Billionaire says there is a wealth crisis in the United States

Bethesda - Robert L. Johnson, founder of Black Entertainment Television, is a man who knows full well how hard it is for African Americans to 'make it' in the U.S. He recently said a wealth gap between black and white Americans has become a crisis.

Johnson, who was thought to be worth around $1 billion in 2008, according to Forbes, is a self-made African American billionaire. Recently he spoke to a Congressional Black Caucus meeting, advocating for a national dialogue on race and wealth. It's not that Johnson isn't making enough money; but more the case that, as Johnson puts it, the growing wealth gap between African Americans and white Americans constitutes a national crisis. In a press release issued Sunday, Johnson called the growing divide between white and black a "wealth gap Tsunami threatening African American families." Johnson said

"We must admit the harsh reality of a history of institutionalized racism and economic discrimination against African Americans is the primary cause of wealth disparity between Black and white Americans" and "we must be willing to talk about race recognition remedies at the highest levels of government as well as between Black and white Americans."

Johnson brought a study conducted by the Institute on Assets and Social Policy titled The racial wealth gap increases fourfold to the attention of the Caucus. That study, Johnson pointed out, found

"the wealth gap between white and African American families has more than quadrupled over the course of a generation; the racial wealth gap increased by $75,000, from $20,000 to $95,000; and, at least 25 percent of African Americans have no assets."

Johnson also cited data from the U.S. Census, which found

"white household median net worth is 10 times that of Black households. The median net worth for African Americans was $11,800 compared to $118,000 for whites."

The billionaire also cited a study by United for a Fair Economy, which found

"for every dollar of white per-capita income, in 1968, African Americans had 55 cents and only 57 cents in 2001. At this pace, it would take African Americans 581 years to get the remaining 43 cents and achieve income parity with whites."

A more recent study from United for a Fair Economy found the disparity had not improved much. "Blacks earn 62 cents for every dollar of white income, and Latinos earn 68 cents for every dollar of white income," researchers wrote in the report State of the Dream 2010: Drained. Current unemployment rates for Latinos and Blacks are higher than those for whites, the researchers found. Johnson proposed some measures to address the growing gap. Calling the measures 'race recognition policy initiatives,' he urged a national discussion. One proposed measure is to

"... allow African American families earning less than $250,000 annually to defer all federal income taxes, without interest, provided tax savings are placed into a 401(k) type savings account which can only be drawn out at retirement or upon death at which time the government would be reimbursed for the deferred taxes."

Johnson said

"... this would allow the gain on the 401(k) investment to be available to the families at retirement or passed on to future generations."

The first step to creating more equality, Johnson said, is to

"... admit that a history of institutionalized racial and economic discrimination against African Americans is the primary cause of wealth disparity between Black and white Americans."

Johnson acknowledged his proposals would be controversial, but justified the directions he was suggesting by saying

"... if we are serious about closing the wealth gap we must first be willing to talk about race-recognition remedies and this discussion must take place at the highest levels of government as well as between Black and white Americans. I recognize that public policy based on race is extremely provocative and controversial, but controversy should not prevent a reasonable dialogue about a societal dilemma that is real and economically devastating in its potential to millions of African Americans."

Johnson closed his presentation to the Caucus by saying

"I wish the answers to close the wealth gap were as politically palatable and acceptable as proposals to make our public schools better for minorities, to retrain minority workers for the new jobs market, and aggressively enforce laws against racial and economic discrimination. Over the years, this Nation has been committed to all of these objectives, but this effort will not close the Black wealth gap. I recognize that public policy based on race is extremely provocative and controversial but controversy should not prevent a reasonable dialogue about a societal dilemma that is real and economically devastating in its potential to millions of African Americans."

It is not known what the Caucus will do with Johnson's proposal. The Congressional Black Caucus has a stated mission of "Opportunities for All - Pathways Out of Poverty." In the words of the Chairwoman of the Caucus, Barbara Lee,

"... Forty years ago the Congressional Black Caucus was founded “to positively influence the course of events pertinent to African Americans and others of similar experience and situation.” In the years since, we have earned the moniker “the conscience of the congress” because of our unyielding commitment to our communities and our country. We know that our mission is to help our country become a more perfect union."

Johnson founded RJL Companies.