Erbe: Women

An interesting new report titled, "Lifting As We Climb," was issued this month by The Insight Center for Community Economic Development. The center describes itself on its Web site as, "a national research, consulting, and legal organization dedicated to building economic health in vulnerable communities."

In plain English, I interpret that to mean it is a liberal think tank and legal advocacy group dedicated to raising women and people of color out of poverty. Laudable goals.

The report reveals some interesting although not in any way unexpected data points: that the median amount of wealth controlled by American women is less than half the amount of median per capita wealth owned by American men. Wealth is defined as total assets minus total debt. The "wealth gap" is much greater for women of color. Single Hispanic and black women, the report notes, control one penny of wealth for every dollar of wealth controlled by their male counterparts. They own a fraction of a penny of worth for every dollar of wealth controlled by single white women.

It's interesting to take a new look at women and wealth, because similar and prior reports focus on women's earnings as compared to men's or on women's impoverishment compared to men's, and women always come up on the lower end of the economic gauge. This is the first such report I've seen focusing on the amount of wealth all women and women of color control.

While I would like to see all American women (and men for that matter) rise out of poverty as much as any of the report's authors, I must note that I differ from them in several respects on how best to accomplish this.

The report's recommendations include more education for these women, particularly financial education and training in entrepreneurship. I'm fully on board with both of those options as poverty is usually a result of lack of education. And data show the average small business owner's earnings greatly outpace the average earnings of a salaried employee.

But also among the report's recommendations is a list of ways to create more federal and private sector "good jobs" (meaning full-time employment with paid benefits) for women of color, and a call for greater unionization, so women can obtain more union jobs. Here's where I differ from the authors' recommendations. The two suggestions noted above are good ways for impoverished women to raise themselves out of poverty and into the middle class. But they do little to help women gain much by way of true wealth and net assets. The best thing women can do to build wealth is to start businesses, as opposed to getting caught in time-consuming and income-limiting salaried positions. So teaching women to become wealth creators is a very different thing from teaching them to become wage earners.

Second, the report fails to take note of how women got themselves into the predicament where they currently find themselves: that is, in greater financial need than men. The data also show women who bear children out of wedlock before they have completed their own education are much more likely to not only spend their own lives in poverty, but also to raise their children in poverty and consign those children to a cycle of poverty.

White women and women of color who are under- or uneducated and have children outside of marriage need to be given the facts before they make the decision to continue that cycle of poverty. They need educational support much sooner than they are presently being given it - starting in grade school, for example. And we need to stop them from spinning ever downward in that cycle before they launch themselves into it.

Bonnie Erbe is a TV host and writes this column for Scripps Howard News Service. E-mail bonnieerbe@CompuServe.com.