Biden to unveil effort to slim racial wealth hole
United States President Joe Biden speaks about the COVID-19 Response and Vaccination Program at the White House in Washington on May 12, 2021.
Kevin Lamarque | Reuters
WASHINGTON – President Joe Biden will on Tuesday announce new measures his administration is taking to narrow the racial wealth gap.
The announcement coincides with Biden’s trip to Tulsa, Oklahoma, to commemorate the 100th anniversary of the Tulsa massacre, one of the worst episodes of racial violence in US history.
Biden will announce an increase in the proportion of federal contracts for small, disadvantaged businesses; the repeal of two Trump-era housing rules; and the launch of an initiative to tackle inequality in housing valuation.
The measures represent “a step towards delivering on the ideals and promises of this nation regarding racial justice,” a White House official said Monday during a call to reporters.
On May 31, 1921, white racists attacked Tulsa’s Greenwood neighborhood, one of the then richest black communities in America. Countless blacks have been killed – estimates range from 55 to more than 300 – and 1,000 homes and businesses have been looted and set on fire in what remains one of the worst incidents of racial violence in American history.
In the century since the Tulsa massacre, black Americans have faced discrimination across the US economy, in housing, banking, and the workplace.
The average net wealth of white households is now roughly eight times the net worth of black households, a racial wealth gap that widened during the Covid pandemic.
Biden campaigned for the president as a pledge to address systemic racism and gaps in opportunity in all aspects of American life.
White House officials said the efforts, announced on Tuesday, are specifically aimed at expanding equity and access to two major wealth generators: home ownership and small business.
This is what Biden will announce:
- The creation of an inter-agency initiative to eradicate inequalities in the valuation of housing, led by Marcia Fudge, Minister for Housing and Urban Development. “Homes and black-majority neighborhoods are often valued tens of thousands of dollars less than comparable homes in similar white-majority communities,” the White House said. “These efforts will try to use the many levers available to the federal government very quickly to eradicate discrimination in the valuation and home purchase process.”
- The HUD will enact two rules of the Fair Housing Act that will reverse the efforts of the HUD during the Trump administration to weaken the protections afforded by the law. “In both cases, the HUD is returning to traditional interpretations of the Fair Housing Act,” the White House said on Monday. The new rules are intended to “pave the way for HUD to enforce the Fair Housing Act more vigorously,” it said.
- The administration will announce the goal of increasing the proportion of federal contracts to small, disadvantaged companies by 50% over the next five years. Currently, about 10% of federal contracts go to SDBs annually, totaling about $ 50 billion. A 50% increase by 2026 would mean an additional $ 100 billion in federal contracts will be awarded to SDBs over that five-year period, officials said.
Remarkably, however, Biden’s announcement lacks concrete action on two issues that are at the heart of the debate about how to advance racial justice in the US economy: student loan waivers and redress for slavery.
As a candidate, Biden pledged to use federal powers to cancel thousands of dollars in debt for every student in America. So far, however, his government has not presented a plan or a timetable for implementing the debt relief.
Some economists estimate that student loan debt accounts for up to a quarter of the racial wealth gap between blacks and whites aged 30-35.
Nor did Biden say whether he would support a bill in Congress to provide financial reparations to the descendants of slaves. Instead, the White House says Biden is in favor of the idea of a commission examining the possibility of redress.
During his speech in Tulsa, Biden will outline several ways his signed $ 2 trillion infrastructure proposal, the American Jobs Plan, could help fill the racial wealth gap.
This includes a new neighborhood home tax credit, which offers a tax credit to investors renovating homes in low-income and derelict areas, where property remediation often costs more than it can sell.
Another move that could help narrow the gap is a $ 15 billion fund for a neighborhood reconnection program that would provide grants to upgrade or redesign highways that run through the middle of downtown areas US cities lead.
But these initiatives are still in the planning phase. The American employment plan has yet to be legislated by Congress, let alone passed into law. And with only one seat in the Senate, Democrats have few opportunities to pass laws without a Republican vote.
The White House has spent the past three weeks negotiating with a group of Republicans in the Senate to work out a bipartisan infrastructure bill that could be passed by majority in both houses.
But those talks have stalled and Biden has come under increasing pressure over the past week to give them up.
Democrats are increasingly focused on pushing the president’s domestic agenda through a budget vote bill, a complex legislative maneuver that requires only 51 votes in the Senate.