An extraordinary thing happened during the year the COVID-19 pandemic ceaselessly delivered death, despair, and economic misery to so many: The world got 493 brand new billionaires.
A new billionaire was being created every 17 hours and 39 minutes last year, adding a $5 trillion boost to the collective $13 trillion wealth of the richest of the rich, as listed in Forbes newest tabulation of the record-high 2,755 billionaires on earth. The list includes the Boston Globe’s owner and publisher John Henry, who is worth $2.8 billion.
In the United States, where nearly 8 million Americans fell into poverty during the second half of 2020, that explosion of wealth played out in the most American of ways, with a broadening wealth gap that hit Black folks hard, at all income levels.
We already knew, even before the pandemic, that the racial wealth cleave between Black and white America is wide when it comes to the poorest. Black Americans are far more likely to have little to no savings or safety net, according to a survey by the Federal Reserve. Nearly one in five Black households has a zero or negative net worth, compared to less than one in 10 white Americans, according to the Federal Reserve data. In 2019, the median wealth of a white family was $188,200. The median wealth of a Black family? Just $24,100, according to a Brookings analysis.
But who knew the racial wealth gap was also hitting the Black billionaires of America? By the way, the Black billionaires of America could fit around my dining room table: There are seven of them.
At least that’s more than the five that existed in 2020, as rapper and shoe designer Kanye West and entertainment mogul Tyler Perry joined the club last year. But they still make up less than 1 percent of the nation’s whopping 724 billionaires — more than in any other nation — despite Black people representing roughly 13 percent of the population.
I’m not expecting anyone to cry tears for Oprah Winfrey and the others for being in such a tiny club. But it is important to understand that the inequality represented even at the highest echelons of affluence not only reflects systemic inequalities that make the road to riches a lot more tortuous for Black folks, but also how a dearth of Black super-wealth can have a ripple effect on the rest of society.
Consider the sources of wealth for most of the nation’s billionaire class, even for the majority of which are self-made: profits from investments, particularly in banking, finance, and tech.
But these are also industries where Black Americans are underrepresented. While the top two richest Black Americans — Robert F. Smith whose $6 billion net worth is from private equity and David Steward who amassed his $3.7 billion fortune from the nation’s largest Black-owned tech firm — earned success in those fields, the remaining members of the Black Billionaires Club — West, Perry, Winfrey, Michael Jordan, and Jay-Z — made their money largely in the media, entertainment, and apparel industries.
This distinction matters. Most Americans aren’t going to make a living designing a trendy athletic shoe or getting a lucrative endorsement deal. But access to investment opportunities, including retirement savings, is something all Americans, including Black folks, should have. Yet as stocks soar, Black people have been left out: while 61 percent of white American households owned stocks in 2019, only 33 percent of Black households did, according to Federal Reserve data.
It’s also important to remember that money is power. Consider the way Joseph P. Kennedy, the patriarch of America’s most powerful political family, was able to leverage wealth and place it in family trusts so that his descendants could focus on creating a political dynasty that has spanned generations. Then think of how Black political candidates consistently have the most difficulty raising campaign funds, according to analyses by the Center for Public Integrity.
Also consider how none of America’s Black billionaires belong to the political megadonor class, as fellow billionaires Charles Koch, George Soros, Tom Steyer, and others do.
Or take for example education, where wealthy benefactors help send 28 percent of college donations to a select group of elite schools that educate less than 2 percent of students in the country, based on the annual Voluntary Support for Education survey. And let’s not the forget legacy college admissions policies that give an additional leg up to the most privileged. Even with Smith’s $50 million pledge to reduce student debt for students at HBCUs, the divide is still wide.
There are too many billionaires in a world where poverty remains rampant. But even the wealthiest Black folks in the nation serve as examples of the persistence of the racial wealth gap in this country. And that is, sadly, very American.