Whites recover, but the black recession lingers

Deborah Goldring stands inside her Baltimore home on June 20, 2011. Goldring is among the thousands of African Americans still suffering from the recession in ways that most of their white counterparts are not. AP Photo

BALTIMORE — Growing up black in the segregated 1960s, Deborah Goldring slept two to a bed, got evicted from apartment after apartment, and watched her stepfather climb utility poles to turn their disconnected lights back on. Yet Goldring pulled herself out of poverty and earned a middle-class life — until the Great Recession.

First, Goldring's husband fell ill, and they drained savings to pay for nursing homes before he died. Then Goldring lost her executive assistant job in the Baltimore hospital where she had worked for 17 years. The cruelest blow was a letter from the bank, intending to foreclose on her home of almost three decades.

Millions of Americans endured similar financial calamities in the recession. But for Goldring and many others in the black community, where unemployment has risen since the end of the recession, job loss has knocked them out of the middle class and back into poverty. Some even see a historic reversal of hard-won economic gains that took black people decades to achieve.

Goldring remembers her mother taping the window shades to the wall so no one could see them stealing electricity. She remembers each time she sat on the curb with her three brothers, surrounded by her family's belongings, waiting for a new place to live. Sitting on those curbs, she promised to always pay her bills on time.

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Now, after finding herself poor again, "the only word I can say is devastated," says Goldring, 58.

"For me to live that life we were so comfortable in, we never had to worry about finances, we always had money where I can help my kids and my grandchildren — to go to calling my daughter to borrow $100 because I can't pay a bill ..." Goldring's voice trails off as she struggles to hold back tears.

Economists say the Great Recession lasted from 2007 to 2009. In 2004, the median net worth of white households was $134,280, compared with $13,450 for black households, according to an analysis of Federal Reserve data by the Economic Policy Institute. By 2009, the median net worth for white households had fallen 24 percent to $97,860; the median black net worth had fallen 83 percent to $2,170, according to the EPI.

Algernon Austin, director of the EPI's Program on Race, Ethnicity and the Economy, described the wealth gap this way: "In 2009, for every dollar of wealth the average white household had, black households only had two cents."

Since the end of the recession, the overall unemployment rate has fallen from 9.4 to 9.1 percent, while the black unemployment rate has risen from 14.7 to 16.2 percent, according to the Department of Labor.

"I would say the recession is not over for black folks," Austin says. He believes more black people than ever before could fall out of the middle class, because the unemployment rate for college-educated blacks recently peaked and blacks are overrepresented in state and local government jobs that are being eliminated due to massive budget shortfalls.

Maya Wiley, director of the Center for Social Inclusion, says the anti-discrimination laws passed in the 1960s took decades to translate into an increase in black economic security — and that was before the recession.

"History is going to say that the black middle class was decimated" over the past few years, Wiley says. "But we're not done writing history."

"I really miss that checkbook with my name on it"

Goldring was born and raised in Baltimore, and her mother was single for much of Goldring's childhood. At 16, she dropped out of school and went to work cleaning hotel rooms.

"That's when I first met white people. Some of them would stay a month at the hotel. They would have all their children with them," she remembers. "I thought, one day I'd like to hang out at a hotel."

She didn't know any middle-class people in her all-black neighborhood. "Where we lived, everyone struggled. We just struggled a little harder," she says. "If the lights stayed on for a whole year, if we didn't get put out, I thought we were doing really, really well."

At 21, pregnant with her second child, Goldring decided to get her GED. Then she went to community college, got a degree in secretarial work, and began a career.

She met her husband in 1983. He had a steady job as a heating and air-conditioning installer, and owned a brick two-bedroom home in Morgan Park, a leafy, integrated neighborhood.

With two incomes, money was not a problem. He liked to travel. She had never been out of Maryland.

"I thought, 'Is this how rich people live?'" Goldring remembers. "From where I was to where I ended up, it was way different."

Her husband had been married before. As a condition of the divorce, his daughter's name was added to the deed of the house. After Goldring's husband died in 2007, Goldring took out a 30-year fixed-rate mortgage, with a 6.5 percent interest rate, to purchase the house outright.

Everything was fine until her hospital "restructured" in 2009. Her boss, a senior vice president, was transferred to the corporate office. Executives were now sharing secretaries. A few months later, they let Goldring go.

No more family vacations. No more trips to the mall. No more filling the grocery cart.

But what Goldring misses the most is her checkbook. Her unemployment payments arrive on a debit card.

"Just being able to pull out my checkbook and pay a bill, even though there might not be much left in there," she says. "I really miss that checkbook with my name on it."

Black male employment at lowest level since 1972

This May, black male employment fell to the lowest level since the government began keeping track in 1972. Only 56.1 percent of black men over age 20 were working, compared with 68.3 percent of white men.

Chris Wilder, a Philadelphia journalist, lost his job in 2008 as the media industry suffered huge losses. Unemployment benefits amounted to about one-third of his salary. Ever since they ran out, his income has been near zero, other than sporadic freelance work.

If not for a policy in his apartment co-op to assist people who lose their jobs, "I might be living with my mother," he says.

He has felt depression and anxiety. He's gone from a six-figure salary to having to check his balance before using his bank card. "I miss being able to go into a store and go off budget," he says. "Now, when I go to shop for something, I have to stick to exactly what I came to get. I never have money to buy anything else."

Wilder, 43, grew up solidly middle class, the son of a newspaper editor and a college administrator. Now the single parent of a 15-year-old, he has managed to keep his son in cleats and baseball camps, but thoughts of dying poor have crept into his mind. All of his savings are gone.

"It's definitely harder for black people to get jobs," Wilder says. "With the economy as bad as it is, people are hiring nephews and family friends and friends of friends. It's hard for black people to break that cycle. We don't own or even run the big companies."

"It's hard to keep jobs as well, because they're gonna `last hired/first fired' you," he adds.

Wilder isn't giving up on finding a job in his field, "but I should."

"I call everyone. I send resumes. It is extremely rare that I get a call back," he says. "When I was growing up, I never imagined there would be a time when I was out of work for three years."

College-educated blacks fared worse than their white counterparts in the recession. In 2007, unemployment for college-educated whites was 1.8 percent; for college-educated blacks it was 2.7 percent. Now, the college-educated unemployment rate is 3.9 percent for whites and 7 percent for blacks.

"I've definitely played by the rules," Wilder says.

He's not desperate enough to break the law, but "I see why people become drug dealers."

Who gets more job callbacks: White felons or blacks with clean records?

Horace Davis did become a drug dealer. He illustrates another dimension of the recession's impact on blacks: While law-abiding folks are falling out of the middle class, those who got in trouble with the law are further than ever from a second chance.

After serving four years for drug trafficking, Davis walked out of prison into the middle of the recession in 2008. "I thought to myself, I'm older, I need to get a job, move on. The dope game was dead to me," Davis says, sitting on a concrete porch in an Asheville, N.C., housing project.

In the past few decades of the "War on Drugs," harsh sentencing laws have sent a disproportionate number of black people to prison, even though blacks are not more likely than whites to sell or use drugs, according to a 2008 report by the Sentencing Project. Today, about 280,000 African-Americans emerge from behind bars each year. They are often the last of the last to be hired.

After Davis got out, he spent months applying for dozens of jobs mopping floors or flipping burgers. He carried a letter from the state offering a $2,500 tax credit for hiring ex-offenders. He got one call back, from a chicken restaurant. "We'll be in touch," Davis remembers them saying. They weren't.

"Nobody wants black felons in their businesses," says Davis, 26.

A 2003 University of Chicago study by Devah Pager sent young white and black "testers" to apply for real low-wage jobs. Some of the testers were randomly assigned felony convictions. The study found that whites with felonies were slightly more likely to get callbacks than black applicants without criminal records.

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