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Wall Street widened the racial wealth gap. Can big banks help bridge it?

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The JPMorgan Chase headquarters building in New York City.

The JPMorgan Chase headquarters building in New York. Many major Wall Street firms pledged to support economic equality for Black Americans after the killing of George Floyd in 2020. Michael M. Santiago/Getty Images

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In the wake of George Floyd’s murder in May 2020, Wall Street’s biggest banks pledged billions of dollars to address the racial wealth gap. But what often went unrecognized was the role these financial institutions have played in perpetuating wealth disparities.

That’s the subject of New York Times reporter Emily Flitter’s new book, “The White Wall: How Big Finance Bankrupts Black America.” In it, she draws on her own reporting to explain how Black Americans have been kept out of the financial system.

“From the way Black bank customers are treated when they walk into a bank, to the way they are looked at by algorithms that are assessing their creditworthiness, to the way Black employees are treated on Wall Street,” Flitter said, “it’s a lot of different inputs that all add up to the continuing inability for Black Americans to build and preserve wealth.”

“Marketplace” host Kai Ryssdal spoke with Flitter about her book and whether the recent pledges to address inequality have succeeded. To listen to the interview, use the media player above.

The following is an excerpt of Flitter’s book in which she explains how she came to look at Wall Street’s racial history.

The collective blindness to the racial wealth gap has a parallel in the perception of racism itself in America. When most Americans think about the issue of racism, especially in the present-day corporate world, they are likely willing to admit that there are still instances of discrimination here and there but are also apt to say that the biggest issues are mostly structural, which means, in their minds, that they are nobody’s fault in particular. This is the “I didn’t practice slavery, so why should I feel guilt about it?” argument. But we know, through undeniable data, that Black Americans start out in life with disadvantages that are directly correlated with economic and professional setbacks. The “Not I” brand of denialism allows some to feel comfortable avoiding close examinations of whether any ongoing action is responsible for these disadvantages.

Bound up in the idea of structural racism is the belief, slyly embraced by corporate America over decades and solidified in the public discussion that followed the election of Barack Obama as U.S. president, that active racism has come to an end. Of course, this does not preclude discussions of “diversity,” nor does it make marketing departments trying to target various racial and ethnic groups think twice about what they are doing. It simply serves to ease the minds of corporate and government power brokers about whether the mistreatment of Black Americans by companies and people based on hateful or biased motives is still a problem. Since American voters selected a Black man to lead them as president of the United States, this view says, clearly there is no longer a problem.

This is the idea of “post-racialism” as defined by law professor Sumi Cho of DePaul University College of Law. In a 2009 article in the Iowa Law Review, Cho described the term as “a twenty-first century ideology that reflects a belief that due to racial progress the state need not engage in race-based decision-making or adopt race-based remedies, and that civil society should eschew race as a central organizing principle of social action.” If racism is “over,” and all that’s left behind is a bit of catching up that Black Americans have to do now that they have the same opportunities as white Americans, then the world can carry on with business and not worry about having to make any inconvenient accommodations.

Tell all that to Ricardo Peters, a former JPMorgan Chase employee whose story shoved me the rest of the way toward writing this book.

I met Ricardo in the summer of 2019 when he did what dozens of witnesses of brutality against Black Americans have done in recent years: force a reckoning with unacknowledged injustice. When Peters pulled out his iPhone and hit “record,” he swept away the ambiguities that normally plague cases like his, the kind that abounded in John Lockette’s story. And, like the terrified witnesses watching police beat, shoot, and strangle Black people, Ricardo made history. The story I wrote about him in December of 2019 attracted a million and a half readers and set me on a path to discovering other, similar cases—scores of them.

I never did write about John Lockette, but each subsequent story of discrimination I have encountered has made me reflect on his struggle. There are countless others like him whose perhaps too “subtle” or “quiet” stories are no less awful than his or Ricardo’s. My work on Ricardo’s story led me to perceive the scope of the effects of active, ongoing racism in the financial industry, and once that door opened, the truth came rolling in. Racism in banking and finance is a devastating force—in our capitalist society, perhaps the devastating force—that prevents Black Americans from gaining equal footing in the United States. And as I learned, finance’s role in that story is no secret to the financial firms that determine who wins and loses in this country.

Excerpted from “The White Wall,” published by Atria/One Signal Publishers, a division of Simon & Schuster, Inc. Copyright © 2022 by Emily Flitter.

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