03/11/2013 12:11 pm ET Updated May 11, 2013

America's Racial Wealth Gap Is Fixable

America's yawning racial wealth gap gets mentioned only rarely in political and policy discussions -- perhaps the only thing rarer is for a political leader to suggest that this problem can actually be fixed. But a recent study from Brandeis University's Institute on Assets and Social Policy suggests that it is indeed fixable -- if we forget most of what we think we know.

First, some numbers: According to U.S. Census data, for every dollar of wealth a U.S. white family has, the median Asian family has about 63 cents, the median Latino family has seven cents, and the median black family has less than a nickel.

Many believe this gap comes from personal attributes and choices like laziness or choosing not to save. As one commenter on a conservative website put it recently, "This [racial wealth gap] may be no more than the result of different tendencies in different cultures with respect to saving money."

It's comforting to believe that America's staggering wealth gap exists only because "those" people are lazy and irresponsible. Reality is more complicated.

The fascinating study from Thomas Shapiro and colleagues -- which got some coverage but deserves far more attention -- followed 1,700 families from 1984 to 2009. They looked at how much wealth these families managed to accumulate and what factors contributed to differences between racial groups, and the results were startling.

Unfortunately, the researchers didn't have data for enough Asian and Latino households to produce reliable comparisons, but they were able to compare white and African-American families. In 1984, the white families were worth about $85,000 more than the black families. Over time, both groups gained wealth, but 25 years later the gap between white and black families had soared to over $236,000.

What perpetuated and expanded this gap was a web of what the researchers termed "opportunities and barriers in workplaces, schools and communities that reinforce deeply entrenched racial dynamics in how wealth is accumulated." Those opportunities are shaped by policy, meaning we can fix them.

Those barriers and opportunities revolved around things like homeownership, income, unemployment and inheritance. The biggest factor by far was years of homeownership, which accounted for more than a quarter of the racial wealth gap in these families.

And homeownership, sadly, has a huge racial component. Decades of what Shapiro and colleagues term "racial segregation by government design" (and not just in the Jim Crow south, but often enforced by federal agencies like the FHA) lowered demand for homes in black neighborhoods, reducing the equity black homeowners could accrue. Because whites are five times more likely to inherit money than blacks, or otherwise help family members with downpayments, whites on average bought homes and started building equity eight years earlier than African-Americans, generally with lower lending costs.

Shockingly, factors that should help everyone helped whites far more than blacks. Take education, for example: "Similar college degrees," the researchers write, "produce more wealth for whites." A number of factors contribute to this, including the fact that African-Americans are more likely to graduate college burdened by debt.

This is discouraging, but much of it can be addressed by smart policies. We can enforce lending standards and fair housing policies to lessen the effects of segregation and predatory lending. We can help low-income families and families of color attend college and graduate without massive debt. We can use the minimum wage and equal pay provisions to reduce the income gap, and strengthen employer-based retirement plans.

But the first step is to recognize that the racial wealth gap didn't just happen. Policies created it, and policies can fix it.