Wednesday, December 21, 2016

Asian American Inequality

Asian Americans are about 5 percent to 6 percent of the US population

There are many ways to measure inequality - in this case, the economists compared different wealth thresholds. According to the data, white families in the top 10 percent each had more than $1.26 million in 2010-2013, while white families in the bottom 20 percent each had less than $10,468. In other words, a typical rich white family was about 120 times wealthier than a typical poor white family.

Among Asian Americans, the cutoff to make it into the top 10 percent was actually higher - about $1.44 million. And the families at the bottom end seemed to be worse off - the poorest 20 percent of families were each worth less than $9,319. So a rich Asian household was about 168 times richer than a poor Asian household.

The housing boom and bust explains a lot of the patterns in inequality. Homes tend to be the most expensive asset a family owns, and although the Asian American homeownership rate (about 60 percent) is lower than the white homeownership rate (about 74 percent), Asian Americans also tend to live in coastal metropolises where homes are expensive. In the early 2000s, the Asian Americans who were fortunate enough to own homes had their net worth skyrocket, increasing wealth inequality between Asian American homeowners and Asian American renters, as well as helping Asian Americans catch up to white Americans.

"It appears that the returns that African Americans and Hispanics get on similar assets are lower," said Ray Boshara, director of the Center for Household Financial Stability at the Federal Reserve Bank of St. Louis. "So buying a home or pursuing an education does not yield the same amount of wealth."

Compared with whites and Asians, African Americans and Hispanics are much less wealthy, and they don't seem to be making much progress. Data from the same survey shows that both groups have actually been losing ground relative to whites in recent years.

Such disparities are completely invisible according to the usual way we consider racial differences, which focuses on averages, not levels of inequality. Asian American households and white American households in fact have about the same amount of mean wealth - about $680,000, according to CAP's calculations. That creates the illusion that Asians are about as well off as whites. But as the report suggests, the richest Asian Americans are far more affluent than the poorest Asian Americans - so much so that they skew the data and obscure the problems of the people at the bottom.

"The problem is that 'Asian American' doesn't hold together as a category," said Philip Cohen, a sociology professor at the University of Maryland. "The group is too diverse. It doesn't really make sense to compare recent Chinese, Korean or Pakistani immigrants who are working in tech and engineering jobs to people who came as refugees in the 1980s and their working-class descendants."

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