USA: discrimination against blacks and Latinos costs 50 trillion – economy

It’s not like there is a lack of insight, Sunday talk and warm words. On the contrary: American politicians repeatedly complain that the country’s ethnic minorities are economically disadvantaged and excluded from participating in growth and prosperity. Hours later, however, most white citizens forgot about the topic again, which may also be related to the fact that discrimination against blacks and Latinos does not put them at a disadvantage. Where is it?

A study by four women economists, including Mary Daly, president of the San Francisco regional central bank, has now concluded that it is not only the groups directly affected that suffer from inequality, but that the majority of the people cut their flesh out of ignorance. Experts provide a precise figure: According to their study, severe economic, social and societal inequalities in the country have cost the United States an almost unimaginable economic return of $ 51 trillion (roughly $ 43 trillion) over the course of over the past 30 years.

There are many arguments against such calculations: they are very theoretical, they ignore many influencing factors, and are based on dozens of assumptions, in which the smallest lag leads to a different total. But that doesn’t change the fact that the study first revealed the full dimension of the problem, because basically, it doesn’t matter whether the three-decade prosperity losses are $ 30, $ 50, or $ 70 trillion: a political point of view, each is one of these numbers are fundamentally out of the question.

African Americans earn eight dollars less an hour

From Daly’s perspective, the deciding factor is the realization that large and lasting ethnic differences in employment rate, education level and income opportunities not only harm those directly affected, but “reduce the economic pie of the nation as a whole “ “The imperative to create more equality and to close at least some of these gaps is not only moral, it is also economic,” said the regional chief executive. central bank, which is responsible for the entire western United States. Daly is also a member of the Monetary Policy Committee, the most important body of the US Federal Reserve.

There are many examples that show just how different working life is for many Americans – depending on their skin color, background, and social status. Black workers earn an average of eight dollars less an hour than white workers, unemployment among African Americans is significantly higher, and the wages of black and white women diverge even more. White Americans and those of Asian descent are also much more likely to hold jobs commensurate with their level of education than blacks and people of Latin American descent. They often have to live with simpler jobs even after graduating from college.

The United States destroys its founding myth

Daly and his co-authors Lily Seitelman, Laura Choi and Shelby Buckman have now calculated in their study for the Brookings Institute in Washington how much economic output would have increased since 1990 if the number of college graduates, participation rates and wages of blacks. had been and whites, Latinos and Asian Americans, women and men were the same throughout the period. If only the direct effects were taken as a basis, according to the study, the gross domestic product would have been nearly 23 trillion dollars higher than it actually was. This is more than what the United States does in an entire year today. If you factor in that a much more productive workforce would also result in significantly higher investment, you arrive at a total of $ 51 trillion, which the United States lost in economic output according to the study.

Daly points out that the problem is likely to worsen in the coming years as the proportion of non-white Americans in the total population increases. The United States, according to the Chairman of the Federal Reserve, is not only losing ground in competition with other countries, it is also increasingly undermining its founding myth, that every American has the right to economic participation and to self-determination according to its competences. and attendance. Politics and business need to understand that this is not about dividing the existing pie differently. “It’s about making the cake bigger.”

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