- The NC Justice Center sees economic disparities between groups and assumes they derive from a “system” of discrimination
- There is no basis to the belief that — absent racial discrimination — all income or resources would be equitably distributed. Disparities among groups is the norm in all facets of life
- Facts show many reasons for economic disparities
- Bad assumptions by the Left lead to destructive policies
In a blatant and disturbing play of the race card, the NC Budget & Tax Center – a project of the far-left NC Justice Center – recently promoted one of their articles with the following tweet:
In actuality, the data from the article doesn’t reflect “benefits” from the proposed tax rate cap at all. The tax rate cap wouldn’t change any current tax rates, so there would be no relevant “benefits” to measure. Instead, the data refers to savings North Carolinians enjoy due to the absence of a ‘progressive’ tax code that imposes higher rates on higher income levels, a policy the Justice Center has long supported.
More to the point, however, is that the Justice Center not only decided to publish a report based upon a hypothetical, wished-for tax bracket, but appallingly decided to inject racial division into its analysis.
Such a bald-faced appeal to identity politics is nothing new for the Justice Center. They have injected the race card into their analyses for quite some time now, and the narrative they are advancing is quite transparent.
Blaming the “System”
The latest Budget & Tax Center article alludes to “historic barriers to asset accumulation and access to high-paying jobs” as being a primary culprit behind flat income tax codes harming people of color. Of course, this is rather curious given that the Justice Center supported for decades North Carolina’s “progressive” income tax code before the 2013 tax reforms ended that era. If the barriers are historic, weren’t they erected in part by the progressive income tax code the Justice Center applauded for so many years?
Similarly, a 2017 NC Justice Center report cited “economic systems that disproportionately benefit white people, while creating barriers to economic prosperity for people of color in North Carolina.”
The report also insisted that racial and economic disparities “did not come out of thin air,” but rather came about “from systems and policies, past and present, that create barriers to economic opportunity for people of color.” One such policy cited is “occupational segregation” which caused inequity in pay, with “people of color being paid less for doing the same work as their white colleagues.”
The message is clear – some unnamed discriminatory “system” exists that disadvantages people of color. Therefore, according to the narrative, this system must be overthrown in the name of racial justice.
As Thomas Sowell wrote in his book “Civil Rights: Rhetoric or Reality,” one of the central premises of this narrative is “that statistical disparities in incomes, occupations, education, etc., represent moral inequities, and are caused by ‘society.’”
Whether blaming “society” or an unnamed “system,” the narrative is the same. More to the point, it is no great leap to conclude that overturning their alleged villain involves the continued expansion of state power at the expense of individual freedom.
Does the Data Support Their Narrative?
What if a deeper dive into the data reveals facts that run counter to their narrative?
To support their claim that this villainous “system” is to blame for economic disparities, the Justice Center authors cite a few statistics purporting to make their case.
For example, in one article the author cites wage data showing that in 2016 “African American workers in North Carolina were paid roughly $3.25 per hour less on average than their white colleagues.”
The author also points out that “the poverty rate for Latinx, American Indian, and African American people in North Carolina remains much higher than for whites and people of Asian descent.”
In another NC Justice Center article, the author uses U.S. Census Bureau data to inform readers that “In North Carolina, the Black median household income is approximately $34,000, while the white median household income is above $53,000, a difference of almost $20,000.”
Case closed, right? The “system” has created insurmountable “barriers” to people of color, generating great income inequality.
Contrary to the Justice Center reports, however, it’s not quite that simple. This is where the lost art of critical thinking comes in to play.
Disparities in Outcomes Are the Norm
The Leftist narrative being advanced by the Justice Center assumes that statistical disparities between groups imply a discriminatory “system.” In turn, that assumption is based on the premise, as Sowell wrote, “that large statistical differences between groups do not usually arise and persist without discrimination.”
But what if such disparities do arise absent discrimination perpetrated by the “system”?
If that can be shown as the case, then the Left’s assumptions about statistical disparities “lose their validity as evidence,” Sowell notes.
“There are many decisions wholly within the discretion of those concerned, where discrimination by others is not a factor – the choice of television programs to watch, opinions to express to poll takers, or the age at which to marry, for example. All these show pronounced patterns that differ from group to group,” Sowell continued.
The bottom line, Sowell concludes, is that “Statistical disparities extend into every aspect of human life,” and that “statistical disparities are commonplace among human beings.”
In short, Sowell’s analysis tells us that the cherry-picked statistical disparities presented by the Justice Center fail to support their pre-determined narrative.
Indeed, a more thoughtful and thorough analysis of the data reveals the presence of many factors which influence income and poverty statistics, a fact conveniently ignored by the Justice Center because it questions their contrived narrative.
Fatherlessness and Poverty
According to 2016 American Community Survey data from the U.S. Census Bureau, North Carolina families with at least one child in the home headed by a married couple have a poverty rate of just 8.7 percent. But in households with at least one child in the home headed by a female householder with no husband present, the poverty rate skyrockets to 42.7 percent.[i]
In other words, North Carolina families are roughly five times as likely to be in poverty when there is no father in the home.
Moreover, for households with multiple children, one of which is under five years old, headed by a married couple, the poverty rate is 15.6 percent in North Carolina. In households in the same situation, except with no father in the home, the poverty rate jumps to a heart-wrenching 60.6 percent.[ii]
The strong correlation between fatherlessness and poverty can’t be overestimated. That said, a racial breakdown of single-parent households may help to explain disparities in poverty rates. While no state data is readily available, national data is quite instructive. According to recent research, 66 percent of black children live in single-parent families, while 42 percent of “Hispanic/Latino” children do. Comparatively, 24 percent of “non-Hispanic white” children live in single parent families.[iii]
These facts have implications. Clearly, a higher rate of single-parent households strongly correlates to lower levels of income – regardless of race.
It is professional negligence to speak about disparities in poverty rates in North Carolina and ignore these facts. Much of the racial disparities in poverty derive from the high rates of single-parent households, i.e. life choices.
Household Size
Using household income data, without any analysis, is intellectually lazy. Simply stating that there is a “difference of almost $20,000” between black and white median household incomes tells us nothing without knowing the average number of income earners in the households.
Of course, households with two working adults will tend to earn more than those with one or no income earners. For instance, economist Mark Perry analyzed 2016 U.S. Census Bureau data and found that 63 percent of households in the lowest income quintile nationally had no income earners, and had an average of just 0.43 earners per household. Conversely, households in the top quintile featured an average of 2.04 earners.
Indeed, just the act of working full-time enables nearly all to escape poverty. The poverty rate in North Carolina for those who work full-time, year-round, is only 3.4 percent.[iv]
What does this mean for the Justice Center’s findings?
Federal Reserve data shows that nationally, 29 percent of white households have two earners, compared to 27 percent of Hispanic and 18 percent of black households. There is no reason to believe that these patterns are different in North Carolina.[v]
The number of earners per household also has a substantial impact on median household income – regardless of race. Failing to disclose average number of earners when discussing household income data is irresponsible.
Age
People tend to earn more as they acquire more work skills and experience. It is the natural career arc of most people. If different races skew differently in terms of age demographics, that will reflect in poverty and income statistics.
For instance, according to the 2016 American Community Survey the poverty rate in North Carolina for individuals ages 18-34 is 22 percent. The poverty rate drops to 13 percent for individuals 36-64 and falls even further to 10 percent for those over 65.[vi]
According to North Carolina Office of State Budget and Management demographic data, the median age of whites in the state is 39.2, compared to a median age for blacks of 33.4.[vii]
Because the white population trends older, it naturally follows that greater career experience will create racial disparity in income levels, even if every black and white person of the same age was paid the same rate.
Education
Education level has a significant impact on people’s earnings. Individuals with at least a bachelor’s degree are almost guaranteed not to live in poverty. For those with a bachelor’s degree or higher in North Carolina, only 4.3 percent live in poverty.
Meanwhile, there is a 16 percent poverty rate for those with a high school education only, and a 30 percent poverty rate for those with less than a high school degree.[viii]
In North Carolina the median income for those with a bachelor’s degree or higher is $45,922, compared to $26,460 for high school grads.[ix]
According to U.S. Census Bureau data, 33 percent of whites in North Carolina have a bachelor’s degree or higher, compared to 19 percent of blacks and 14 percent of Hispanic/Latino.[x]
Moreover, 18 percent of white households feature both parents with a bachelor’s degree or higher, compared to 5 percent of black and 6 percent of Hispanic households nationally.
Higher rates of education – not to mention higher rates of two college educated income earners in the household – translates into higher income levels. These facts demonstrate the impact educational qualifications, and spousal choices, have on poverty and income, not discrimination.
Color vs. Culture
Finally, when evaluating claims that “systems and policies, past and present” create “barriers to economic opportunity for people of color,” we can compare the levels of economic success among people of color. After all, racist “systems and policies” just see people of color, and do not differentiate based upon different backgrounds.
As Sowell wrote, “Blacks may ‘all look alike’ to racists, but there are profound internal cultural differences among blacks.”
As a result, comparing results for people of the same color but different culture is a valuable tool to provide an indication of other factors besides discrimination at work.
One source of data is a recent American Community Survey Report from the U.S. Census Bureau that analyzes characteristics of selected Sub-Saharan African and Caribbean ancestry groups.[xi] Among these “ancestry groups,” 60 percent or more are foreign born.
For instance, in 2012, the U.S. poverty rate for Jamaicans was reported as 14.8 percent, Ethiopians 19.7 percent and Nigerians 12.8 percent. All the rates were significantly lower than the rate of 28 percent for blacks as a whole.[xii]
Furthermore, the median income for Jamaican males was $41,969, and females $39,155; for male Ethiopians $34,018 and $30,253 for females; and $50,922 for male Nigerians with $44,874 for females.
Two of the three of these male ancestry groups noticeably out-earned the median rate of $37,526 for black males overall, while the same two groups outpaced the overall female black median income of $33,251.[xiii]
Additionally, these three ancestry groups had significantly lower rates of poverty and higher median incomes than the Hispanic population.
How were these people of color, often without the benefit of growing up in America, able to clear the “barriers” of a discriminatory “system” far better than other people of color? Culture unquestionably plays a role in income and poverty disparities as well, even in situations comparing people of color where “discrimination” can be ruled out.
Why is This Important?
Getting the narrative wrong means getting the policies wrong. The Leftists at the Justice Center, along with millions of like-minded people across the nation, make the spurious assumption that statistical disparities between racial or ethnic groups necessarily imply discriminatory “system” that “creates barriers” to economic progress for people of color.
A more responsible analysis of the facts shows that many factors play a significant role in creating economic disparities. These factors include: fatherlessness, education, age, number of earners per household and culture.
When inspired by a faulty narrative, the policies that follow will make the situation worse. Government welfare programs are advocated for in no small part as a remedy to “correct” the racial disparities created by a discriminatory “system” that advantages whites.
The welfare state, however, has enabled a tripling of births to unmarried mothers, and in North Carolina households with no fathers are five times more likely to be in poverty.
Moreover, the welfare state creates poverty traps. North Carolina spent more than $570 billion on welfare programs between 1992 and 2015, only to see poverty worsen during that time.
Oher policies do the same. Limiting children’s educational choices to schools in the public school monopoly often traps children in schools that fail to prepare them for college or the workforce. Minimum wage laws cut off the first rung of the career ladder for lower-skilled, less-educated people. Having diminished access to jobs, they enroll in welfare programs to make ends meet. The perverse incentives of the welfare programs trap them in poverty, and the cycle continues.
And let us not forget about the policies designed to close the “racial gap” in home ownership that played a significant role in the 2008 Great Recession.
Conclusion
Advocates of greater political control of society like the Justice Center cling to a narrative based on flimsy assumptions. The policies they champion based on these assumptions make matters worse for those they claim to want to help.
Nobody is arguing that racial or ethnic discrimination has been eliminated. But to cling to a narrative that asserts racial discrimination as the only cause of statistical disparities in measures such as income and poverty turns a blind eye to reality and leads to damaging policies.
Perhaps making matters worse, is promotion of the narrative of an all-powerful “system” that is structured unfairly and creates a sense of helplessness among those labeled as ‘victims’ of said “barriers to economic prosperity.”
“Why study and discipline yourself in preparation for the adult world if the deck is completely stacked against you anyway?” Sowell asked rhetorically.
Statistical disparities among groups are the norm in every facet of human life, including those in which discrimination clearly cannot possibly play a role. Leftists like those at the Justice Center lecture us to “embrace diversity”, but then also deny that such diversity lends itself naturally to differences in outcomes. Instead, they choose to play identity politics based on faulty assumption in pursuit of greater social control.
[i] U.S. Census Bureau, Poverty Status in the Past 12 Months of Families. 2012-2016 American Community Survey 5-year estimates. Accessed online Sept. 12, 2018: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF
[ii] Ibid.
[iii] Kids Count Data Center. A Project of the Annie E. Casey Foundation. Available online at: https://datacenter.kidscount.org/data/tables/107-children-in-single-parent-families-by#detailed/1/any/false/870,573,869,36,868,867,133,38,35,18/any/432,431
[iv] U.S. Census Bureau, Poverty Status in the Past 12 Months, 2012-2016 American Community Survey 5-Year Estimates. Accessed online Sept. 12, 2018: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF
[v] FEDS Notes, Federal Reserve System. September 27, 2017. Available online at: https://www.federalreserve.gov/econres/notes/feds-notes/recent-trends-in-wealth-holding-by-race-and-ethnicity-evidence-from-the-survey-of-consumer-finances-20170927.htm
[vi] U.S. Census Bureau, Poverty Status in the Past 12 Months, 2012-2016 American Community Survey 5-Year Estimates. Accessed online Sept. 12, 2018: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF
[vii] North Carolina Office of State Budget Management, County Estimates. Available online at: https://www.osbm.nc.gov/demog/county-estimates
[viii] U.S. Census Bureau, Poverty Status in the Past 12 Months, 2012-2016 American Community Survey 5-Year Estimates. Accessed online Sept. 12, 2018: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF
[ix] U.S. Census Bureau, Earnings in the Past 12 Months (In 2016 Inflation-Adjusted Dollars). 2012-2016 American Community Survey 5-Year Estimates. Accessed online Sept. 12, 2018: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF
[x] U.S. Census Bureau, Educational Attainment, 2012-2016 American Community Survey 5-Year Estimates. Accessed online Sept. 12, 2018: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF
[xi] STELLA U. OGUNWOLE, KAREN R. BATTLE, AND DARRYL T. COHEN. “Characteristics of Selected Sub-Saharan African and Caribbean Ancestry Groups in the United States: 2008-2012.” JUNE 28, 2017. REPORT NUMBER ACS-34. Available online at:
https://www.census.gov/content/dam/Census/library/publications/2017/acs/acs-34.pdf
[xii] U. S. Census Bureau, American Community Survey, 2012. Accessed online Sept. 12, 2018: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk
[xiii] Ibid.
