The map below shows the estimated share and count of workers in each congressional district who would receive wage increases if the Raise the Wage Act of 2021 were enacted into law. The map also breaks down the share of workers who would benefit by age, gender, and race and ethnicity. Hover over any congressional district to see more information about the workforce that would be affected by the proposed federal minimum wage increase. (Grayed areas denote districts where few, if any, workers are likely to be affected by a change in the federal minimum wage because the prevailing state or local minimum wage will already be $15 or higher by 2025.) The table below the map lists all the data for all congressional districts.

Note: This page and map are an update to “The Impact of Raising the Minimum Wage to $15 by 2025, by Congressional District,” Economic Policy Institute, July 25, 2019.

Minimum Wage

Note that the map shows where affected workers live, which may be different from where they work. EPI’s Minimum Wage Simulation Model takes these differences into account by using data from the American Community Survey to compare the proposed change in the federal minimum wage with the prevailing minimum wage where individuals work. Because the map tracks where affected workers live, there may be small numbers of affected workers in congressional districts where the local minimum wage will already exceed $15 in 2025 (some workers living in those congressional districts may work in a different district). See the methodology for greater detail.

In addition, the Raise the Wage Act of 2021 also gradually raises and eliminates the lower minimum wage for tipped workers. In some jurisdictions that will already have a $15 minimum wage in 2025, there may be tipped workers who would be affected by the change in federal policy because their state or local tipped minimum wage law would still be lower than the proposed federal tipped minimum wage. See EPI’s research on the tipped minimum wage for more information.

Minimum Wage

• Unemployment is at historic levels. Today, as many as 30 million people are receiving unemployment insurance. By contrast, the previous high was roughly 12 million.
• Unemployed workers need extra assistance during the pandemic. The $600 benefit is essential for millions of people to get food, to pay rent, to care for their children, to afford basic necessities. If it is cut off, it will mean a sharp decline in their living standards, an increase in poverty, and completely unnecessary suffering.
• Cutting off the $600 benefit will make racial inequality worse. Black and brown communities are suffering more from this pandemic, both physically and economically, due to historic and continuing systemic racism.
• Cutting off the $600 benefit will kill millions of jobs. The spending generated by that $600 is supporting over 5 million jobs. In other words, kill the $600 and you will kill 5 million jobs—jobs in every single state.
• Cutting off the $600 benefit will not be an incentive to work. Some on the right have criticized the $600 as being a disincentive to work because many people have higher income on unemployment insurance than they did in their prior job. But this gets it all wrong. Right now in the U.S., there are 14 million more unemployed workers than there are job openings, so millions will remain jobless no matter what they do. You can’t incentivize people to get jobs that aren’t there.

Cutting off or reducing the $600 will cause enormous hardship and further damage the economy. And all of this is preventable. Policymakers need to take this crisis seriously and take the data seriously—and extend the $600 unemployment benefit.

The federal minimum wage is just $7.25 and has not increased since 2009. The Raise the Wage Act of 2019 passed by the U.S. House of Representatives on July 18 would gradually raise the federal minimum wage to $15 an hour by 2025. EPI research shows that raising the federal minimum wage to $15 an hour by 2025 would lift pay for over 33 million workers across the country—that’s 22.2 percent of the U.S. workforce. The increases would provide an additional $92 billion in wages for the country’s lowest-paid workers, with the average affected worker who works year-round receiving an extra $2,800 a year.

The map below shows the estimated share and count of workers in each congressional district who would receive wage increases if the Raise the Wage Act of 2019 were enacted into law. The map also breaks down the share of workers who would benefit by age, gender, and race. Click on any congressional district to see more information about the workforce that would be affected by the proposed federal minimum wage increase. The table below the map lists all the data for all congressional districts.

Minimum Wage

Note that the map shows where affected workers live, which may be different from where they work. EPI’s Minimum Wage Simulation Model takes these differences into account by using data from the American Community Survey to compare the proposed change in the federal minimum wage with the prevailing minimum wage where individuals work. As a consequence, there may be small numbers of affected workers in congressional districts where the local minimum wage will already exceed $15 in 2025 because some workers living in that congressional district work in a different district. See the methodology for greater detail.

In addition, the Raise the Wage Act of 2019 also gradually raises and eliminates the lower minimum wage for tipped workers. In some jurisdictions that will already have a $15 minimum wage in 2025, there may be tipped workers who would be affected by the change in federal policy because their state or local tipped minimum wage law would still be lower than the proposed federal tipped minimum wage. See EPI’s research on the tipped minimum wage for more information.

Minimum Wage

The map below shows the share and count of workers in each congressional district that would receive wage increases if the Raise the Wage Act of 2019 were enacted into law. The map also breaks down the share of workers who will benefit by age, gender, and race. Click on any congressional district to see more information about the workforce that would be affected by the proposed federal minimum wage increase. The table below the map lists all the data for all congressional districts.

Minimum Wage

Note that the map shows where affected workers live, which may be different from where they work. EPI’s Minimum Wage Simulation Model takes these differences into account, by using data from the American Community Survey to compare the proposed change in the federal minimum wage with the prevailing minimum wage where individuals work. As a consequence, there may be small numbers of affected workers in congressional districts where the local minimum wage will already exceed $15 in 2024 because some workers living in that congressional district work in a different district. See the methodology for greater detail.

In addition, the Raise the Wage Act of 2019 also gradually raises and eliminates the lower minimum wage for tipped workers. In some jurisdictions that will already have a $15 minimum wage in 2024, there may still be tipped workers who would be affected by the change in federal policy because their state or local tipped minimum wage law would still be lower than the proposed federal tipped minimum wage. See EPI’s research on the tipped minimum wage for more information.

As the infographic shows, the North American Free Trade Agreement (NAFTA) resulted in growing U.S.-Mexico trade deficits that caused nearly 700,000 lost U.S. jobs between 1993 and 2010.

Likewise, in the first two years the Korea-U.S. Free Trade Agreement (KORUS) took effect, U.S. exports to Korea declined, and growing trade deficits with that country resulted in nearly 60,000 lost U.S. jobs.

The “Transparency In Visa Reporting To Protect American Jobs And Prevent Human Trafficking Act” seeks to protect foreign workers, here in the United States on temporary, legal work visas, from exploitation by dishonest employers who lure with the promise of a decent job and subsequently coerce them into unbearable conditions, such as sex trade or domestic servitude.

The Department of Justice and FBI reported over 1,200 human trafficking investigations in 2011. There are likely many more victims since this is a widely underreported crime.

WHO: Congresswoman Lois Frankel

Congressman Ted Deutch

Congressman Jim Himes

Representatives from the Economic Policy Institute & Global Workers Justice Alliance

WHAT:           Conference Call – Combatting Human Trafficking

WHERE:         Call in number provided upon RSVP

WHEN:           Thursday, July 24, 2014

1:00 – 1:30 pm EST

This presentation documents historical and current trends in wage and benefit disparities between women and men. It examines disparities at different points in the wage distribution, for different education levels and occupations, and by age, including workers in retirement. The main findings include the following:

• Women’s wages still lag men’s, particularly at the high end of the wage distribution, though the gap has narrowed over time. In 2013, women’s hourly wages were 83.4 percent of men’s at the median of the wage distribution.
• Women are disproportionately in low-wage and service occupations.
• Women are less likely to have workplace benefits such as employer-sponsored insurance and pensions than their male counterparts.
• A lifetime of compensation inequality means that women are more economically vulnerable in retirement: Elderly women are more than 10 percentage points more likely to be economically vulnerable than men.

There is no cost to the economy of women catching up to men. Through increasing bargaining power of workers generally, it’s possible to reduce the gender gap and increase wages.

Wage disparities between men and women

In 2013, the median hourly wage for men was $18.11 compared with $15.10 for women. At that point in the wage distribution, women make 83.4 percent of what men make—about 83 cents on the dollar. As shown in Figure A, this gap has been closing, though it’s clear that typical men’s wages have been stagnating as women’s wages are slowly increasing. In 1979, women at the middle made about 63 percent of what men made, or 63 cents on the dollar.

Figure A

Figure A

The gender wage gap occurs at all levels of the distribution. As shown in Figure B, the gender wage gap is greater at higher points of the wage distribution; women near the bottom (at the 10^thpercentile) make about 92 cents on the dollar while women at the 95^th percentile make only 76 cents on the dollar relative to men.

Figure B

Figure B

Women are concentrated in low-wage sectors

According to a recent Council of Economic Advisers presentation, “Women are concentrated in low-wage sectors of the labor force such as health care support and personal care and are underrepresented in occupations with high average wages, such as STEM occupations.”

Furthermore, the National Women’s Law Center (NWLC) finds that women make up three-fourths of workers in the 10 largest occupations that typically pay low wages (Figure C), and over one-third of these low-wage workers are women of color.

Figure C

Figure C

Low-wage job growth has fueled the recovery for women.  Between 2009 and 2013, 35 percent of women’s employment growth can be attributed to low-wage occupations, twice as large as the low-wage share of men’s employment growth (18 percent), according to NWLC. Notably, these low-wage occupations are still paying full-time working women 10 percent less than men.

As Figure D shows, women are also less likely to have workplace benefits. Among strongly attached private-sector workers, 55.8 percent of men have employer-sponsored health insurance coverage compared with only 49.9 percent of women. Women are also less likely to have employment-based pension coverage: 41.9 percent compared with 43.6 percent for men.

Figure D

Figure D

Even at the start of their careers, there is a substantial gap between wages of women and men. Figures E and F examine wages for recent high school and college graduates, respectively. Entry-level wages for men with only a high school degree were $11.73 on average in 2013 compared with only $9.98 for women. Among recent college graduates, men earn on average $22.67 an hour compared with $19.04 for women. These gaps are particularly striking given the fact that women have likely not left the labor force at this point to care for children.

Figure E

Figure E

Figure F

Figure F

Among those with advanced degrees, however, it is clear from Figure G that the gender wage gap grows throughout women’s lifetimes. Wages are similar for men and women early in their careers, however, the earnings gap widens substantially over time; by their mid-30s and approaching 40, earnings for men are more than 50 percent higher than women’s earnings.

Figure G

Figure G

A lifetime of inequality means that women are more economically vulnerable in retirement

As Figure H shows, 52.6 percent of women age 65 and older are “economically vulnerable,” compared with 41.9 percent of men age 65 and older. In fact, at every level of the distribution, the shares of men who are above the “economically vulnerable” threshold are larger than the corresponding shares of women who are above this threshold. Likewise, at every level, the shares of men below the “economically vulnerable” threshold are smaller than the corresponding shares of women.

Figure H

Figure H

It’s important to note as well that this is not a statistical artifact based on the fact that women live longer than men—although women’s longer lifespans do indeed make retirement planning that much more challenging. In fact, women are more likely to be economically vulnerable than men among both the young elderly and the older elderly (as shown in Figure I). Women age 65 to 79 are 9 percentage points more likely to be economically vulnerable than men, and women age 80 and older are 13 percentage points more likely to be economically vulnerable than men.

Figure I

Figure I

Inducing comparable pay would have real benefits for women’s living standards

If we want to reduce poverty, comparable pay is a great way to do it, as shown in Figure J.

Figure J

Figure J

According to a January 2014 report on equal pay from the Institute for Women’s Policy Research, “providing equal pay to women would have a dramatic impact on their families. The poverty rate [of working women] would be cut in half, falling to 3.9 percent from 8.1 percent.” The impact on single women and single mothers with children is particularly dramatic.

There is no cost to the economy of women catching up to men. Workers generally have failed to see gains from a growing economy; there’s plenty of room to increase bargaining power of workers generally, reducing the gender gap and increasing wages.

i.

Education Policy is Housing Policy

We cannot substantially improve the performance of the poorest African American students – the “truly disadvantaged,” in William Julius Wilson’s phrase – by school reform alone. It must be addressed primarily by improving the social and economic conditions that bring too many children to school unprepared to take advantage of what schools have to offer.

The conclusion rests on two distinct analyses:

– First, social and economic disadvantage – not only poverty, but a host of associated conditions – depresses student performance, and

– Second, concentrating students with these disadvantages in racially and economically homogenous schools depresses it further.

The schools that the most disadvantaged black children attend today are segregated because they are located in segregated neighborhoods far distant from truly middle class neighborhoods. We cannot desegregate schools without desegregating these neighborhoods, and our ability to desegregate the neighborhoods in which segregated schools are located is hobbled by historical ignorance. Too quickly forgetting twentieth century history, we’ve persuaded ourselves that the residential isolation of low-income black children is only “de facto,” the accident of economic circumstance, personal preference, and private discrimination. But unless we re-learn how residential segregation is “de jure,” resulting from racially-motivated public policy, we have little hope of remedying school segregation that flows from this neighborhood racial isolation.

The individual predictors of low achievement are well documented:

• With less access to routine and preventive health care, disadvantaged children have greater absenteeism, and they can’t benefit from good schools if they are not present.
• With less literate parents, they are read to less frequently when young, and are exposed to less complex language at home.
• With less adequate housing, they rarely have quiet places to study and may move more frequently, changing schools and teachers.
• With fewer opportunities for enriching after-school and summer activities, their background knowledge and organizational skills are less developed.
• With fewer family resources, their college ambitions are constrained.

As these and many other disadvantages accumulate, lower social class children inevitably have lower average achievement than middle class children, even with the highest quality instruction.

When a school’s proportion of students at risk of failure grows, the consequences of disadvantage are exacerbated.

In schools with high proportions of disadvantaged children,

• Remediation becomes the norm, and teachers have little time to challenge those exceptional students who can overcome personal, family, and community hardships that typically interfere with learning.
• In schools with high student mobility, teachers spend more time repeating lessons for newcomers, and have fewer opportunities to adapt instruction to students’ individual strengths and weaknesses.
• When classrooms fill with students who come to school less ready to learn, teachers must focus more on discipline and less on learning.
• Children in impoverished neighborhoods are surrounded by more crime and violence and suffer from greater stress that interferes with learning.
• Children with less exposure to mainstream society are less familiar with the standard English that’s necessary for their future success.
• When few parents have strong educations themselves, schools cannot benefit from parental pressure for higher quality curriculum,
• Children have few college-educated role models to emulate, and
• They have few classroom peers whose own families set higher academic standards.

Nationwide, low-income black children’s isolation has increased. It’s a problem not only of poverty but of race.

• The share of black students attending schools that are more than 90 percent minority has grown in the last twenty years from about 34 percent to about 40 percent.
• Twenty years ago, black students typically attended schools in which about 40 percent of their fellow students were low-income; it is now about 60 percent.
• In cities with the most struggling students, the isolation is even more extreme. The most recent data show, for example, that in Detroit, the typical black student attends a school where 2 percent of students are white, and 85 percent are low income.

It is inconceivable that significant gains can be made in the achievement of black children who are so severely isolated.

As I mentioned, this school segregation mostly reflects neighborhood segregation. In urban areas, low-income white students are more likely to be integrated into middle-class neighborhoods and less likely to attend school predominantly with other disadvantaged students. Although immigrant low-income Hispanic students are also concentrated in schools, by the third generation their families are more likely to settle in more middle-class neighborhoods.

The racial segregation of schools has been intensifying because the segregation of neighborhoods has been intensifying. Analysis of Census data by Rutgers University Professor Paul Jargowsky has found that in 2011, 7 percent of poor whites lived in high poverty neighborhoods, where more than 40 percent of the residents are poor, up from 4 percent in 2000; 15 percent of poor Hispanics lived in such high poverty neighborhoods in 2011, up from 14 percent in 2000; and a breathtaking 23 percent of poor blacks lived in high poverty neighborhoods in 2011, up from 19 percent in 2000.

In his 2013 book, Stuck in Place, the New York University sociologist Patrick Sharkey defines a poor neighborhood as one where 20 percent of the residents are poor, not 40 percent as in Paul Jargowsky’s work. A 20-percent-poor neighborhood is still severely disadvantaged. In such a neighborhood, many, if not most other residents are likely to have very low incomes, although not so low as to be below the official poverty line.

Sharkey finds that young African Americans (from 13 to 28 years old) are now ten times as likely to live in poor neighborhoods, defined in this way, as young whites—66 percent of African Americans, compared to 6 percent of whites. What’s more, for black families, mobility out of such neighborhoods is much more limited than for whites. Sharkey shows that 67 percent of African American families hailing from the poorest quarter of neighborhoods a generation ago continue to live in such neighborhoods today. But only 40 percent of white families who lived in the poorest quarter of neighborhoods a generation ago still do so.

Considering all black families, 48 percent have lived in poor neighborhoods over at least two generations, compared to 7 percent of white families. If a child grows up in a poor neighborhood, moving up and out to a middle-class area is typical for whites but an aberration for blacks. Black neighborhood poverty is thus more multigenerational, while white neighborhood poverty is more episodic.

From the perspective of children, think of it this way: black children in low-income neighborhoods are more likely to have parents who also grew up in low-income neighborhoods than white or Hispanic children in low-income neighborhoods. The implications for children’s chances of success are dramatic: Sharkey calculates that “living in poor neighborhoods over two consecutive generations reduces children’s cognitive skills by roughly eight or nine points … roughly equivalent to missing two to four years of schooling.”

And Sharkey has a final finding in this regard that is most startling of all: Children in poor neighborhoods whose mothers grew up in middle-class neighborhoods score only slightly below, on average, the average scores of children whose families lived in middle-class neighborhoods for two generations. But children who live in middle-class neighborhoods yet whose mothers grew up in poor neighborhoods score much lower. Sharkey concludes that “the parent’s environment during [her own] childhood may be more important than the child’s own environment.”

Integrating disadvantaged black students into schools where more privileged students predominate can narrow the black-white achievement gap. But the conventional wisdom of contemporary education policy notwithstanding, segregated schools with poorly performing students cannot be “turned around” while remaining racially isolated. And the racial isolation of schools cannot be remedied without undoing the racial isolation of the neighborhoods in which they are located.

ii.

The Myth of De Facto Segregation

In 2007, the Supreme Court made integration more difficult when it prohibited the Louisville and Seattle school districts from making racial balance a factor in assigning students to schools, in cases where applicant numbers exceeded available seats.

The plurality opinion by Chief Justice John Roberts called student categorization by race unconstitutional unless designed to reverse effects of explicit rules that segregated students by race. Desegregation efforts, he ruled, are impermissible if students are racially isolated, not as the result of government policy but because of societal discrimination, economic characteristics, or what Justice Clarence Thomas, in his concurring opinion, termed “any number of innocent private decisions, including voluntary housing choices.”

In Roberts’ terminology, commonly accepted by policymakers from across the political spectrum, constitutionally forbidden segregation established by federal, state or local government action is de jure, while racial isolation independent of state action, as, in Roberts’ view, like that in Louisville and Seattle, is de facto.

It is generally accepted today, even by sophisticated policymakers, that black students’ racial isolation is now de facto, not only in Louisville and Seattle, but in all metropolitan areas, North and South.

Even the liberal dissenters in the Louisville-Seattle case, led by Justice Stephen Breyer, agreed with this characterization. Breyer argued that school districts should be permitted voluntarily to address de facto racial homogeneity, even if not constitutionally required to do so. But he accepted that for the most part, Louisville and Seattle schools were not segregated by state action and thus not constitutionally required to desegregate.

This is a dubious proposition. Certainly, Northern schools have not been segregated by policies assigning blacks to some schools and whites to others; they are segregated because their neighborhoods are racially homogenous.

But neighborhoods did not get that way from “innocent private decisions” or, as the late Justice Potter Stewart once put it, from “unknown and perhaps unknowable factors such as in-migration, birth rates, economic changes, or cumulative acts of private racial fears.”

In truth, residential segregation’s causes are both knowable and known – twentieth century federal, state and local policies explicitly designed to separate the races and whose effects endure today. In any meaningful sense, neighborhoods and in consequence, schools, have been segregated de jure.

Massey and Denton’s American Apartheid is the title of one book describing only a few of these many public policies. The title is no exaggeration. The notion of de facto segregation is a myth, although widely accepted in a national consensus that wants to avoid confronting our racial history.

iii.

De Jure Residential Segregation by Federal, State, and Local Government

The federal government led in the establishment and maintenance of residential segregation in metropolitan areas.

• From its New Deal inception and especially during and after World War II, federally funded public housing was explicitly racially segregated, both by federal and local governments. Not only in the South, but in the Northeast, Midwest, and West, projects were officially and publicly designated either for whites or for blacks. Some projects were “integrated” with separate buildings designated for whites or for blacks. Later, as white families left the projects for the suburbs, public housing became overwhelmingly black and in most cities was placed only in black neighborhoods, explicitly so. This policy continued one originating in the New Deal, when Harold Ickes, President Roosevelt’s first public housing director, established the “neighborhood composition rule” that public housing should not disturb the pre-existing racial composition of neighborhoods where it was placed.

This was de jure segregation.

• Once the housing shortage eased and material was freed for post-World War II civilian purposes, the federal government subsidized relocation of whites to suburbs and prohibited similar relocation of blacks. Again, this was not implicit, not mere “disparate impact,” but racially explicit policy. The Federal Housing and Veterans Administrations recruited a nationwide cadre of mass-production builders who constructed developments on the East Coast like the Levittowns in Long Island, Pennsylvania, New Jersey, and Delaware; on the West Coast like Lakeview and Panorama City in the Los Angeles area, Westlake (Daly City) in the San Francisco Bay Area, and several Seattle suburbs developed by William and Bertha Boeing; and in numerous other metropolises in between. These builders received federal loan guarantees on explicit condition that no sales be made to blacks and that each individual deed include a prohibition on re-sales to blacks, or to what the FHA described as an “incompatible racial element.”

This was de jure segregation.

• In addition to guaranteeing construction loans taken out by mass production suburban developers, the FHA, as a matter of explicit policy, also refused to insure individual mortgages for African Americans in white neighborhoods, or even to whites in neighborhoods that the FHA considered subject to possible integration in the future.

This was de jure segregation.

• Although a 1948 Supreme Court ruling barred courts from enforcing racial deed restrictions, the restrictions themselves were deemed lawful for another 30 years and the FHA knowingly continued, until the Fair Housing Act was passed in 1968, to finance developers who constructed suburban developments that were closed to African-Americans.

This was de jure segregation.

• Bank regulators from the Federal Reserve, Comptroller of the Currency, Office of Thrift Supervision, and other agencies knowingly approved “redlining” policies by which banks and savings institutions refused loans to black families in white suburbs and even, in most cases, to black families in black neighborhoods – leading to the deterioration and ghettoization of those neighborhoods.

This was de jure segregation.

• Although specific zoning rules assigning blacks to some neighborhoods and whites to others were banned by the Supreme Court in 1917, racial zoning in some cities was enforced until the 1960s. The Court’s 1917 decision was not based on equal protection but on the property rights of white owners to sell to whomever they pleased. Several large cities interpreted the ruling as inapplicable to their zoning laws because their laws prohibited only residence of blacks in white neighborhoods, not ownership. Some cities, Miami the most conspicuous example, continued to include racial zones in their master plans and issued development permits accordingly, even though neighborhoods themselves were not explicitly zoned for racial groups.

This was de jure segregation.

• In other cities, following the 1917 Supreme Court decision, mayors and other public officials took the lead in organizing homeowners associations for the purpose of enacting racial deed restrictions. Baltimore is one example where the mayor organized a municipal Committee on Segregation to maintain racial zones without an explicit ordinance that would violate the 1917 decision.

This was de jure segregation.

• You may recall that in the 1980s, the Internal Revenue Service revoked the tax-exemption of Bob Jones University because it prohibited interracial dating. The IRS believed it was constitutionally required to refuse a tax subsidy to a university with racist practices. Yet the IRS never challenged the pervasive use of tax-favoritism by universities, churches, and other non-profit organizations and institutions to enforce racial segregation. The IRS extended tax exemptions not only to churches where such associations were frequently based and whose clergy were their officers, but to the associations themselves, although their racial purposes were explicit and well-known.

This was de jure segregation

• Churches were not alone in benefitting from unconstitutional tax exemptions. Consider this example: Robert Hutchins, known to educators for reforms elevating the liberal arts in higher education, was president and chancellor of the tax-exempt University of Chicago from 1929 to 1951. He directed the University to sponsor neighborhood associations to enforce racially restrictive deeds in its nearby Hyde Park and Kenwood neighborhoods, and employed the University’s legal department to evict black families who moved nearby in defiance of his policy, all while the University was subsidized by the federal government by means of its tax-deductible and tax-exempt status.

This was de jure segregation.

• Urban renewal programs of the mid-twentieth century often had similarly undisguised purposes: to force low-income black residents away from universities, hospital complexes, or business districts and into new ghettos. Relocation to stable and integrated neighborhoods was not provided; in most cases, housing quality for those whose homes were razed was diminished by making public housing high-rises or overcrowded ghettos the only relocation option.

This was de jure segregation.

• Where integrated or mostly-black neighborhoods were too close to white communities or central business districts, interstate highways were routed by federal and local officials to raze those neighborhoods for the explicit purpose of relocating black populations to more distant ghettos or of creating barriers between white and black neighborhoods. Euphemisms were thought less necessary then than today: according to the director of the American Association of State Highway Officials whose lobbying heavily influenced the interstate program, “some city officials expressed the view in the mid-1950’s that the urban Interstates would give them a good opportunity to get rid of the local ‘niggertown.’”

This was de jure segregation.

State policy contributed in other ways.

• Real estate is a highly regulated industry. State governments require brokers to take courses in ethics and exams to keep their licenses. State commissions suspend or even lift licenses for professional and personal infractions – from mishandling escrow accounts to failing to pay personal child support. But although real estate agents openly enforced segregation, state authorities did not punish brokers for racial discrimination, and rarely do so even today when racial steering and discriminatory practices remain.

This misuse of regulatory authority was, and is, de jure segregation.

Local officials have played roles as well.

• Public police and prosecutorial power was used nationwide to enforce racial boundaries. Illustrations are legion. In the Chicago area, police forcibly evicted blacks who moved into an apartment in a white neighborhood; in Louisville, the locus of Parents Involved, the state prosecuted and jailed a white seller for sedition after he sold his home in his white neighborhood to a black family. Everywhere, North, South, East, and West, police stood by while thousands (not an exaggeration) of mobs set fire to and stoned homes purchased by blacks in white neighborhoods, and prosecutors almost never (if ever) charged well-known and easily identifiable mob leaders.

This officially sanctioned abuse of the police power also constituted de jure segregation.

• An example from Culver City, a suburb of Los Angeles, illustrates how purposeful state action to promote racial segregation could be. During World War II, the local state’s attorney instructed the municipality’s air raid wardens, when they went door-to-door advising residents to turn off their lights to avoid providing guidance to Japanese bombers, also to solicit homeowners to sign restrictive covenants barring blacks from residence in the community.

This was de jure segregation.

Other forms abound of racially explicit state action to segregate the urban landscape, in violation of the Fifth, Thirteenth, and Fourteenth Amendments. Yet the term “de facto segregation,” describing a never-existent reality, persists among otherwise well-informed advocates and scholars. The term, and its implied theory of private causation, hobbles our motivation to address de jure segregation as explicitly as Jim Crow was addressed in the South or apartheid was addressed in South Africa.

Private prejudice certainly played a very large role. But even here, unconstitutional government action not only reflected but helped to create and sustain private prejudice. In part, white homeowners’ resistance to black neighbors was fed by deteriorating ghetto conditions, so that white homeowners had a reasonable fear that if African Americans moved into their neighborhoods, these refugees from urban slums would bring the slum conditions with them.

Yet these slum conditions were supported by state action, by overcrowding caused almost entirely by the refusal of the federal government to permit African Americans to expand their housing supply by moving to the suburbs, and by municipalities’ discriminatory denial of adequate public services. In the ghetto,

• garbage was collected less frequently,
• predominantly African American neighborhoods were re-zoned for mixed (i.e., industrial, or even toxic) use,
• streets remained unpaved,
• even water, power, and sewer services were less often provided.

This was de jure segregation, but white homeowners came to see these conditions as characteristics of black residents themselves, not as the results of racially motivated municipal policy.

iv.

The Continuing Effects of State Sponsored Residential Segregation

Even those who understand this dramatic history of de jure segregation may think that because these policies are those of the past there is no longer a public policy bar that prevents African Americans from moving to white neighborhoods. Thus, they say, although these policies were unfortunate, we no longer have de jure segregation. Rather, they believe, the reason we don’t have integration today is not because of government policy but because most African Americans cannot afford to live in middle class neighborhoods.

This unaffordability was also created by federal, state, and local policy that prevented African Americans in the mid-twentieth century from accumulating the capital needed to invest in home ownership in middle-class neighborhoods, and then from benefiting from the equity appreciation that followed in the ensuing decades.

Federal labor market and income policies were racially discriminatory until only a few decades ago. In consequence, most black families, who in the mid-twentieth century could have joined their white peers in the suburbs, can no longer afford to do so.

• The federal civil service was first segregated in the twentieth century, by the administration of President Woodrow Wilson. Under the rules then adopted, no black civil servant could be in a position of authority over white civil servants, and in consequence, African Americans were restricted and demoted to the most poorly paid jobs.

• The federal government recognized separate black and white government employee unions well into the second half of the twentieth century. For example, black letter carriers were not admitted to membership in the white postal service union. Black letter carriers had their own union, but the Postal Service would only hear grievances from the white organization.

• At the behest of Southern segregationist Senators and Congressmen, New Deal labor standards laws, like the National Labor Relations Act and the minimum wage law, excluded from coverage, for undisguised racial purposes, occupations in which black workers predominated.

• The National Labor Relations Board certified segregated private sector unions, and unions that entirely excluded African Americans from their trades, into the 1970s.

• State and local governments maintained separate, and lower, salary schedules for black public employees through the 1960s.

In these and other ways, government played an important and direct role in depressing the income levels of African American workers below the income levels of comparable white workers. This, too, contributed to the inability of black workers to accumulate the wealth needed to move to equity-appreciating white suburbs.

Segregation is now locked in place by exclusionary zoning laws in suburbs where black families once could have afforded to move in the absence of official segregation, but can afford to do so no longer with property values appreciated.

Mid-twentieth century policies of de jure racial segregation continue to have impact in other ways, as well. A history of state-sponsored violence to keep African Americans in their ghettos cannot help but influence the present-day reluctance of many black families to integrate.

Today, when facially race-neutral housing or redevelopment policies have a disparate impact on African Americans, that impact is inextricably intertwined with the state-sponsored system of residential segregation that we established.

v.

Miseducating Our Youth

Reacquainting ourselves with that history is a step towards confronting it. When knowledge of that history becomes commonplace, we will conclude that Louisville, Seattle and other racially segregated metropolitan areas not only have permission, but a constitutional obligation to integrate.

But this obligation cannot be fulfilled by school districts alone. In some small cities, and in some racial border areas, some racial school integration can be accomplished by adjusting attendance zones, establishing magnet schools, or offering more parent-student choice. This is especially true – but only temporarily – where neighborhoods are in transition, either from gradual urban gentrification, or in first-ring suburbs to which urban ghetto populations are being displaced. These school integration policies are worth pursuing, but generally, our most distressed ghettos are too far distant from truly middle-class communities for school integration to occur without racially explicit policies of residential desegregation. Many ghettos are now so geographically isolated from white suburbs that voluntary choice, magnet schools, or fiddling with school attendance zones can no longer enable many low-income black children to attend predominantly middle class schools.

Instead, narrowing the achievement gap will also require housing desegregation, which history also shows is not a voluntary matter but constitutional necessity – involving policies like voiding exclusionary zoning, placing scattered low and moderate income housing in predominantly white suburbs, prohibiting landlord discrimination against housing voucher holders, and ending federal subsidies for communities that fail to reverse policies that led to racial exclusion.

We will never develop the support needed to enact such policies if policymakers and the public are unaware of the history of state-sponsored residential segregation. And we are not doing the job of telling young people this story, so that they will support more integration-friendly policies in the future. Elementary and secondary school curricula typically ignore, or worse, mis-state this story. For example, in over 1,200 pages of McDougal Littell’s widely used high school textbook, The Americans, a single paragraph is devoted to 20th century “Discrimination in the North.” It devotes one passive-voice sentence to residential segregation, stating that “African Americans found themselves forced into segregated neighborhoods,” with no further explanation of how public policy was responsible. Another widely used textbook, Prentice Hall’s United States History, also attributes segregation to mysterious forces: “In the North, too, African Americans faced segregation and discrimination. Even where there were no explicit laws, de facto segregation, or segregation by unwritten custom or tradition, was a fact of life. African Americans in the North were denied housing in many neighborhoods.” History Alive!, a popular textbook published by the Teachers Curriculum Institute, teaches that segregation was only a Southern problem: “Even New Deal agencies practiced racial segregation, especially in the South,” failing to make any reference to what Ira Katznelson, in his 2013 Fear Itself, describes as FDR’s embrace of residential segregation nationwide in return for Southern support of his economic policies.

Avoidance of our racial history is pervasive and we are ensuring the persistence of that avoidance for subsequent generations. For the public and policymakers, re-learning our racial history is a necessary step because remembering this history is the foundation for an understanding that aggressive policies to desegregate metropolitan areas are not only desirable, but a constitutional obligation.

vi.

Documentation

In published work, I have documented much of what I have described, citing many previous historians who have recounted this story. Full citations for the evidence I have described and to other scholars who have recounted it, can be found, for example, at
http://www.ascd.org/publications/educational-leadership/may13/vol70/num08/Why-Our-Schools-Are-Segregated.aspx, or at
http://prrac.org/newsletters/novdec2012.pdf, or at
http://www.epi.org/files/2012/Different_Kind_Of_Choice.pdf. For source citations regarding the pathways by which social and economic disadvantages affect student performance, see Class and Schools (http://www.epi.org/publication/books_class_and_schools/). Or, if you e-mail me at riroth@epi.org, I’d be glad to send you documentation of any of the claims I make here today. The segregation history I have described to you was once well known, but has now been dropped from policymakers’ and the public’s consciousness.

About the author

Richard Rothstein (riroth@epi.org) is a Research Associate of the Economic Policy Institute and a Senior Fellow at the Chief Justice Earl Warren Institute on Law and Social Policy, University of California (Berkeley) School of Law.

What is being done to make it better? Not enough.
Public spending and public investment are too low, wages for increasingly productive workers are flat or falling, and the minimum wage is inadequate.

However, there is hope for 2014.
The policies that created these trends can be reversed. There is a renewed push to raise the federal minimum wage, states are raising their own minimum wages, and more policymakers are coming to terms with the downside of economic inequality.

EPI’s top charts of 2013 explain why a full economic recovery and policies that ensure broadly shared prosperity should be policymakers’ foremost priorities in 2014.

In November 2013, the labor market had 1.3 million fewer jobs than when the recession began in December 2007. Further, because the potential labor force grows every month, the economy would have had to add 6.6 million jobs just to preserve the labor market health that prevailed in December 2007. Counting jobs lost plus jobs that should have been gained to absorb potential new labor market entrants, the U.S. economy had a jobs shortfall of 7.9 million in November 2013.

One of the best measures of labor market health is the share of 25- to 54-year-olds with a job. Looking at 25- to 54-year-olds instead of the entire working-age population provides more certainty that the trends we see are being driven by reduced demand for workers and not supply-related factors such as retiring baby boomers or increased college enrollment of young people. This ratio deteriorated dramatically through late 2009, essentially stalled for two years, and improved modestly over the last two years. But the 75.9 percent share of 25- to 54-year-olds with a job in November 2013 is identical to the share at the official end of the Great Recession in June 2009.

In today’s labor market, the headline unemployment rate drastically understates the weakness of job opportunities because it does not count the large pool of “missing workers”—potential workers who, due to weak job opportunities, are neither employed nor actively seeking a job. These are people who would very likely be either working or looking for work if job opportunities were significantly stronger. In November 2013, there were 5.7 million missing workers. If they were looking for work and therefore counted as unemployed, the unemployment rate in November 2013 would have been 10.3 percent, significantly above the official 7.0 percent rate.

The recovery from the Great Recession has been accompanied by the slowest growth of public spending following any recession since World War II. If the current recovery had instead featured public spending growth that mirrored spending growth following the early 1980s recession (one that was similarly as deep, if not as long, as the Great Recession), the economy would be almost fully recovered with more than 7 million additional jobs.

One economic indicator that has shown extraordinary strength in the recovery from the Great Recession is the share of corporate-sector income claimed by owners of capital instead of employees. By the third quarter of 2013, the share of corporate-sector income accruing to profits and other forms of capital income had reached 25.8 percent, the highest share ever recorded. To put this number into perspective, if the share of corporate-sector income accruing to capital owners in the third quarter of 2013 were 20.4 percent (the 1969–2007 average), every worker in the U.S. economy would have earned $3,200 more in wages.

After shrinking during the recession, the gap between CEO pay and typical worker wages is growing rapidly. The ratio of annual pay received by CEOs of the largest 350 U.S. firms relative to annual wages of production/nonsupervisory workers in those firms’ industries was roughly 20-to-1 in 1965, reached 100-to-1 by 1992, and peaked at 383-to-1 during the stock market bubble of 2000. In 2012, it was 273-to-1.

While CEOs are doing fine in today’s economy, most other U.S. wage earners could badly use a raise—and not just to make up ground lost in the Great Recession. Essentially the bottom 70 percent of American workers have seen flat or falling real (i.e., inflation-adjusted) wages since 2002. The disproportionate income gains going to capital owners rather than workers have slowed the recovery, as a higher share of capital income is saved when it could instead be spent by workers and thus create more demand for goods and services.

Wages and productivity grew in tandem during the three decades following World War II. But as EPI began pointing out in the 1994 edition of The State of Working America, this link broke in the late 1970s for the vast majority of American workers. Productivity measures the average dollar value of economic output produced in an hour of work—essentially measuring the economy’s potential for providing rising living standards for all. But this potential has been unrealized for most American workers. Between 1979 and 2012, productivity rose 63.8 percent, but compensation per hour for production and nonsupervisory workers (who constitute 80 percent of the private-sector workforce) rose only 7.5 percent. As a result, an enormous share of economic output is going to profits and earnings of CEOs and other workers much higher up the wage scale—which is why American inequality has skyrocketed over the past generation.

It’s not just workers with less education who are failing to get their fair share of overall wage growth. For nearly the last quarter century, real wages for young workers with a four-year college degree have essentially stagnated.

Sending American workers to computer programming school will not guarantee that their wages will keep pace with economy-wide growth. From 1994 to 2010, real wages for workers in computer occupations like computer programming and computer system design were essentially flat. Besides indicating that American wage problems are not due to workers’ lack of technical skills, wage trends in high-tech occupations also belie claims that the United States needs to give more visas to foreign tech workers because there aren’t enough here. If there were glaring labor shortages in tech sectors, tech-sector wages would be way up.

Every year that the minimum wage is not raised by Congress, its real value is reduced by inflation. This inaction has eroded living standards for low-wage workers. The real value of the minimum wage today, $7.25, is much lower than its height of $9.40 in 1968, despite the 109 percent rise in U.S. productivity since 1968. Today’s minimum wage would be $18.30 if it had grown at the same rate as U.S. productivity.

Inequality in the U.S. economy has many dimensions, including inequalities in retirement security. The generation-long experiment in retirement security policy away from pensions to individual accounts—often called the “401(k) revolution”—has been a clear disaster, generating a few big winners and millions of losers: Most American households now face a deeply insecure retirement. Nearly half of households have no savings in retirement accounts, and a household in the 90th percentile of the retirement savings distribution has nearly 100 times more retirement savings than the median household.

One of the starkest divides in retirement readiness is by race and ethnicity: White households have more than six times as much saved in retirement accounts on average as Hispanic and black households. Clearly the move away from a retirement system based on pensions to one dependent on 401(k)s has hurt minority households.