Heather McGhee explores the price everyone pays for economic and social inequality
CRAIN’S: In âThe Sum of Us,â you tell of being born in Chicago and living on the South Side. Chicago has played a central role in black history in the United States, where economic successes and woes have taken place. What did your stay in Chicago tell you about how much racism costs everyone?
MCGHEE: My time in Chicago taught me about inequality. I grew up when the thriving black working middle class of the South Side was starting to split when public sector cuts and deindustrialization and loss of manufacturing jobs really hit the black middle class hard and the economy gangs and the drug economy were starting to take hold. I also moved to the south side to Evanston and saw some really well funded schools and parks for the first time and went to some white friends and saw what it was like to have a wife from housekeeping and a kitchen full of all the snacks. We had cousins ââwho had lost everything and who were struggling. We had cousins ââwho made him relatively tall. So there was this feeling that economic misfortune or fortune could happen to anyone, and I didn’t grow up believing that if you had more money, it was because you wanted more. I think it shaped my sense of economic justice and fairness. I didn’t believe in the dominant story, certainly in the 90s, that people in poverty made bad choices. So I looked for a deeper answer to what was going on and why poverty existed, and I looked for structural reasons, not individual reasons.
Why is it difficult for whites to see how much racism is costing them?
The zero-sum mindset that creates a us and them and tries to accumulate benefits on one side and costs on the other is trying to create direct competition. It also makes it harder for many white Americans not to feel threatened by racial justice, advances in racial equity, even the presence of people of color. But it is also more difficult for people to see that racism is not structural racism, and disadvantage has costs for them as well.
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Part of the problem is that the desire to downplay historic illiteracy and racial illiteracy means that often people downplay the extent of racism in our politics or policy making. We don’t want to know how widespread it has been and continues to be.
As an expert on the US economy, what remedies would you recommend to level persistent economic inequalities?
To me, it’s all about wealth – home equity, savings, securities, retirement – that’s where the story shows up in your portfolio. The average black family gets 13 cents for every dollar of wealth held by the average white family. It’s not about working hard or getting more education or any of those individualized issues or factors. These are past and present public policies. We can see this in the fact that the average black college graduate has less wealth than the average white high school dropout. For me, the political answer is that because public policy created this problem, public policy can solve it.
The murder of George Floyd sparked a wider awareness of systemic racism and the depth of the racial economic divide. So, a year later, have you seen the responses so far in Minneapolis as just a moment or the start of a lasting movement?
It is a lasting movement. Tens of millions of people took to the streets, realized, were unwilling to stay in the dark about the truth about American racism. This resulted in massive voter turnout, especially among black youth. It got a lot of voters to take action, and we have a multiracial anti-racist majority in this country. For the first time in American history, it can be said. It has absolutely changed the policy proposals emanating from Washington. Yesterday I spoke to the House Ways and Means Committee, and the whole conversation was about fairness. They were thinking of the tax code, which is one of the most unequal pieces of our public policy infrastructure. Black families pay more of their income in taxes than the millionaire-billionaire class. It’s just wrong.
Talk a bit about what you see in the current US economy with the return of inflation, a billionaire class whose wealth is exploding as reports show signs of a patchy recovery among US consumers.
Our economy is as healthy as our families are. And our families are in trouble. They racked up debts on utility bills and rent payments during the pandemic. They have lost jobs that we have not yet recovered. So when you look at inflation, it cuts down on things like airline tickets. I am not worried about inflation. If you look at the categories where inflation is, it really isn’t about runaway. We still don’t have most families who can make ends meet. We are still over-indebted. We now have an even more concentrated climate, where so many small businesses have had to close their doors and where big giants like Amazon are even more powerful.
The fundamentals of our economy still need work. This is why the American Jobs Plan and the American Families Plan, which say, as a people, that we have to take care to be the backbone of our economy, and that has to be compensated for. We need new green jobs because we need our economic growth not to destroy our planet. We need paid family leave because we are in an advanced society. We can’t just turn the lights back on and expect the chips to fall where they can, because the chips all end up at one end of the table.
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