Tag: income inequality

Ivy colleges favor rich kids for admission, while middle-class students face obstacles, study finds

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Admission to an Ivy League college or a similar elite institution like MIT is often seen as a golden ticket offering entry into academic institutions that have collectively produced more than 4 in 10 U.S. presidents and 1 in 8 CEOs of Fortune 500 companies.

But that ticket is far more likely to be handed out to students who are already privileged irrespective of their academic credentials— the children of the top 1% of U.S. income earners, a new analysis finds.

Ivy-plus colleges — the eight Ivy League colleges along with MIT, Stanford, Duke and University of Chicago — admit children from families in the top 1% at more than twice the rate of students in any other income group with similar SAT or ACT scores, according to the new analysis from the Opportunity Insights, a group of economists at Harvard University who study inequality. Families in the top 1% of earners typically have annual income of around $611,000, the researchers said.

Stuck in the middle

It may come as no surprise that the likes of Harvard, Yale and Princeton favor the children of the ultra-wealthy, but the study also shows that academically high-performing students from middle-income families are among the least likely to gain admission to one these elite colleges.

About 40% of students from the richest families who scored at the 99th percentile on the SAT or ACT class attend an Ivy-Plus college, compared with 20% of students with the same scores who come from the poorest U.S. families. Among middle-class students who have the same top SAT or ACT scores, only about 10% attend an Ivy-Plus college, the analysis found.

The study comes as the Supreme Court recently ended affirmative action in college admission decisions, effectively ending the use of race as a basis for consideration in whether to accept an applicant. The end of affirmative action has drawn scrutiny to other forms of preference at top colleges, such as children whose parents are alumni, called “legacy” admissions, or who are wealthy.

“Highly selective private colleges serve as gateways to the upper echelons of society in the United States,” wrote co-authors Raj Chetty and David Deming of Harvard and John Friedman of Brown University. “Because these colleges currently admit students from high-income families at substantially higher rates than students from lower-income families with comparable academic credentials, they perpetuate privilege across generations.”

Ruth Simmons on impact of affirmative action ruling and how schools can work towards diversity

04:34

These colleges could make their student bodies more socioeconomically diverse by changing their admissions policies, the researchers noted. These steps would include ending legacy admissions and evaluating non-academic qualities that account for the impact of privilege.

The findings also suggest that middle-income students may be at a disadvantage compared with either their wealthy or low-income peers. In effect, such students may not be rich enough to give them a foot in the door, nor are they among the demographic groups that colleges have courted in recent decades to foster diversity.

Ivy League impact

The impact of getting an Ivy-Plus education can be significant in a student’s trajectory after college, the researchers noted. The group analyzed applicants who were put on the waitlist at Ivy-Plus institutions, and then compared the outcomes of those students who were either admitted off the waitlist or were ultimately rejected.

“Compared to attending highly selective flagship public colleges, students who attend Ivy-Plus colleges are 60% more likely to earn in the top 1%, twice as likely to attend a graduate school ranked in the top 10, and three times more likely to work at prestigious employers in medicine, research, law, finance and other fields,” they noted.

Of course, plenty of students who attend colleges that aren’t among the Ivy-Plus achieve success in their careers. And the Ivy-Plus colleges enroll less than 1% of college students. Yet because the oversize impact of these schools in creating the next generation of leaders and the rich, they face more scrutiny for their acceptance policies than other universities.

“We conclude that even though they educate a small share of students overall and therefore cannot change rates of social mobility by themselves, Ivy-Plus colleges could meaningfully diversify the socioeconomic origins of society’s leaders by changing their admissions practices,” the authors noted.

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July 24, 2023
Celebrate Juneteenth by promoting Black health, wealth and joy | CNN

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CNN
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June 19, 2023 is the third annual observance of Juneteenth. The federal holiday commemorates June 19, 1865, when the enslaved people in Galveston, Texas, learned of their emancipation two years after President Lincoln signed the Emancipation Proclamation.

Although Juneteenth has recently become more widely recognized, the date has long been a deeply spiritual time of remembrance and celebration for the Black community.

Across the country, African Americans have rejoiced with fireworks and cookouts, sipping red drinks – a nod to ancestors’ bloodshed and endurance.

“We know the horrors that we went through,” explained Kleaver Cruz, writer of the forthcoming book “The Black Joy Project” and creator of a digital initiative of the same name. “It’s always concurrent: the joy and the pain. We use one to get through the other.”

On a particularly joyous note, this June 19, CNN and OWN (both properties of Warner Bros. Discovery) will simulcast Juneteenth: A Global Celebration for Freedom at 8 PM Eastern time. The concert will feature artists across multiple genres including Charlie Wilson, Miguel, Kirk Franklin, Nelly, SWV, Davido, Coi Leray, Jodeci and Mike Phillips. CNN will kick off pre-show coverage at 7 PM Eastern time, highlighting Black advocates, trailblazers, and creators.

“We get to celebrate our freedoms; we get to celebrate the dismantling of things and lean into what we want in the future,” Cruz said of Juneteenth observance. “We want more of that space and less of the one that harms us.”

The Black community still struggles with pain and inequity. Impact Your World has gathered ways you can help reject the pathology of racism and thoughtfully celebrate Juneteenth through non-profits that support Black health, wealth, joy, and overall empowerment. You can donate to those charities here.

For Black Americans, the end of slavery was just the beginning of a 158-year quest for equality. Along the way, the cumulative effect of institutional and systemic racism fomented stark disparities in income, health, education, and opportunity.

“Those that came before us were physically free but were unable to earn livable wages or receive an education without its share of defeating challenges,” said Marsha Barnes, Founder of The Finance Bar.

Data collected by the Board of Governors of the Federal Reserve System shows that in the fourth quarter of 2022, the average Black household’s net worth was about one-fourth that of the average White household.

“Taking the time to address the racial wealth gap highlights many of the roadblocks we as Black Americans currently face,” explained Barnes, a certified financial therapist. She sees the well-documented connection between financial literacy and financial wellness as a key to enhancing wealth in the Black community.

“We still are at a disadvantage, but it’s important we become comfortable with having to learn while playing the game,” Barnes told CNN.

HomeFree-USA is a non-profit aiming to close the racial wealth gap by improving financial education, homeownership, and opportunities. Their Center for Financial Advancement (CFA) recruits, trains, and places Historically Black College and University students into internships and careers with mortgage and real estate companies. The goal is to enhance diversity in the financial sector, expose students to credit and money management and help them become savvy consumers and future homeowners.

The African American Alliance for Homeownership is a non-profit counseling agency that helps families obtain, retain, maintain, and sustain their homes. The organization offers HUD-certified counselors who support first-time homebuyers and foreclosure prevention. The group recently expanded its services to help homeowners with estate plans, resource navigation, home repairs, and energy-efficiency upgrades.

Former NFL Player Warrick Dunn started Warrick Dunn Charities in 1997 to help single parents buy homes by providing $5,000 down payments and home furnishings.

“The more I learned, we wanted to get into the business of giving people the potential to break their cycle of poverty,” Dunn explained in a 2021 interview with CNN.

The non-profit has expanded its priorities to include financial literacy, health and wellness, education attainment, workforce development, and entrepreneurship support.

The National Urban League is committed to the advancement of African Americans through economic empowerment, equality, and social justice. The organization champions education, job training, workforce development, and civic engagement through community and national initiatives.

The legacy of racism in America continues to fuel health and healthcare inequities for Black people.

“We’re seeing diseases that, when I was in medical school, I thought to be diseases that would start to develop in people in their fifties, sixties, and seventies. I’m seeing these diseases sometimes in teenage years,” said Dr. Barbara Joy Jones, an Atlanta-based family medicine physician.

According to the CDC, five health conditions particularly affect the Black community at higher rates: cardiovascular disease, human immunodeficiency virus (HIV), metabolic syndrome, colon cancer, and mental health conditions.

“I consider hypertension, Diabetes, and obesity the triad,” said Jones.

The leading contributor to that triad is what you eat.

“Diet is 80% of health, and just access to quality food and education about food has been very hard,” Jones explained.

“When you go back and look at slavery, the foods we had to eat were the last scraps, so through the passing down of culture, you’re eating foods that are not the healthiest because it was simply for survival,” said Jones.

According to Feeding America, eight of the ten US counties with the highest food insecurity rates are at least 60% Black and one in every four Black American children is affected by hunger.

Addressing food insecurity, nutrition education, and better food access can make a difference.

Feeding America runs a network of food banks in those mostly Black hard-hit counties.

Share Our Strength runs a program called Cooking Matters offering cooking classes, grocery store tours, and digital content to help marginalized families across the country shop and cook with an eye towards health and budget.

The African American Diabetes Association uses targeted outreach projects to help Black people prevent or delay type 2 diabetes.

Despite progress over the years, racism continues to impact the mental health of African American people.

“The stress and microaggressions that happen daily for a person of color in the work environment and everyday life add up, and unmitigated stress can lead to disease,” Jones told CNN.

The Black Mental Health Alliance and the Trevor Project, provide training and networks of mental health providers specifically supportive of the Black and Black LGBTQ communities.

In 2019, the CDC found that Black people comprised 41% of the new HIV infections in the US. The Black AIDS Institute was founded in 1999 to mobilize and educate Black Americans about HIV/AIDS treatment and care. The Black AIDS Institute advances research, support groups, and education and runs a clinic catering to BIPOC and underserved communities.

As recently as the 1990’s, unethical medical research was conducted on Black Americans. The Tuskegee Study is one of the most widely recognized examples of the racist practice that led many Black people to distrust the healthcare system and avoid doctors altogether.

Beyond investing in cultural sensitivity training and prioritizing preventative care, Jones said, “For anti-doctor people, find someone that looks like you; representation matters.”

“Half of the getting to know your part of medicine is to know why psychosocial and economically you are where you are, and having a doctor that looks like you can support that.”

Only about 5.7% of US physicians identify as Black or African American, according to the Association of American Medical Colleges.

The White Coats Black Doctors Foundation is working to increase diversity in the medical profession, supporting educational preparation to become a doctor and helping offset the costs associated with applying and transitioning to residencies.

Black joy has been essential for survival, resistance, and self-development for centuries. But these days, it’s often exploited and misunderstood.

“I see the ways that Black joy at this moment is being commercialized or co-opted to make it feel like it’s Black people smiling,” lamented Cruz. “It’s much, much deeper than that.”

Cruz launched the Black Joy Project as a photo essay on social media in 2015 following the deaths of Michael Brown and Sandra Bland to help the Black community process its collective pain.

“I posted it on Facebook in the stream of consciousness and said, ‘Let us bombard the internet that joy is important too, and as people are sharing these traumatic videos, we have to make space for joy.’ And it was an invitation for anybody else that wanted to do that.”

Enslaved Black people knew they weren’t free but still hoped their future generations would be. That empowering optimism gave them the will to press forward, no matter the circumstance.

“This (joy) is just a continuation of those practices,” Cruz said. “Joy is intrinsic. It’s something that can’t be taken from us because it comes within us; it’s always ours to have.”

Juneteenth is a celebration of freedom, culture, and history, and it’s important to uplift non-profits that positively nourish the arts, music, and all the things that foster Black joy.

The Robey Theatre Company was founded in 1994 by actors Danny Glover and Ben Guillory to tell the complex stories of the Black experience. The theater showcases and develops up-and-coming actors and playwrights to sustain Black theater.

The Debbie Allen Dance Academy uses dance, theater, and performance to enrich, inspire and transform students’ lives.

As some states are moving to block Critical Race Theory and Black history from public education, the Legacy Museum: From Enslavement to Mass Incarceration gives visitors an interactive history lesson on the harsh repercussions of slavery and systemic racism in the US. The immersive exhibition carries visitors through the transatlantic slave trade up to the current mass incarceration of Black people. The museum occupies a site in Montgomery, Alabama where enslaved Black people were historically auctioned off.

“If we’re being serious about Black joy, that means we’re being serious about Black lives, period,” Cruz concluded.

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June 16, 2023
Guaranteed income program helps single mother make ends meet

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Chicago — Adriana Flores, a single mother of two boys, watches every dollar, and even though she works full-time as an educator, she earns less than $40,000 per year.

Last year, she could only dream of new soccer supplies for her sons.

“We could get by,” Flores told CBS News. “But how horrible is it to live your life just getting by? That’s not enjoying it.”

However, thanks to a new $500 monthly payment she will receive for the next two years, she has been able to do more than just get by.

“I don’t stress as much because I have that little cushion,” Flores said.

The Chicago-area mom is one of more than 3,200 families who are receiving direct payments in the first-ever Cook County Promise Guaranteed Income Pilot Program for low-earning households.

“The money is unconditional and unrestricted,” explained Harish I. Patel with the Economic Security Project, a group which advocates for guaranteed income programs.

Cook County’s program is one of 130 similar guaranteed income pilot programs in 32 states and Washington, D.C., which have public and private funding and offer monthly stipends of anywhere from $50 to $1,500, according to data from the Economic Security Project.

“What we have seen is people, especially mothers, are spending money on diapers, food for their kids, sometimes getting that interview so they can have a full-time job, or starting a small business,” Patel said. “That’s actually where all the cash is going.”

Thanks to the extra income, Flores was able to rent a prom tuxedo for her son Isaiah, while her other son Elias now has the right gear for soccer.

“Seeing that joy on their face when I’m like, ‘Oh, you know, I can pay for this, I can pay for that,’ you know, I like it,” Flores said.

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Janet Shamlian

Janet Shamlian is a CBS News correspondent based in Houston, Texas. Shamlian’s reporting is featured on all CBS News broadcasts and platforms including “CBS Mornings,” the “CBS Evening News” and the CBS News Streaming Network, CBS News’ premier 24/7 anchored streaming news service.

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May 10, 2023
Life Expectancy In U.S. Faces Widest Wealth Gap in 40 Years | Entrepreneur

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Can your zip code and income correlate to how long you have to live?

Although life expectancy has declined overall in the U.S. during the last three years — it now stands at an average of 76, according to the CDC, as compared to 78 in 2019 — the decline is happening more rapidly in certain areas than in others.

A new report by research platform American Inequality, found a correlation between money and life expectancy, noting that Americans in wealthier countries live an average of 20 years longer than those in poorer areas — marking the widest gap in life expectancy in nearly 40 years.

Related: Compounding Inequality to Compounding Success: Bridging the Racial Wealth Gap

Oglala Lakota County in South Dakota had the lowest life expectancy in the country at 66.8, where the average income of the area is $30,347. By contrast, the county with the highest life expectancy in the U.S. was Summit County in Colorado at 86.9, where the average income is $77,589.

The disparity could be attributed to the rising cost of healthcare, which has nearly doubled over the past two decades and therefore poses a financial burden on Americans, per the report.

The two other counties with the lowest life expectancy were Union County in Florida, where the life expectancy was an average of 67.6 and an average income of $41,770, followed by Todd County, South Dakota at 68.5 years and an average income of $24,257.

Related: How This Innovative Technology is Making Healthcare More Affordable and Accessible

After Summit County, the second and third areas with the highest life expectancy were both in Colorado — Pitkin County at 86.5 years with an average income of $71,244 and Eagle County at 85.9 years and an average income of $84,685.

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Madeline Garfinkle

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April 14, 2023
Studies Suggest It’s Good Business to Hire Women Over Men. Here’s Why. | Entrepreneur

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Opinions expressed by Entrepreneur contributors are their own.

Research from cognitive neuroscience and behavioral economics has consistently shown that women are held back from career advancement compared to men.

A study of managers in 20 Fortune 500 companies discovered that men had a faster career progression and received higher pay than women, despite the fact that women had similar qualifications, worked in the same industries and had consistent work experience.

Another study of 138 executives, half male and half female, found that women had to work harder to overcome barriers such as exclusion from informal networks and receiving less mentoring than men.

Additionally, a study of over 1000 MBA graduates revealed that women faced discrimination more often than men, and even when controlling for work experience, women earned less than men.

It is clear that the “glass ceiling” exists, and women face discrimination that hinders their advancement compared to men, despite having similar qualifications, skills and experience.

Related: If You Want More Women in Leadership, You Have to Enact Concerted Change. Here’s How.

However, employing women over men may be the key to success for your business, according to a wealth of scientific research. Studies have shown that teams led by women tend to outperform those led by men and that companies with a higher proportion of women in leadership positions are more profitable.

One study published in the Harvard Business Review reports that companies with a higher proportion of women in top leadership positions “are more profitable, more socially responsible and provide safer, higher-quality customer experiences.” Focusing deeply on innovation, the study looked at 163 multinational companies over 13 years to determine how these firms’ long-term strategies shifted after women joined their top management teams. They discovered that firms became more open to change and less open to risk and shifted focus from M&A to R&D.

Other scholarship shows similar results. Research from the 1996 to 1997 National Organizations Survey revealed that firms with more gender diversity tend to have more clients, higher sales revenues and greater profits. Another study found that companies with at least 30% of women on their Board of Directors tend to be more profitable. Furthermore, a third study found that teams with gender balance tend to have better sales and profits compared to teams that are mostly male.

But why do teams led by women tend to perform better? Research suggests that women may be more effective leaders because they are more likely to foster a positive and inclusive work environment. Studies have found that women are more likely than men to encourage collaboration, share credit, and provide constructive feedback.

Additionally, women are often more adept at multitasking, which can be a valuable asset in today’s fast-paced business world. Women are also more likely to adopt a long-term perspective, which can be beneficial for a company’s long-term success.

However, it’s not just about the numbers. It’s also important to ensure that women are given equal opportunities to succeed and are not held back by unconscious bias.

Related: Women Are Being Pushed Out Of The Workforce, and It’s Time Employers Do Something About It. Here’s How.

Companies that prioritize diversity and inclusion tend to have a more engaged workforce and a more positive company culture. This can lead to increased productivity and employee satisfaction, as well as a more innovative and adaptable workforce.

This discrimination is often the result of implicit bias, which refers to unconscious and unwarranted associations and assumptions that we make due to our gut reactions, intuitions and instincts around people we perceive to belong or not belong to our group. These biases can take the form of the halo effect, where we make a too-positive evaluation of other aspects of an individual based on one characteristic we like, or the horns effect, where we downgrade all of another person’s characteristics based on one aspect we dislike.

To address these biases, it is important to evaluate their consequences and take steps to counteract them. This can include implementing diversity and inclusion programs, training employees on implicit bias and its effects, and actively seeking out and promoting qualified women for leadership positions. Additionally, it is important for both men and women to be aware of their own biases and work to counteract them in their interactions with colleagues and in their decision-making processes.

Overall, the research is clear that discrimination against women in the workplace is a real problem, and that addressing implicit bias is crucial to promoting gender equality and creating a more inclusive and equitable workplace. By taking proactive steps to counteract these biases, organizations can not only promote gender equality but also reap the benefits of improved performance and increased profitability.

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Gleb Tsipursky

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March 7, 2023
The US gender pay gap: Why it hasn’t narrowed much in 20 years | CNN Business

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New York
CNN
—

A lot can change in two decades. Or… not.

In 2022, US women on average earned about 82 cents for every dollar a man earned, according to a new Pew Research Center analysis of median hourly earnings of both full- and part-time workers.

That’s a big leap from the 65 cents that women were earning in 1982. But it has barely moved from the 80 cents they were earning in 2002.

“Higher education, a shift to higher-paying occupations and more labor market experience have helped women narrow the gender pay gap since 1982,” the Pew analysis noted. “But even as women have continued to outpace men in educational attainment, the pay gap has been stuck in a holding pattern since 2002, ranging from 80 to 85 cents to the dollar.”

Before getting to potential reasons why the pay gap hasn’t narrowed for two decades — let alone disappeared — it’s worth noting that the top-line average doesn’t tell the whole story of what’s been going on for women in different cohorts.

Take age: Women between the ages of 25 and 34 are much closer to achieving pay parity with men than they are likely to be when they get older.

Since 2007, younger women have been earning about 90 cents on the dollar, according to Pew: “But even as pay parity might appear in reach for women at the start of their careers, the wage gap tends to increase as they age.”

Having children is a factor, Pew found. For example, parenthood leads some women to put their careers on hold, or put in a shorter workweek. For employed fathers between the ages 35 and 44, having children at home is a time that often coincides with receiving higher pay even though the pay of employed mothers that same age is unaffected.

“In 2022, mothers ages 25 to 34 earned 85% as much as fathers that age, but women without children at home earned 97% as much as fathers. In contrast, employed women ages 35 to 44 — with or without children — both earned about 80% as much as fathers,” the report said.

Or take race and ethnicity: Pew found that Black women last year earned just 70% as much as White men. Hispanic women earned 65% as much. For White women, the gap was less, at 83%. Asian women were closest to parity, at 93%.

“To some extent, the gender wage gap varies by race and ethnicity because of differences in education, experience, occupation and other factors that drive the gender wage gap for women overall,” the Pew analysis noted.

“But researchers have uncovered new evidence of hiring discrimination against various racial and ethnic groups, along with discrimination against other groups, such as LGBTQ and disabled workers,” the report continued. “Discrimination in hiring may feed into differences in earnings by shutting out workers from opportunities,”

Lastly, consider occupation: Women are still overrepresented in lower-paying occupations such as personal care and service jobs; and underrepresented in higher-paying ones, like managerial and STEM jobs.

Regardless, the gender pay gap is typically narrowest when you pick any single occupation and control for measurable factors between men and women like education, tenure and hours worked.

“But it never goes away,” said Rakesh Kochhar, a Pew senior researcher.

The persistence of a gap over the past 20 years, even when comparing apples to apples, suggests there are other factors at play.

These can include potential discrimination. When Pew asked Americans in October what factors they believed played a role in the gender wage gap, half indicated a major reason is that employers treat women differently. Women were much more likely than men (61% vs 37%) to cite this as a major reason.

Another factor that may help explain the stickiness of the pay gap is that the wage premium for those with college degrees has grown smaller. So while more employed women (48%) now have at least a bachelor’s degree than men (41%), it is worth less.

Individual choices such as taking periods away from the workforce to care for children also continue to play a role. Those choices may be borne of cultural norms, societal issues such as a lack of affordable child care, or personal preference.

Narrowing the gender pay gap from here may be tough sledding.

“More sustained progress in closing the pay gap may depend on deeper changes in societal and cultural norms and in workplace flexibility that affect how men and women balance their careers and family lives,” Pew researchers suggested.

And even then, progress may be slower than desired, since, as they noted, “even in countries that have taken the lead in implementing family-friendly policies, such as Denmark, parenthood continues to drive a significant wedge in the earnings of men and women.”

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March 1, 2023
Black Americans more likely to be audited by the IRS than any other race

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Black Americans are up to five times more likely to have their federal tax returns audited than taxpayers of other races, according to a new study released this week.

With the IRS now accepting tax returns, the study provides evidence that some Americans have a greater risk of seeing an audit, a process that often delays refund checks.

The higher audit rate for Black taxpayers is due to a flawed AI algorithm relied on by the IRS to decide who gets audited, the study’s authors said. The study, which taps data from more than 148 million anonymous returns and 780,000 audits, offers suggestions for how the IRS might fix the disparity, including focusing on auditing filers with complicated returns.

“The IRS should drill down to understand and modify its existing audit selection methods to mitigate the disparity we’ve documented,” said Stanford University law professor Daniel Ho, who co-wrote the study. “And we’ve shown they can do that without necessarily sacrificing tax revenue.”

Tips for taxpayers as filing season begins

05:25

“Equitable enforcement of our tax laws is a top priority for the Administration, and resources provided by the Inflation Reduction Act will enable the IRS to upgrade technology and hire top talent to go after wealthy tax evaders,” a U.S. Treasury Department spokesperson said in an email to CBS MoneyWatch.

The IRS, a bureau of the Treasury, didn’t immediately respond to a request for comment.

“Small dollar” audit cases

The study, published Tuesday, comes from Ho and a team of other researchers including University of Michigan economist Evelyn Smith.

Even though many of the factors the IRS’ algorithm relies on are secret, the researchers said the program prioritizes “small-dollar, high certainty” audit cases and places less emphasis on how much a filer is claiming in income, Smith told NPR on Wednesday.

Black taxpayers tend to make the types of mistakes that the IRS historically has focused on,” Smith told NPR. “So an example would be claiming dependents. The IRS focuses very heavily on ensuring that dependents that are claimed for the purposes of EITC meet the eligibility criteria.”

IRS says tax refunds may be smaller this year

04:02

The study represents the first time the IRS has given an outside research team so much access to tax returns and completed audits, Ho and the others said. The returns, which were filed between 2010 and 2018, don’t reveal the filer’s race, so researchers used a special method (cross-referencing names, geography and Census tract data) to loosely predict which returns were filed by Black taxpayers.

The researchers said there’s no evidence that IRS agents — who don’t see the race of a tax filer — are purposely discriminating against Black Americans. However, the IRS could eliminate the disparity by auditing people with complex tax returns and people who underreport their income, they said.

The IRS’ audit rates have drawn criticism from other researchers as well as lawmakers, with a 2022 report finding that low-income households are five times as likely to be audited as higher-income taxpayers. That is due to higher audit rates linked to the Earned Income Tax Credit, a tax benefit for low-income workers that often leads to errors on tax returns.

The Stanford study also found a link between Black taxpayers claiming the EITC and being audited. Black people accounted for 21% of EITC claims in 2014 but they were 43% of EITC audits.

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Khristopher J. Brooks

Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.

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February 1, 2023
This prominent pastor says Christian nationalism is ‘a form of heresy’ | CNN

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CNN
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Left vs. right. Woke vs. the unwoke. Red State Jesus vs. Blue State Jesus.

There are some leaders who see faith and politics strictly as an either/or competition: You win by turning out your side and crushing the opposition.

But the Rev. William J. Barber II, who has been called “the closest person we have to MLK” in contemporary America, has refined a third mode of activism called “fusion politics.” It creates political coalitions that often transcend the conservative vs. progressive binary.

Barber, a MacArthur “genius grant” recipient, says a coalition of the “rejected stones” of America—the poor, immigrants, working-class whites, religious minorities, people of color and members of the LGBTQ community can transform the country because they share a common enemy.

“The same forces demonizing immigrants are also attacking low-wage workers,” the North Carolina pastor said in an interview several years ago. “The same politicians denying living wages are also suppressing the vote; the same people who want less of us to vote are also denying the evidence of the climate crisis and refusing to act now; the same people who are willing to destroy the Earth are willing to deny tens of millions of Americans access to health care.”

Barber’s fusion politics has helped transform the 59-year-old pastor into one of the country’s most prominent activist and speakers. As co-chair of the Poor People’s Campaign: A National Call for Moral Revival, he has helped lead one of the nation’s most sustained and visible anti-poverty efforts.

He electrified the crowd at the 2016 Democratic National Convention with a speech that one commentator called a “drop the mic” moment. And at a time when both political parties have been accused of ignoring the working class, Barber routinely organizes and marches with groups such as fast-food workers and union members.

“There is a sleeping giant in America,” Barber told CNN. “Poor and low-wealth folks now make up 30% of the electorate in every state and over 40% of the electorate in every state where the margin of victory for the presidency was less than 3%. If you could just get that many poor and low-wealth people to vote, they could fundamentally shift every election in the country.”

Starting this month, Barber will take his fusion politics to the Ivy League. Yale Divinity School has announced he’ll be the founding director of its new Center for Public Theology and Public Policy. In that role, Barber says he hopes to train a new generation of leaders who will be comfortable “creating a just society both in the academy and in the streets.”

Though he’s stepping down as pastor of the North Carolina church where he has served for 30 years, Barber says he is not retiring from activism. He remains president of Repairers of the Breach, a nonprofit that promotes moral fusion politics.

Barber recently spoke to CNN about his faith and activism and why he opposes White Christian nationalism, a movement that insists the US was founded as a Christian nation and seeks to erase the separation of church and state.

Barber’s answers were edited for brevity and clarity.

You’ve talked about poverty as a moral issue and said the US cannot tolerate record levels of inequality. But some extreme levels of poverty have always existed in this country. Why is it so urgent to face those problems now, and why should someone who isn’t poor care?

Doctor King used to say America has a high blood pressure of creeds, but an anemia of deeds. In every generation we’ve had to have a moment to focus on the urgency of the right now. We will never be able to fix our democracy until we fully face these issues. We will constantly ebb and flow out of recessions because inequality hurts us all.

Joseph Stiglitz (the Nobel Prize-winning economist) talks about this in his book “The Price of Inequality,” and says that it costs us more as a nation for these inequalities to exist than it would for us to fix them.

Look at how much it costs us to not have a living (minimum) wage. There was a group of Nobel Peace Prize-winning economists two years ago that debunked the notion that paying people a living wage (the federal minimum wage in the US is $7.25 an hour) would hurt business. They said it’s not true.

Well, President Roosevelt said that in the 1930s. He said that any corporation that didn’t pay people a living wage didn’t deserve to be an American corporation.

I don’t think that American society as a democracy can stand much more. We’re moving toward 50% of all Americans being poor and low wealth. It’s unnecessary.

Christian nationalism attempts to sanctify oppression and not liberation. It attempts to sanctify lies and not truth. At best it’s a form of theological malpractice. At worst, it’s a form of heresy.

Rev. William J. Barber II

We say in our founding documents that every politician swears to promote the general welfare of all people. You’re not promoting the general welfare of all people when you can get elected and go to Congress and get free health care but then sit in Congress and block the people who elected you from having the same thing.

We say equal protection under the law is fundamental. Well, there’s nothing equal about corporations getting all kinds of tax breaks and all kinds of ways to make more and more money, while the average worker makes 300% less than the CEOs.

Marjorie Taylor Greene calls herself a ‘nationalist.’ This is what that means

Some people cite the scripture where Jesus says, “The poor you always have with you” to argue that poverty is inevitable, and that trying to end it is a hopeless cause.

Every time they say that, they are misquoting Jesus. Because that’s not what Jesus meant or said. He was saying, yeah, the poor are going to be with you always, because he was quoting from Deuteronomy [15:11]. The rest of that scripture says the poor will always be with you because of your greed — I’m paraphrasing it, but that’s the meaning of it. The poor will always be with you is a critique of our unwillingness to address poverty.

To have this level of inequality existing is a violation of our deepest moral, constitutional and religious values. It’s morally inconsistent, morally indefensible, and economically insane. Why would you not want to lift 55 to 60 million people out of poverty if you could by paying them a basic living wage? Why would you not want that amount of resources coming to people and then coming back into the economy?

I want to ask you about Christian nationalism. What’s wrong with saying God loves America and that the country should be built on Christian values?

God doesn’t say it. That’s what’s wrong with it. The scriptures says God loves all people and that if a nation is going to embrace Christian values, then we got to know what those values are. And those values certainly aren’t anti-gay, against people who may have had an abortion, pro-tax cut, pro one party and pro-gun. There’s nowhere in the scriptures where you see Jesus lifting that up.

Jesus said the Gospel is about good news to the poor, healing to the brokenhearted, welcoming all people, caring for the least of these: the immigrant, the hungry, the sick, the imprisoned. Christian nationalism attempts to sanctify oppression and not liberation. It attempts to sanctify lies and not truth. At best, it’s a form of theological malpractice. At worst, it’s a form of heresy.

When you have some people calling themselves Christian nationalists, you never hear them say, “Jesus said this.” They say, “I’m a Christian, and I say it.” But that’s not good enough. If it doesn’t line up with the founder, then it’s flawed.

Are you an evangelical?

I’m very much an evangelical. I tell folks that I’m a conservative, liberal, evangelical Christian. And what that means is I believe in Jesus, not to the exclusion of other faith traditions because my founder said that “I have others who are not of this fold.” I believe that love, truth, mercy, grace and justice are fundamental to a life of faith. And for me to be evangelical means to start where Jesus started.

The word “evangel” is good news. When Jesus used that phase it was in his first sermon, which was a public policy sermon. He said it in the face of Caesar, where Caesar had hurt and exploited the poor. He said it right in the ghetto of Nazareth, where people said, “nothing good could come out of Nazareth.” He said, “The Spirit of the Lord is upon me to preach good news” — evangel —”to the poor.” That’s what evangelicalism is to Jesus. That’s the kind of evangelicalism that I embrace.

You’ve had health challenges over the years. How do you keep going year after year and keep yourself from being burned out?

I read the Bible one time, specifically looking to see if I could find any person in scripture that God used in a major way that did not have some physical challenge. And I couldn’t find it. That helped me get over any pity party.

You know, Moses couldn’t talk. Ezekiel had strange post-traumatic syndrome types of emotional issues. Jeremiah was crying all the time from his struggles with depression. Paul had a physical thorn in the flesh. Jesus was acquainted with sorrow.

Then then I looked down through history, and I couldn’t find anybody. Harriet Tubman had epileptic-type fits. Martin Luther King was stabbed before he did the March on Washington and had a breathing disorder after that.

During covid, I thought deeply about death and mortality. I have some immune deficiencies and challenges. I’ve battled this ankylosing spondylitis for now 40-plus years. At any time, it could shut my body down.

During covid, as I kept meeting people, I sat down one day and I said, Lord, why am I still here? I’m not better than these people. I know I’ve been around covid. My doctor said to me if I caught covid I probably would not fare well.

As I was musing one day, it dawned on me. That’s the wrong question. The question is never, why are you still alive? Why are you still breathing? The question is what are you going to do with the breath you have?

Because at any given moment, the scripture says we’re a step from death. And so I’ve decided that whatever breath I have, it is too precious to waste on hate, on oppression and on being mean to people. It’s only to be used for the cause of justice.

John Blake is the author of “More Than I Imagined: What a Black Man Discovered About the White Mother He Never Knew.”

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January 21, 2023
Why 200 millionaires want higher taxes: Inequality is

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More than 200 millionaires say they have a message for the corporate executives and billionaires attending the World Economic Forum in Davos this week: “Tax the ultra rich.”

The group, which includes actor Mark Ruffalo and Disney heir Abigail Disney, argues that the rich aren’t paying their fair share, allowing them to become even richer while inequality widens across the globe.

Meanwhile, a group of lawmakers in seven states plans to introduce bills this week that would raise taxes on the rich, the Washington Post reported. The states include California, Connecticut, Hawaii, Illinois, Maryland, New York and Washington.

The push for higher taxes on the rich comes as the U.S. is hurtling toward an economic crisis over reaching the debt ceiling, currently at $31.4 trillion, on Thursday. That figure represents borrowing the Treasury taps to fund financial obligations, from social safety-net programs like Social Security to the military budget and infrastructure spending. The number has ballooned from $24 trillion since President Donald Trump’s 2017 tax cuts, which primarily helped the rich and corporations lower their tax burdens.

“Eating our world alive”

“Extreme wealth is eating our world alive,” said Abigail Disney in a statement. “It is undermining our democracies, destabilizing our economies, and destroying our climate.”

She added, “But for all their talk about solving the world’s problems, the attendees of Davos refuse to discuss the only thing that can make a real impact — taxing the rich.”

Creating a federal U.S. wealth tax could raise more than $583 billion annually, revenue that could be used to boost education spending by almost half, according to a new report from Oxfam, Patriotic Millionaires, the Institute for Policy Studies and the Fight Inequality Alliance that was released on Wednesday.

The group is calling for a new progressive wealth tax, which would add a 2% tax for people with net wealth of $5 million or more, 3% for those with $50 million or more and 5% for those with $1 billion or more. “Tax the ultra rich and do it now,” said a letter signed by the 200 millionaires.

World Economic Forum warns of global “polycrisis” in next decade

06:07

The rich get richer

The benefits of the growing economy have largely accrued to the richest Americans, according to the new report.

In the past decade, the richest 1% of Americans have seen their wealth grow 19 times faster than the bottom half of the population. On a dollar basis, that means $37 of every $100 has gone to the top 1%, while the bottom 50% received $2, it found.

The U.S. has about 64,500 people with more than $50 million in wealth and 728 billionaires, ranging from Elon Musk to Jeff Bezos.

While the report focuses on the fortunes of wealthy individuals, corporations have also benefited during the past several years due to the tax cuts enacted by former President Trump.

The average effective tax rate for profitable large corporations, or the percentage of income paid after tax breaks, fell from 16% to 9% in 2018, the first year the tax cuts went into effect, according to a new report from the U.S. Government Accountability Office, a government watchdog.

The impact of extreme wealth

About 7 in 10 economists believe inequality is rising across the globe due to tax cuts for the rich, according to the new report, which surveyed 135 economists in 40 nations. About the same proportion believe the rich pay lower taxes in relation to their income compared with the average citizen in their country, the report added.

The latter has been a criticism of the U.S. tax system, with a 2019 analysis from economists Emmanuel Saez and Gabriel Zucman finding that the 400 richest U.S. families enjoy a lower overall tax rate than the middle class. The rich have been helped by the 2017 Tax Cuts and Jobs Act, as well as lower tax rates for capital gains, including profits from investments, compared with earned income.

Such an upside-down tax system is hurting the nation’s economic stability and social cohesion, said Chuck Collins, a board member of the Patriotic Millionaires, in a statement. It also makes it more difficult for the U.S. to raise revenue, he added.

“Our failure to tax the rich effectively is making things much, much worse,” he said.

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January 18, 2023
The top 1% captured nearly twice as much new wealth as the rest of the world over last two years | CNN Business

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New York
CNN
—

The world’s wealthiest residents have been getting far richer, far faster than everyone else over the past two years.

The top 1% have captured nearly twice as much new wealth as the rest of the world during that period, according to Oxfam’s annual inequality report, released Sunday. Their fortune soared by $26 trillion, while the bottom 99% only saw their net worth rise by $16 trillion.

And the wealth accumulation of the super-rich accelerated during the pandemic. Looking over the past decade, they netted just half of all the new wealth created, compared to two-thirds during the last few years.

The report, which draws on data compiled by Forbes, is timed to coincide with the kickoff of the annual World Economic Forum meeting in Davos, Switzerland, an elite gathering of some of the wealthiest people and world leaders.

Meanwhile, many of the less fortunate are struggling. Some 1.7 billion workers live in countries where inflation is outpacing wages. And poverty reduction likely stalled last year after the number of global poor skyrocketed in 2020.

“While ordinary people are making daily sacrifices on essentials like food, the super-rich have outdone even their wildest dreams,” said Gabriela Bucher, executive director of Oxfam International. “Just two years in, this decade is shaping up to be the best yet for billionaires — a roaring ’20s boom for the world’s richest.”

Though their riches have slipped somewhat over the past year, global billionaires are still far wealthier than they were at the start of the pandemic.

Their net worth totals $11.9 trillion, according to Oxfam. While that’s down nearly $2 trillion from late 2021, it’s still well above the $8.6 trillion billionaires had in March 2020.

The wealthy are benefiting from three trends, said Nabil Ahmed, Oxfam America’s director of economic justice.

At the start of the pandemic, global governments, particularly wealthier countries, poured trillions of dollars into their economies to prevent a collapse. That prompted stocks and other assets to soar in value.

“So much of that fresh cash ended up with the ultra-wealthy, who were able to ride this stock market surge, this asset boom,” Ahmed said. “And the guardrails of fair taxation weren’t in place.”

Also, many corporations have done well in recent years. Some 95 food and energy companies have more than doubled their profits in 2022, Oxfam said, as inflation sent prices soaring. Much of this money was paid out to shareholders.

In addition, the longer term trends of the unwinding of workers’ rights and greater market concentration is heightening inequality.

By contrast, global poverty increased greatly early in the pandemic. Though some progress in poverty reduction has been made since then, it is expected to have stalled in 2022, in part because of the war in Ukraine, which exacerbated high food and energy prices, according to World Bank data cited by Oxfam.

It’s the first time that extreme wealth and extreme poverty have increased simultaneously in 25 years, said Oxfam.

To counter this growing inequality, Oxfam is calling on governments to raise taxes on their wealthiest residents.

It proposes introducing one-time wealth tax and windfall taxes to end profiteering off global crises, as well as permanently increasing taxes on the richest 1% of residents to at least 60% of their income from labor and capital.

Oxfam believes the rates on the top 1% should be high enough to significantly reduce their numbers and wealth. The funds should then be redistributed.

“We do face an extreme crisis of wealth concentration,” Ahmed said. “And it’s important before all, I think, to recognize that it’s not inevitable. A strategic precondition to reining in extreme inequality is taxing the ultra-wealthy.”

The group, however, faces an uphill battle. Some 11 countries cut taxes on the rich during the pandemic. And efforts to hike levies on the wealthy fell apart in the US Congress in 2021, even though Democrats controlled both chambers and the White House.

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January 16, 2023
Wyoming’s new land rush

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Jackson, Wyoming is often called the Last of the Old West. Its cowboy culture runs so deep it even rides long on the morning cup of coffee. And while some of the best things in life here may be free, you pay a steep price to live in this valley known as Jackson Hole.

Elizabeth Hutchings moved here from Massachusetts in 2018. “I love this community and I love the place where I live. But there is always that question in the back of your mind of, are you going to be able to survive here?”

For the first seven months, the only place she could afford to live was in her van.

Correspondent Ben Tracy asked, “Between living in your van, your car, and various apartments, how many places have you lived here in four years?”

“Eight or nine,” Hutchings replied. “And in a lotta places there’s been that question of, ‘Oh, this is home, but for how long?’”

Teton County is now home to a divide bigger than those mountains for which it’s named. It is the wealthiest, and most unequal, in America. The average income here is $312,000. The median home price in the county is now more than $3.6 million. That’s left a food pantry overwhelmed by demand, staring at $6 million townhomes rising across the street.

Hutchings said, “The level of wealth you see and the level of disparity that you see, I mean, some people have more money than you could spend in ten lifetimes.”

With COVID accelerating the arrival of the ultra-wealthy, Teton County in Wyoming is now home to the widest income divide in America, squeezing out the middle class.

CBS News

There’s a saying in town that you either have three homes or three jobs. Many workers have been forced to cheaper towns nearly 40 miles away over sometimes treacherous roads.

Hutchings works at a local restaurant, and shares a basement apartment with a roommate. It’s the most stable housing she’s ever had here.

“If you’re spending so much of your time driving, or so much of your time working, just trying to survive, I think everybody has that question of, is it worth it?” she said.

Elizabeth Hutchings works in a Jackson, Wyoming restaurant. “There is always that question in the back of your mind of, are you going to be able to survive here?”

CBS News

Yale School of the Environment professor Justin Farrell grew up in Wyoming, and is author of the book “Billionaire Wilderness.” He said the middle class here has been completely hollowed out.

Tracy asked, “Inequality is an issue playing out across the country. Is it uniquely bad here?”

Princeton University Press

“It is uniquely bad, actually. It’s nation-leading bad,” Farrell replied. “If you’re making $40,000 or $50,000, $60,000, you’re likely living in your car, or you’re living 45 minutes away. For most people, it’s becoming unlivable.”

The reason, he said, is that the ultra-wealthy find Teton County very livable. Their arrival here accelerated during COVID. The desire for multi-million dollar mountain escapes has created a new land rush.

Farrell said, “Americans have always looked West. It’s always been the lodestar of American identity. And probably Jackson Hole, with the cowboy image and the Tetons, it’s, I think, what makes it so special for so many people. On top of that, it’s functionally a tax haven. Wyoming does not have a state income tax. It doesn’t have a corporate tax. So, it’s a really great place to park your money legally.”

All that wealth is cleverly disguised behind a facade of pickup trucks and jeans. it’s almost as if the landmark watering hole, the Million Dollar Cowboy Bar, knew what was coming

Farrell said, “This place is really unique, because it allows people to engage in this personal transformation to become a normal person. They rely on the Western stereotypes to do that, and so you have these millionaires and even billionaires dressing in Wrangler jeans, dressing down, trying to avoid any sort of class indicators that might make them look wealthy. And I think it’s really well-intentioned.”

Phil Hartl is a private wealth advisor who moved here from high-tax California. He and his wife Monica relocated to Jackson in late 2020. “It was really about living in a different kind of place and really being closer to nature,” he said. “And so, it’s tremendous to be a part of that.”

Private wealth advisor Phil Hartl relocated to Wyoming from California.

CBS News

Tracy said, “I get a sense that you really do have a respect for the place.”

“Very much so.”

“And I don’t want this to sound rude, but I assume you’re aware that some people here think you’re part of the problem?”

“Oh, of course. Absolutely, absolutely.”

“How does that feel?”

“It’s my responsibility to show them that, you know, I understand that we came here more recently – we’re COVID babies, right?” Hartl said. “But at the same time, if you approach it with a regard and a respect and a listening, and at the end of the day, like anywhere, they judge you as an individual, what kind of person you are.”

Hartl said he’s planning to donate a third of his tax savings to local nonprofits and charities. (Teton County is one of the most philanthropic communities in America.) “Am I part of the problem? Sure I am, you know?” said Hartl. “I’m one of the people that came in and was able to buy a house at a marked-up price. And I’m very grateful for that. But again, I also see that I have an obligation as a result.”

The median home price in Teton County is above $3.6 million.

CBS News

For Elizabeth Hutchings, she says she wants to make sure people like her – the horsepower that keeps this cowboy town running – can also call it home. “If we don’t find a way to create a more equitable society and to support people with housing and human services, you won’t have an economy,” she said. “You won’t have dozens of nice restaurants to eat at.”

Tracy asked, “Do you look down the road and do you see yourself here in ten years?”

“I don’t care if I’m here in ten years,” Hutchings said, “but I want other people to have a better quality of life in ten years.”

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Story produced by Sari Aviv. Editor: Karen Brenner.

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October 16, 2022