A House Divided

[MikeM]

Why do middle-class blacks have far less wealth than whites at the same income level? The answer is in real estate and history.

By Thomas J. Sugrue

A few years ago, I met Roosevelt Smith. He still owned my parents’ old house on Detroit’s West Side, which was a rental property by then, and he gave me a tour. It was in good shape—pretty much the same house that my parents sold, but with newly refinished floors and some new kitchen cabinets and tiles and the garage out back. He’s a resourceful guy who bought a second, larger house nearby—another asset, a nest egg for the future. But together, the two houses aren’t worth much. The median listing price for homes in Detroit is now just $21,000, or about the cost of a Chevy Malibu—and, like the car, likely to depreciate in value from the moment you buy it. Detroit’s population has fallen from 1.85 million in 1950 to a little more than 700,000 today, and as population falls housing demand falls with it. Today, nearly every block has abandoned homes on it. The Smiths probably have more in household assets than the $4,955 median for black families, but not a lot.

http://www.washingtonmonthly.com/mag...ided042051.php

[Lowell]

A good question MikeM. Sugrue's article is a painful but accurate analysis of the way things are and while cast around racial demographics, what is said is true more broadly. Sugrue, whose book "The Origins of the Urban Crisis" was voted best book about Detroit by this forum some years back, pretty much answered the racial question, chapter, line and verse, in that book.

Beyond racism, the cards are generally stacked against all in the working middle class whose wages have stagnated or declined for three decades now. Minorities, who have always been the 'canaries in the mine' of the American economy, continue to be hit first, hardest and longest. But the dominoes are falling on the majorities too.

The labor movement which played a big role in creation of and the movement to the middle class has been weakened to near impotence largely as a result of free flight of capital across state and international borders and increasing growth of automation and sophistication of technology.

We are evolving into an increasingly rich upper class, a well-paid technocratic upper middle class, a wage-declining lower working class [think Walmart now the country's largest single employer] and a growing 'useless' class [not as humans but useless to the needs of the economy] for which there are no economic roles.

That area between the technocrat class and the lower middle class, where the traditional middle class existed, is being squeezed out of existence and demoted to the lower middle working class.

In this month's WIRED magazine has an insightful article Robots Are Already Replacing Us that basically shows the even the technocrat class has much to be alarmed about.

[5speedz34]

Hasn't Wal-Mart been the nation's largest employer for quite some time now?

It's really sad, in a lot of ways we are living in the 21st Century Gilded Age. Both my parents are attorneys and their combined income is within the top 5% but I'm convinced I won't make as much as they did in their lifetimes which is really sad.

I've been thinking I need to get a Master's Degree/Law Degree after I wrap up my bachelor's but the market is terrible for attorneys nationwide. It's just a sad state of affairs right now. Supposedly this is now the 'knowledge' economy but I'm not convinced there are jobs.

[Hermod]

Hasn't Wal-Mart been the nation's largest employer for quite some time now?

It's really sad, in a lot of ways we are living in the 21st Century Gilded Age. Both my parents are attorneys and their combined income is within the top 5% but I'm convinced I won't make as much as they did in their lifetimes which is really sad.

I've been thinking I need to get a Master's Degree/Law Degree after I wrap up my bachelor's but the market is terrible for attorneys nationwide. It's just a sad state of affairs right now. Supposedly this is now the 'knowledge' economy but I'm not convinced there are jobs.

Law schools should have limited their enrollment as did medical schools. We now have a wretched excess of lawyers all busy chasing the same ambulances.

[poobert]

Law schools should have limited their enrollment as did medical schools. We now have a wretched excess of lawyers all busy chasing the same ambulances.

http://www.youtube.com/watch?v=0u9JAt6gFqM

[Hermod]

http://www.youtube.com/watch?v=0u9JAt6gFqM

My granddaughter [[the one we don't talk about) is a lawyer. She is quite successful and works for a large and well-established law firm doing mostly corporate law. I remember talking with her when she was in law school. She said that she really had to excel and get top grades because her law school wasn't the most prestigious and the top law firms would only recruit her if she go the best grades [[which she did). She said that if she didn't get into a great law firm, she would just have to "hang out my shingle and starve to death".

[Eber Brock Ward]

5speedZ34,

As a guy that many moons ago had both a Lumina and a Monte Z34, and a practicing lawyer, I implore you to check out Professor Paul Campos' law school scam blog and the law school transparency program's website.

Simply put, the overarching theme is that most schools are negative expected value for most people.

[MidTownMs]

Why do middle-class blacks have far less wealth than whites at the same income level? The answer is in real estate and history.

By Thomas J. Sugrue

Are you referring to the Black middle-class in Detroit or nationwide?
http://www.washingtonmonthly.com/mag...ided042051.php

Are you referring to the Black middle-class in Detroit or nationwide?

[Hermod]

Are you referring to the Black middle-class in Detroit or nationwide?

It is nationwide. As an anecdote, I have counseled young black officers in the military who were "making it". The concept that they should be placing extra money every year in buying stocks like Coca-Cola, Heinz, or Proctor and Gamble wit their loose change was just not on their radar. Some of them, after talking with me, began a low risk investment plan, but no one had ever given them to see the world in this light before. Culturally, they had equated success with "stuff" rather than capital. The education system 9and the media) do a very poor job of explaining the velue of capital for success.

[MikeM]

Are you referring to the Black middle-class in Detroit or nationwide?

I'm not referring to anyone; the author is.

[renf]

Thomas Sugrue wrote an impressive essay about why middle class blacks
have fewer assets than middle class whites. His essay is specific to Detroit but many blacks in other metropolises face a similar challenge because of declining
property values in cities and metropolises with declining population. The situation may be quite different in the rapidly growing metropolises of the South, especially those in which increasing population is driving up home values.