Wealth Inequality and The Fallacies of Impact Investing
Originally posted on medium.com/balle
Written by Rodney Foxworth
In 2015, Ford Foundation president Darren Walker penned a powerful essay arguing that formal philanthropy achieve not only generosity, but justice, calling for a new charter of philanthropy, a 21st century “Gospel of Wealth” that would accomplish what Andrew Carnegie’s proselytizing could not: address the root causes that perpetuate human suffering, wrestling not just with what is happening in the world, but also with how and why.
We live in deeply troubling times. Then again, most of us always have. According to Credit Suisse, the wealthiest 1 percent now own 50.1 percent of the world’s wealth, up from 45.5 percent in 2001. In comparison, the wealthiest 1 percent of American households own 40 percent of the country’s wealth.
According to a 2017 study, “The Road to Zero Wealth,” by Prosperity Now and the Institute for Policy Studies, median wealth for African Americans will fall to $0 by 2053, if current trends hold. Median wealth for Latino-Americans will hit $0 nearly two decades later. By 2020, white American households are projected to own 86 times more wealth than African American households, and 68 times more wealth than Latino households. And based on studies by University of Oxford economist Robert Allen, there are 5.3 million Americans who are absolutely poor by global standards, more than in Nepal (2.5 million) or Sierra Leone (3.2 million), and the same as in Senegal (5.3 million).