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The State of Racial Inequality in the US: Where Are We? How Did We Get Here?


While we think about economic inclusion in a universal sense, inequality of opportunity appears stubbornly persistent across racial groups in the US. For example, neither the earnings gap nor the wealth gap across Black and white households has changed over the past sixty years. Similarly, Black and white households with the same income and wealth live in neighborhoods with remarkably different socioeconomic characteristics. In addition, Black children are disproportionately attending schools facing the obstacles created by concentrated poverty. Why has racial inequality remained so persistent? What are some of the barriers to economic inclusion facing Black Americans? And how are the answers to these questions tied to the history of racial discrimination?



Roundtable Summary

After hosting the recorded one-on-one conversations posted below, we then hosted a group conversation where Ruby, Dan, and Richard discuss the path toward racial equality of labor market outcomes. This conversation is summarized in the write-up below.

Richard Rothstein

Key takeaway: Richard Rothstein describes why, as an education reporter for The New York Times, he gradually came to see neighborhood segregation as a central cause of educational difficulties in the US. He also discusses the findings in his book The Color of Law, which summarizes his investigation into the causes of segregation.

Dan O'Flaherty

Key takeaway: Dan O’Flaherty thinks that racial inequality is more consequential than income inequality. He discusses lessons from the economics literature on how we can create an economy in which race is not an obstacle to economic opportunity.

Ruby Mendenhall

Key takeaway: Ruby Mendenhall sees our society losing out on potential because of divisions and structural barriers such as racism, classism, and sexism. She describes the work she and others are doing to make sure that everyone has the opportunity to use their gifts and genius.

Interested in seeing more conversations? View the Conversations on Economic Inclusion archive

Participant Bios

  • Ruby Mendenhall is the Kathryn Lee Baynes Dallenbauch Professor in Sociology, African American Studies, Urban and Regional Planning, and Social Work at the University of Illinois at Urbana-Champaign. She is also the Associate Dean for Democratization of Health Innovation at the Carle Illinois College of Medicine and an affiliate of the Institute for Genomic Biology and the Institute for Computing in Humanities, Arts and Social Sciences. Dr. Mendenhall has conducted foundational research on the links between neighborhoods, segregation, violence, and economic outcomes, and is currently engaged in community/participatory research with citizen/community scientists, training community health workers, and developing pathway program that provide marginalized youth with unprecedented access to STEAM careers. Her recent awards include a $500,000 grant from the MacArthur Foundation and the 2021 Pearl Birnbaum Hurwitz Humanism in Healthcare Award. Dr. Mendenhall received her PhD in Human Development and Social Policy from Northwestern University in 2004.

  • Dan O’Flaherty is a professor of economics at Columbia University. He is the author of the books The Economics of Race in the United States and Shadows of Doubt: Stereotypes, Crime, and the Pursuit of Justice, and the textbook City Economics; and he is co-editor of the book How to House the Homeless. Dr. O’Flaherty has extensive experience advising government and community groups in Newark, New Jersey. Dr. O’Flaherty earned his bachelor’s degree in 1973 and his PhD in economics in 1980, both from Harvard University.

  • Richard Rothstein is a Distinguished Fellow of the Economic Policy Institute and a Senior Fellow (emeritus) at the Thurgood Marshall Institute of the NAACP Legal Defense Fund. He is the author of The Color of Law: A Forgotten History of How Our Government Segregated America, which recovers a forgotten history of how federal, state, and local policy explicitly segregated metropolitan areas nationwide, creating racially homogenous neighborhoods in patterns that violate the Constitution and require remediation. For several years he was the national education columnist for The New York Times. He is also the author of many other articles and books on race and education, including the books Class and Schools: Using Social, Economic and Educational Reform to Close the Black–White Achievement Gap and Grading Education: Getting Accountability Right. He is a graduate of Harvard University.

The views expressed in this Cleveland Fed Conversation on Economic Inclusion are those of the participants and are not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System.

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