Slow Economic Growth in US Poisons Race Relations
H. Erich Heinemann. H. Erich Heinemann is chief economist of Ladenburg, Thalmann &. Co., investment bankers York., The Christian Science Monitor
FOR two decades, the United States economy has been marching in slow motion. Since 1973, real labor income per worker (wages, salaries, and benefits adjusted for inflation) has advanced a scant three-tenths of 1 percent annually.
By contrast, during the first 25 years after World War II, real income grew at a steady rate of more than 2.6 percent a year. The average US worker today earns about half what he or she would have earned had the trend of the early postwar period continued.
Shock waves from the slow-motion economy have torn at the nation's social fabric. Slow growth has produced a zero-sum society, where one group's gain is inevitably another's loss. In a basic sense, this is what lies behind the perennial gridlock over the federal budget. Politicians, who must face the voters regularly, cannot prosper taking from Peter to pay Paul.
Equally important, slow growth has helped poison and polarize US race relations. This is true not only between blacks and whites, but among all racial and ethnic groups.
Linda Chavez, executive director of the Civil Rights Commission under President Reagan and a Republican candidate for the US Senate in 1986, has published a brilliant analysis of the successes and failures of the nation's Hispanic minority in achieving the American dream.
Ms. Chavez argues that Hispanic leaders "have a vested interest in showing that Hispanics were ... the poorest of the poor." Even so, she says "most native-born Hispanics have leaped over blacks in achievement" and today enjoy solid, middle-class living standards.
The central thesis of this important volume, "Out of the Barrio" (Basic Books, 1991), is that too often public policy works to isolate and impoverish those it was supposed to help. Rather than bring Hispanics into the mainstream, government has kept them out. She shows that the first criterion of a good social welfare program is taking good care of its social workers.
Chavez is silent on the transcendent issue of growth. This is what will really determine how Americans - of all colors, shapes and sizes - will live in the 21st century. …