Toward reimagined global financial architecture: Progress and challenges

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Toward reimagined global financial architecture: Progress and challenges
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The Roots of Poverty Are Many and Deep

In 1982, Doris Entwisle, Linda Olson, and I wanted to launch a study that examined the first grade year as a potentially consequential life course transition.  Toward that end, we randomly selected a sample of 790 Baltimore six-year-olds who were about to start first grade in 20 Baltimore City public elementary schools.  The random selection afforded perspective on the experience of children city-wide. What was intended at the outset to be a three-year snapshot bloomed into a three-decade longitudinal study when we realized that our project had the potential to illuminate large questions about the drivers of urban poverty, privilege, and persistent socio-economic immobility across generations.

The Bottom is a Long Way from the Top

Our recent book The Long Shadow (Russell Sage 2014) compares the experience of four groups defined around the intersection of race and socio-economic status (SES): higher-SES whites, lower-SES whites, higher-SES African Americans and lower-SES African Americans, along with comparisons along gender lines.  Those who began life in lower SES family circumstances (95% low income, with parents averaging around 10 years of schooling) are the “urban disadvantaged” by the standards of the book.  They comprise half the sample; 40% of them are low-income whites, a group largely absent from studies of the urban poor.   

Parents’ socio-economic status casts a long shadow on their children’s prospects. If every child in our sample had an equal chance of being at the top rung of the SES ladder during adulthood – solidly middle class in the Baltimore context– 70 from the lower-SES group would have moved up.  By age 28, only 33 had done so. The others fell victim to a triangle of disadvantage at home, at school, and in their neighborhoods.

And that hurt them. Forty-five percent of the higher-income children graduated college; among the poor children, just four percent did. College is touted as a bridge into the middle class, but for the vast majority of Baltimore’s urban disadvantaged, that proved to be a false hope.  Academic challenges during childhood and adolescence held them back; as young adults, so did practical challenges in their lives outside school, challenges that do not weigh on most middle class youth—having to care for a child or needy parent or finding money to cover the upcoming semester’s tuition or books.    

An Historic Racial Divide Still Matters

This state of affairs affects poor black and white Baltimoreans differently. White men without college degrees are better-off because they have access to relatively lucrative blue-collar jobs through social ties within their families and their largely segregated neighborhoods. Eighty-nine percent of white high school dropouts were working at age 22; the figure for black dropouts was 40 percent. Contrary to popular portrayals of inner-city Baltimore, this isn’t due to differences in drug use and related social maladies.  Higher- and lower-income white men were more likely than their African American counterparts to use hard drugs and marijuana, smoke, and binge drink.  These young men, poor white and black alike, had numerous problem encounters with the law, but a police record was less of an impediment to whites in the job market.  And in the industrial and construction trades, where 45% of whites were employed, but just 15% of blacks, whites earned practically twice what African American men earned.

This matters for women and children’s well-being. Lower-SES white women had relatively low individual earnings, but their average family income was at parity with that of lower-SES white men’s because they married or (more often) partnered with those men.  By way of comparison, at age 28, many more lower-SES African American women were parenting alone, and struggling to get by on their own low personal earnings.  These factors gave lower-income white families more stable neighborhoods and home environments. Coupled with their superior access to job networks, this afforded white children  a decided material advantage over their lower-SES African American counterparts.

The Long Shadow

The conditions these children face aren’t immutable states of nature. But the depth of the challenges they face was well described by one of our respondents—a low-income African American man employed at the time:

“I mean, to me, success coming out of the neighborhood that I came out of, and doing what I’m doing, I think I’ve succeeded in what I wanted to do. To not become a statistic. To not be on a corner selling drugs… To be able to live, say that I have things that are mine. I think I will be completely successful, like I said… once I become comfortable with living.”

A revealing depiction, a reminder, among other things, that “success” isn’t always counted in degrees conferred and dollars earned.