Shapiro on racial wealth gap, Occupy movements
Director of the Institute on Assets and Social Policy shares views on economy
Thomas Shapiro has dedicated his career to closing the racial wealth gap and instituting public policy. The Pokross Professor of Law and Social Policy and director of the Institute on Assets and Social Policy, is also a respected pundit for audiences ranging from the Washington Post to the Village Voice. His books, which have received wide acclaim, include "The Hidden Cost of Being African American: How Wealth Perpetuates Inequality," "Great Divides: Readings in Social Inequality in the United States," and "Black Wealth/White Wealth," with Dr. Melvin Oliver. We sat down with Shapiro to discuss the Occupy movements; why our economy is in trouble; race and wealth and what launched his career passions.
BrandeisNow: Do you feel that movements such as Occupy Boston and Occupy Wall Street are important to create a buzz and open up conversation?
Thomas Shapiro: I don’t think the question is how long into the winter we’re going to see tents in Dewey Square, but how long will the stickiness, the staying power of the conversation around inequality and the kinds of policies that that puts on the table last. I like to put the Occupy movements into a much broader context, which for me is that there is a lot of activity through grassroots organizations in communities that have more people involved than just those in the Occupy movements. They have created space for conversations to happen, created space for people like me to speak to larger audiences than I might otherwise [have the opportunity] to do. It creates cover for policy makers, because they now need to be responsive to a constituency that’s more progressive than the policies that they’re proposing.
Why is the topic of inequality particularly hot right now?
The topic of inequality is hot, I think, because of the Great Recession. We can track it from 2007, with very high unemployment rates, the standard of living declining for many families and rising poverty levels. When a society reaches historic levels of inequality, not only do you see that divergence in fortunes and prospects and inequality but you start to see a lot of ramifications in terms of social issues, the types of threshold problems that go with historic levels of inequality. Income inequality has not been this high since 1929. I do not think that is a random occurrence between two years, one the beginning of the Great Depression and the beginning and the consequence of the recession, the Great Recession that we’re in now.
Who do you feel is responsible for the plummeting economy?
There are 1,000 cuts to this bleeding, but it is also important to figure out and to think through that not all causes are equal. We are, and have been in the midst of a structural adjustment to a different place in the global economy of the United States, something that’s been going on since the early 1970s. I think some part of this is that global structural adjustment which means a lower standard of living, which means a different labor force and all kinds of things. On top of that we get the shock of the foreclosure crisis, which has its clearest roots in predatory lending, speculative investments and lack of regulation in the financial sector. That hits the perfect storm of the economy also starting to go through a recession. This is unofficially the longest sustained Great Recession since the Great Depression. But it’s also part of a longer pattern of what’s been happening with top bracket income taxes, top bracket estate taxes and top bracket corporate taxes, all three of which are at the lowest levels they have been at since 1929, again. The top tax bracket in the 1950s was 90 percent, today the top tax bracket is 35 percent. The top estate tax bracket three decades ago was 55 percent and is down to 35 percent. We’ve created a tax policy that is lopsided in distributing the huge amount of the benefits to those that need it the least, those at the very top.
You began research your research on inequality two decades ago. What first moved you to this?
I was in high school when John F. Kennedy was assassinated and began some exploratory participation in what it was about. As a young boy I witnessed inequality around farm workers in the citrus industry in California and Arizona. A lot of this crystallized when I was a senior in high school and was arrested for something that I did not do. This was in 1964, and the attitude and the politics and the institutions around that time forced me into a situation where I was told not to vehemently protest my innocence of the charge, but to be good about it, to nod, and it would go away. In the process, I was thrown in jail overnight. As a 17 year old [the experience] was simultaneously horrifying and imprinting. It’s about the level of how innocence is not taken as the assumption, how the label sticks, and how difficult it is to right an injustice, and to think about people where real injustices are done.
How and when did you begin investigating the wealth gap?
My interest in wealth inequality started two decades ago, looking at the ways in which the prospects of African American and white and Latino and Asian families differed according to the financial assets and resources of their families, which is something that had not been studied much in the American social sciences.
What prompted your research in race and wealth?
I became involved through an academic and policy project where we were trying to get at the issue of affirmative action. For the first time, in 1984, publicly available information about family wealth became available for researchers and we became extremely excited about a way to crack open a window to the past. Wealth, unlike most other things, is something that can be passed along. We can track the historical legacy of race, possibly through that avenue and it might tell us something — perhaps a new way of looking at racial inequality, certainly a way of assessing affirmative action and policies around race in the United States. It was the moment where the availability of the data matched sort of an intellectual roadblock that we felt the social sciences had come to, and that was a way to unlock it.
You coined the term "transformative assets" while writing “The Hidden Cost of Being African American: How Wealth Perpetuates Inequality” (Oxford Press 2004). It describes the inherited wealth that lifts a family beyond their own achievements and contributing to the wealth gap between working-class and middle-class families and individuals. Will you expand on that?
Whether inherited or earned, for many families, transformative assets have the capacity to lift them above the economic station in which their earnings otherwise would put them, allowing families to live in upper middle class communities when their income might otherwise have put them in a middle class or a working class community; allow families to send their children to private schools to navigate what can be very weak public school systems. That provides thinking about a pathway of how inequality and advantage and disadvantage is passed along through families.
You recently attended a teach-in at Northeastern University, and discussed a number of subjects including the wealth gap. Do you feel we should have a teach-in at Brandeis, and if so, how would you like to see it run?
For me, a teach-in is also a listen in. It’s for the community to come together in a way that shares information and tries to work through some evidence and what to do about that. The structure and format of a teach-in at Brandeis should reflect the values of this community.
Categories: Humanities and Social Sciences