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Transcript: Race in America: Black Economic Mobility with Ariel Investments Chair & Co-CEO, John W. Rogers Jr. and White House Council of Economic Advisers Chair, Cecilia Rouse

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MR. CAPEHART: Good afternoon. I’m Jonathan Capehart, opinion writer for The Washington Post. Welcome to Washington Post Live and another in our series on “Race in America.” Today we’re taking a closer look at the impact of the racial wealth gap on Black Americans and ways to promote economic mobility with perspectives from both the public sector, meaning government, and the private sector.

And to start things off, we're going to focus on the public sector first. Please welcome Cecilia Rouse. She is the chair of the White House Council of Economic Advisors, the first Black official to lead the council.

Dr. Rouse, Chair Rouse, thank you very much for coming to Washington Post Live.

DR. ROUSE: You're welcome. Thank you. It's a pleasure to be here.

MR. CAPEHART: And it's the battle of the bookcases here. I'll just throw that out there.


MR. CAPEHART: So, in the opening slide, as we showed a statistic from the Center for American Progress, and that is the median wealth of White households in 2019 was $189,100; for Black Americans, Black households, just $24,100. How did COVID-19 not only widen this gap but sort of illuminate this gap for all to see?

DR. ROUSE: Well, as the premise of your question bakes in is these gaps existed before the pandemic, but what we know in this pandemic, it has disproportionately affected communities of color.

If we go back over a year ago, the unemployment rate of African Americans and for Hispanics is like 19 percent, 17 percent, much--significantly higher than that for White Americans, and that at the same time, African Americans and Hispanics were essential workers and were often on the front line. And so, the pandemic also disproportionately affected those communities.

Meanwhile, because we had to power down our economy, it meant that those who weren't getting a regular paycheck, it made housing more precarious. It means if you didn't have adequate internet connection, your children's schooling was in danger. This pandemic, because it affected every corner of our economy, every corner of our society, really did lay bare the inequities that have existed in our economy for quite sometime--

MR. CAPEHART: So then, Dr.--

DR. ROUSE: --including in terms of--

MR. CAPEHART: Mm-hmm. So, given all that, how is the administration addressing the structural inequities that you're just talking about? Housing, entrepreneurship, and other area.

DR. ROUSE: This administration is committed to building back better, and my interpretation of that is not only do we want to build back past this pandemic, but it is not just good enough to get back to where this economy was in February of 2020. We know then that there were these inequities, these structural inequities. We have to do better than that, and so the Biden-Harris administration is committed to an all-of-government approach, which means it's kind of soup to nuts.

Yes, there are individual programs. There are initiatives in housing, initiatives to address--redress the way that houses are assessed. They tend to be assessed lower in predominantly Black communities than in predominantly White communities. There are initiatives in entrepreneurship in education.

But the part that I believe is most important is that we're paying attention. It's an administration that understands that many of these policies have been baked in, and that we can't just assume that by spending a little bit more government money that it's going to affect all the communities equally. It's really put a focus on saying where are the places where we can put and make some significant progress, and let's make investments there.

One small example that I will just highlight that follows from the American Rescue Plan is in the American Rescue Plan, there was an expansion and extension of the child tax credit. It made it more generous, and one way in which it made it more generous was by making it refundable. So, even if you didn't owe any taxes to the federal government, you would be able to receive some money back through the child tax credit. This is so important. It has the potential to make a significant dent in child poverty, will disproportionately impact African American families.

The president has proposed as part of the American Families Plan that this be continued, and that because we understand, that that will be an important way to give families the resources they need to be able to take care of their children because we know that poverty begets poverty, and so if children can grow up in families with more resources, then they will do better in school, and they're have more successful adulthoods as well.

It also gives the parent some resources to balance work life if they need to hire more child care or to have better food on the table, to fill in around the edges to make their lives somewhat easier.

That is one small example, but in every agency, there are initiatives to try to look where are there gaps between Blacks and Hispanics, Native Americans and Whites, and what can we do to make them better.

MR. CAPEHART: You know, the phrase you used just a moment ago, "disproportionately impact Black families," another area where we see something like that happening is in the realm of student debt. NAACP president Derrick Johnson has said, and this is quote, "You cannot begin to address the racial wealth gap without addressing the student loan debt crisis." He also--in the Washington Post story from earlier this month, the story points out that although President Johnson, Derrick Johnson of the NAACP, applauded President Biden's focus on homeownership as a way to build wealth, Johnson said many African Americans would not qualify for the necessary loans because of a high debt-to-income ratio. My question is, does the administration need to do more on student loan debt?

DR. ROUSE: Student loan debt has become a big problem in our country. Personally, I study higher education as an economist. I believe that student loans have an appropriate place as part of our financial aid portfolio, but it's really important that students understand what they're taking on when they take on those student loans and that obligation and that they use them in the right kinds of programs, and so I believe that we understand that it has become a huge burden.

The president is committed to finding ways to improve our income-based repayment programs. Those can work much more--they can work much better. He believes very strongly in debt forgiveness for those who go into the public sector, and he has said that if Congress delivers a bill that cancels debt for some students that he will sign it. This administration is committed to helping students with their student loans, even though they do have an important place in our financial aid system, and we recognize this. A higher education is such an important investment. I want to say that and emphasize that, that for so many students, that even with their loans over their lifetimes, they will be able to pay off those loans from the increase in their income that they obtained because of their schooling. But we do recognize and want to make better and work more effectively the student loan system.

MR. CAPEHART: One figure that is out there that the president has rejected a couple of--several times is this notion that $50,000 of student loan debt should be forgiven, that there are a lot of progressives on the Hill who are pushing the president to do that. Is there a number or the right number that the administration would consider in terms of forgiving student loan debt as a means of helping those Black individuals and Black families close their own personal wealth gap relative to their peers?

DR. ROUSE: So, again, the president understands the burden that student loans have placed on individuals. Through this crisis, there's been a pause on student loan payments, and as I mentioned, the president is committed to having a much more robust income-based repayment program in which individuals would only have to pay--currently, it's what? Ten percent of their income would be capped. He's open to making that even more generous. He believes in having a robust system that respects the fact that this is an important investment, but that it's a costly investment for many individuals. And he wants to help make that better.

I also want to just emphasize that President Biden has put forth numerous proposals to help with the cost of college up front. So, for example, he's putting forward a proposal to make community college free for two years of schooling. He has committed money for HBCUs and minority student institutions so that they can reduce the tuition that they're charging for students. We completely understand how important higher education is for communities of color and for Black students and want to make that affordable and are looking at a portfolio of options and ways to address that problem and to make college more affordable for all.

MR. CAPEHART: In your own personal history, education, you said earlier education is very, very important, and in your own family--and correct me if I am wrong--your father was the first African American to earn a doctorate in physics from the California Institute of Technology, only the fifth to earn the degree from any American university, which is quite spectacular. Your mom was a school psychologist. Has that shaped how you view the role of education in promoting economic mobility?

DR. ROUSE: Absolutely. My parents were so committed to schooling that they--our studies was a major focus of everyday life. My parents saved every dollar that they could in order to help pay for our college because they wanted us to be able to go to any school that they could.

For my mother, it went back to her father who had three daughters and was driving a used car himself or a rundown car, and his family said, "You need to drive a better car. Why are you putting those girls through college?" But he was so committed to them going to--all three went to Indiana University and graduated.

So, in my family, education has been the source of economic mobility, and it has brought so much. It's why I study education because I want to understand what are the benefits, what are the costs, how can we ensure that all children have access to a high-quality education and can make those kinds of investments for themselves and for their family and for their children, as it has brought so much to my family.

MR. CAPEHART: Dr. Rouse, let me get you on two issues before we run out of time. You said about reparations in a Bloomberg interview back in March--you said, "'What's the right way to address it today?' is an open question," and so my question to you, is H.R. 40, which is called the Commission to Study and Develop Reparation Proposals for African Americans Act--is that the right way to address it?

DR. ROUSE: Well, I think we need to--I still stand by the question. I still am not entirely convinced of what is the right way to address it. We know that this country has a history of slavery and discrimination, and that has embedded itself in structural inequalities that have to be addressed if we're really going to flourish as a country. There is no question about that.

The right way to make up for those, that structural history and that racist history, I think it's not absolutely clear to me as an individual. I welcome any and all proposals to how to do it effectively and fairly, and most importantly, as an economist, I'm interested in what's really going to move the needle and so that we can finally close some of these gaps that have been so persistent and so stubbornly difficult to close.

MR. CAPEHART: Then it would seem to me, then, a commission to study and look at and come up with these plans and proposals is something that you and/or the administration could get behind as sort of an official commission. No?

DR. ROUSE: Well, I'm going to speak for myself. I'm an academic, and I believe in having groups of people come together and think of new ideas. I want to speak for myself here.

I believe the president is open to hearing ideas that are put on the table, but I don't want to put forward the official administration position. I know the president wants to address these inequalities, wants to do so in a way that really does move the needle, and I share that goal.

MR. CAPEHART: I can't have the chair of the White House Council of Economic Advisors here and not ask this question, and it's one that's in our paper, and it's about inflation. Let me just read you the lead to the story. It says the Federal Reserve expects inflation will climb to 3.4 percent this year higher than the central bank's previous forecast, while also projecting for the first time that there could be two interest rate hikes in 2023. Could inflation be a looming threat to the economy, the economic recovery that it seems like we're enduring now?

DR. ROUSE: This is an important question, and I'll give you my perspective on it, which is that we are slowly but surely and maybe not even so slowly--we are coming out of the greatest recession, if not close to a depression. I don't know if we're technically there, but the greatest recession since the Great Depression. The number of jobs we lost, 17-, 18 million jobs from last April, and we did that because of a virus. This was not caused by a typical economic problem in the economy, which is typically how we go into a recession like the Great Recession in 2008-2009, but it was caused by a virus which required that we power down our economic activity.

We developed vaccines in record time, and with the American Rescue Plan, we had the funds to mount a very effective rollout strategy so that in record time that we got shots into people's arms, and so people were vaccinated against this virus, and importantly, these vaccines turned out to be much more effective than I know I would have imagined back in January. It turns out if you've been fully vaccinated, you're not transmitting, and these vaccines are very effective against the variants at least so far. We should knock on wood.

All of that means, especially with the really fast rollout of the vaccination, is we have gotten back to the semblance of normality really quickly, and when I say very quickly, let's remember it was just back in April 19th that we opened up vaccinations for all adults, and it takes five to six weeks for adults to get fully vaccinated. We're what? Three or four weeks from most adults having had the opportunity to be fully vaccinated.

What that means is that demand has come roaring back. It's come roaring back faster than the Federal Reserve anticipated. It's come back faster than I would even argue most businesses anticipated, which means that they are scrambling to find workers. They're also scrambling to put goods on the shelf and to be able to provide because they liquidated their inventories last spring, liquidating often at a loss, or they powered down their own enterprises, and so everybody is coming back at once. That is causing supply chain challenges.

On the workers' side, workers now, since we followed a policy of--we broke up relationships. People were fired through the pandemic. It means that workers now need to find another suitable position, and they are just weeks from understanding that they can start to get back to normal.


DR. ROUSE: So, we are seeing what I believe is the kind of a reopening of a nearly $23 trillion economy. That is a normal process.

So, at the moment, I believe that this inflation is temporary. It's transitory, as the economy works itself back together, as we knit back together, and that is what I believe underlies the Fed's thinking as well.

Do I think the inflation we're seeing is a problem? I don't think it's a problem in the sense that it will become anchored, to use a technical term, and result in a hyperinflation, but I think we will see some elevated prices as the economy gets back to normal.

MR. CAPEHART: Dr. Rouse, in the 30 seconds that we have left, in closing the racial wealth gap, what's the one thing that you're looking at that would show you that you're being successful, that the administration is being successful in closing the racial wealth gap?

DR. ROUSE: Wealth happens over time. I would first look to see whether we have rates of unemployment that look more equal so that we see Blacks participating in our economy at rates similar to Whites. That's the first step I would look at.

I would start to look at wages, whether we see wages, the racial gap in wages narrowing, and then in terms of wealth, I would like to see that Blacks are able to buy homes in the same kinds of areas as Whites and that they can afford the homes and they can buy homes in the areas where they would like. We know that homeownership accounts for more than 30 percent of the Black-White gap in wealth, and so I think that will be an important metric as to whether we've created the kinds of policies, the kinds of credit markets and availability so that Blacks are able to participate in homeownership at increasing rates as well.

Those would be some early signs, but wealth happens over time. It's an accumulation--


DR. ROUSE: --which is why it really is one of those profound signs of the health of our economy because when you have such large and entrenched differences in wealth, that doesn't tell you that at one point in time there was a difference. That tells you that that difference has been going on for quite some time.

MR. CAPEHART: And with that, Dr. Rouse, we're going to have to leave it there. Cecilia Rouse, chair of the White House Council of Economic Advisors, thank you very much for coming to Washington Post Live.

DR. ROUSE: You're very welcome. It's been a pleasure.

MR. CAPEHART: Coming up, John W. Rogers Jr., chair and CEO of Ariel Investments.

[Video plays]

MR. ROLLEY: Hello. I'm Otis Rolley III, senior vice president for U.S. Equity and Economic Opportunity at The Rockefeller Foundation.

I'm excited to have a conversation today with Shelley Stewart III. Shelley is a partner with McKinsey and the head of McKinsey's U.S. Institute for Black Economic Mobility. He's a leader with McKinsey's Private Equity and Principal Investors Practice, and he has published numerous articles and is a speaker on the topic. Shelley is also on the board of directors at the National Black MBA Association.

Shelley, I have so many different questions for you, but I just want to kind of kick off with why did you undertake this research, and why now?

MR. STEWART: Absolutely, Otis, and thank you so much for taking the time to chat with me.

Look, the murder of George Floyd, the continued unfolding of the pandemic and its disproportionate impact on Black Americans has created a real moment for us to reexamine and reevaluate the way we think about racial justice.

Now, McKinsey has been in this arena for a while. We've been doing work on what I call "four wall diversity" for a number of years, serving our clients and publishing research. We thought now, though, was a unique moment for us to extend beyond the four walls of corporate America, which is really important, right? Recruiting more diverse people and promoting them, getting them to the C-Suite is a big part of racial justice, but corporations in the private sector play roles far beyond the four walls of their company. And this piece is meant to set the stage for what is it that we can do to truly change the circumstance for Black Americans.

MR. ROLLEY: You know, it's interesting. You look at the multiple realities that Black Americans face in the economy. I thought the report was just really powerful because it's not a moral document, it's not an emotional document. You come with data and facts. Could you talk a little bit more about what is the report about, and what surprised you most?

MR. STEWART: Absolutely. And this report tries to stick true to McKinsey's fabric and DNA, which is to anchor on economic realities and talk about the data.

What we sought to understand in this research is the Black experience, and we looked at the Black experience through the lens of different roles we play in society. We chose five of them. For example, Black Americans are workers. Black Americans are consumers. Black Americans are entrepreneurs. And we really sought to understand what it's like to be Black in each of those roles.

There were many things that were surprising about this research, but I'll give an example on the worker role. We found an aggregate wage gap of more than $200 billion between Black worker and White workers. That's both being underrepresented in different occupations and also being paid less in the same occupation. That's a huge amount of opportunity.

What was surprising was that 60 percent of that wage gap was in just 20 occupations, so less than 5 percent of occupations made up 60 percent of the wage gap, and these are things like Black lawyers, Black doctors, Black teachers. We really need more folks in those professions not only to close the wage gap, but having Black lawyers, Black teachers, Black doctors has downstream implications for the people who use those services as well. And so, we were excited about the level of concentration and that it gives us a clear starting point on where to go to address these issues.

MR. ROLLEY: What do you want business leaders to take away from this report?

MR. STEWART: Yeah. I think there's a number of things in this report that are relevant to private-sector leaders. I'll hit on two to bring it to life.

One is, don't neglect the Black consumer. While we have income issues that we identified in the worker role, meaning we need to continue to increase the income of Black Americans so they can more fully participate, even today at current income levels, Black Americans spend almost $850 billion a year across all of your normal consumption categories. That's a tremendous opportunity.

And what we also found through some research and talking to Black consumers is that on average, they're less satisfied. They are less happy with the products and services that are being offered today in many categories, and that presents an opportunity for companies to tailor and to get to know the Black customer in a way that creates a win-win situation.

Additionally, there's a huge opportunity for private-sector leaders to support Black entrepreneurship and Black businesses. Only 2 percent of employer firms today are Black-owned, and there's all sorts of latent entrepreneurial energy in the Black community that companies can foster and develop through supply diversity programs, through direct lending, whether you're a financial institution or some other fund, in a way that will build more domestic suppliers and a more dynamic business environment here in the U.S. That is a huge opportunity for private sector.

MR. ROLLEY: Those are some important steps that the private sector can take, but I'm also curious on the public side. What are some takeaways for policymakers and civil society?

MR. STEWART: Policymakers, the government, whether it be the federal government, state and local governments, play a huge role in facilitating economic mobility for the citizens, and it touches almost every aspect of our lives.

Let me give two examples which I think have been brought into sharp focus most recently with the pandemic. The first is health care. The public sector plays a huge role in designing and implementing policies and things that help to expand access to affordable health coverage for low-income individuals, in particular, and of which Black Americans today are disproportionately represented in that bucket.

If you look at mortality rates, even pre-COVID-19, the average Black American lives 3.5 years shorter than the average White American. Now, someone may say, "Oh, 3.5 years." Let me dimension that. If that gap were closed, there would be 2 million more Black Americans alive right now. That's a staggering figure.

The second is on education. The policy design and implementation and the way we fund schools serves to only exacerbate and continue on disparity. If you look at high-concentration Black school districts, so 75 percent more, and you compare that to high-concentration White school districts, so 75 percent or more White, you find an $1,800-per-pupil funding gap in those Black schools. These are decisions that we have made, and we can choose a different path. We can choose to invest in a different way and build a more robust and inclusive economy.

MR. ROLLEY: Shelley, I want to thank you for your time, and thank you for this work. I know time is limited, but I think it's just so important what was able to be highlighted in this important document.

Now I'm going to turn it back over to The Washington Post.

[Video plays]

MR. CAPEHART: If you're just joining us, I'm Jonathan Capehart, opinion writer for The Washington Post. Welcome back to Washington Post Live and part two of our conversation on the racial wealth gap in America as part of our "Race in America" series.

We just heard from the public sector with Cecilia Rouse. Joining me now with a perspective from the private sector on how to shrink the racial wealth gap in our country, John W. Rogers Jr., chair and co-CEO of Ariel Investments.

John, great to see you, and welcome back to Washington Post Live.

MR. ROGERS: Great to be back.

MR. CAPEHART: So, as we just saw in the clip, in the intro about the impact of the 1921 Tulsa Race Massacre, we saw the impact on your family. Tell us more about your family's connection to Tulsa, and what went through your mind as we marked the centennial?

MR. ROGERS: Well, I did have the opportunity two weeks ago along with my daughter, Victoria, to go to Tulsa and to be a part of all of the acknowledgement of what happened during the Tulsa Race Massacre. Our family connection was direct. My great-grandfather was J.B. Stradford. He owned the Stradford Hotel that was arguably the largest Black hotel in the nation. It was extraordinarily successful. It had a cabaret and bars and pool hall. It was a real celebration there in Tulsa where his hotel was center to everything.

At the same time, my great-grandfather, J.B. Stradford, was a very outspoken civic leader, a real leader in the Black community and someone who was outspoken when it came to Civil Rights and economic justice, and so once the race riots happened and the race massacre occurred, he ultimately was indicted and accused of helping to start the riots, which of course was totally false, totally untrue, but it forced him to have to escape undercover and escape Tulsa to get away from the convention center where he was being held against his will. He made it to Kansas--Independence, Kansas, where he met up with his son, C.F. Stradford, who used his legal skills to stop Tulsa from extraditing my great-grandfather back to Tulsa.

And my mom, Jewel Stradford Lafontant, always told me growing up that she was inspired to become a lawyer because she saw her father use his legal skills to save her grandfather's life.

MR. CAPEHART: John, what does it mean to you personally to have the nation talk so openly now about the Tulsa Race Massacre, given that we spent so many decades not talking about it at all and the fact that so many millions of people learned about it for the first time, either watching "Watchmen" or watching "Lovecraft Country"?

MR. ROGERS: Well, our family has been very, very proud of the recognition and again very proud of the leadership of our great-grandfather and, you know, are glad to see that America is starting to understand the challenges that we face as African American entrepreneurs in this country over the 400 years since slavery and Jim Crow and all the other challenges that we faced in our society. We think it's an important part of our journey as American citizens for people to be aware and to be able to see viscerally how much it's impacted, how much wealth was lost and multi-generations because of what happened in Tulsa and many, many other cities throughout this nation.

MR. CAPEHART: Well, let's talk about the loss of generational wealth. I mean, the Tulsa Race Massacre was a big, big event, but it wasn't the only race massacre where Black communities were completely destroyed and livelihoods were lost, and I'm wondering if you could talk about how that specifically had an impact on building wealth across generations. And talk about, if you know, what the Tulsa Race Massacre did in terms of your own family's accumulation of wealth. What was lost? Do you know?

MR. ROGERS: Well, our understanding is that my great-grandfather's wealth at the time, we think was roughly $100,000, and if it had been invested in the stock market over this last hundred years and it had a kind of reasonable 7 percent or so return, it would be worth well over $100 million for our many, many, many family members. You just think about that, just all that wealth and opportunity just completely lost because of that, and as we said, this has happened time and time again in this country. Very few of us have had multi-generational wealth. Very, very few of us have been able to benefit from inheritances. It's just really shocking what could happen in this country.

When you think about the white supremacy movement back a hundred years ago, those white supremacists couldn't stand to see successful Black families, successful Black business leaders, people who were outspoken and proud of their accomplishments. There was this pressure to put us back in our place.

MR. CAPEHART: So then, John, what are some of the other factors that contribute to the persistence of this racial wealth gap in our country?

MR. ROGERS: Well, I think a lot of it has to do with--there's just so many things, but one of the things we talk to--I understand and I heard from your prior conversation, you know, we have this idea that corporations continue and major anchor institutions in our community refuse to do business with Black entrepreneurs and continue to this day to have very few African American leaders in their boardrooms, in their C-Suites, and we all know the data. We know how few. Mellody Hobson, my co-CEO, is the only African American female chairman of a Fortune 500 company. She's the chairman of Starbucks. These are just too few and far between.

We need to get corporate America to agree to not only have us in the C-Suites, on the management committees of the organizations, have us on the board of directors in more than just the token one spot, and then agree to do business with African American entrepreneurs in everything that we do in our society. Get away from this term "supplier diversity," where you say the Black and brown people do the supply chain work, the catering, and the construction, which are important parts of our economy, but then leave African Americans out of the spend where the wealth and jobs are created in the 21st century, technology, health care, money that's spent on legal services, accounting services, professional services broadly, financial services, hedge funds, private equity and venture capital. If institutions don't work with African Americans and again in the parts of the economy where there is real growth and profits, we're going to continue to have our wealth gap get larger and larger in this country.

MR. CAPEHART: You invoked her name, Mellody Hobson, your co-CEO at Ariel Investments. She was here, I believe, back--yes, back in February to talk about a new initiative that you had launched called Project Black, getting into a lot of the things that you were just talking about in that last answer.

John, I'm just wondering, talk about policies like discriminatory lending practices. Are they part of the problem, part of the obstacle that hurt Black ownership, one; and two, do you see those discriminatory lending practices changing?

MR. ROGERS: Well, I do believe that we are in a better place today than we were 40 years ago, 50 years ago, 60 years ago, where--it's interesting. My grandfather actually helped to argue the case in Supreme Court, Hansberry v. Lee, that was all about the restrictive covenants that we had here in Chicago that wouldn't allow us to own homes in certain parts of our community. As you know, the redlining that went on and the added costs when we did have a chance to buy a home was really extraordinarily damaging and losing the impact, not giving us the opportunity to create real wealth.

That discrimination that you've talked about is better than it used to be, but the ramifications of redlining and restrictive covenants of 50, 60, 70, 100 years or more continue to really plague us because we haven't been able to benefit from the rising housing prices.

Here in Chicago, we're one of the most segregated cities in the country, and unfortunately, our real estate has primarily been in parts of our city where wealth has not been able to be really created, and because we didn't have the opportunities to have homes up on the North Shore or in the western suburbs where home prices went higher and higher and higher.

A lot of Black wealth has been lost through the real estate, but also a lot of Black wealth has been lost by the fact that we have not been able to fully participate in the parts of the economy where the growth and wealth is being created today, and also, we're not being able to--even our nonprofits, our universities, our hospitals, our museums continue to give economic opportunities to their friends of their trustees and the families that are serving on those boards. And we don't have those relationships to be able to build our economic opportunity in this country.

It starts with--housing is a big part of it, but it goes well beyond that.

MR. CAPEHART: Mm-hmm. One of those areas I wanted you to get into has to do with financial literacy, and Ariel Investments has taken on financial literacy by partnering with schools. Talk about why financial literacy is so important.

MR. ROGERS: Well, I think it's critically important. My father taught me about the stock market when I was 12 years old. Every birthday and every Christmas after I was 12, he bought me stock instead of toys, and it was maybe $250 worth of General Motors or IBM, blue-chip stocks, and he let me keep the dividend checks. And he just wanted me to have that exposure. He had been a Tuskegee Airman, and he just thought it was so important for his son to get exposed to all the things that White Americans are exposed to and the stock market being central to that.

Today it's more important than ever, financial literacy. If you think about it, as we've replaced pension funds in this country with defined contribution plans, every individual at their workplace has to be able to get involved in their defined contribution plan, their 401(k), their 403(b), their 457 plan. They've got to make sure they are maxing out and putting as much money into those programs as possible and then having the right capital allocation within those programs, how much is in equities, how much are in fixed income, how much are in money market funds. You have to be your own financial expert to be able to put money away effectively for your retirement. I think that's so critically important.

Of course, we saw during the financial crisis, because of our lack of financial literacy, we got the worst mortgages, and these unethical lending institutions that took advantage of many African American families because we didn't know always the right questions to ask. We have not been well positioned to be our own wealth managers because this country hadn't allowed us to build wealth over these last 400 years. You get to be an expert in wealth management when you have wealth to manage, but discrimination, Jim Crow laws, and the remnants of slavery have stopped us from being able to create that kind of wealth, and therefore, we're behind.

What we've tried to do is Ariel is just not complain about the problem. We created a small public school with former secretary of education Arne Duncan, roughly 25 years ago called the Ariel Community Academy. It's a public school on the South Side of Chicago, roughly 500 African American kids, and all the kids eventually get real money to invest in real stocks, work with our analysts on how to do research, get comfortable in the markets, and if they decide to put money away when they graduate from eighth grade into a 529 program, we match it with $500 to start to teach the young people about the importance of matching so they'll be prepared for that first defined contribution plan when they get out of college.

We think financial literacy is really, really important. I chaired President Obama's Council on Financial Capability for Young Americans, and the report we gave to the president suggested that we wanted to find ways to get more--how to get more financial institutions to partner with urban public schools and using the model of the Ariel Community Academy where young people can get real dollars to invest in real stocks and see role models that look like them who can pick stocks and help show them the way on how to do that kind of research.

MR. CAPEHART: You know, John, you and I spoke a year ago, and it was just a few weeks after the nationwide protests had erupted over the murder of George Floyd, and I want to read to you something you told me. You said, "This has brought the worst of America onto national television," talking about the video of the killing of George Floyd, "made it a worldwide event, and it's brutal. I think the only shining light is that there's some hope now that we can tell our story and more people are listening than ever. And hopefully, this will be an opportunity for us to transform America and get us back on the right track, where we can all respect each other, believe in each other, and create equal opportunity for everyone."

A year on, do you think--are you satisfied with the progress we've made, and what more needs to be done?

MR. ROGERS: Well, definitely not--definitely not satisfied, but we are making progress. We are making real progress. The data is clear. There are more of us--more African Americans are joining corporate boards. You look at Walgreens here in Chicagoland. Now we have an African American woman CEO. We have Valerie Jarrett, our good friend who joined the board of Walgreens. A year ago, there was none of that. It's just been something that's been transformative that's happened in corporate America.

Here in Chicago, our Civic Committee which represents our 84 largest businesses, they have a real commitment now to do business across the board, using the term "business diversity" instead of "supplier diversity" to show that these corporations are open to work with Black people in everything we do. That's real progress, and they borrowed from the University of Chicago, this concept of business diversity instead of supplier diversity. You're starting to see real sustained change and opportunity.

We're also seeing it more in political empowerment where more politicians are thinking about these issues. Our speaker of the house, Chris Welch, here in Illinois, created legislation that forced all the corporations to be transparent with their board of directors, where there was diversity, where there wasn't, and that put pressure on corporations that looked like 1940s companies to do the right thing.

We have leadership now in Congress like Maxine Waters and Joyce Beatty at the House Financial Services Committee that, of course, Maxine chairs, and Joyce chairs the Subcommittee on Diversity and Inclusion. They're making a profound impact pushing banks and financial institutions to do the right thing when it comes to working with Black-owned businesses and making sure we get our opportunities to get the kind of loans and opportunities that we really, really deserve.

It's a much better day today, and I think it's going to continue into the future. I think momentum is there. People get it that we deserve equal economic opportunity, and a lot of the challenges that face our urban communities will start to dissipate once we do have real equal economic opportunity in this country.

MR. CAPEHART: John, we've got less than two minutes left, but since you brought up corporate boards, I recently interviewed Mark Mason who is the CFO of Citi, and he gave corporate America a D, D as in David, in its goals to work toward corporate diversity, inclusion, and racial equality. What grade do you give corporate America, and what will it take to get an A? Tell me in 90 seconds.

MR. ROGERS: Yeah. Well, I would think that I would probably give corporate America maybe a C, a C minus, because they continue to still do too much business the way they've always done it, and the economic opportunities continue to go to primarily White males.

But I do think that there are some models. McDonald's here in Chicago has a longstanding program where they've worked with Black franchisees and have built up large Black suppliers for McDonald's. Northern Trust Bank has done--they have two African Americans on their management team for the first time, their top ten officers of Northern Trust Bank. Exelon Corporation has great work. There are some really terrific role models out there doing things the right way and having not only senior African Americans in senior roles and doing business with Black businesses and everything that we do but also putting African Americans in a position where once you're in these leadership roles, your willingness to speak out and speak up and fight for economic justice is happening more and more people--for more and more people.

People have heard from John Lewis and understand that when you're in these leadership roles, you have a responsibility to make good trouble and to point out the things that are not right, that are not fair, and I think that is also changing corporate America. We're getting more fighters in these leadership roles that are going to make a difference for all of us.

MR. CAPEHART: John W. Rogers Jr., chair and co-CEO of Ariel Investments, thank you very much for coming back to Washington Post Live. Great to see you. Have a great weekend.

MR. ROGERS: Thank you.

MR. CAPEHART: And thank you for tuning in. Join us on Monday at 1:00 p.m. Eastern when my colleague, Geoff Fowler, talks with PayPal's CEO Dan Schulman.

Once again, I'm Jonathan Capehart, opinion writer for The Washington Post. Thank you very much for tuning in to Washington Post Live.

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