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Group of Experts Releases Comprehensive Policy Recommendations Aimed at Helping People of Color Achieve Economic Stability

Washington, D.C., June 10, 2015—The 200 members of the Experts of Color Network released “A Policy Agenda for Closing the Racial Wealth Gap” today. Black and Latino families hold 6 and 7 cents respectively for every dollar of wealth held by white families. These wide-ranging policies aim to remove structural barriers preventing families of color from attaining economic stability for themselves and future generations.

The policies are grouped in seven categories: employment, financial services, entrepreneurship, housing, education, tax policy, and retirement. The document also highlights the importance of targeting policies to address the needs of those most disadvantaged and, in the process, provide positive race-specific results.

“These policies strengthen both societal and individual assets, from Social Security and public education to financial institutions that serve communities, to personal savings for retirement, college education, or starting a business,” said Maya Rockeymoore, President and CEO of the Center for Global Policy Solutions. “Individuals do not achieve success on their own, without support. The good news is that there are lots of ways to support communities of color, which have been left behind. We just have to enact the right policies.”

Highlights from the package of policies proposed:

  1. Expand access to jobs and higher wages

Black and Latino communities experience higher rates of unemployment, more frequent and extended periods of joblessness, and, when employed, significant wage disadvantages. Policies such as a major infrastructure investment, raising the minimum wage, banning barriers to employment like credit checks and criminal background checks, and implementing a federal jobs guarantee can address some of the circumstances preventing people of color from becoming financially secure.

  1. Increase savings and improve financial services

Communities of color often lack access to affordable financial services, which is why predatory lenders target them. This problem could be fixed if the U.S. Postal Service or community development financial institutions provided such services. A baby bonds program would create endowed trusts for children at birth and would help break intergenerational barriers to wealth accumulation. The child could use the money at age 18 for going to college, purchasing a home, or starting a business.

  1. Expand access to entrepreneurship

Entrepreneurship is an essential way to build wealth and create jobs in communities of color. Policies to stimulate it include more funding for minority business development centers and instituting a tax credit to promote venture capital investments in minority businesses.

  1. Improve housing policy

Communities of color have absorbed the bulk of the damage from the housing meltdown and have yet to recover. They also need substantial policy help to overcome segregation and systematic housing discrimination. Proposed policies include strengthening and enforcing the Fair Housing Act of 1968, using alternative credit models to assess borrowers’ creditworthiness, encouraging shared-equity loans between private investors and first-time homeowners, and creating a first-time homebuyer tax credit.

  1. Expand access to quality education

Few assets are more crucial to economic prosperity than education but most people of color do not have access to good schools and lack financial resources to pursue a college degree. Universal pre-K can reduce poverty and improve the lives of vulnerable youth. Adequate resource allocation in K-12 public schools and curbing tuition increases at public universities would go a long way in setting young people of color on a path to success.

  1. Make tax policy work for working families

Tax policy overwhelmingly favors the wealthy but there are policies already in place, which, if expanded, can level the playing field for low-income families. Among them are making the earned income tax credit expansions permanent, increasing it for non-custodial parents and childless families, establishing a renters credit, and making the savers’ tax credit universal.

  1. Make retirement secure for all

Over three quarters of blacks and Latinos have less than $10,000 in retirement savings and most of them depend on Social Security for a large part of their retirement income. Policies that would make retirement more financially secure include expanding Social Security, establishing universal retirement accounts, and protecting defined-benefit public pension plans.

The Experts of Color Network is part of the Closing the Racial Wealth Gap Initiative, a national program that seeks to build awareness and support for efforts to address racial and ethnic wealth inequalities based on structural factors. The network includes advocates, practitioners, and other experts of color who inform the national debate with diverse perspectives on creating an inclusive and equitable future for all Americans.

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The Center for Global Policy Solutions manages the Closing the Racial Wealth Gap Initiative in collaboration with the Insight Center on Community Economic Development and with generous support from the Ford Foundation.