Through intention or neglect, the rules of our economy (and society more broadly) drive and reinforce racial divides in income and wealth. These disparities are rooted in slavery and then Jim Crow—both of which denied black Americans not only freedom but also the ability to build economic security across generations—and they are entrenched by a web of policy decisions and institutions that continue to cripple opportunity for people of color in the 21st century.
Structural racism is not inevitable, nor is it created by any one policy choice. America’s market power problem is to blame. So is skewed tax policy, outsized employer power, inequitable consumer protections, and more. In a new report, however, Roosevelt Fellow Susan R. Holmberg looks beyond the “what” and challenges us to ask “who?”
In Who Are the Shareholders?, Holmberg calls for the dismantling of shareholder power—a phenomenon that fuels our high-profit, low-wage economy by extracting value out of corporations, and ultimately the economy, without adding anything productive. Most notably, she argues that we must first better understand the demographic makeup of shareholders (the who) before we can truly undo their influence over what could and should be shared prosperity.
By examining the identity of shareholders, Holmberg finds a predominantly white cohort, but she also exposes the inequality of stock ownership, especially across race. In 2007, for instance, corporate stock, financial securities, mutual funds, and personal trusts accounted for more than 17 percent of total assets held by white families. For black families, this number drops to 3.4 percent, and it falls even further to 2.5 percent for Latinx households. As many black and brown Americans face an economy—and society—that holds them back in low-wage, insecure work, the disparities in this source of wealth are not promising for their economic futures.
Stock ownership is a specific measure, but the inequities it reveals are part of the much larger economic and racial inequality story in the U.S. Holmberg’s research shows us that in order to confront these troubling trends, we must first unmask who’s driving and reinforcing them.
