By Anne Price, President & CEO

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Originally published in Insight Center’s June 2016 Newsletter.

Last week I spoke at the RESULTS International Conference to End Poverty, an inspired gathering of volunteers and advocates who use their voices to influence political decisions that will bring an end to poverty.

At RESULTS, I spoke about the importance of addressing the root causes of poverty by exposing the hidden truths of economic exclusion and inequity. There is perhaps not a better issue to explore hidden truths than race and wealth inequities. The current focus on wealth inequality and poverty outcomes alone leads to an oversimplified analysis and vast overestimation of the role of personal behavior that does not reflect the history and impact of policy.

A recently released report by the Center for Social Development in St. Louis quantifies the impact of denying Social Security coverage to 15 million domestic and agricultural workers, who were disproportionately people of color, through the passage of the Social Security Act of 1935. The failure to provide a public pension for these workers in 1935 is rooted in slavery and Reconstruction, but this policy of exclusion cannot be discounted as a relic of our uneasy past. The Social Security Act plays a significant role in why such large racial wealth disparities exist today and is one of the cornerstones of why certain groups reap a greater share of all America offers while others are intentionally left out.

As historians point out, the policy decision to exclude domestic and agricultural workers was driven by Southern politicians who “demanded a ‘docile’ labor force and pitted Blacks against Whites in competition for low wage work.” The full cost of exclusion cannot be quantified, but the “order of magnitude represented by these benefits — $618.24 billion in 2016 between the inception of Social Security in 1935 and the amendments of the early 1950s — approximates for the South and Southwest what Congress appropriated as a stimulus to the entire nation to address the Great Recession.” Domestic workers today, many of whom are immigrant women and women of color, are still fighting outdated but entrenched laws like these, some of which are rooted in the legacy of slavery.

Exploring and exposing these hidden truths of the racial wealth gap means pulling back the curtain on how wealth is accumulated. Examining the historical policies and decisions that continue to manifest and shape life outcomes in communities of color today, like the Social Security Act of 1935, will help us move from treating the symptoms of wealth inequities to treating the causes.

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The Insight Center for Community Economic Development’s mission is to help people and communities become, and remain, economically secure.

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