NUMBER OF THE DAY
The Economic Cost of Racism, by the Numbers
An economist calculated the cost of racial bias, and it’s a big one
$16 trillion: That’s the additional economic output the U.S. would have generated since 2000 if it closed racial gaps, according to a report written by Dana Peterson, an economist at Citigroup, as reported in Bloomberg Businessweek.
In the 104-page report, her last as a global economist for Citi, Peterson set out to quantify the costs of failing to address racial bias in American institutions over the last two decades, motivated by her own experiences of facing racism as a Black student and professional. The report arrives at its eye-popping estimate by adding up costs from a range of institutional biases. For instance, she estimates that since 2000, the U.S. economy could have generated $2.7 trillion by closing the Black wage gap, $218 billion by improving access to housing credit, and up to $113 billion in increased lifetime incomes by facilitating easier access to higher education for Black students. But the biggest piece of the pie is the additional $13 trillion that Black entrepreneurs could have generated for the economy if they had fair and equitable access to lending.
All told, that’s a tremendous loss over the last two decades, and 2020 has only…
