Amara Omeokwe
Sun 27 October 2024
(Bloomberg) -- Kamala Harris is seeking to persuade Black Americans that she can narrow America’s centuries-old racial wealth gap, a task that’s become urgent as Donald Trump makes inroads with a group that could tip the presidential election.
Harris in recent weeks has tried to tailor her broader vision of an “opportunity economy” — including support for first-time homeowners and would-be entrepreneurs — and talk up the benefits for Black men in particular. Her campaign website promises measures to give them “the tools to build wealth and achieve financial freedom.”
It’s a move aimed at bolstering support in a core Harris constituency as the knife-edge contest nears its end. Black Americans lean strongly toward Democrats, but some recent polls suggest the vice president – who’d become the first Black woman to lead the country if she wins – may struggle to rack up the numbers that recent party candidates have managed.
A New York Times/Siena survey this month found her support among Black men is down 15 points compared with the backing for President Joe Biden in 2020. The latest Bloomberg/Morning Consult survey of swing-state voters shows Harris supported by 77% of Black men compared with 88% of Black women, though both numbers have climbed since she replaced Biden atop the ticket.
The Harris campaign points to a platform that it says will improve the balance of racial wealth. For all the signs of progress in recent years, the gap has remained stubbornly wide.
‘President for Everybody’
The vice president is promising forgivable government loans of up to $20,000 to help entrepreneurs start businesses, and down-payment assistance for new homebuyers. Since Black Americans are under-represented in both categories – as home and business owners – the Harris campaign says they’d be among the biggest winners.
“I am running to be a president for everybody,” Harris said earlier this month at an event with Charlamagne tha God, co-host of the radio program The Breakfast Club, which is popular with Black audiences. “But I am clear-eyed about the history and the disparities that exist for specific communities, and I’m not going to shy away from that.”
Trump’s pitch to Black voters invokes the pre-pandemic economy he presided over, when prices were lower and sentiment more upbeat. Trump also says his proposed crackdown on immigration will help Black voters by easing pressure on jobs.
In the swing state of Michigan, Rhuben Crowley Jr. is a Black voter who’s open to both arguments. Active in Detroit politics but undecided who to vote for this time — if anyone — he went to a recent Trump rally to try to make up his mind.
Crowley echoes voters in general with his focus on the economy, calling it a “major, major, major” election issue. “Blacks are being locked out of the economy,” which was better under Trump with lower gas prices, he said.
He’s also hesitant to trust Harris’ proposals aimed at Black men because he blames her for the flow of migrants across the southern US border, which he said has cost his community jobs — echoing Trump’s rhetoric. On the other hand, Crowley says he doesn’t feel the former president has a plan specifically for Black Americans.
‘The Only Way’
Targeted policies are essential because the racial wealth chasm has persisted through good economic times and bad, say some economists who’ve studied the issue.
Biden’s administration highlights the rise in black wealth in recent years. Between 2019 and 2022, the wealth of the average Black family jumped more than 60%, according to Federal Reserve data. At the end of that period, the wealth gap between the median Black and White households — when measured as a ratio – was the narrowest in two decades.
In straightforward dollar terms, though, the gap rose by some $50,000 over the three-year period, to around $240,000 in 2022. That’s because the typical Black family had less wealth to begin with.
The size and persistence of wealth disparities have spurred some experts to call for fixes less timid than anything offered so far – such as reparations for historic slavery.
“The bottom line here is we have not given enough attention to substantial monetary transfers for the purposes of asset growth,” says William “Sandy” Darity, an economist and professor of public policy at Duke University and leading scholar on the topic. “Whether or not you call it reparations, the only way to alter these circumstances is through some form of direct transfer of resources to Black Americans.”
Asked about reparations during the event with Charlamagne tha God, Harris said the issue “has to be studied” and turned the conversation toward her “immediate plan” focused on small businesses, housing and other proposals.
‘Change the Fundamentals’
Home ownership has long been central to this policy debate, since it’s a major driver of household wealth. Just 45% of Black Americans owned their home as of June, versus 74% of Whites – and the gap has hardly shifted since the Fair Housing Act, a landmark measure to prohibit discrimination, was passed in 1968.
Harris’ platform includes as much as $25,000 in down-payment assistance “for first-time homebuyers who lack inherited wealth,” in the form of a tax credit. Citing a Moody’s analysis, the Harris campaign says the number of first-time Black homebuyers would more than triple per year by the end of her first term. She’s also promised steps to boost housing supply.
“In order to begin to address the racial wealth gap, you’ve got to change the fundamentals of housing affordability broadly,” says Jim Parrott a nonresident fellow at the Urban Institute who has informally advised the Harris campaign.
Housing is far from the only measure that matters, as both campaigns make pitches to Black voters that rely on their achievements while in office.
Household incomes and weekly pay for the group rose on Trump’s watch, says Janiyah Thomas, spokeswoman for the ex-president’s campaign. “A second Trump term would build on this progress by expanding access to capital for Black entrepreneurs, offering more job opportunities and driving growth in underserved areas.”
She also points to the so-called opportunity zones created under Trump’s 2017 Tax Cuts and Jobs Act, saying they drew employment and investment to Black communities.
Tony Jones says his barber shop in Cleveland sits in one of those zones — as well as an “opportunity corridor” that local officials have touted as a way to spur investment in the city’s predominantly Black eastern neighborhoods. But the 65-year-old says he hasn’t seen much benefit from that: Business is slow. He’s already cast an early ballot for Harris.
Jones says his vote was largely one against Trump, who he argues has offered very few firm ideas. “I’ve got a hundred dollars in my pocket that I’ll mail to you if you could tell me what platform Trump is standing on,” he says. “Tell me one platform that Trump ran on other than try and over-talk and disgrace his competitor.” He notes that many Black men are wary of Harris’ past as a prosecutor, but likes what he’s heard of her economic plans.
‘Systematically Lower’
In addition to her new proposals, Harris’ campaign leans on the Biden administration’s track record. Officials point to strong wage gains for Black Americans, a long stretch of low Black unemployment during the post-pandemic recovery and a surge in the number of Black-owned small businesses.
Lael Brainard, a top economic adviser to Biden, also highlights efforts to combat bias in home appraisals. Fairer valuations would allow Black Americans to tap more equity in their homes, she said in an interview.
“If appraisals are systematically lower in those communities because of bias, then essentially it is preventing the kind of wealth building that has been so meaningful for intergenerational advancements in opportunity,” Brainard said.
Questions remain over the focus on home ownership and whether it comes at the expense of more liquid kinds of wealth that can be used to buy property but also for other things such as college fees. The racial gap in ownership of financial assets like stocks and bonds is even wider than for housing.
Darrick Hamilton, an economist and professor at the New School who’s written extensively on the wealth gap, says the Harris proposals lean in the right direction, by focusing on directing investment and capital toward Black Americans. It’s a step away from “that personal responsibility narrative that’s often directed specifically at Black people, often at Black men in particular,” he says.
“What remains to be seen, for her and any political candidate,” says Hamilton, “will be the actual policies to accompany once in office.”
--With assistance from Shawn Donnan and Hadriana Lowenkron.
©2024 Bloomberg L.P.
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