Minding the wealth gap

LOUISVILLE — Cliff Goins IV, an investor and entrepreneur whose book “Minding the Wealth Gap: Our Playbook to Close It Together” was published earlier this month, is the most recent guest on “A Matter of Faith: A Presby Podcast.” Listen to Goins’ hour-long conversation with hosts Simon Doong and the Rev. Lee Catoe here.

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In his book, Goins shares insights from in-depth interviews with management consultants, bankers, a lawyer turned entrepreneur and others focused on scaling small- and medium-sized businesses into large enterprises.

On the podcast, Catoe asks the first questions: How do we address the wealth gap between Black households and white households when wealth is intersectional with other issues that Black people face? How do we know where to start?

“On the one hand, it’s a big problem, and facing it would seem to be vital to our communities and our nation,” Goins said. It’s also a complex problem. “It’s a tension that either causes people to throw up their hands and say, ‘Good luck with that, Cliff,’ or to say, ‘It wasn’t my fault. That was way back then. Why are you talking about it now?’”

“But I think we do ourselves a disservice if we take that approach,” he said. It’s more than pointing out disparate statistics. “It’s really about the stark difference in life’s reality that a lot of Black households face.” Think of it as “not just a Black problem, but an American problem,” he said. “I would love to see us break the cycle together. I think that unlocking the economic potential of 15 million households creates a more prosperous nation for us all.”

As to the getting started part of the question, Goins said measuring wealth “gives us the best window into some pervasive and persistent problems we face in communities. I actually think it’s a blessing,” he said, because it’s linked to other justice issues, including inferior educational opportunities, housing instability and poor access to health care.

“We find Black Americans are behind the 8-ball no matter how you cut it,” he said. Because the problems are so pervasive, “this allows us as fellow Americans to all jump in on the problem, to activate solutions from where you are. If you’re passionate about education, you can make some commitments there. If you believe in health equity, you can spend your time and resources in that way. If you believe in entrepreneurship like me, you can put your energy there.”

“I think there’s an invitation in all of the intricacy of this particular issue,” he said. “If we come together and put together our collective efforts, that’s how we can make meaningful progress.”

There are “small things we can all do tied to our personal situation,” Goins said. “At the same time, some of us have more influence, more ability, more access. We know it’s through large-scale partnerships that the needle really moves.”

While some people call for required classes in personal finance literacy, Goins called that “a component” of what’s needed, “but that’s not what created this wealth gap.”

“Ultimately,” he said, “it’s a multilayered, multigenerational problem.”

The wealth gap is “a problem 400 years in the making. If we stay at the same pace of closure, it would take another 400 years to get close to closure,” Goins said, suggesting people stick with their “passion areas” for helping to close the wealth gap. The wealth issue has economic, political and social components. “If you’re a [person of faith] who’s in the political realm, maybe it’s standing up to some of the momentum that’s going the other way around [Diversity, Equity and Inclusion] and things of that nature.”

“At the end of the day, people respond to stories, and right now the storyline is these DEI programs are taking away from people who have stuff, which is actually not what they’re doing.”

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Among the people Goins interviewed for his book is George Fatheree III, a corporate lawyer turned entrepreneur who advocates for real estate justice.

“George started a company to help individuals with down payments. George is passionate about real estate and he has a legal background, and so that’s the lane he’s playing in,” Goins said.

“The folks I interviewed for the book are doing cool stuff. Most of it will likely work; some of it probably won’t,” Goins said. “But they’re committed to it and they have coalitions of people who are not just Black people who are committed [and] have written million-dollar checks to make sure the work continues. That’s the kind of stuff that gives me hope right now.”

In many communities, bankers are referred to as “relationship bankers,” Goins noted. “If we build a banking system around relationships and you have a population of people who don’t necessarily have those relationships,” he said, “we should expect a skewed outcome. It could be intentional or unintentional racism, but the outcomes are still the same.”

Goins said for Black adults, the home ownership rate in the U.S. is 44%, while it’s 77% among white adults. When the Fair Housing Act was passed in 1968, 42% of Black American adults owned homes. “We have done nothing in 50 years,” Goins said. “Most of us know the education system is also tied to real estate. It seems like a massive problem and it is, but we can solve it if we put our American minds to it.”

There is something about the entrepreneurial spirit “that’s very American, and we should celebrate that,” Goins said. “It’s also the case that a feature of capitalism as we run it results in capital concentration, and that’s a big contributor to the [wealth] gap.”

“At the end of the day we’re talking about people. What can we appeal to in human nature that will compel people to help solve this people?” Goins asked. “I want us to imagine a world where every child, regardless of their ZIP code, has a chance to thrive.”

“I have a lot of hope and faith in the American people,” Goins said. “I think it’s something we can get done.”