Some Historical Reasons for the Racial Wealth Gap
African Americans and other minorities hold far less wealth than whites. But why should the wealth gap
be so large, greater even than the racial income gap? It turns out that government has played a central
role. Throughout U.S. history, countless specific laws, policies, rules, and court decisions have made it
more difficult for nonwhites to build wealth, and transferred wealth they did own to whites. Here are some
examples
Native Americans:
 When European settlers came to the U.S., Indian tribes in general did not
consider land to be a source of individual wealth. Europeans believed land
was owned by individuals and used it to generate private profit
 Over 400 treaties signed in first century of U.S.
o Indians forcibly removed from land
 1862 Homestead Act
o Transfers vast amounts of land from Indian tribes to white homesteaders giving any

white family 160 acres of land for free if they farm it for 5 years
Legal concept of "trust responsibility" for Native nations
o
o

Dawes Act of 1887
o

Money from sale of land or natural resources placed in trust fund and managed for
"best interest of tribes"
Government mis-management rampant, but tribes aren't allowed to fire manager
Pressure Indians to assimilate; breaks up reservations into individual plots and force
Indian to farm "western" style; "surplus" land sold to whites (millions acres transferred
from Native Americans to whites)
1953 – U.S. government terminates trust status of tribes
o
Supposed to free Indians from government control but also included loss of tribally
held land
African Americans:
 From earliest years of European settlement until 1860s, African American
considered assets for their owners – bought and sold, created more wealth
from slaves' children
 Slaves and their labor basis of wealth creation for plantation owners, people
who owned and operated slave ships, and companies that insured them
 End of Civil War
o
o



o
1883 – Supreme Court overturned Civil Rights Act of 1875 which had given
blacks right to protect themselves and their property
By 1900 – southern states passed laws that keep African Americans separate
and unequal
Some African-American families and communities prosper despite all this, but
often targets of vigilantes – destroy homes, businesses, lynching
o

Freedmen's Bureau and occupying Union Army – distribute land to ex-slaves – "Forty
Acres and a Mule"
Freedmen's Bureau disbands after seven years – most land of slaves returned to
former white owners
Slaves become sharecroppers – perpetually in debt
Example: African-American business district in north Tulsa, known as "Black Wall
Street," torched on June 21, 1921 by white rioters – destroyed about 600 black-owned
businesses
New Deal
o
African Americans often barred from new asset-building programs benefiting whites:

Significant black occupations of domestic and agricultural work excluded from
Social Security, unemployment insurance, and minimum wage.

Post WWII:
o
Veteran benefits, such as GI Bill of Rights provide little benefits for Blacks because so
many colleges don't accept them; housing discrimination means less benefits for low
interest mortgages.
Latinos:
(example here mostly about Mexico and Mexicans – largest Latino population in us and the one with the
longest particular history)

1824 Monroe Doctrine
o






Promised newly independent nations of Latin America "protection" from European
powers, but actually allowed U.S. to intervene and political and economically dominate
Mexico and Central and South America causing "push and pull" for people in and out of
U.S.
Mexicans and Anglos fight together to free Texas from Mexican rule creating
"lone Star Republic of Texas" – annexed to U.S. in 1845.
1848 – Treaty of Guadalupe Hidalgo – gives U.S. half of Mexico's land – land
transferred from Mexicans to Anglos – racial categories used to determine
who can obtain land
1924 – first U.S. Mexico border patrol; deportations common
During WWII – Bracero program – Mexican workers brought to U.S. to work
for sub-minimum wages, then kicked out when labor not needed
Latino workers disproportionately represented in occupations not covered by
Social Security Act
North American Free Trade Agreement (NAFTA) and Central American Free
Trade Agreement, Free Trade Agreement of the Americas
o
New "incarnation" of Monroe Doctrine – Trade and immigration polities used to
maintain U.S. control over resources and oppress workers
Asian Americans:
 Chinese first large wave of Asian immigrants
o
o
o



Naturalization Act of 1790 limited eligibility for citizenship to "whites"
Many court cases to determine who was white. Lawsuits filed by Chinese, then
Japanese, Indian (South Asian) and Filipino.
Confusing outcomes – South Asians, for instance, classified as Caucasian and white,
then in later cases classified as Caucasian, but not white
Chinese immigrants involved in Gold Rush, but Foreign Miners Tax designed
to push them out of mining
Chinese Exclusion Acts 1882 – first nationality to be denied right to join
"immigrant" nation
Japanese immigration
o
o
o
At first successful farmers and business people.
Resentment leads to 1924 Alien Land Act, prohibited non-citizens from owning land
WWII – 1942 Roosevelt administration forces Japanese Americans to relocate to
internment camps – have a week to sell homes and businesses to whites at "fire sale
prices"
Based on Doubly Divided by Meizbu
Lui
Note what you inherit from your family status,connections (cultural and social capital) $$,
land, etc.