Disparate economic insecurity is the key internal link to economic growth – multiple warrants

[Benjamin, Sydney Shreiner, “Racial Differences in Economic Security: The Racial Wealth Gap,” US Department of Treasury, September 15, 2022, https://home.treasury.gov/news/featured-stories/racial-differences-economic-security-racial-wealth-gap#:~:text=The%20racial%20gaps%20in%20economic,impact%20economic%20security%20for%20all., accessed July 1, 2023, GDS-LL]

ADDRESSING RACIAL DIFFERENCES IN WEALTH WILL BENEFIT ALL AMERICANS

The racial gaps in economic security in the United States are stark and have been exacerbated by policies that hinder people of color from building wealth. Moreover, inequitable policies and practices that prevent wealth-building by some groups have been shown to negatively impact economic security for all.

More unequal societies are less likely to invest in public goods that enhance productivity, including education, infrastructure, public transportation, and technology.[11] Policies that address racial wealth disparities, therefore, have the potential to benefit all Americans not only by spurring economic growth but also through public investments that benefit everyone.

As the United States becomes more racially and ethnically diverse, the persistence of racial wealth disparities has the potential to do increasing harm to all Americans. When a significant share of the population is unable to fully participate in the economy, private consumption and investment suffers, stifling GDP growth.[12] The basic economic premise that returns to investment exhibit diminishing returns suggests that the largest gains to our economic potential as a nation come from addressing disparities that hinder the ability of the least advantaged families to invest in their future.