The Great Recession and its aftermath have spurred increasing income and wealth inequality.
The Washington Post takes a look into the effects of the recession and housing crisis on African Americans. The article takes a look at the subprime loans African Americans were given and the long-lasting effects these loans may have on credit and wealth for African American communities.
- Ylan Q. Mui, The Washington Post — For black Americans, financial damage from subprime implosion is likely to last:
The implosion of the subprime lending market has left a scar on the finances of black Americans — one that not only has wiped out a generation of economic progress but could leave them at a financial disadvantage for decades ...
For blacks, the picture since the recession has been particularly grim. They disproportionately held subprime mortgages during the housing boom and are facing foreclosure in outsize numbers. That is raising fears among consumer advocates, academics and federal regulators that the credit scores of black Americans have been systematically damaged, haunting their financial futures.
A commonly used tool to fight income inequality is the minimum wage, helping those at the bottom of the economic ladder keep up with everyone else — that is, when the rate is periodically increased. National Public Radio takes a look at Senator Tom Harkin’s proposal to raise the national minimum wage to $9.88 an hour, a 36% increase from the current $7.25 wage. Unfortunately, this bill has little chance of being enacted.
- National Public Radio — Raising Minimum Wage: A Help Or Harm?:
Harkin estimates that his minimum wage increase would mean about $25 billion more for GDP, 100,000 more jobs and 28 million Americans would get a raise ...
"If my proposal went through, a $15,000 a year worker will make $20,000 a year," he says. "You know $5,000 a year is significant to someone in that category. [It] may not get them out of poverty, but it makes life better."
Who would be helped by such a change? A recent analysis of minimum wage workers in Illinois by the Economic Policy Institute found the following:
- 84% of minimum wage workers were 20 years or older;
- Only 6.6% of minimum wage workers were teenagers working under 20 hours per week;
- 29% were single parents supporting at least one child;
- 56% of minimum wage earners were women;
- Finally, racial and ethnic minorities, while making up 33% of the Illinois workforce, made up 41% of minimum wage earners.