"Over the last four years, 53 percent of black wealth has just disappeared."
Donna Brazile on Sunday, August 21st, 2011 in a comment on 'This Week with Christiane Amanpour'
Brazile said 53 percent of black wealth has disappeared in the downturn
If some of President Barack Obama's supporters are irritated with him about jobs, it's understandable because the times are so hard, said Democratic strategist Donna Brazile on This Week with Christiane Amanpour.
Brazile was responding to a question about harsh words for Obama from Rep. Maxine Waters, D-Calif., a member of the Congressional Black Caucus.
"The president has to do more than just run against Congress. He has to tell the American people that his administration has used every tool at their disposal to get job creation back on track," Brazile said. "But over the last four years, 53 percent of black wealth has just disappeared. The average -- for white families, the median income is $113,000. For black families, $5,000, $5,000. It has dropped.
"So these families are hurting. They want help. They want relief. They don't want to hear about Congress. They don't want to hear about the tea party. They don't want to hear another plan. They want jobs," she said.
We decided to fact-check Brazile's statement that "over the last four years, 53 percent of black wealth has just disappeared." We'll also explain her comment that "for white families, the median income is $113,000. For black families, $5,000, $5,000," which actually has a critical slip of the tongue. She should have repeated the word "wealth" in place of "income." More on that in a bit.
Brazile's first number comes from a recent study by the Pew Research Center, a nonpartisan "fact tank" that provides information on demographic trends but does not take policy positions. A study from Pew's Social & Demographic Trends project released a report about racial disparities in family wealth on July 26, 2011.
That report analyzed data from the Survey of Income and Program Participation (SIPP), an economic survey conducted by the U.S. Census Bureau.
The Pew report analyzed household wealth, a very different measurement than income. "Household wealth is the accumulated sum of assets (houses, cars, savings and checking accounts, stocks and mutual funds, retirement accounts, etc.) minus the sum of debt (mortgages, auto loans, credit card debt, etc.)," the report states. "It is different from household income, which measures the annual inflow of wages, interest, profits and other sources of earning. Wealth gaps between whites, blacks and Hispanics have always been much greater than income gaps."
As you might be able to guess from that definition, home values are a critical component of household wealth, and plummeting home values were responsible for wiping out a good deal of household wealth. The Pew report specifically compared the data from the 2005 survey with a 2009 survey, the most recent data available.
From the Pew report: "The Pew Research Center analysis finds that, in percentage terms, the bursting of the housing market bubble in 2006 and the recession that followed from late 2007 to mid-2009 took a far greater toll on the wealth of minorities than whites. From 2005 to 2009, inflation-adjusted median wealth fell by 66% among Hispanic households and 53% among black households, compared with just 16% among white households. As a result of these declines, the typical black household had just $5,677 in wealth (assets minus debts) in 2009, the typical Hispanic household had $6,325 in wealth and the typical white household had $113,149."
For comparison, in 2005 the median black household wealth was $12,124; Hispanic household wealth was $18,359; and white household wealth was $134,992.
Brazile said that, "Over the last four years, 53 percent of black wealth has just disappeared." The Pew report wasn't for the most recent four years, as Brazile's words imply, but for the period between 2005 and 2009. However, as we already noted, that is the most recently available data from the Census.
We're doing a fact-check on the 53 percent loss of black wealth claim, but we should point out that Brazile went wrong in her second statement -- "for white families, the median income is $113,000. For black families, $5,000" -- when she said "income." She should have simply repeated the word "wealth."
We're rating Brazile's statement, "Over the last four years, 53 percent of black wealth has just disappeared." That is the percentage that the Pew report found, based on data collected by the U.S. Census. But the years in question were 2005 to 2009. So we deduct one notch off the Truth-O-Meter and rate Brazile's statement Mostly True.
Published: Wednesday, August 24th, 2011 at 10:21 a.m.
ABC News, This Week with Christiane Amanpour, Aug. 22, 2011
Interview with Rakesh Kochhar of the Pew Research Center, Aug. 23, 2011
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