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Sen. Bernie Sanders says by addressing economic inequality, he would also correct racial injustices.
Sanders railed against Wall Street in his response to a question about race relations in the Feb. 11 Democratic debate in Milwaukee, Wis.
"Turns out that the African-American community and Latino community were hit especially hard," Sanders said. "As I understand it, the African-American community lost half of their wealth as a result of the Wall Street collapse."
That claim stood out to us. Is it true that black wealth was slashed so dramatically as a result of the financial crisis?
Sanders understood correctly. His campaign referred us to a 2013 report from the National Association of Real Estate Brokers.
"According to the report, African-Americans have lost over half of their wealth since the beginning of the recession through falling homeownership rates and loss of jobs," it reads.
The report refers to Pew Research Center data from 2011 that shows the median net worth of black households decreased by 53 percent from $12,124 in 2005 to $5,677 in 2009. Technically, this loss fits the timeline of the housing crisis in 2006.
A 2014 Pew report more closely follows the financial crisis of 2007. According to that report, median net worth of the black household decreased from $19,200 in 2007 to $11,000 in 2013 (in 2013 dollars). That’s a loss of 43 percent.
Of course, the two economic crises are intertwined, and both Pew reports note that the housing bubble and the recession that followed "took a far greater toll on the wealth of minorities than whites." Here’s a chart from the Pew Center that demonstrates this:
Census Bureau data corroborates, if not magnifies, this point: Black median net worth decreased 61 percent from 2005 to 2009. Whites, in contrast, lost 21 percent of their wealth.
Sanders said, "The African-American community lost half of their wealth as a result of the Wall Street collapse."
Estimates for how much wealth blacks lost from 2005 to 2009 — as a result of the housing bubble — range from 53 percent to 61 percent. African-American net worth plummeted 43 percent from 2007 to 2013 — as a result of the financial crisis.
Because the two financial crises are inseparable, we won’t quibble with Sanders’ timeline. We rate his claim True.
Washington Post, "Transcript: The Democratic debate in Milwaukee, annotated," Feb. 11, 2016
Email interview with Warren Gunnels, policy director for Bernie Sanders, Feb. 11, 2016
National Association of Real Estate Brokers, "State of Housing in Black America," Aug. 30, 2013
Pew Research Center, "Wealth Gaps Rise to Record Highs Between Whites, Blacks and Hispanics," July 26, 2011
Pew Research Center, "Wealth inequality has widened along racial, ethnic lines since end of Great Recession," Dec. 12, 2014
U.S. Census Bureau, Detailed tables on wealth and asset ownership 2005 to 2011, accessed Feb. 11, 2016
The Atlantic, "The Recession's Racial Slant," Jun. 24, 2015
CNNMoney, "Whites get wealthier, while Blacks and Hispanics lag further behind," Dec. 15, 2014
PolitiFact, "Brazile said 53 percent of black wealth has disappeared in the downturn," Aug. 24, 2011
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