Care about poverty? You also
need to understand the racial
wealth gap and tax fairness.
Purpose
This training is designed to:
 Review basic information on poverty, inequality,
and the racial wealth gap
Understand the creation and perpetuation of the
racial wealth gap
Learn the policy tools that can
narrow the gap
Answer your questions
What We Do
Creating the political will to end hunger and poverty
Empowering individuals to have breakthroughs in
exercising personal
and political power
Active and engaged
network that builds
relationships with
legislators, media and
local communities
RESULTS Activists
650 active volunteers in about 100 communities
around the country
Everyday people who want to make a difference
In 2014, our activists had…
Over 600 meetings with congressional offices,
including 233 face-to-face meetings with U.S.
House members and 60 face-to-face meetings with
U.S. Senators
438 strategic media placements, including
editorials, Op-eds, and letters to the editor
Over 150 outreach and community events around
the country
In action: the story of LaNae Havens in Albuquerque
Our Approach to Change
Why Do Political Priorities
Matter?
We stand by as children starve by the millions
because we lack the will to eliminate hunger. Yet
we have found the will to develop missiles capable
of flying over the polar cap and landing within a
few hundred feet of their target. This is not
innovation. It is a profound distortion of
humanity’s purpose on earth.
– former Sen. Mark Hatfield (R-OR)
Poverty in America: 1 in 7!
Based on the most recent U.S. Census data,
14.8 percent of Americans were living in poverty
in 2014, or 46.7 million people. The child
poverty rate was 21.1 percent of children, which
amounts to 15.5 million children.
CFED reports that in 2014, the asset poverty
rate in the U.S. was 25 percent.
Child Poverty: Almost 1 in 5!
The child
poverty
rate in
2014 was
21.1
percent, up
from 19.9
percent in
2013.
Liquid Asset Poverty
• Liquid asset poverty: assets that are cash or can
be converted to cash quickly
• More astounding is that the liquid asset poverty
rate was 44 percent.
• This means that nearly one half of all Americans
are only one financial crisis away from poverty!
Growing Income Inequality
Inequality by Race/Ethnicity
Focusing on Income Alone is not
Sufficient to Address Inequality
Racial Wealth Gap Quiz
1. The average top 0.1 percent of
households gets how much in benefits from
homeownership tax programs?
A. $17,276
B. $10,276
C. $3
D. $20,500
Racial Wealth Gap Quiz
1. The average top 0.1 percent of households gets
how much in benefits from homeownership tax
programs?
A. $17,276
The U.S. tax code spends over $540 billion per year
in asset-building programs and incentives, the
overwhelmingly majority of which goes to the
wealthiest families.
Source: http://cfed.org/assets/pdfs/Upside_Down_to_Right-Side_Up_2014.pdf
2014 Wealth Inequality in America
Racial Wealth Gap Quiz
1. In 2014, how much wealth did Black and
Latino households own for every $1 dollar
White households owned?
A. A Black family held 30 cents and a Hispanic
family held 20 cents
B. A Black family held 6 cents and a Hispanic
family held 7 cents
C. A Black family held 4 cents and a Hispanic
family held 7 cents
D. A Black family held 50 cents and a Hispanic
family held 63 cents.
Racial Wealth Gap Quiz
1. In 2014, how much wealth did Black and
Latino households own for every $1 dollar
White households owned?
B. A Black family held 6 cents and a Hispanic
family held 7 cents
Racial Wealth Gap
An Example on Wealth Inequality
Richard and Brigitte Thomas, an African
American couple with two children, earned a
combined income of $115,000 in 2014. In
2000, they decided to purchase a home to
call their own. Their search led them to a
newly constructed house with a yard, priced
at $130,000. To them, this appeared to be a
great opportunity.
Great Recession’s Impact on
Households
Racial Wealth Gap Quiz
3. As of 2013, what is the ratio of Black
wealth to White wealth?
A. 15:2
B. 13:1
C. 10:1
D. 9:1
Racial Wealth Gap Quiz
3. As of 2013, what is the ratio of Black wealth to
White wealth?
B. 13:1
This ratio has actually grown since the Great
Recession. Pew Research Center points out that
financial assets (stocks and investments), which
White families are much more likely to own,
recovered quicker than housing assets.
Source: http://www.pewresearch.org/fact-tank/2014/12/12/racial-wealth-gaps-greatrecession
/
The Savings Gap
Racial Wealth Gap Quiz
4. How many Latino families do NOT hold
financial assets?
A. 1 in 5
B. 1 in 4
C. 1 in 3
D. 1 in 2
Racial Wealth Gap Quiz
4. How many Latino families do NOT hold
financial assets?
C. 1 in 3
Families on the Brink
Racial Wealth Gap Quiz
5. Does education have the most impact on the racial wealth
disparity?
A. Yes- education allows people of color to have equal
access to home loans and stock options.
B. Yes- Latino college graduates fare better than White high
school dropouts in accumulating wealth.
C. No- education fails in providing people of color with
opportunity.
D. No- more educational attainment alone will not
significantly close the racial wealth disparity.
.
Racial Wealth Gap Quiz
5. Does education have the most impact on
the racial wealth disparity?
D. No- more educational attainment alone
will not significantly close the racial
wealth disparity.
Education as the Vehicle of
Opportunity?
A Black college graduate or a
Latino college graduate, on
average, owns less wealth than a
White high school dropout.
Racial Wealth Gap Quiz
6. What is the single largest driver of the
racial wealth gap?
A. Inequities in education
B. Inequities in homeownership
C. Inequities in income
Racial Wealth Gap Quiz
What is the single largest driver of the racial
wealth gap?
B. Inequities in homeownership
Racial Wealth Gap Quiz
Which of the following is considered the
most significant cause of the racial wealth
gap?
A. Lack of educational attainment.
B. Racially-motivated/discriminatory
public policies.
C. The housing bust of 2007.
D. Natural occurrences with such a
diverse country.
Racial Wealth Gap Quiz
Which of the following is considered the most significant cause
of the racial wealth gap?
B. Racially-motivated/discriminatory public policies.
It is easy to assume that this wealth gap is because people just
do not attain enough education, or earn enough, or that it just
happened. But history shows that policies at the federal, state,
and local levels (especially housing policies) explicitly or
implicitly denied communities of color access to wealth building
opportunities that were available to White Americans.
Source: http://www.epi.org/publication/modern-segregation/
Racial Wealth Gap Quiz
9. What percentage of Black workers
weren’t included in the original Social
Security Act created by FDR?
A. 65 percent
B. 50 percent
C. 25 percent
D. 80 percent
Racial Wealth Gap Quiz
What percentage of Black workers weren’t
included in the original Social Security Act
created by FDR?
A. 65 percent
Exclusionary Policies- Savings
The Social Security Act of 1935
Immense success at lifting millions of older
Americans out of poverty
At its creation, excluded domestic and
agricultural workers
Consequently, 65% of Black workers excluded
and weren’t included until 1954
Racial Wealth Gap Quiz
What is redlining?
A. A practice that denies or charges premium
prices for mortgages and other services in
certain neighborhoods, specifically those of
color.
B. A federal tax program that only helps
upper middle income Americans buy a home.
C. A secret agreement between realtors and
White homeowners that prohibited the
purchase of property by Blacks.
Exclusionary PoliciesHomeownership
G.I. Bill
Huge influence in the creation of the middleclass and rapid homeownership
 Did not prevent banks’ discriminatory policies
Suburb exclusion
Still impacts wealth today
Access to credit
Subprime mortgages
Redlining
Continued Example
The Thomas’ obtained a subprime
mortgage—a type of loan frequently
targeted towards buyers in neighborhoods of
color—and had to refinance multiple times to
obtain a mortgage with a fixed interest rate.
Like most other houses in the neighborhood,
the value of Thomas’ home has been wildly
volatile, swinging from $172,000 in 2007 to
just over $100,000 in 2015. The combination
of the subprime loan and unstable home
values has impacted the Thomas family’s
ability to build wealth. Their neighborhood
public schools are ranked the lowest
possible by a school ranking website.
Income Equality Won’t Close
Racial Wealth Gap
Racial Wealth Gap Quiz
10. How can we begin to close the racial
wealth gap?
A. Equalizing homeownership rates
B. Fair tax policies
C. We can’t close it.
D. A & B.
Racial Wealth Gap Quiz
10. How can we begin to close the racial wealth
gap?
D. A & B!
It will take intentional public policies- both within the
housing and tax spheres- to be able to begin the
decreasing gap.
But it can happen. Luckily we have you to help make
it happen!
Source: http://www.newrepublic.com/article/118425/closing-racial-wealth-gap
Homeownership’s Role in Wealth
Current Tax Policy Widens the Gap
Tax policy is a critical tool in the toolbox of policies that
can decrease the wealth gap.
Earned Income Tax Credit and
Child Tax Credit
The Earned Income Tax Credit (EITC) is a
federal tax credit for low- and moderateincome working people. It encourages and
rewards work as well as offsets federal
payroll and income taxes.
Child Tax Credit (CTC) helps working
families offset the cost of raising children.
It is worth up to $1,000 per eligible child
(under age 17 at the end of the tax year)
EITC and the CTC Make an
Impact
Long Term
Impacts of the
EITC and CTC
The Real Effects of EITC
Andy Trujillo, RESULTS Volunteer on EITC:
 “I don't remember getting many presents, but I still remember
tax time. For my little brother and me, it was almost like
Christmas. Because of the Earned Income Tax Credit, it was
the only time of year we didn't have to worry about money.”
 “I thought my employees made a decent wage and could
support their families. But now I realize it's really hard for
some of them. They say, "I can't wait until tax time." A lot of
them work paycheck to paycheck. After they receive the
Earned Income Tax Credit or the Child Tax Credit, they can
catch up. They can finally fix their car or their broken washing
machine and get a sense of relief. I've learned that just
because somebody has a job, doesn't mean that they don't
struggle.”
The Real Effects of EITC
Quanda Burrell, a single mother of two, works
full time as a day-care teacher, earns $24,000 a
year, and juggles the bills that inevitably pile up
in her Boston home. But during tax time, she
can “clear the slate,” paying her debts with an
income tax refund bolstered by an $800 state
credit.
Source: http://www.bostonglobe.com/business/2015/03/04/momentum-buildsraise-state-earned-income-tax-credit-for-low-incomeworkers/9Ic8MGKXDEIqg21YaE0H7I/story.html
Any questions?