People of all races and ethnicities are demanding racial and economic justice. We have experienced a collective racial reckoning.  We also have realized that systems and structures drive racial and economic inequities.  There has been a momentous groundswell in a movement for multi-sector system change, and it is led by people furthest from economic and wealth equity.

The events of 2020 clarified that talking about a problem is not the same as solving it. That well-intentioned statements are not synonymous with driving impact. That reckoning is not the same as reconciliation or repair. And, that the true measure of this unprecedented moment will not be the intention of society to change, but the evidence of positive change in the lives of Black, Indigenous and People of Color (BIPOC), low- and moderate-income and low-wealth people.

Since there is near-consensus that racial economic and wealth inequity is no accident, we are ready to pivot to design, develop and implement comprehensive solutions to reverse the trends that perpetuate inequity.  

To begin, it is imperative to understand the causes of racial economic and wealth inequity. Spoiler! It is not a lack of education or motivation of the people suffering social, economic, and political inequity. Instead, the unwillingness of those with privilege and power to act on behalf of the people closest to the problem perpetuates it. Prioritizing the people furthest from justice benefits all of us.

To solve a problem, we must understand its origin.

• Racial Wealth Gap. Black and Latinx households now own just five cents and 14 cents of wealth, respectively, for every dollar of wealth owned by White households.
• Racial Wage Gap. Communities of color experience a wage gap that today sees median Latinx and Black individuals earning incomes that are 25 – 30% lower than their White peers.
• Racial Asset Gap. Black and Latinx families lost nearly 600,000 homes between 2007-2009. Between 2007 and 2013, median Black families lost 51% of their household net worth, while median Latinx families lost 48% of their wealth.
• Racial Funding Gap. Philanthropy is overwhelmingly White-led. Though hundreds of billions of dollars circulate in charity dollars, only eight percent of foundational grant-making is invested in communities of color.
• Racial Debt Gap. Black adults take on 85% more education debt than their White counterparts, and that disparity compounds by seven percent each year after the borrowers leave school.
• Racial Poverty Gap. 52.6% of households of color –more than 172 million – are liquid asset poor, meaning that they lack sufficient savings to get by at the federal poverty level for three months.

There is plenty of work to do! Programs, products and services, and policies as well as the institutions, systems, and structures that uphold them all need transformation to bring about reparative justice for BIPOC communities. Prosperity Now is singularly focused on addressing racial and economic inequalities. For example, our Racial Wealth Divide Initiative (RWDI) work in 16 cities, 11 states with 100+ BIPOC organizations demonstrates that effective interventions emerge after the people most impacted by inequity are centered in the solution-making process.

RWDI was launched in 2015 as a national demonstration project to understand, articulate and positively impact racial economic and wealth inequities in partnership with the institutions and people closest to the problem. RWDI has gleaned transferrable insights, lessons learned and emerging promising practices to facilitate the move from education to advancement of solutions for impact.

As we enter our sixth year, we remain steadfast, even in the midst of the most significant social, economic, political and health crises our society has faced. We believe the tools we have developed for technical assistance and transformational capacity building drive resources into the pockets of community members and institutions that need them most.

So, what is needed to operationalize (do) racial economic and wealth equity work?

Operationalizing an equity approach is a commitment to use data and research to drive decision making. It means giving priority to the people most impacted in the cure we are creating.  Monitoring the economic outcomes of target beneficiaries is essential to ensuring that well-intentioned interventions have the desired positive impact.

The success of any equity intervention is measured by its ability to drive resources to community members, fund organizations that serve them and shift the ecosystems they operate in to ensure nonprofits, public, private, and philanthropic allies use an equity approach.

Inequity is exacerbated by lack of access to power and privilege, so it is essential for BIPOC with lived experience to lead as experts who can ensure impact mirrors intention.

Finally, the ultimate goal of racial economic and wealth equity is for low- and moderate-income, low-wealth people to reach parity with the cost of living. Often, there is a zero-sum frame that casts some as winners and others as losers when we seek equity and justice for all. This is a false dichotomy, as life is not a competition. The approach outlined above is designed to build communities, institutions, systems, and structures that generate the resources needed for every individual and family to earn and own more than they owe so they, and future generations, can live liberated and prosperous lives.