Next Question with Katie CouricOn this episode of Next Question with Katie Couric, produced in partnership with Ally and Katie Couric Media, we’re taking a look at the racial wealth gap; the systemic and historical factors that have contributed to persuasive economic inequality, as well as how we can work together to navigate a new path forward. First, Katie is joined by financial columnist Michelle Singletary from the Washington Post. Her series, “Sincerely, Michelle,” was not only a reaction to the murder of George Floyd, but also an invitation to millions of Americans to see the reasons for the stark financial disparity that falls along racial lines. Next, Katie speaks to Chloe McKenzie, founder of Black Fem, an organization dedicated to reimagining wealth opportunities for Black women.
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Hi everyone, I'm Katie Kuric and this is next question. You know, my company, Katie Kuric Media, wouldn't get to do all the cool things we do like bring you this podcast if it weren't for the really innovative, smart and forward thinking companies. We're lucky enough to partner with one of those, is Ally. On the last episode in this series, I sat down with Alli Senior Director of Financial Health and Wellness, Jack Howard. We spoke about how money stories influence our financial decision making. On today's episode, we're digging even deeper. We'll be talking about the racial wealth gap and the systemic and historical factors that have contributed to pervasive and seemingly intractable financial inequality. With the help of two amazing guests, we're taking a look at the causes of economic injustice, as well as how to navigate a new path forward. I'll be speaking with Chloe McKenzie, founder of blackfam, an organization dedicated to reimagining wealth opportunities for black women. But first from The Washington Post financial columnist Michelle Singletary. Michelle's award winning ten part series Sincerely, Michelle addressed common misconceptions involving race and inequality, and it really helped so many people understand the roots of the racial wealth gap. I'm really excited to have Michelle here today. Michelle, great to see you.
Oh, thank you so much. I really appreciate having this opportunity.
I know, Michelle, you were prompted to really begin this work focusing on race and money following the murder of George Floyd. Can you tell me how that inspired you to try to tackle this really important but often ignored issue.
Yeah. So, for most of my career, like many black Americans, have dealt with race issues on my job in the community, and I'll be honest, I didn't talk about it a lot because when you do, people say things like, oh, you're playing the race card or you're too sensitive, and so for most of my career, even though I've written about discrimination, particularly as it relates to personal finance, personally, I didn't talk a lot about it. And then after the death of George Floyd, that whole summer of reckoning I'm going to tear up now. I just said, I can't be silent anymore. I can't be afraid of the blowback of talking about what it's like to be black in America. Like now it's twenty twenty three, we are still dealing with issues that people were dealing with doing the civil rights movement, you know, posts the end of slavery, And so I talked to my editor about doing the columns of you know, folding in my personal story with historical data, real stats, and folding in those two using data to talk about race. And my intention wasn't to make anybody feel guilty, because we're often accused of that when we talk about race. You know, there's this whole controversy about blacks trying to make white people feel bad about slavery. That wasn't the intention. The intention, which is why it was signed and sealing, Michelle. It was a letter, It was a discussion. It was like, let me tell you what it's like to walk in my shoes from the time I got the job at the Post, the Washington Post, to what it was like even before the Post is a young black intern and a scholarship program that was designed to hire more black reporters. And let me tell you what it's like to be, you know, trying to get credit and home loans. And I I live in a beautiful home in Prince George's County, Maryland, on almost an acre of land. I'm right now looking at a bank of trees and deer skipping through my yard, and yet my home value is considerably less simply because I'm black and I live in a black community. You picked my house up and moved it, you know, thirty miles, not even thirty miles from where I live in a white neighborhood, and my equity would be twenty thirty forty percent more. And so my equity has not increased the same it would be if the color of my skin was different.
Did you feel that people were more receptive to this message following George Floyd's death, because I feel like there were a lot of people eager to learn. You might have gotten some blowback, but I also feel there were many people myself in that category who became even more interested in some of these issues. Did you find that as well?
I hope I actually did, and it shocked me. I have to say I expected and did get the racist emails that go back to Africa. Somebody actually said that, but the overwhelming majority were from white Americans who said I didn't know, I didn't realize the depth of this and that was It was the highlight of that series that people understood and they understood me, They understood what I was trying to say. They had a lot of self reflection. How did I contribute? How how do I contribute to this?
I mean, it's awesome that you know, again, that speaks to people who are really receptive, who want to be about things that may be ingrained in them and the result of sort of cultural conditioning. In the first column, Michelle, you wrote about your own experience confronting your boss about whether you were originally hired by the Washington Post in nineteen ninety two because you were black. Tell us about that conversation and also what gave you the courage to have it.
Yeah. I don't know if it was courage. I was just pissed off, to be honest, I would you know. I got to the Post at a very pretty young age. I was like, what was I just twenty nine I think, you know, and in the business section, so one of the youngest reporters in the business section. And I kept hearing people say things like, well, how did you get to the Post and what's your background? But it wasn't inquisitive, like, oh, what paper did you come from? It's like, how did you get here? And then some of my friends on the staff say, yeah, people keep asking me about how you got here, how you got this job, And after one time too many, somebody asking how did I get to the Washington Post, because the implication was I got there because I was black, that they had some sort of quota, and that I just fit the quota it regardless of my credentials. At that point, I had been in the business for eight years, had done well at the Baltimore Evening Sun, you know, one awards at college. You know I you know I was I was a good reporter. And so I just got so discouraged, because nobody wants a job that they're not qualified for. If you're any person of honor, you don't want a job just because you're black, or you're a woman, or you're Asian. You want it because you're qualified for it, of course. And so I walked up to him and I said to him, just point blank, there was no preceding conversation. I said, did you hire me because I was black? And he paused and he said I did. And the tears started to well up, and he said, come into my office and he sat me down in the couch. I remember this like it was yesterday. And he set me down in the couch, and in my head, I was sick. So they're right, They're all right. I'm not qualified. They just got me here because I was a black girl. And I'm thinking all of this in my head and he could see tears rolling down my face and he says, well, let me tell you something. I hired you because you were black and you have an experience as a Black American that we needed in this section. I hired you because you're a woman. We need women in the business section. I'd hired you because you're a good reporter. I hired you because at that time I had developed an expertise and bankruptcy. And he said, and I hired you because you're young and you grew up in an inner city. In my head, I said, well, dude, why did you start there?
I was going to say why.
Did he lead with me yes.
Yes, and he followed up, without knowing that's what I was saying in my head. He followed up, he said, I told you that first, that I hired you because you're black. Because I don't want you to run away from who you are. Your blackness is an asset to the Washington Post, and you should not be ashamed of the fact that that was one of the qualities that I put on that paper when I hired you, And it was a conversation thirty years later that I still remember, and that conversation I had never told anybody about that until I wrote the series.
Let's talk about financial inequities that currently exist, because I think people don't realize that structural racism is really responsible for the inequities that persist today.
Yeah. You know, the thing about racism in our country is lots of people feel that it was an individual thing. It was the clan over there doing something. It was that racist white person that wasn't me or my family. And while there were a lot of individual attacks on folks, there were systemic, system wide discrimination. So just take redlining for an example. So we sort of think it was like a bank here and there, but also the federal government participated in discrimination. I mean, they had the mortgage program, you know, the loans they were saying, carving out whole neighborhoods, saying, these people over here, because they're black, don't lend to them. It was on the federal level, it was on the state level, the local level, in addition to individuals and banks, and so it was a whole system in place. And they would create spaces for blacks that then they wouldn't put grocery stores, they wouldn't put banks, they wouldn't put a place for them to work, and then they would make it difficult for them to take transportation to the jobs, or they would create highways and barriers. Then they created within those areas that we call them ghettos, right, they would say things like, you couldn't have but so many people in the house, and and there's no there's no recreational centers, there's no place for them to swim during the summer, and the pools that you open up, you don't allow them to come and swim. And it's so it's those things, all of that put together, in addition to the actual fear for their lives. You know, after slavery ended. The reason why there's so many African American men in jail is because there were laws, vacancy laws that said you couldn't walk on the street and not have a job. But if you're not giving people a job, what else are they gonna do? And so you penalize them by not allowing him to job, and they put them in jail, and then you create another slavery system by selling out their services as inmates. You see how that system works. It's still in place to this day. And now, I'm a big believe in personal responsibility. So I grew up in a household where my mother and father weren't they and my father was a felon, my mother ran off, and so I'm from that kind of background, and so I studied hard and went to college. But I'm just a small blip of the people because I had people who helped me do that. But if you don't have mentors, you don't have somebody telling you there's another side to this life, then of course you don't go to school. Of course you drop out. Of course you turn the selling drugs to help pay for stuff in your household. It's not an excuse. But you got to understand the history to understand why this is still an.
Issue and the ripple effect. That's correct, there's a misconception. I know that the income and equality in America between black and white people is largely due to the spending habits of Black Americans. Why is that sort of conventional wisdom and why is that so wrong?
It's so wrong you think you hear people say things like, well, they bought a cell phone. It's ridiculous because buying a cell phone or a sneaker is not the same as having the ability to buy a home and create wealth. And so Black Americans, like the rest of Americans, are spend threats. Right. We are a consumer nation, So we're not doing anything more or less than the rest of America. The difference is that lots of wealth in America is tied to home ownership, right, So it goes right back to redlining. And so when for example, the gis came back, you know, with the GI bill, they were allowed to buy homes, they were allowed to use a GI build, go to school about homes. The Black soldiers were not. And so home ownership has been the key to building wealth in America, particularly for middle Americans. So when you denied a whole population the ability to build that wealth, that's where the disparity comes. And so when you put all these ofcas on on away, and then you say, why can't you run that race when you had put roadblocks every part of that race.
When we come back, Michelle shares her great grandmother's harrowing story that led to fear and mistrust for the generations that followed. We're back with Michelle Singletary, financial columnists for the Washington Post. I know you've said your parents were pretty much absentee and your grandmother, who you call Big Mama, raised you starting at age four. But like a lot of blackm Americans, she was very distrustful of financial institutions. And given everything you've already said, you can understand why. So tell us how she felt and how that manifested itself into your upbringing.
Yeah, especially even again to the stock market. So I liked to joke that my grandmother didn't believe in the stock market. She only had a simple savings account. She didn't even have bonds because she the only bond she had was the Bondamheson for her dentures. She just didn't trust them. And many communities across not just the South, by the way, but the North as well had these When they created pockets of wealth for themselves, it was destroyed because of racism. And so because of that, my grandmother didn't trust banks. You know, we knew that banks they own slaves, they had investments in slavery. So many people in our community had that same mistrust, but in terms of the stock market. But what we don't realize, and not just Black Americans, but white Americans too, Americans in general, that you have to invest your money so that it can grow. And so I had to learn to be an investor, despite the fact that I grew up in a household where my grandmother was like, don't you mess with that market. Don't you you know those you put that money there. But I understand her fear. Now I did not at the time, because people have to understand where the mistrust comes from and the fear. So it's only in my lifetime that black Americans had the right to vote. It's only in my lifetime that I had the right to live where I live. It's only in my lifetime that I was able to get a job at the Washington Post. And so, you know, my grandmother would tell me this one story that I wrote about in my column. So my grandmother's grandmother was enslaved in the South, in North Carolina, and she was what they call a wet nurse, and so she had a child at the same time her owner had a child, and so she was charged with nursing that owner's babe. And so the owner determined that the milk on the left side was better because it was closer to the heart. So she told my grandmother's grandmother that she better not nurse her own child on the left side. So one evening, she was tired, she had put the other, the white baby, to sleep. She's sitting in the kitchen in front of the fry place. She starts to nurse her own child in her sleepiness on the left side. The white owner came.
In and saw that, and she whipped my grandmother's grandmother to probably an inch of her life for nursing her own baby on her own black breast.
And that story carried through my family. So you can imagine how that story carries. You can't trust these people. They will take stuff away from you, They will take away the naturalness of feeding your own child.
And so when people say slavery was a long time ago, it wasn't for me, because I touched a woman who touched a woman who was enslaved, who couldn't nurse her own child on her own breasts. When we traveled to North Carolina, we had to make sure that we weren't on the road at nighttime.
In my lifetime, of course, there's also a new school of thought. It's relatively new about generational trauma, right. It is very much alive today and I can hear it in your voice when you recount that story.
Yeah, I mean, you think about it. If you were sold away from your family, denied the ability to get a job, jailed, you weren't allowed to buy a home in a decent neighborhood, you were packaged and pushed into neighborhoods that didn't have resources to support the people in those then what do you do? You do all the things that create a legacy of victims and people being victimized, and it is hard to overcome that. That's what I try to write in my column, and you know a lot of the things that we're doing at the Washington Post to expose these things is to sort of say, look, y'all, all of us can be better off if the parts of our community, be it African Americans, Hispanic immigrants, if we help them, we all benefit. We all benefit.
Do you see things changing the income gap between black and white families is staggering. Black Americans networth is seventy percent below that of non black households. So we've been having conversations that we didn't have ten years ago about systemic racism. Do you feel like that has prompted any kind of positive change?
I actually do. I do the fact that we are going to college at record numbers, and even though home ownership rates is still fairly low when you compare to white Americans, it's about forty five percent for African Americans, it's about seventy five percent for white households. And actually that number is the same as it was on the Civil Rights when housing laws were enacted. So we've got to get that number up. But I feel like we're making progress. Even with we talked about credit scores, right, there's you know, like Fico and other companies are trying to figure out ways to include information that would be more inclusive to African Americans. So some of the newer credit scoring models taken to account rent payments, right, so if you've been paying your rent on time, they include that like they would alone. And so I do see some progress. Is it slow? Yes? But I am optimist because to not be optimistic is to just give up. And I'm not going to give up having this conversation. The series was so well received, and I think if we are bold enough to write about it and people can open their minds and not just rely on stereotypes and trope sayings. But I do think that the more people are aware of this, the more we write about it, the more we expose it, that change is coming.
Well, that editor was right, although he buried the league as they say, Michelle, about why you were hired for the totality of who you are, but because you're a damn good reporter, writer and highly intelligent person. I just wanted to mention that Michelle, you're a baller, that we need to come up with a with a more gender appropriate word, like what is the synonym for baller if you're a woman.
Oh, you know, that's a good question. I don't know. Queen. Well, thank you for having me and I appreciate you and thank you for addressing this topic.
Great. Thank you, Michelle. When we come back, our conversation about the racial wealth gap continues. I'll be joined by Chloe McKenzie, founder of Blackfan, who will share her personal struggle with financial trauma and how it gave her a unique ability to help others find financial freedom. If you want to get smarter every morning with a breakdown of the news and fascinating takes on health and wellness and pop culture, sign up for our daily newsletter Wake Up Call by going to Katiecuric dot com. We're back. I'm delighted to introduce my next guest, Chloe McKenzie. Choe is a researcher and a wealth justice activist. She's been working on behalf of Black women addressing the root causes of financial trauma through her organization Blackfem. Chloe Welcome.
Hi.
So if someone said, Chloe, what exactly does Blackfem do Black.
Them partners with?
I would say the nation's most forward thinking governmental bodies, private institutions, and public institutions to undo generations of systemic financial trauma.
And the way that we do this is.
We start to look at the different points of where financial trauma is perpetrated in education systems and our policymaking systems, and our familial systems and our culture systems to not only teach people how to navigate an economically violent system, but to ultimately change policy and the systems themselves so that they're no longer perpetrating the financial trauma onto the populations.
When you say wealth and trauma, I'm just curious because that I think, Well, wealth doesn't insulate you from trauma. That's so interesting. Well, we'll further explore the relationship between wealth and trauma in a moment, but first, I want to go back to your personal story, Chloe.
Yes, so a lot of my own contentious relationship with money comes from the fact that I grew up incredibly privileged, but I rejected a lot of that privilege to be safe, and so I have this very kind of interesting dynamic with money and wealth, which is how I got to the where I am today.
That's fascinating. All these different, almost conflicting messages you were getting as a child. Tell us a little more about, if you could, about your childhood and how as you said, you were privileged, at the same time you were under a lot of stress and experienced trauma.
Yeah. So again, you're right. It's so funny.
I always think of Brene Brown's quote about she says the truth lies in the paradox and there are so many conflicting paradoxical experiences that I had growing up. So I was the golden child's you know, I skipped two grades, I was reading at three, all of these kind of wonderful things. But you know, I experienced physical and sexual abuse my entire childhood until I was able to really escape because I skipped two grades growing up. I was twelve as a freshman in high school, and so my primary purpose was to just get to college as quickly as possible, because waiting until eighteen six years it would just be.
Be too much.
You were a superstar in high school, you were captain of the soccer team, student body president, made obviously great grades, and you go on to Amherst and then you go on to be a Wall Street trader.
Yeah yep.
Now this was just a few years after of the financial crisis, and I'm imagining there weren't a lot of traders who look like you, Chloe, Am I right now?
Absolutely not.
The way that I describe it to people is if they've ever seen the movie Hidden Figures, I was the Taraji p Henson on the trading floor, as she was the only calculator mathematician on a floor full of you know, astrophysicists.
And what was that experience, like.
Old Chloe would tell you, I mean it was exhilarating, so old and new Chloe would say that, I again, and this is part of my understanding of how I've been resilient through my trauma. But you know, I love being discounted. I love being the underdog. I love being subversive. That's just my competitive nature. And if I can subvert gender norms or racial norms or whatever, I'm in it like all the time.
So it was it was exciting in that way.
It was the most intellectually compelling play to be at the time because, as you mentioned, this was right after the two thousand and eight financial crisis of several years after Dodd Frank has just been implemented, so we were recovering in some ways.
But what was most fascinating to me.
Was that a lot of the things that were being done in two thousand and eight were in some ways still being done, just in a different name and maybe like slightly more compliant with Dodd Frank. I studied law, jurisprudence, and social thought at AMMERS because I thought I was going to be a lawyer, and so I'm coming in with no finance background or economics or anything. I just happened to be really good with numbers, so I found it intellectually fascinating. It also was incredibly morally bankrupting, just because of the frat boy behavior that you just had to be around at all times.
Yeah, doesn't sound like a whole lot of fun, although I guess it was very adrenaline producing, right, and that the pay so beine on a trading floor must just be constant, you know, motion, energy, noise.
I think what made it very fascinating and frankly intense was that it was what I was trading. So I was trading mortgages, student loans, credit card receivables, and auto loans, so all of the debt that the average American touches, I was trading. And that made it more intense for me because I'm thinking to myself, Okay, I didn't even know what securitization was, and why am I trading the cash flow of somebody who's playing their bill but they're struggling and on the brink of foreclosure. But we're going to make how many millions off of this trading pool? And we were also financing, you know, for other hedge funds to buy these distressed properties, and I was in charge of making sure things were compliant because I was the legal girl, and so I also dealt with all of the appraisers who were going to confirm that these properties were not crap like they were in two thousand and eight or something like that.
So I just I saw.
The more human element than what usually most traders.
See to compensate for the morally bankrupt environment. You started working at a homeless shelter as a financial counselor This was while you're working on Wall Street, right, Chloe, Yes, So why did you want to do that and what impact did that have on your career?
Yeah?
So, so much of what I told myself and I still do today, But so much what I've told myself when I was younger was that serving others was a way to heal myself. It provided perspective that I went through hell growing up, So there was that, and then, yes, the profundity of that experience was that I really again connected this idea of how is it that I am trading the cash flows of the bills people need to pay and they are struggling to pay, and helping people make so much money off of.
That activity and then coming.
Here and working with women, predominantly Black women. A lot of them were young women, a lot of them were mothers, and some of them had just aged out of foster care.
And be in.
The worst financial situation you can think of.
And so in many ways it started to kind of piece together this narrative of like again, this inherent contradiction of what it means to be in quote financial services, like who are we really serving? Why are we doing it this way? And especially I think when I connected again the racial and gender lens of my experience and working with these women, I said, we're.
Not doing enough.
So you started Black Them in twenty fifteen, talk about the driving idea behind the work. And I love the reason you named your company any Black Them.
Yes, you have absolutely no doubt in your mind who it's for and why and who founded it.
So when I was working in the homeless shelter.
I started to realize that a lot of the research and even the solutions, programmatic, policy based solutions.
Around the wealth gap never we're intersectional.
So I always say the racial and gender wealth gap, because if we're taking them together, then we need to actually name the oppressive forces that are interlocking and so I said, you know, with the time that I've left on this earth, I'm going to dedicate it to closing the racial and gender wealth gap. And I'm going to do so by prioritizing the very population that suffers the most from this structural positioning of always having to do the most to achieve or you know, achieve any type of wealth building, type of stability or capability.
Talk to me about working with black women and black girls specifically and why you think that is key in solving some of these broader social issues.
Yeah, being a mom, it's so hard to say this, but the first thing that I kind of grounded myself in when I created black then, which is black women birthed all of the wealth in America.
And so the apparatus.
Through which the slave holders used in order to make sure that they were getting enough laborers to pick said cotton was through birthing children that ultimately they you know, disowned. And so I think about the fact that that truth that trauma, that's where this link of wealth and trauma kind of exists, has been passed down through everything that we do.
And so how do you reverse that? Though you know, those are years that have been ingrained in the consciousness of this population. How are you applying what I'm understanding to be generational financial trauma to the women you're serving today.
That's a great question, But the short answer is I'm figuring that out.
That is literally the day to day work.
And so part of what I do when I work with black women and girls is I look at the way in which I can describe to them how to navigate a.
System that was designed to be harmful.
And so I'm teaching people here are the ways that the system is already actively harming you, and giving them the vocabulary to navigate that, and then the skills on how to navigate that.
And so it's a harm reduction strategy as.
I'm trying to figure out what the harm elimination strategy is.
So what you're trying to do is eradicate some of the obstacles, long long term obstacles that have discouraged particularly women of color.
Yes, I actually really appreciate how you frame that, because that is true, and to your point, it's a both and that on the one hand, I'm hoping to help people who are in charge of building and perpetuating our economic system to understand how to participate and make it less scary, but then also working with the community black women, how is it that I can help reduce some of that fear to help you then more fully participate.
Well, this is fascinating, Chloe McKenzie. You are something. Thank you so much for everything that you're doing and good luck with all your efforts.
Thank you so much, Katie.
Thanks for listening everyone. By the way, if you have a question for me, a subject you want us to cover, or you want to share your thoughts about how you navigate this crazy world reach out. You can leave a short message at six h nine five point two five to five five, or you can send me a DM on Instagram. I would love to hear from you. Next Question is a production of iHeartMedia and Katie Couric Media. The executive producer Katie Couric and Courtney Ltz. Our supervising producer is Marcy Thompson. Our producers are Adrianna Fazzio and Catherine Law. Our audio engineer is Matt Russell, who also composed our theme music. For more information about today's episode, or to sign up for my newsletter wake Up Call, go to the description in the podcast app or visit us at Katiecuric dot com. You can also find me on Instagram and all my social media channels. For more podcasts from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen to your favorite shows.
