)-an ongoing government funded study begun in 1968 that examines the finances of approximately 8,000 American families. In addition, he and his research team interviewed approximately 200 families in Boston, St. Louis, and Los Angeles, half of whom were black, half were white, with a subset of latino families. Shapiro blends statistical data with the voices of the families he has interviewed. People discuss their salaries, their financial assets, their reasoning for buying and selling homes, and their thoughts about money. This approach makes for a highly readable book. Based on PSID data and the interviews, Shapiro focuses on the imbalance in asset-share between African Americans and white Americans, and its repercussions. He shifts the discussion from one focused on salaries, where in the last two decades there has been progress toward greater parity between whites' and blacks' wages, to a study of real assets. From an asset perspective, Shapiro argues, the nation's economic picture is very problematic. Shapiro shows that in general, African Americans' accumulated financial assets are considerably smaller than whites', leading to fewer economic opportunities, greater economic hardship, and less access to wealth creation opportunities. The diminished asset share stems directly from the nation's history of racial oppression when African Americans did not have the same opportunities to amass wealth over generations. Shapiro outlines the real consequences of this difference in assets. A financial asset perspective offers a global picture of economic wellbeing that includes a family's savings accounts, stocks and other investments, home equity, and inherited wealth through gifts and bequests. One of Shapiro's main points is that white families, in general, have much greater access to "transformative assets"-wealth and gifts inherited from previous generations-which enable families to enjoy opportunities that they have inherited from previous generations but have not earned themselves through merit. Shapiro looks at the types of advantages that come with these "transformative assets" and generational wealth, including down payments on homes and college educations paid for by parents and grandparents, as well as inheritable legacies from grandparents and parents. These "transformative assets" lead to considerable (and often profound) differences in social and economic opportunity and quality of lif

Sobering and Inspiring

This book and its description of the power of transformative assets is must reading for all Americans, espeically those who are descendents of slaves, like myself. If you want the boiled down pop version of this argument, peep Chris Rock's perceptive sketch on how black folks confuse the relationship between income and wealth from his latest HBO special "Never Scared." Highly relevant stuff within these pages.