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← How to reduce the wealth gap between Black and white Americans

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Это 4-я версия субтитров, её создал-а Erin Gregory 10/22/2020.

  1. As last recorded
    by the US Federal Government,
  2. the median wealth for a white family
    in the United States was 171,000 dollars
  3. and the median wealth for a Black family
    was just 17,000 dollars,
  4. a 10x different over 150 years
    after the end of slavery.
  5. I think first we have to ask ourselves,
    what is wealth really?

  6. Well, wealth is all of your assets,
    all of the things that you own,
  7. minus all of your liabilities.
  8. Assets are things like your car,
    your house, your savings account,
  9. your checking account, your investments,
    if you own other properties,
  10. your business.
  11. Well, that gap, that 10x gap,
  12. is partially because for many years,
  13. decades in fact,
  14. Black Americans
    were left off of that ladder
  15. and didn't really have access to it.
  16. Well, why are we talking about this now?

  17. Well, in 2020, in the midst of
    a global pandemic and a looming recession,
  18. inequities are really laid bare
  19. across nearly every system
    in the United States:
  20. health care, education,
    criminal justice and finance,
  21. and people were moved
    to take action online, in streets,
  22. in meetings at work,
    in corporate boardrooms.
  23. And I, as a consultant, started
    having conversations with clients
  24. that I thought I would never have.
  25. I guess the question
    that I'd been asking myself is,
  26. how do we make sure that in this moment,
    this results in action and progress
  27. that starts to close that wealth gap
    for Black versus white Americans?
  28. So who am I?

  29. My name is Kedra Newsom Reeves.
  30. I am a consultant
    for banking institutions,
  31. hedge funds, asset managers.
  32. But before any of that,
  33. I am a Black American
    who is the descendant of slaves.
  34. And when we talk about the wealth gap,
  35. it's really important
    to understand the history,
  36. so I thought I'd tell a little story
    about a family, my family,
  37. and how policy intersects with wealth.
  38. So we'll start with
    my great-great-grandfather.

  39. He was a man named Silas Newsom,
  40. and Silas was born a slave
    outside Nashville, Tennessee,
  41. on Newsom Station,
  42. where he and his family
    worked on a quarry.
  43. He didn't own anything.
  44. He didn't own his home.
    He didn't own property.
  45. He didn't really even own his own body,
  46. his own labor, his children.
  47. Any of those things, all of those things,
  48. were here to create wealth
    for someone else.
  49. So we believe that he was a servant
  50. during the Civil War
    for a Confederate general
  51. who was actually fighting
    to keep him enslaved,
  52. so he really had no wealth,
    he had no control over his life.
  53. Well, at the end of slavery,
    there was a policy opportunity.

  54. There was a question:
  55. what do we do for
    the hundreds of years of slavery
  56. now that we are ending slavery
    and the country is coming together?
  57. And there was a choice.
  58. We could make a settlement
    with the slaves,
  59. or we could make a settlement
    with the slave owners.
  60. Well, the slaves had no power
    to advocate for themselves in that moment,
  61. and the country had to be united,
  62. so the federal government decided
    to give that settlement to slave owners,
  63. essentially giving them money
    for the property that they had lost
  64. at the end of the war.
  65. And not their physical property,
    not their homes, but people,
  66. the slaves that had provided
    free labor for years and decades.
  67. So Silas, at the end of the Civil War,
  68. had no wealth.
  69. He was free but had no wealth.
  70. He became a sharecropper.
  71. My great-grandfather Silas was born

  72. a number of years
    after the end of slavery,
  73. and he was drafted to serve in World War I
  74. along with 350,000
    other Black American soldiers
  75. in segregated units.
  76. He served in the war.
  77. When he came back to the United States,
  78. at the end of the war,
    there was very anti-Black sentiment.
  79. The economy was compressing,
    there were a lot of stressors,
  80. and Black people could not get land,
    they could not get loans for homes,
  81. they really could not acquire any credit
    to build wealth over time,
  82. so he also became a farmer.
  83. And he had a son, also named Silas --
  84. there are a lot of Silases in my family --
  85. my grandfather.
  86. My grandfather Silas was also a soldier
    and fought in World War II.

  87. After World War II,
  88. the US Federal Government
    passed the GI Bill,
  89. which provided support for veterans.
  90. And the bill provided
    for building of hospitals,
  91. student loans
  92. and, most importantly for wealth-building,
    low-interest home mortgages for veterans.
  93. In the years following the war,
  94. the GI Bill accounted for
    four billion dollars of funding
  95. to nine million veterans.
  96. But Black veterans
    largely did not benefit.
  97. So Silas, my grandfather,
    came back to Nashville, Tennessee,
  98. and he married my grandmother,
    whose name is Cinderella.
  99. Yes, my grandmother's name was Cinderella.
  100. And they had eight children.
  101. But they never bought a home.
  102. And the highlight of their housing journey
  103. was moving into
    a new public housing project
  104. with their children
  105. and paying rent for that housing project,
  106. which in terms of the quality of housing
    was fantastic for them and a step up,
  107. but did not allow them to build wealth.
  108. My father, another soldier,

  109. a 20-year veteran
    of the United States Marines,
  110. bought his first home in his early 50s,
  111. but it took four generations
    for our family to move into homeownership
  112. and begin to build ownership
    and equity in a home.
  113. That's one family's story,
    and I skipped a lot of things

  114. that happened between
    the end of slavery and today:
  115. redlining, housing discrimination
    before the Fair Housing Act in the 1970s,
  116. the really important role
    that Black-owned banks played
  117. in building Black communities,
  118. the Savings and Loan Crisis of the 1980s,
  119. which crushed a lot of Black banks,
  120. and the subprime crisis in 2008,
  121. which stripped a lot of Black
    and brown homeowners of their homes.
  122. There's a lot of history there,
  123. but that story tells you a bit
    about how we get to this 10x gap
  124. where we are today.
  125. Now, certainly, as we think
    about the size of that gap,

  126. it is critical for the Federal Government
    to take a number of actions.
  127. That said, financial institutions
    play a really important role
  128. in providing access to credit,
    access to capital,
  129. to build communities
  130. and allow Black communities to thrive.
  131. We have to be clear;

  132. managing 17,000 dollars better
    does not get us there.
  133. Better education does not get us there.
  134. Access to credit and capital are critical.
  135. So I want to talk
    about four solutions today
  136. that financial institutions can contribute
    to start to close the wealth gap.
  137. Number one is getting
    more people on the ladder,

  138. getting more people banked.
  139. We know today that
    about half of Black Americans
  140. are un- or underbanked.
  141. Unbanked means that
    you don't have a banking account.
  142. Underbanked means
    that you have a bank account
  143. but you use alternative services
    for check-cashing or payday lending
  144. or paying bills.
  145. And that's not just expensive
    from a transaction perspective
  146. in terms of the fees that you pay,
  147. it's also expensive in terms of the time
    that you commit to paying a bill.
  148. Think about how you pay
    your utility bill today.
  149. It probably comes
    out of your checking account.
  150. You don't even think about it.
  151. You set it up in advance,
    and it's automatic.
  152. Well, if you're unbanked,
  153. you are probably going
    to get a money order somewhere,
  154. physically, a piece of paper.
  155. You then travel to City Hall or your DMV
  156. to pay that bill.
  157. About 40 percent of people
    who are unbanked

  158. say they are unbanked because they think
    they don't have the minimum amount
  159. to really maintain a checking account.
  160. Well, that's just not true.
  161. In the last several years,
  162. credit unions, community banks
    and major banking institutions
  163. have created low-cost, no-minimum
    checking and savings account products
  164. specifically made for this population.
  165. So we have an issue with awareness.
  166. Banks, community partners and others
  167. have to work together to increase
    the awareness of these products
  168. in communities that need them,
  169. so that we can start to reduce
    the number of people
  170. who are un- and underbanked
  171. and get them on the ladder
    that we talked about earlier.
  172. The challenge is about 28 percent
    of Black and Latinx families

  173. are credit-invisible,
  174. which means that you have
    a thin credit file or no credit file.
  175. And the way that credit works
    and creditworthiness assessments work
  176. is to say, if you can prove
  177. that you have paid credit back
    consistently previously,
  178. then I can lend you more credit.
  179. It's kind of a chicken
    or an egg situation.
  180. The interesting thing is that banks
    and financial technology companies
  181. have really innovated in recent years
    to use alternative data --
  182. cable bills,
  183. utility bills,
  184. rent payments, etc. --
  185. to show that you're able
    to consistently make payments.
  186. The additional challenge on this one,
    unlike the last one,
  187. which was more about awareness,
  188. is that you need to have
    regulatory support to do these things.
  189. You need to prove to regulators
  190. that you are able
    to fairly use alternative data
  191. to lend credit to marginalized groups.
  192. What we need to see is,
    from the Federal Government
  193. and the banking industry,
  194. to come together
    to create innovation sandboxes
  195. to start to use alternative data
    to expand to marginalized groups.
  196. Well, what about communities?

  197. Without community wealth,
  198. individual wealth, in a way,
    is on an island.
  199. And if you go into most
    major cities in the United States
  200. to most communities of color,
  201. what you'll find
    is underinvested communities.
  202. For every economic crisis,
    these communities have suffered severely.
  203. For every economic boom,
    they have not benefited.
  204. And so what we're seeing
    in a number of cities across the country,
  205. and I'll use Chicago as an example,
  206. is the partnerships occurring
  207. between banking institutions,
  208. philanthropists,
  209. the city and community leaders
  210. to invest hundreds of millions of dollars
  211. to build community resources
  212. and communities that have
    historically been disinvested.
  213. Lastly, we've got to talk about business,

  214. and not just small businesses.
  215. Now, when you have individual stability
    and a banking institution,
  216. and you have access to credit,
    and when you have community wealth,
  217. those are all fantastic things,
    but we need also job creation.
  218. Take all of the new tech companies,
  219. and I say "new" because now
    they're not so new,
  220. but take Facebook, Google, Amazon.
  221. At some point, all of those companies
    were sole proprietorships
  222. with one employee
  223. or a few employees
  224. that were building a technology
    that was not yet proven.
  225. What those companies received early on
  226. was venture capital money.
  227. And when you look
    at venture capital today,
  228. only one percent of venture capital funds
    go to Black founders.
  229. So if Black entrepreneurs
    are largely shut out of those networks
  230. they're not able to grow,
  231. and the only way for that to change
  232. is from within the industry itself.
  233. In this generation, we must not only
    be talking about thriving businesses
  234. in Black communities.
  235. We must also be talking
    about seeing more Black-owned
  236. and founded businesses going public.
  237. Those are just four solutions.

  238. There's many other things
    that can and should be done
  239. to close the wealth gap.
  240. This gap is not new.
  241. It was born and perpetuated
    by federal policy, social constructs
  242. and business practice over time,
  243. and all of those things need to change
  244. to start to close the gap.
  245. Financial institutions
    play a really critical role
  246. at the individual level,
    at the community level
  247. and at the business level.
  248. It's important to our families,
    it's important to our communities
  249. and it's important to our economy.
  250. Instead of talking about
    how the gap continues to grow,

  251. let's begin to close the gap now.
  252. Thank you.