Conley’s story of the Jones’s and Smiths. What the comparison of the two families illustrates is
the inadequacy of relying on income alone to describe the social and economic circumstances of
families at the lower end of the economic scale. Lack of property ownership can be attributed to
Jones is the white family -- got married and purchased a house and got a down payment from the
parents. (10%) They had tax credits so their mortgage was fairly and were able to pay back the
down payment to the parents fairly quickly. They were able to pay off their mortgage entirely
and had no mortgage at all. Man had a good job, and company folded and started flipping
The Smiths were in a similar situation -- could not find a place to live because of the real estate
agent. The Smith drained their savings, wife moved out lived with her parents and eventually got
divorced. The Smiths were just above the poverty threshold at that point and were not defined as
Conley wants to see the effect of X, Y, Z variables are while being this family. When we control
for this variable. Being INCOME -- let’s compare how these variables affect the wellbeing of
both families. Pretty much the same occupation, marital status, and controlling for those factors.
-Government aid cannot be based upon poverty income.
-Ignoring assets is a huge mistake
It is the hypothesis of this book that certain tenacious racial differences--such as deficits in
education, employment, wages, and even wealth itself amongAfricanAmericans--will turn out
to be indirect effects, mediated by class differences. In other words, it is not race per se that
matters directly; instead, what matters are the wealth levels and class positions that are
associated with race inAmerica.
-Not to say race does not matter; rather, it maps very well class inequality, which in turn affects a
whole host of other life outcomes. In fact, when class is taken into consideration,African
Americans demonstrate significant net advantages over whites on a variety of indicators (such as
rates of high school graduation for instance). In this fact lies the paradox of race and class in
1. Class in the labor market:
a. Wealth is different from income. They are not the same thing.
i. Income - flow it is coming in
ii. Wealth - is accumulated (stock) or accumulated income.
1. Savings account, accrued money or income.
iii. Net Worth - the +/- result of assets and debts. Whatever the outcome of
that is your net worth. It could be negative or positive.
b. Majority of wealth is inherited - accumulated through time and position.
c. Data shows that residential segregation by race is still a huge issue.
i. Real estate steering ofAfricanAmericans and other ethnicities happens
ii. Red-lining, every other quarter there is a new scandal with like bank of
america that are accused of red-lining. 1. Multi-million dollar settlements over this
2. Refusing to give loans or provide banking which is part of the law
to certain communities.
iii. Official Poverty Line