Over the past three decades, average household wealth in the United States has declined among all but the richest families, with a near 80 percent drop among the nation's poorest families. Although the national debate about inequality has focused on income, it is wealth—the private assets amassed and passed on within families—that provides the extra economic cushion needed to move beyond mere day-to-day survival. Assets for the Poor is the first full-scale investigation into the importance of family wealth and the need for policies to encourage asset-building among the poor. Assets for the Poor shows how institutional mechanisms designed to encourage acquisition of capital and property favor middle-class and high-income families. For example, the aggregate value of home mortgage tax deductions far outweighs the dollar amount of the subsidies provided by Section 8 rental vouchers and public housing. Banking definitions of creditworthiness largely exclude minorities, and welfare rules have made it nearly impossible for single mothers to accumulate savings, let alone stocks or real estate. Due to persistent residential segregation, even those minority families who do own homes are often denied equal access to better schools and public services. The research in this volume shows that the poor do make use of the assets they have. Cash gifts—although small in size—are frequent within families and often lead to such positive results as homebuying and debt reduction, while tangible assets such as tools and cars help increase employment prospects. Assets for the Poor examines policies such as Individual Development Account tax subsidies to reward financial savings among the poor, and more liberal credit rules to make borrowing easier and less costly. The contributors also offer thoughtful advice for bringing the poor into mainstream savings institutions and warn against developing asset building policies at the expense of existing safety net programs. Asset-building for low-income families is a powerful idea that offers hope to families searching for a way out of poverty. Assets for the Poor challenges current thinking regarding poverty reduction policies and proposes a major shift in the way we think about families and how they make a better life. A Volume in the Ford Foundation Series on Asset Building

This fast-paced book by Yale professors Michael Graetz and Ian Shapiro unravels the following mystery: How is it that the estate tax, which has been on the books continuously since 1916 and is paid by only the wealthiest two percent of Americans, was repealed in 2001 with broad bipartisan support? The mystery is all the more striking because the repeal was not done in the dead of night, like a congressional pay raise. It came at the end of a multiyear populist campaign launched by a few individuals, and was heralded by its supporters as a signal achievement for Americans who are committed to the work ethic and the American Dream. Graetz and Shapiro conducted wide-ranging interviews with the relevant players: members of congress, senators, staffers from the key committees and the Bush White House, civil servants, think tank and interest group representatives, and many others. The result is a unique portrait of American politics as viewed through the lens of the death tax repeal saga. Graetz and Shapiro brilliantly illuminate the repeal campaign's many fascinating and unexpected turns--particularly the odd end result whereby the repeal is slated to self-destruct a decade after its passage. They show that the stakes in this fight are exceedingly high; the very survival of the long standing American consensus on progressive taxation is being threatened. Graetz and Shapiro's rich narrative reads more like a political drama than a conventional work of scholarship. Yet every page is suffused by their intimate knowledge of the history of the tax code, the transformation of American conservatism over the past three decades, and the wider political implications of battles over tax policy.

As debate rages over the widening and destructive gap between the rich and the rest of Americans, Claude Fischer and his colleagues present a comprehensive new treatment of inequality in America. They challenge arguments that expanding inequality is the natural, perhaps necessary, accompaniment of economic growth. They refute the claims of the incendiary bestseller The Bell Curve (1994) through a clear, rigorous re-analysis of the very data its authors, Richard Herrnstein and Charles Murray, used to contend that inherited differences in intelligence explain inequality. Inequality by Design offers a powerful alternative explanation, stressing that economic fortune depends more on social circumstances than on IQ, which is itself a product of society. More critical yet, patterns of inequality must be explained by looking beyond the attributes of individuals to the structure of society. Social policies set the "rules of the game" within which individual abilities and efforts matter. And recent policies have, on the whole, widened the gap between the rich and the rest of Americans since the 1970s. Not only does the wealth of individuals' parents shape their chances for a good life, so do national policies ranging from labor laws to investments in education to tax deductions. The authors explore the ways that America--the most economically unequal society in the industrialized world--unevenly distributes rewards through regulation of the market, taxes, and government spending. It attacks the myth that inequality fosters economic growth, that reducing economic inequality requires enormous welfare expenditures, and that there is little we can do to alter the extent of inequality. It also attacks the injurious myth of innate racial inequality, presenting powerful evidence that racial differences in achievement are the consequences, not the causes, of social inequality. By refusing to blame inequality on an unchangeable human nature and an inexorable market--an excuse that leads to resignation and passivity--Inequality by Design shows how we can advance policies that widen opportunity for all.