US GDP lost $16 trillion since 2000 due to racism, says Citigroup study

Bloomberg September 25 | Updated on September 25, 2020 Published on September 25, 2020

If the US could instantly end the most severe forms of economic discrimination against African Americans, it could give a $5-trillion boost to gross domestic product over the next five years, according to a new study by Citigroup Inc.

The New York-based bank looked at the costs of lost wages, less access to home and small business loans and limited access higher education. Over the past 20 years, GDP lost about $16 trillion because of race-based inequalities, the firm estimated in a study released recently.

Citigroup concluded the costs of racism are greater than did a 2019 McKinsey study, which estimated that the racial wealth gap would cost the US economy $1.5 trillion through 2028, but both agree the status quo is a drag on growth.

Also read: For American voters, the choice is Black or Blue

“What this report underscores is that this tariff is levied on us all, and particularly in the US, that cost has a real and tangible impact on our countrys economic output,” Citigroup Vice-Chairman Raymond J. McGuire said in the report. “We have a responsibility and an opportunity to confront this longstanding societal ill.”

Citigroup also concluded that closing the wage gap two decades ago could have freed up $2.7 trillion in income for consumption and investment, and fair lending to Black entrepreneurs could have generated $13 trillion in business revenue over the same time period.

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

Published on September 25, 2020
This article is closed for comments.
Please Email the Editor