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Protests highlight COVID-19's economic toll on African Americans

Protests highlight COVID-19's economic toll on African Americans

Protests around the country over the deaths of George Floyd and other black Americans at the hands of police come as communities of color suffer staggering losses to the coronavirus pandemic and the economic crisis it created.

Economists and public health experts have issued increasingly dire warnings about the unique toll the pandemic is taking on black Americans and other minority groups, who make up a disproportionate number of COVID-19 deaths and layoffs driven by the health crisis. 

Despite more than $3 trillion in fiscal aid from Congress, months of lagging stimulus checks, backlogged unemployment benefits and mounting bills have plunged the most vulnerable Americans deeper into financial peril.

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The weekend of protests laid bare the ways that rising economic inequality driven by the pandemic is coming amid outrage over the criminal justice inequality that sparked demonstrations across the U.S.

“It would be impossible to divorce the protests that are going on now from larger economic forces,” said Trevon Logan, an economics professor at Ohio State University, noting that African Americans are simultaneously fighting an epidemic of police-involved deaths and COVID-19 cases in cities across America.

“There are going to be, in any local community, a number of cases that are highly questionable, a number of cases in which police misconduct has been suspected, and where we have not seen — or have not seen to the public's view — the administration of justice and that is going to lead each community have their own unique response to what is a national epidemic,” he continued. 

Black people make up 13 percent of the U.S. population, but nearly 24 percent of American COVID-19 deaths where the race is known, according to The COVID Tracking Project.

Public health officials stress that the higher case rates of COVID-19 among minorities are not due to genetic causes, but rather the impact of public and social policy decisions that have left communities of color more susceptible to catching the virus and experiencing its worst complications.

The higher COVID-19 case rate among black Americans poses its own inherent economic challenges. Black people make up a disproportionate number of U.S. workers who’ve been laid off, business owners who’ve been forced to shut down, and people in front-line jobs that cannot be done from home.

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“It's not just about police violence. It's about a whole bunch of things that people just maybe don't pay attention to along the way and a lot of that is stemmed from the economic impact of discrimination affecting these communities over time,” said Mehrsa Baradaran, a law professor at the University of California, Irvine.

A report released Monday from the left-leaning Economic Policy Institute (EPI) laid out in stark terms the abundance of factors against African Americans.

“Persistent racial disparities in health status, access to health care, wealth, employment, wages, housing, income, and poverty all contribute to greater susceptibility to the virus — both economically and physically,” the report's authors Elise Gould and Valerie Wilson wrote.

The unemployment rate among black workers is 2.5 points higher than among whites, but among men that gap rises to 6.8 points, according to EPI. Heading into the crisis, black families had less than a fifth ($8,762) in cash reserves than white families ($49,529).

And when it came to getting help from the government, underbanked black communities had to wait longer to get stimulus checks from the CARES Act and had more difficulty applying for Small Business Administration emergency loans.

“The pandemic and related job losses have been especially devastating for black households because they have historically suffered from higher unemployment rates, lower wages, lower incomes and much less savings to fall back on, as well as significantly higher poverty rates than their white counterparts,” Gould and Wilson wrote.

“This prior insecurity has magnified the current economic damage to these workers and their families,” they added.

On the health front, things were no better. Black workers are less likely to have work-from-home options or have paid sick leave, and are over-represented in fields that have been deemed essential during the pandemic, such as health care, public transport, grocery store work and child care.

As a result, African Americans were more likely to have to be exposed to the virus in order to keep working.

Meanwhile, black workers are 60 percent more likely than white ones to be uninsured, and more likely to live in multi-generational households with at-risk, older family members.

Economists looking back to the way the Great Recession and its recovery played out say some of the most important services needed to provide aid happen at the state and local level.

“The post-Great Recession saw the longest period of economic growth in history, however this economic recovery did not reach all communities within America," said Gbenga Ajilore, senior economist at the left-leaning Center for American Progress, citing issues such as education and local health care.

"We need substantial relief to state and local governments precisely because they can support the groups that have been left behind in the recovery from the Great Recession and have been hit hard by this pandemic," he added.

Mark Zandi, chief economist at Moody's Analytics, said without another law giving aid to state and local economies, the country could expect the economy to hit bottom again.

"If we don't get that second package we go back into recession, we double dip," he said. Congress should be aiming for another package of $1 trillion to keep the economy afloat, Zandi said, split about evenly between support for state and local government and income support such as unemployment benefits.

But Ajilore also pointed out that the protests and riots of the past week will take their own toll on local budgets, which he worries will shift resources away from rehabilitating the economy and toward policing and cleanup.

“Enforcement is going to take away from COVID response, it’s going to take away from education. You think about schools ending now and we have summer, camps are being closed, the child care issue. I think there is going to be harm, but it’s going to be harm in terms of shifts from certain services to other services,” Ajilore said.