Just four years ago, the median wealth of African American families was $17,600, compared to $171,000 for white families, a problem known as the racial wealth gap. This gap is driven by racial discrimination in legal, financial and educational institutions, commonly referred to as systemic racism. While systemic racism has existed in the US for decades, it’s only relatively recent that researchers have started trying to calculate the losses it has caused.
New research shows that racial discrimination does not only do harm to communities of color. Discrimination also drains trillions of dollars from the US economy and drives down wages for all workers.
What have we lost at a cost of $16 Trillion?
A new study by Citigroup details the economic price of systemic racism. At $16 trillion over the past 20 years, this includes:
- $113 billion in lost income for Black workers caused by a lack of access to a college education
- $218 billion lost in potential real estate sales because Black applicants are often denied home loans
- $13 trillion in lost revenue because Black entrepreneurs are often denied business loans
This lost revenue is damaging to the country’s gross domestic product ( GDP). The GDP is the total value of all the goods and services produced within a country. Slow GDP growth means fewer job opportunities and less financial stability for Americans of all ethnic backgrounds, making systemic racism a problem that harms everyone.
A Stronger Economy for Everyone
According to a report from McKinsey and Company, the national GDP could be 4 to 6% higher by 2028 if we can close the racial wealth gap. Addressing the economic damage caused by racial discrimination would strengthen the U.S. economy, create jobs and provide more economic opportunities for Americans.
Because racism occurs on such a large scale, ending it would require multiple initiatives across many industries and political systems. Possible solutions include stricter enforcement of anti-discrimination laws, improved educational opportunities for communities of color and a higher minimum wage.
The UPI Loan Fund is one organization seeking to close the racial wealth gap. Our solution is to provide underserved communities with an alternative to predatory lenders, including payday loans and title loans. People of color often face additional challenges when applying for loans from banks, making them especially vulnerable to predatory lending when they are in need of financial assistance. We have launched in the state of Arizona, and plan to roll out our financial program regionally until every American has the opportunity to apply for the UPI Loan Fund.
How We Can Help
The UPI Loan Fund is an emerging Community Development Loan Fund, offering low-cost loans to qualified applicants. Our mission is to invest in low- and moderate-income communities that are often neglected by financial and political institutions. Our loans can help people pay for necessities like:
- Medical costs
- Emergency expenses
- Funeral expenses
- Auto repairs
Part of the solution to the economic drain caused racism is to invest in the communities affected by financial discrimination. We believe in building a stronger economy and a brighter future for all Americans.
Contact Us
The UPI Loan Fund is now accepting applications for low-interest and interest-free loans for Arizona residents. Contact us to learn more or to begin your application.
