Economic Perspectives with Hopeton Hay on KAZI 88.7 FM in Austin, TX

Posts Tagged ‘House Oversight and Government Reform Committee’

The Silent Depression: How are Minorities Faring in the Economic Downturn

Posted by Hopeton on October 19, 2009

On Wednesday, September 23, 2009 at 10:00 a.m., the House Oversight and Government Reform Committee held a hearing titled “The Silent Depression: How are Minorities Faring in the Economic Downturn.” The hearing examined the disparate effects of the current economic downturn on minority populations in the United States, with particular attention on the recent increases in unemployment and home foreclosures. Additionally, the hearing explored the effectiveness of Federal government initiatives in ensuring that minority populations are adequately included in the nation’s efforts toward economic recovery.  Enclosed below is an excerpt from the written testoimony provided by Marc Morial, President of the National Urban League.

The State of Africans Americans in Our National Economy

I do not say this to alarm or inflame.  I am just stating a plain fact based upon our experience that includes decades of service delivery and research.  We see it in the faces of the people who come to us for help each year.  We hear it in the voices of the men and women seeking jobs that just aren’t there.  We feel it in the pain of those who come to us for help in keeping a roof over their heads.

Marc Morial

Marc Morial

And our direct experience is borne out by our empirical research.  Each year, the National Urban League publishes the Equality Index as part of our annual State of Black America report.  The Equality Index is an indicator of the relative status of blacks and whites in America.  It consists of five sub-indices: economics, education, health, social justice and civic engagement. Equality is indicated by an index of 100%, therefore an Equality Index less than 100% suggests that blacks are doing worse relative to whites, and an Equality Index greater than 100% suggests that blacks are doing better than whites. 

According to our 2009 Equality Index, African Americans are at about 71% compared with white Americans.  The Economic Index is 57.4%.

According to our 2009 State of Black America Report: nationally, the typical African-American family today possesses less than 10 percent of the net worth of the average white family; almost 30 percent of black families have zero or negative net worth; and far fewer blacks than whites benefit from inherited wealth or assets.

While this is but a snapshot, it paints a dire picture.  Among other things, it illustrates that African Americans just don’t have the cushion that protects us from economic catastrophe when an economy goes into freefall.  

We are starting to see some hopeful signs in other areas of the economy that indicate we may be turning course.  Of course, the job numbers are a lagging indicator, so we hope that they will begin to improve as other areas of the economy begin to point to recovery.

However, even if this is the case, it does not necessarily mean that the African American community will be out of the woods.  In fact, our long-term research indicates a troubling trend that must be proactively reversed.

Catching Up From the End of the Line

According to our State of Black America 2009, African Americans have been doing progressively worse in each economic expansions.  For example, median household income increased during the 1991 expansion, but declined in the 2001 expansion.  

During the first six years of the 1991-2001 recovery, real median income for African-American households grew by 15.6 percent while the real median income of white households grew by 8.9 percent.   Poverty rates declined by 19 percent and 8.5 percent, respectively.  For the duration of the 1992 expansion, real median household income grew by 23.6 percent for African Americans and by 13 percent for whites, while poverty rates declined by 30.6 percent and 17 percent, respectively.  

Although unemployment declined for both groups during each of the most recent expansions, the six-year decline for African Americans during the 1991-2001 expansion was nearly six times greater than the decline during the 2001-2007 expansion.  For whites, the magnitude of the difference was thirteen times.

Between 2001 and 2007, whites saw a net gain in the rate of homeownership (1.2 percent) while African Americans experienced a net loss (-1.0 percent)

To read the entire written testimony of Morial go to: http://groc.edgeboss.net/download/groc/fullcommittee/testimony-marcmorial.pdf.

To peruse all the written testimony provided at the haring go to http://oversight.house.gov/story.asp?ID=2604.

Posted in African American, Economy | Tagged: , , , | Leave a Comment »

U.S. House Committee Probes Economic Plight of Minorities in Recession

Posted by Hopeton on September 22, 2009

The following was released by the press office of the U.S. House of Representatives Oversight and Government Reform Committee

U.S. Representative Edolphus “Ed” Towns (D-NY), the Chairman of the House Oversight and Government Reform Committee, today announced that the House Oversight and Government Reform Committee is holding a congressional hearing, entitled “The Silent Depression: How are Minorities Faring in the Economic Downturn?” to examine the disparate effects of the current economic downturn on minority populations, with special emphasis on the rise in unemployment and home foreclosures.

Congressman Edolphus Towns

Congressman Edolphus Towns

The hearing, scheduled for Wednesday, September 23, 2009 at 10:00 a.m. in Room 2154 of the Rayburn House Office Building, will feature the heads of several leading minority organizations, including the National Urban League, National Council of La Raza, National Coalition for Asian Pacific American Community Development, National Congress of American Indians and National Black Chamber of Commerce. Also set to testify are the Honorable Raymond Skinner of the Maryland Department of Housing and Community Development, Chief Operating Officer James Carr of the National Community Reinvestment Coalition and Christian Weller, PhD, of the Center for American Progress Action Foundation.

“The inability to find gainful employment has crushed the hopes of achieving the American dream for so many families in minority communities,” said Chairman Towns. “For us to move ahead as a nation, we have to examine why the African-American unemployment rate in several communities more than doubles that of whites. We must also take a look at the high rate of subprime loans and default mortgages within minority communities that are expanding an already enormous debt disparity.”

Although the recession has had devastating consequences for the nation’s economy and a direct effect on nearly every American household, minorities are at least 40 percent more likely to be unemployed than whites, according to a study by the Center for American Progress, with the highest rates of unemployment in the African American population. In states with significant minority populations like New York State, the African American unemployment rate has soared to 15.1 percent, compared to 6.4 percent for whites. In New York City, where minorities make up more than 50% of the population, the rise in unemployment for African-Americans has spiked to four times that of whites, according to a recent New York Times article.

Unscrupulous lending practices may compound the economic crisis, with home foreclosures higher amongst minorities than whites. Since the recession began, home foreclosures increased dramatically, but experts agree that for African-Americans and Hispanics, record foreclosures may be the result of lax enforcement of the Fair Housing Act or reverse redlining, homeownership schemes targeted at minority groups. Wednesday’s Oversight Committee hearing will review these factors.

“The fact of the matter is that the current economic downturn has amplified an already burgeoning economic gap for minorities,” said Chairman Towns. “The role of race in unemployment and other economic trends is something we must analyze because for minorities this is not a recession but is, in fact, a depression that could potentially alter decades of economic progress.”

Posted in African American, Economy, Hispanics | Tagged: , | 1 Comment »

 
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