Feb. 14, 2011, 4:23 p.m. EST
Source: Market Watch
By Charles Payne
Reading Rex Nutting’s piece on disappearing wealth of black families filled me with a range of emotions from sadness to shock but mostly anger.
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The fact that typical black household net worth is only $2,200 is heartbreaking but blacks do have capital. Blacks can leave their heirs something other than being alone. I found it interesting that the same day the article appeared, Polo Ralph Lauren Corp. /quotes/comstock/13*!rl/quotes/nls/rl (RL 126.76, +2.47, +1.99%) reported increased corporate profits and the stock soared to a new high up 680% since 2000. The success of Ralph Lauren underscores the two sides of capitalism.
Ralph Lauren was born in the Bronx to a housepainter father and stay home mom. He was born Ralph Lifshitz and early on decided he wanted to be a millionaire. He sold ties to fellow students in high school, changed his name and eventually found a backer for his first tie shop. The rest, as they like to say, is history. Fast forward a few decades to the birth of my godson in the Bronx.
He grew up in the projects and his parents never made a lot of money and often are between jobs. We bring him out to the house in New Jersey and help him with things like school clothes. A couple of years ago I took him and several other teens and young adults in the family to Burlington Coat Factory for back-to-school shopping. I saw great looking Ralph Lauren shirts for around twenty bucks. “Hey guys come check these out.”
The boys all came over and mulled over the shirts but none shared my enthusiasm. It turns out they were unhappy because these shirts had the small Polo logo while newer shirts had larger logos. As it turns out, the newer shirts are up to four times more expensive than the ones with the smaller logos.
Everyone in America is part of the capitalistic system, either they fuel wealth for others or they invest in the companies that provide products and services to the masses. Unfortunately, black people are too caught up in not just being consumers but consumers willing to spend money not commensurate with their income or savings.
Mr. Nutting pointed out that wealth is “a bit like sourdough bread — you need a starter to get it going.” Going further to point out each generation of black youth starts out with a deficit, not a legacy. I want to scream — being born in America is a legacy. Moreover, parents who smoke two packs of cigarettes a day could have $130,000 for their child to attend college or start a business, all they have to do is make the sacrifice.
There are so many ways to build wealth but it takes sacrifice and determination. That’s the financial starter but there are other ingredients for bread and for a successful life. I read another shocking and sad article recently about preparedness of high school graduates in New York. The Wall Street Journal reported that only 64% of black high school students graduate, and a pitiful 12% are prepared for college or a career.
I guess you could blame the video games, politically correct grade inflation, even discouragement of living in such an unfair and racist society. There is no greater wealth or better starter than education and more importantly a curiosity about the world. Again, it’s something black people can control just like all that capital that flows through their hands but ends up on the balance sheet of Ralph Lauren.
I’m not saying it’s easy. I am saying it’s time to stop the complaining and stop accepting second-class status in return for aide and help supposedly designed to make up for the loopholes in capitalism. Life isn’t fair but we black people better take advantage of the economic platform we have to change our circumstances.
Consider the excitement over the economic juggernauts of China, India and Brazil. Blacks in America earn so much more than the people in those nations but it flows out of the community faster than it flows in.
Consider black purchasing power will be more than $1.0 trillion this year versus $1.4 trillion for India. There are 40 million blacks and 1,000,000,000 Indians. In 1935 only 4 out every 10,000 Indian students enrolled in college and there was only 16,000 books for 350 million people.
Count me as one of those Americans that believe anyone can make it with hard work, sacrifice and determination. When any American stops counting their blessings and start counting the reasons why success is too hard to attain, they make an unfulfilled life self-fulfilling.
Charles Payne is founder and chief executive of Wall Street Strategies, a contributor to Fox News Channel and Fox Business Network, and host of “The Charles Payne Show.” MarketWatch and Fox properties are owned by News Corp.
