# Why do blacks and hispanics have such low net worths compared with whites? **URL:** \ **Category:** Great Debates\ **Created:** [February 12, 2014, 1:05am UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108 "2014-02-12T01:05:38Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![nevadaexile](https://avatars.discourse-cdn.com/v4/letter/n/eb8c5e/32.png) [@nevadaexile](https://boards.straightdope.com/u/nevadaexile)\ **Post date:** [February 12, 2014, 1:37pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/21 "2014-02-12T13:37:48Z")
> [@flatlined](#): > > I’m having problems understanding this. When one is selling a home, they take all of the personal stuff out. This allows the potential buyers to imagine their stuff there and how it would fit. > > As a buyer, I might admire how your home is set up with beautiful art and pics on the walls…but it would not help me to visualize how my stuff would work. At least that’s how it worked when I was buying my home. > > If your house doesn’t sell because the buyer can’t see the house due to the artwork and pics and general clutter, you will get offered a lower price or it just won’t sell. > > That’s not racism happening, its because you didn’t bother to make your house ready to sell. Where do you live where people are able to move and then show their home? Most people have to show their homes while still living there. And please don’t add anything to my answer as “general clutter” is your term and not one which I used, nor would have. ---
**Author:** ![aldiboronti](https://avatars.discourse-cdn.com/v4/letter/a/9fc348/32.png) [@aldiboronti](https://boards.straightdope.com/u/aldiboronti)\ **Post date:** [February 12, 2014, 2:06pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/22 "2014-02-12T14:06:46Z")
> [@nevadaexile](#): > > Where do you live where people are able to move and then show their home? Most people have to show their homes while still living there. And please don’t add anything to my answer as “general clutter” is your term and not one which I used, nor would have. I’m still not seeing how racism would lower the value of your home. Do you mean that some people would not want a house that was owned by an African-American? I guess maybe with KKK types that may be true but the majority of sane people wouldn’t care at all. I can’t believe they would not buy somewhere they liked because there were a few African objets d’art on the wall. ---
**Author:** ![Falchion](https://avatars.discourse-cdn.com/v4/letter/f/a88e57/32.png) [@Falchion](https://boards.straightdope.com/u/Falchion)\ **Post date:** [February 12, 2014, 2:22pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/23 "2014-02-12T14:22:47Z")
> [@flatlined](#): > > I’m having problems understanding this. When one is selling a home, they take all of the personal stuff out. This allows the potential buyers to imagine their stuff there and how it would fit. That was not my experience buying a home (either time). Some homes were empty, but most of them were furnished (although there was certainly an effort made to reduce clutter). Much of the truly personal effects (pictures, etc) were gone, but I assumed that was more to protect against creepy people. That being said, I do not understand how this reduced property values for black owners in white neighborhoods is supposed to work. It makes absolutely no sense to me. The racist explanation for why black neighborhoods have lower property values is the black _neighbors_. People aren’t afraid of catching residual blackness. (Also, I have no idea the race of any of the previous owners of my house, maybe I should have checked? Or does my whiteness absolve the home of any potential loss?) ---
**Author:** ![Steve\_MB](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/steve_mb/32/5339_2.png) [@Steve\_MB](https://boards.straightdope.com/u/Steve_MB)\ **Post date:** [February 12, 2014, 2:31pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/24 "2014-02-12T14:31:30Z")
> [@Shalmanese](#): > > The 40% disparity in income does not seem to account for the 95% disparity in net worth. Say what? Given the obvious fact that people have to spend a certain minimum amount to maintain a bare-bones lifestyle, the percentage difference in money over and above that amount (i.e. money available for building net worth) is greater than the percentage difference in total income. ---
**Author:** ![Fuzzy\_Dunlop](https://avatars.discourse-cdn.com/v4/letter/f/848f3c/32.png) [@Fuzzy\_Dunlop](https://boards.straightdope.com/u/Fuzzy_Dunlop)\ **Post date:** [February 12, 2014, 2:32pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/25 "2014-02-12T14:32:00Z")
> [@aldiboronti](#): > > I’m still not seeing how racism would lower the value of your home. Do you mean that some people would not want a house that was owned by an African-American? I guess maybe with KKK types that may be true but the majority of sane people wouldn’t care at all. I can’t believe they would not buy somewhere they liked because there were a few African objets d’art on the wall. I think that’s pretty clearly what **nevadaexile** is suggesting, but I agree it’s just not how it works. White racists don’t like living _near_ black people. As long as **nevadaexile** is the one moving his home isn’t going to be devalued on account of his blackness. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [February 12, 2014, 2:44pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/26 "2014-02-12T14:44:47Z")
Alot of most people’s wealth is tied up in their homes. Much of that wealth was lost when the housing bubble popped. Different ethnicities were affected differently, from the peak value during the bubble to the lowest value after the bubble, hispanic households lost 46.2% of home value, black households lost 32.3%, while households lost 23.6%, and asian households 19.9%. Thus there are alot more hispanic and black households that are underwater on their houses. The reason for this is a combination of geography and a lack of creditworthiness. ---
**Author:** ![Human\_Action](https://avatars.discourse-cdn.com/v4/letter/h/ac91a4/32.png) [@Human\_Action](https://boards.straightdope.com/u/Human_Action)\ **Post date:** [February 12, 2014, 3:00pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/27 "2014-02-12T15:00:21Z")
> [@monstro](#): > > I highly recommend you listen to the This American Life episode entitled [House Rules](http://www.thisamericanlife.org/radio-archives/episode/512/house-rules). It nicely sums up exactly how the biggest promise of the “American Dream”–home ownership–was snatched away from black Americans. That’s surely a major factor; renting doesn’t build net worth, after all. [Per the Department of Commerce](http://www.census.gov/housing/hvs/files/currenthvspress.pdf), home ownership rates, fourth quarter 2013 (table 7) White non-Hispanic - 73.4% Black - 43.2% Hispanic - 45.5% All other races - 56% ---
**Author:** ![davida03801](https://avatars.discourse-cdn.com/v4/letter/d/b5e925/32.png) [@davida03801](https://boards.straightdope.com/u/davida03801)\ **Post date:** [February 12, 2014, 3:03pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/28 "2014-02-12T15:03:29Z")
I’m cynical on this. In my view this is exactly the way the government, and especially liberals and dems, want them to be. Keep em poor, strung out on government benefits, and on the liberal plantation. ---
**Author:** ![Human\_Action](https://avatars.discourse-cdn.com/v4/letter/h/ac91a4/32.png) [@Human\_Action](https://boards.straightdope.com/u/Human_Action)\ **Post date:** [February 12, 2014, 3:09pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/29 "2014-02-12T15:09:39Z")
> [@davida03801](#): > > I’m cynical on this. > > In my view this is exactly the way the government, and especially liberals and dems, want them to be. Keep em poor, strung out on government benefits, and on the liberal plantation. Ok. Why? Will they not vote for the party that helped lift them out of poverty? Will others not vote for the party that slashed crime by attacking poverty? What’s the upside for having poor people here? ---
**Author:** ![iiandyiiii](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/iiandyiiii/32/7924_2.png) [@iiandyiiii](https://boards.straightdope.com/u/iiandyiiii)\ **Post date:** [February 12, 2014, 3:17pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/30 "2014-02-12T15:17:33Z")
> [@davida03801](#): > > I’m cynical on this. > > In my view this is exactly the way the government, and especially liberals and dems, want them to be. Keep em poor, strung out on government benefits, and on the liberal plantation. Your view is incorrect, at least for me and all the other ‘liberals and dems’ I know. ---
**Author:** ![jayjay](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jayjay/32/6765_2.png) [@jayjay](https://boards.straightdope.com/u/jayjay)\ **Post date:** [February 12, 2014, 3:27pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/31 "2014-02-12T15:27:43Z")
> [@iiandyiiii](#): > > Your view is incorrect, at least for me and all the other ‘liberals and dems’ I know. But it’s an article of conservative faith, so no amount of protestations or offerings of evidence otherwise will convince. After all, the only way to actually lift someone out of poverty is complete neglect. /wingnut ---
**Author:** ![ITR\_champion](https://avatars.discourse-cdn.com/v4/letter/i/c67d28/32.png) [@ITR\_champion](https://boards.straightdope.com/u/ITR_champion)\ **Post date:** [February 12, 2014, 4:01pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/32 "2014-02-12T16:01:10Z")
> [@davida03801](#): > > In my view this is exactly the way the government, and especially liberals and dems, want them to be. Keep em poor, strung out on government benefits, and on the liberal plantation. I think you’re wrong. Liberals and Democrats want to help poor Blacks and Hispanics rise out of poverty. Liberals and Democrats pass laws, regulations, programs, and policies which they think will accomplish that. But the laws, regulations, programs, and policies don’t actually do what their authors claim they’ll do. Welfare, affirmative action, “busing” to achieve racial integration, and huge housing projects are a few of the more obvious examples. All have hurt the people that they were intended to help. ---
**Author:** ![monstro](https://avatars.discourse-cdn.com/v4/letter/m/ba9def/32.png) [@monstro](https://boards.straightdope.com/u/monstro)\ **Post date:** [February 12, 2014, 5:07pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/33 "2014-02-12T17:07:46Z")
> [@ITR\_champion](#): > > I think you’re wrong. > > Liberals and Democrats want to help poor Blacks and Hispanics rise out of poverty. Liberals and Democrats pass laws, regulations, programs, and policies which they think will accomplish that. But the laws, regulations, programs, and policies don’t actually do what their authors claim they’ll do. Welfare, affirmative action, “busing” to achieve racial integration, and huge housing projects are a few of the more obvious examples. All have hurt the people that they were intended to help. I’d absolutely love for you to produce some cites showing that these policites have not helped. We can both trade examples/anecdotes that lend support to both sides of the argument. But what does research bear out? Do you even know? If we had no Affirmative Action, would the wealth disparity between blacks and whites be bigger or smaller? On what basis do we make either claim? It seems to me that it’s impossible to answer this quesion with any confidence since we do not have access to the alternative universe that doesn’t have Affirmative Action. But maybe you know something the rest of us don’t? ---
**Author:** ![even\_sven](https://avatars.discourse-cdn.com/v4/letter/e/dfb087/32.png) [@even\_sven](https://boards.straightdope.com/u/even_sven)\ **Post date:** [February 12, 2014, 5:28pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/34 "2014-02-12T17:28:32Z")
Poverty creates it’s own adaptive strategies, which often don’t transfer well to wealth. There can be a considerable lag in adapting to new circumstances. To give an example, I grew up in a family that considered investing in stocks to be dangerously reckless. If we invested at all, it was treasury bonds and CDs. And this makes sense. When your savings are low, you don’t want a risky portfolio. But of course with any wealth, investing is one of the best ways to grow that wealth. But to me, it’s still an exotic thing that “other” people do. I don’t have an idea of where to start and I can’t bounce ideas off my family or draw on their experiences. Just one example, but there are many. ---
**Author:** ![davida03801](https://avatars.discourse-cdn.com/v4/letter/d/b5e925/32.png) [@davida03801](https://boards.straightdope.com/u/davida03801)\ **Post date:** [February 12, 2014, 6:34pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/35 "2014-02-12T18:34:24Z")
As I said it is the cynic in me that made that comment, but think of it in another way. Medieval lords really did not want the serfs rising up too much, as they were needed to do all the grunt work of the princedom, work the fields, common labor and cannon fodder when needed. The serfs remain poor and down trodden and the lords can stay in the high towers. Have things changed all that much ? The lords have changed, but in the end they have the same common interest to keep themselves in the high towers. Meet the new boss, same as the old boss. ---
**Author:** ![Buck\_Godot](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/buck_godot/32/6573_2.png) [@Buck\_Godot](https://boards.straightdope.com/u/Buck_Godot)\ **Post date:** [February 12, 2014, 7:47pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/36 "2014-02-12T19:47:37Z")
> [@Ethilrist](#): > > Maybe it takes $32k to live off of, so the blacks can only save $229, whereas the whites can save $21k and change? It may actually be worse than that. In many ways its [more expensive](http://www.prosebeforehos.com/cultural-correspondent/07/20/why-being-poor-more-expensive-than-being-rich/) [to be poor](http://www.washingtonpost.com/wp-dyn/content/article/2009/05/17/AR2009051702053.html) [than rich](http://robertnielsen21.wordpress.com/2012/11/29/its-expensive-to-be-poor/) ---
**Author:** ![naita](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/naita/32/5862_2.png) [@naita](https://boards.straightdope.com/u/naita)\ **Post date:** [February 12, 2014, 7:59pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/37 "2014-02-12T19:59:00Z")
> [@Fuzzy\_Dunlop](#): > > I think that’s pretty clearly what **nevadaexile** is suggesting, but I agree it’s just not how it works. White racists don’t like living _near_ black people. As long as **nevadaexile** is the one moving his home isn’t going to be devalued on account of his blackness. I think you’re ignoring the fact that racism is emotional, and choosing a house is based on emotions. ---
**Author:** ![ITR\_champion](https://avatars.discourse-cdn.com/v4/letter/i/c67d28/32.png) [@ITR\_champion](https://boards.straightdope.com/u/ITR_champion)\ **Post date:** [February 12, 2014, 8:13pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/38 "2014-02-12T20:13:42Z")
> [@monstro](#): > > I’d absolutely love for you to produce some cites showing that these policites have not helped. We can both trade examples/anecdotes that lend support to both sides of the argument. But what does research bear out? Do you even know? > > If we had no Affirmative Action, would the wealth disparity between blacks and whites be bigger or smaller? On what basis do we make either claim? It seems to me that it’s impossible to answer this quesion with any confidence since we do not have access to the alternative universe that doesn’t have Affirmative Action. But maybe you know something the rest of us don’t? Okay, let’s with [The Painful Truth About Affirmative Action](http://www.theatlantic.com/national/archive/2012/10/the-painful-truth-about-affirmative-action/263122/). The single biggest problem in this system – a problem documented by a vast and growing array of research – is the tendency of large preferences to boomerang and harm their intended beneficiaries. Large preferences often place students in environments where they can neither learn nor compete effectively – even though these same students would thrive had they gone to less competitive but still quite good schools. We refer to this problem as “mismatch,” a word that largely explains why, even though blacks are more likely to enter college than are whites with similar backgrounds, they will usually get much lower grades, rank toward the bottom of the class, and far more often drop out. Because of mismatch, racial preference policies often stigmatize minorities, reinforce pernicious stereotypes, and undermine the self-confidence of beneficiaries, rather than creating the diverse racial utopias so often advertised in college campus brochures. The mismatch effect happens when a school extends to a student such a large admissions preference – sometimes because of a student’s athletic prowess or legacy connection to the school, but usually because of the student’s race – that the student finds himself in a class where he has weaker academic preparation than nearly all of his classmates. The student who would flourish at, say, Wake Forest or the University of Richmond, instead finds himself at Duke, where the professors are not teaching at a pace designed for him – they are teaching to the “middle” of the class, introducing terms and concepts at a speed that is unnerving even to the best-prepared student. The student who is underprepared relative to others in that class falls behind from the start and becomes increasingly lost as the professor and his classmates race ahead. His grades on his first exams or papers put him at the bottom of the class. Worse, the experience may well induce panic and self-doubt, making learning even harder. ---
**Author:** ![monstro](https://avatars.discourse-cdn.com/v4/letter/m/ba9def/32.png) [@monstro](https://boards.straightdope.com/u/monstro)\ **Post date:** [February 12, 2014, 8:26pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/39 "2014-02-12T20:26:49Z")
> [@naita](#): > > I think you’re ignoring the fact that racism is emotional, and choosing a house is based on emotions. A racist person may think, “There’s no way a black person could afford a house that’s priced so high. Something must be wrong with it!” Or they assume a neighborhood, even a predominately white one, that a black person can afford must not be all that. Maybe the white folks in the neighborhood are recovering PWT, given to occasional lapses. Maybe there’s a secret cell of black people somewhere on the block, just waiting to hold a front yard barbeque on the day you move in. There must be SOME reason this black person felt comfortable enough to live here. If the house isn’t crap, the environment must be! Or subconsciously the idea of helping a black person make a profit troubles them, so they make a stingier offer than they would otherwise. If everyone interested in the house has thoughts like this, of course the seller is going to end up taking a hit in the end. I’m not saying that any of this happens. I can’t find evidence that it happens. It’s just that what **nevadaexile** says isn’t _that_ unfathomable to me. In my scroungings for information on the interweb, I found this article about [Airbnb](http://valleywag.gawker.com/harvard-study-black-people-get-screwed-on-airbnb-1505185859). ---
**Author:** ![Strassia](https://avatars.discourse-cdn.com/v4/letter/s/e8c25b/32.png) [@Strassia](https://boards.straightdope.com/u/Strassia)\ **Post date:** [February 12, 2014, 8:37pm UTC](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108/40 "2014-02-12T20:37:29Z")
> [@naita](#): > > I think you’re ignoring the fact that racism is emotional, and choosing a house is based on emotions. And further there is a lot of unconscious bias at work. A potential buyer may offer less for a house with a picture of a black family on the mantle than one with a picture of a white family, just as employers tend to rate resumes with “white” names higher than identical resumes with “black”. The person making the offer may not consider themselves racist, but may just feel like offering a little bit less. [Previous page](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108.md?page=1) [Next page](https://boards.straightdope.com/t/why-do-blacks-and-hispanics-have-such-low-net-worths-compared-with-whites/681108.md?page=3)