The downturn in the economy continues to have a devastating
impact on families. With high unemployment and stagnant job growth,
more families and friends are relying on one another for support to
get through these tough economic times.
The downturn in the economy continues to have a devastating impact on families. With high unemployment and stagnant job growth, more families and friends are relying on one another for support to get through these tough economic times.
As I was growing up, my father always made time to lend a helping hand. A family member or friend would call, requesting something simple, such as fixing a broken window, to something more labor intensive, such as installing a new roof. Whatever the request entailed, my father complied.
Likewise, my father could always count on these same family members and friends to tackle jobs he couldn’t do himself. If we had a plumbing problem, he would call his friend Toby, a plumber by trade. My father knew very little about automotive maintenance, so when our car was making noises, my father sought the advice of his friend Mike, the mechanic.
There was a ritual involved in this labor exchange. When the job was done, no matter who requested the work, the dialogue between friends was always the same. Someone would take out their wallet and ask, “Cuanto?” (How much?) The other would stand back and look surprised, saying, “Nada!” (Nothing).
The bottom line was that money was tight for everyone, and all parties knew it. Once the materials were bought for a job, very little was left to pay for labor.
This ritual, however, was well defined. The first party would not be willing to take no for an answer, at least not the first time, so the back and forth bartering of “please let me pay” and “no, of course not” would continue until both parties exhausted their pleas. The satisfaction of helping a friend was payment enough. These friends could count on one another when their own need arose.
Today, the slowdown in the economy has economists wondering if we’re heading for another recession. The “Great Recession” of 2008 which was triggered by the housing bubble and consequent financial crises caused household wealth to decline in the trillions.
According to a recent report from the Pew Research Center, wealth disparities among racial and ethnic groups increased dramatically from 2005 to 2009. In the study, net worth or household wealth was calculated as the sum of assets minus the sum of debt. Assets include houses, automobiles, stocks, retirement plans, savings and checking accounts. Debts include mortgages, car loans, and credit card debt.
The group hardest hit by the economy downturn were Latinos with a percentage drop of 66 percent of their household net worth with a decrease from $18,359 to $6,325. The decline for African Americans was 53 percent from $12,124 in 2005 to $5,677 in 2009. Whites saw a drop in their wealth from $134,992 to $113,149, a 16 percent decline.
One of the interesting findings from the study was the wealth disparities within racial and ethnic groups.
“Even though the wealthiest 10 percent of households within each group suffered a loss in wealth from 2005 to 2009, their share of their group’s overall wealth rose during this period. The increase was the greatest among Latinos, with the top 10 percent boosting their share of all Latino household wealth from 56 percent in 2005 to 72 percent in 2009. Among Whites, the share of wealth owned by the top 10 percent rose from 46 percent in 2005 to 51 percent in 2009.” The top 10 percent, regardless of color, experienced less of an impact from the recession than the remaining 90 percent.
Wealth differences between minorities and their peers are not new and the reasons for the disparities are largely historical. In general, generational wealth is passed down through children and accumulated. Recent immigration of Latino and Asian groups has had an impact on net worth since most of those jobs are low-paying and unskilled. In the African American community, decades of discrimination has created social barriers. These groups do not have as much wealth to pass to their children, nor is there accumulated wealth from their own parents.
In a Labor Day speech in Detroit, President Barack Obama told the crowd that labor is the bedrock our country is built on; hard work, responsibility, sacrifice and looking out for one another. He continued, “Giving everybody a shot, everybody a chance to share in America’s prosperity, from the factory floor to the boardroom.”
My father’s work ethic and generosity resonated with me this past Labor Day. He and his friends worked hard and definitely looked out for one another. Today, some groups are hit much harder than others, and I wonder which groups are willing to sacrifice and which Americans will have a chance to share in prosperity. Meanwhile, it’s not a bad idea to rely on one another.
Mario Banuelos has lived in Morgan Hill for 21 years. He has served on the south County Dayworker Committee and is a member of the Morgan Hill Community Foundation. He is married and has four children.
