Feature

Debt Collecting Promises High Pay. All It Costs Is Your Soul.

Trevor Powell* was a high school student working part-time at Target in Sioux Falls, South Dakota, in 2007 when he first heard about job openings for collections agents at First Premier Bank from a friend’s mom.

“I just wanted a job that paid more,” Powell explained. First Premier offered him $16 an hour in base pay, which could rise with incentive pay to $18 to $20 an hour depending on Powell’s success in collecting debts.

In a country where middle-class wages are hard to come by without a college degree, the comparatively good pay of debt collection can be a big draw. According to data from the Bureau of Labor Statistics, the median hourly pay in 2018 for debt collectors was $17.32, a big step-up in pay from other lines of work such as retail sales ($12.75) or fast food ($10.89).

71 million U.S. adults have fallen behind on a bill and now have debt in collections. According to data from the Federal Reserve Bank of New York, U.S. household debt is at an all-time high — and behind our system of easy credit are roughly 300,000 debt collectors, working for both lenders and 3rd-party collection agencies, whose job it is to recover money from American families.

These debt collectors may not match your expectations of slick-talking hucksters willing to do whatever it takes to get paid. Like many of the debtors they collect from, the collectors are often low-income themselves. While most have a high-school diploma or equivalent, some, like Powell, are teenagers. 69 percent of debt collectors are female.

At relatively low wages, debt collectors are expected to engage in what University of Brighton psychologist Carl Walker has called “mental warfare” in order to collect; the industry can leave behind scars for both the borrowers and the collectors. It’s a grueling job. In a 2016 Consumer Financial Protection Bureau survey, debt collection agencies with more than 250 employees reported an average turnover rate of 75 percent to 100 percent.

If you were born into the middle class, you’ve probably never heard of Powell’s former employer, First Premier, but it’s a major player in America’s system of subprime credit. At one point, it accounted for as much as 47 percent of all subprime credit card solicitations sent out in the United States, and now it’s the nation’s 12th biggest issuer of Mastercard credit cards.

First Premier credit cards often come with eye-popping fees. One, for example, has a $300 credit limit, a $95 one-time “program fee,” $75 in total monthly and annual fees in the first year, $120 in monthly and annual fees in all subsequent years, and a 36 percent APR. Those exorbitant prices draw in only those consumers with few other options for credit.

As Powell explained, if the borrower couldn’t pay on the spot, the collections agents at First Premier would ask for a “promise to pay.” There was folk wisdom about what different promises to pay meant: a $20 money order on the 3rd of the month meant the customer was on disability, and if it was coming on the first of the month, it meant the customer was a senior collecting Social Security. Getting a customer’s checking account credentials was ideal — it let First Premier automatically debit the customer’s bank account on the specified date — but debit and credit card payments, payments by Western Union, or money orders were all fair game as well. A lot of customers were surprised or angry about how much they owed.

The job “definitely broke you down,” said Powell. “At a certain point, you felt like you weren’t doing the right thing.” Powell “no-called, no-showed” — e.g. got fired after failing to show up to work — a little more than a year after he started. “The lion’s share [of customers] probably would have been better off if they had never opened the card,” he said.

The company’s current interest rates in Arizona were as high as 180 percent per year.

When Chaz Fertal went in for his job interview at Checkmate in Phoenix, Arizona, in 2010, he was originally afraid he was getting duped in a Craigslist scam. Fertal showed up to an office that appeared deserted, with blacked-out windows, only to find out the building had been intentionally obscured; Checkmate was concerned that angry customers would try to track the debt collectors down. Fertal’s base pay at Checkmate was around $2,000 per month, but offered the possibility of big commission checks. Fertal says his biggest was around $4,400, meaning your pay could more than double if you were good at getting borrowers to make payments.

A current Checkmate employee confirmed over the phone that the company’s current interest rates in Arizona were as high as 180 percent per year. As Fertal explained, a customer wouldn’t actually have to make progress on paying down their debt for the Checkmate collector to earn his commission. If customers fell behind and went into collections, Fertal said he would earn commission whether he convinced them to pay the full balance or if he convinced the borrower to pay off outstanding interest while taking out a new loan. For the purposes of commission, taking on a new loan counted as “paying off” the old one.

Fertal said the incentive scheme encouraged agents to push borrowers into these loan “rollovers.” “You’d talk to a customer on the phone who after four or five months would still owe the whole amount” and they’d be outraged, Fertal said, when they realized the payments they’d made had done nothing to pay down their debt.

For Fertal, there was a clear day, he said, when he realized he didn’t want to work at Checkmate anymore. When Checkmate customers applied for loans, they typically gave Checkmate a bank account routing and account number, giving Checkmate the right to withdraw payments; if a customer went past due, the loan entered default, and, Fertal says, Checkmate would attempt to withdraw the whole outstanding loan balance from the customer’s checking account. If Checkmate wasn’t successful at withdrawing the full amount, they’d break the balance into smaller amounts and try again — Fertal said the company’s practice was to make three attempts per day, starting at 4:30 in the morning, just after any direct deposits would have landed in the borrower’s account overnight. The only way, Fertal says, a borrower could stop the process, was by making a promise to pay and providing a credit card number or debit card number to do so.

Fertal remembers one borrower well. Overnight, Fertal says, Checkmate had taken the woman’s “entire paycheck, I think it was a thousand dollars,” he says. “She had two or three kids. She told me, ‘I have nothing to feed my kids, our refrigerator is empty, they took everything.’ I went to the ACH department and they couldn’t reverse it. She told me, ‘I don’t know what I’m going to do, the only thing I can think of is killing myself’ — and I knew it wasn’t a lie, you could hear the loss in her voice. I remember telling her, ‘your kids need you more than anything right now, and that that’s not the answer.’ I was trying to see if there was anything we could do, even taking out a new loan, but she still had a balance on her existing loan.”

Fertal quit shortly after that phone call in 2011, and he said he still thinks about that woman and her family.

Fertal and Powell’s experiences show the toll subprime credit and debt collection industries take not only on their customers, but on the front-line agents as well. These debt collection jobs offer Americans a step up in financial security, in exchange for taking on the difficult role as intermediary between high-priced lenders and consumers in dire straits.

“The environment would just be toxic. You’d get a worse and worse impression of people,” said Fertal. “The reality is that you’re not talking with people who are in a great place in their life.”

Editor’s note: Trevor Powell asked that his name be changed for privacy.

This post has been edited to clarify Fertal’s commission earnings.

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Analysis

Increasing Surveillance of Mentally Ill People Won’t Stop Mass Shootings

Recently, the Washington Post uncovered a Trump administration proposal to monitor the smartphones of people with mental illness, under the guise of detecting and preventing violence before it occurs. This new strategy is consistent with a slew of remarks Trump has given in recent months targeting people with mental illness, including an explicit call to expand institutionalization.

However, President Trump is not alone in targeting people with mental illness in the aftermath of gun violence instead of focusing on access to guns. New York Gov. Andrew Cuomo and Texas Sen. Ted Cruz, among others, have done the same. If they’re successful, it will be another hard hit against marginalized communities during an administration when they are already under attack.

The American legal landscape is a complex web of laws that subject mentally ill people and those experiencing acute crisis or suicidality to surveillance and restrictions of their rights, which most notably includes the right of states to involuntarily commit a person with mental illness or to mandate outpatient treatment. Undergirding this legal framework is the presumption that people with mental illness are prone to violence (whether against themselves or others).

This is sanism: The system of institutionalized oppression that systematically disadvantages people perceived or determined to be mentally ill, while granting privileges to those considered sane.

The legal link between violence and mental illness is so strong that the United States often uses institutionalization as part of the broader carceral system. Among the most glaring examples of this are the insanity defense, people who are deemed incompetent to stand trial, and sex offenders who are confined to mental institutions even after the completion of their criminal sentence.

Technically, people charged under these laws are not sent to prison. However, institutionalization functions as a form of medical incarceration; patients are not free to come and go, and are often confined in hospitals for a longer period than they would have been confined to jail or prison. In fact, the population of forensic patients in state psychiatric hospitals has grown so rapidly that many state institutions are at or beyond capacity, with some patients held for decades or even indefinitely.

The specific legal criteria for involuntary civil commitment vary across states, but most states rely on the dangerousness criterion. In theory, it assesses if a mentally ill person poses a threat of danger to themselves or others to determine whether to initiate civil commitment proceedings. However, states generally do not distinguish between the danger posed to oneself and the danger posed to others in determining the appropriate interventions. The law affirms that states, pursuant to their parens patriae power, or the authority to act as a guardian for those unable to act on their own behalf, have a substantial interest in subjecting people with mental illness to involuntary commitment to ensure their safety or their community’s safety.

So even when no crime has been committed, people can be medically incarcerated. In a country that guarantees a constitutional right to liberty and due process, that poses a serious problem.

Trump’s call for increased institutionalization, therefore, bears a striking similarity to the cruelty of his other policies: It capitalizes on widespread anxiety about community safety in order to justify expanding carceral control of “deviant” groups. People of color and other historically marginalized populations will bear the brunt of any such expansion. People of color are more likely to be found incompetent to stand trial, and Black people are three to four times more likely than white people to be diagnosed with psychotic disorders. Black and Native people are disproportionately impacted by institutionalization and are more likely to be mandated to receive involuntary outpatient treatment.

The American mental health system is violent.

Much like the proposal the Trump administration is weighing today, previous policies meant to reduce gun violence ultimately increased surveillance and criminalization of people with psychiatric disabilities.  For example, 43 states currently require or authorize that people flagged by the state due to certain mental-health adjudications have their names reported to the FBI’s National Instant Criminal Background Check System (NICS). Four more states require such collection in an in-state database, each of which place people who have been involuntarily committed on lists alongside those convicted of violent crimes to bar them from purchasing firearms. Following the shootings at Virginia Tech, mental health related reporting to NICS spiked by 700 percent in just under seven years.

This becomes increasingly important as a focus on suicide becomes a larger target in gun violence prevention. While politicians have previously been met with skepticism for pinning mass shootings on mental illness, they have found support when focusing on the danger that people with mental illness are presumed to pose to themselves. This allows politicians to dodge the issues underpinning mass gun violence, instead targeting a population of people with much less political capital (people with mental illness) rather than the main perpetrators of mass shootings (straight white men). In that sense, they are leveraging sanism to protect white supremacist patriarchy.

As a result, the focus on suicidality is likely to increase the number of people who are institutionalized, without decreasing the number of mass shootings.

The American mental health system is violent. People with mental illness, particularly people of color with mental illness, are increasingly subject to punitive coercive treatment instead of community-based models for healing and care. The national fixation on mental illness which inevitably follows mass shootings is harmful not only because it does nothing to curb gun violence, but because it is a pretext for entrenching and expanding oppression.

Each time gun violence and mental illness are discussed together, we ultimately reinforce the discriminatory assumptions which animate our laws and justify dehumanizing treatment and oppression of psychiatrically disabled people.

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Analysis

California’s Use of Force Law Is a Start, But Not What Communities Really Need

Several weeks ago, the NYPD pulled up on me and a friend while we were standing outside of my friend’s home. Four officers jumped out of an unmarked car. I guess they psychically knew that we were about to smoke a joint, though neither one of us actually had weed in our hands.

While searching us, one of the officers said, cynically, “It ain’t legal yet,” though the “it” was not found on us.

It was around 10 p.m. and I was too tired to assert my rights or to say that I was in a meeting with their commissioner earlier that week about NYPD’s plans to build community-police relations. We accepted the harassment, survived the interaction, and went to our respective homes to smoke our blunts in peace, like most white people who now claim Crown Heights as their home.

Police murders of unarmed people in America sprout from seemingly benign harassment like that which happened to me and my friend, a military veteran — like what happened to Eric Garner, who was strangled to death for bootlegging cigarettes.

In August, California passed a law making it less legal for law enforcement to kill Black and Brown people such as Eric Garner. California’s recently passed Assembly Bill No. 392, described by some as one of the toughest standards in the nation for when law enforcement officers can kill, is progress. Known as the “Act to Save Lives,” the law removes barriers to prosecuting officers who unlawfully use lethal force. The new law also redefines when a peace officer’s use of deadly force is deemed justifiable, based on the totality of the circumstance.

The LAPD alone killed 172 people in 2017. This new law would presumably decrease that number because police will be able to use deadly force only when, based on the perspective of the officer, it is necessary in defense of human life.

Advocates such as Cat Brooks at the Anti Police-Terror Project are the architects of this new law, potentially setting a legal precedent to be replicated across the country.

Acknowledging the success of the efforts of these advocates can occur while we also question whether substantive progress has been made. Five years ago, more than 500 journalists, lawyers, medics, organizers, pastors, students, tech experts and videographers participated in what would be called the “freedom rides,” which were response to the murder of unarmed Mike Brown by Ferguson police officer Darren Wilson.

The group of freedom riders, along with the local residents of Ferguson, had a list of demands, including: “a decrease in law-enforcement spending at the local, state and federal levels and a reinvestment of that budgeted money into the black communities most devastated by poverty in order to create jobs, housing, and schools. This money should be redirected to those … departments charged with providing employment, housing, and educational services.”

California’s new law doesn’t address that concern.

Rightfully, the Act to Save Lives regulates policing with impunity. Police will no longer easily get away with the “I feared for my life” script; they will have to prove after the murder or assault that a “reasonable officer in the same situation would believe that a person has the ability…and intent to immediately cause death or serious bodily injury to the peace officer or another person.” All of this substantiation would be done after the hashtag for this person is created and goes viral.

What is still to be tackled is the oversaturated deployment of police into communities of color.

What is still to be tackled is the oversaturated deployment of police into communities of color.

Which brings me back to Brooklyn. This fall in the East New York section of Brooklyn, less than a mile from where I was harassed, the NYPD is opening its first stand-alone community center — a $10 million investment by the City of New York.

Now, positive police-community relations are a plus for any community, but it is not where we need to invest $10 million dollars in a community where in 2015, the rate of preterm births, a key driver of infant death, is the fourth highest in the city; the teen birth rate is higher than the city average; and the rate of elementary school absenteeism is eighth-highest in the city.

Social welfare is not a function of police training, nor is it a part of their corporate culture. More importantly, policing as a practice has a foundationally biased perspective of poor Black and Brown communities, and that is a truth we all should be honest enough to sit with.

The step after this acknowledgement is changed behavior. Listening followed by action.

Over the past year or so, I have been in roundtable conversations with a diverse array of actors in the criminal legal system. Organizers, directly impacted people, loved ones of the impacted, along with academics, judges, prosecutors, defense attorneys, elected officials, social workers, historians, cops, prison guards, and wardens — basically all the cogs in an irreformable and irreparable old steam engine.

The convenings are a part of a project that Bruce Western of the Columbia University Justice Lab called the “Square One Project.” The home page provokes the following scenarios:

Imagine neighborhoods soaring in education instead of arrests.

Imagine community groups leading the effort to end violence in our towns and cities.

Imagine a response to crime that brings communities together instead of breaking them apart.

The next Square One roundtable convening will take place in Detroit in October, and I also wonder, “can police imagine a community that does not rely on them as a dominant resource?”

In communities such as East New York and Ferguson, police-community relations are one problem of many: High unemployment, negative prenatal outcomes, bad water, dilapidated and unaffordable housing, and the list can go on. More of a police presence is not a solution to any of the above.

Emory University Sociologist Abigail Sewell asserts that “part of the solution may be to reduce police contact in the first place.” With that reduction can come abundant and sustainable investments in community-based organizations and individuals of expertise who reside in the projects and hang on the street corners — the community writ large.

Regulating the justifications for police use of deadly force is a commendable step in the right direction. The leap that communities like East New York need, however, is an investment in reducing the social determinants that give law enforcement the excuse to have a suffocating presence there.

Black and Brown neighborhoods do not need more overseers, or more state of the art smaller jails. We are capable of thriving without emphasis on our perceived criminality, and we are capable of taking care of ourselves, just like those in places like Beverly Hills, Los Angeles, or Carrol Gardens, once we are provided with the tools to deal with the tentacles of American racism, such as poverty, the distribution of money, and overpolicing. The “Seven Neighborhoods Study” produced by formerly incarcerated people in the 1990s found that there was a “direct connection between low income, racially isolated, underserved communities…and encounters with law enforcement that result in prison or death.”

Only time will tell whether the Act to Save Lives will have a measurable positive impact on police interactions with Black and Brown people. That new NYPD community center will come as a win for those focused on building a new paradigm for police-community relations.

But the academic and practitioner in me still thinks about Malcolm X, who famously said, “If you stick a knife in my back nine inches and pull it out six inches, there’s no progress. If you pull it all the way out, that’s not progress. The progress is healing the wound that the blow made. They won’t even admit the knife is there.” I know that police harassment is an underlying and extralegal blade that can be wielded at any time in the name of progress.

Yes, it is less legal to be killed by police, but I still feel the knife.

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Analysis

Low-Income Students Are Returning to Dangerously Hot Schools

This week marks the last of the first days of school. In some school districts, classes have already been in session for several weeks, and they’ve been hot ones. Teachers are bringing fans from home and schools are closing because temperature control is too challenging.

Alex, a teacher in the Bay Area, says conditions in her school have been particularly bad this year; many buildings in the region are not designed for high heat, thanks to the historically temperate climate. Her classroom doesn’t have openable windows, so she uses a fan to try to suck air in from the cooler hallway, but it’s not enough.

“Students will ask to go to the bathroom more often just to get into the hallway where it’s cooler,” she told TalkPoverty. She said the heat makes students feel sluggish and unfocused, a problem particularly acute for young women in her class who struggle with body image, and stay tightly wrapped up even in high temperatures. “I also notice that I tend to run out of energy a lot faster on hot days.”

Not ideal for a high school teacher trying to keep order in a classroom of 16-year-olds, even one who loves her job and is passionate about education.

This is a problem that’s only going to get worse due to the confluence of rising temperatures thanks to climate change — average temperatures in the U.S. could increase by as much as 12 degrees Fahrenheit by 2100 and have already risen several degrees since 1900 — and declining school funding. Schools that don’t overheat today are going to in the future.

Education budgets were cut deeply during the Great Recession and some states haven’t returned to their pre-Recession funding levels; capital spending across the country hasn’t recovered to pre-recession levels either. As a result, schools that urgently need temperature control updates along with other infrastructure improvements face an uphill struggle to increase their budgets.

Overheated classrooms aren’t just uncomfortable. They can actively inhibit health and learning. There’s a large body of evidence showing that air conditioning can improve student health and academic performance, and research as far back as 1984 on the effects of learning in a hot classroom.

A May 2018 paper found that a temperature increase of just one degree can reduce the amount learned over the course of the school year by 1 percent. The researchers estimate that around 30 percent of schools in the U.S. lack air conditioning, and that even within hot areas with widespread air conditioning penetration, kids in low-income schools are less likely to have access to have cooling at school.

They also argue systemic inequality can exacerbate this phenomenon among low-income students of color, who live in hotter regions and are more likely to attend schools without adequate temperature control.

Jisung Park, one of the researchers, said that, “What we’re finding is totally consistent with the last mile of the school desegregation movement not having been completed … the neighborhood-level disparities driven by residential wealth still very much hold true.”

Park, an environmental economist, is swift to note that simply installing air conditioning — itself a known contributor to climate change — is not the solution. Greening electric infrastructure, taxing carbon, and taking other measures to tackle climate change is key, he said.

So is investing in school infrastructure, including new buildings; maintenance to bring schools up to new standards; and retrofitting to help schools adapt, inside and out, to climate change. That must include rich and poor districts alike, or the inequalities they observe will perpetuate themselves.

An Oklahoma educator who works in a school with a high percentage of low-income black students sees the consequences of being housed in outdated school buildings without adequate resources firsthand. Her classroom can get up to 80 degrees, and it takes a noticeable toll on her students. “I’m trying,” overheated students will tell her. “I’m tired, it’s too hot in here.”

Overheated classrooms aren’t just uncomfortable. They can actively inhibit health and learning.

Her school actually has a climate control system, complete with thermostats in every classroom. But it is not well-maintained. It can take hours for the district to respond when teachers put in a request for help.

For one of her colleagues across the hall, that means suffocating in heat as high as 90 degrees until her class is relocated to a comparatively cooler spot. But, she says, in the state with some of the worst education funding in the country, there are so many things going wrong that overheated classrooms aren’t at the top of her list.

This isn’t just a problem indoors. It’s also an issue in the schoolyard. Schools serving low-income students tend to have less greenery, and that’s not just an aesthetic problem. Trees, shrubs, and other plants can help to control temperatures, including indoors, when they’re planted strategically to provide shade to a building’s hot spots.

The lack of shade also increases exposure to harmful UV radiation on the playground, setting kids up for future health inequalities. From the moment they walk into school for the first time, some students are set up for failure, with Park noting that access to greenery can improve temperature control, but also offer mental and physical health benefits.

Oklahoma is not the only state struggling with school infrastructure, from campus trees to sound roofs. Across the United States, kids are attending classes in outdated, poorly-maintained, inadequate, and sometimes unsafe buildings. Schools across the country are struggling with lead contamination. Environmental Protection Agency regulations govern schools that maintain their own water supplies, but not those using municipal water that may get contaminated on its way to the tap. Kids are overheating, and they can’t even drink the school’s water.

It will cost $200 billion nationwide to bring America’s schools into good condition.  But schools, especially low-income ones, face a funding crisis. They rely on property tax revenues alongside some state funding to fund capital improvements, pay teachers and staff, and cover the numerous other expenses associated with running a school. Wealthy districts have a larger tax base and more access to loans and bond issues, and consequently spend more; their students are more likely to attend class in appropriately-cooled classrooms, to drink from lead-free taps, and to have access to well-maintained amenities.

“Targeting school facility upgrades should be part of a long-overdue federal infrastructure bill,” said Park, “or an education reform package.” Modernizing, and installing, HVAC systems is not a trivial task. Failure to make these investments, however, will keep low-income children in the U.S. at a permanent, sweaty, disadvantage.

Editors’ note: By request, the teachers in this article have been anonymized.

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Feature

A Recession May Be Coming. Millennials Never Recovered from the Last One.

Rosamaria Cavalho graduated from the University of California at Berkeley and entered the workforce in 2007. Latina and a woman of color, she is the first in her family to attend a four-year university. She knew that if she wanted to transcend her economically depressed upbringing, she had to attend college and graduate.

A common pressure among first-generation college students, especially those from low-income families or immigrant families who came to the U.S. to give their children more opportunities, is the pressure of finishing. The weight of their family’s sacrifice and struggle is omnipresent.

With all that on her shoulders, graduating into a recession wasn’t even on Cavalho’s radar. But that’s exactly what happened.

“I thought I should be able to get a job with this degree because that’s what I was told. You get your college degree and then good stuff will come. I knew there was value in a college degree,” she said.

A generation lambasted for being the reason America can’t have nice things, while derided for the ways they choose to spend the little money they have, millennials have never fully benefited from our robust economy. Many are still trying to get right after the last recession, which was so bad it earned the moniker “great.”

Unfortunately, as news headlines keep telling us, a new recession may be on the way.

Like a lot of recent college graduates, Cavalho moved back in with her family. According to Pew Research, in 2014, people aged 18-34 were most likely to be living with their parents rather than by themselves or with a spouse. At first, she applied for office jobs. When she didn’t hear anything, she applied for customer service positions at Wal-Mart, Taco Bell, and Jack in the Box. But still, no call-backs.

Her parents were confused as to why she had gone through the trouble and expense to attend college. Didn’t her degree afford her the opportunity to get a good job and be living on her own?

After a few months at home, Cavalho returned to the Bay Area to find work. She eventually found a job working for a private investigator. She was living in her car and hiding her struggles from her friends. They had been so proud of her for graduating, and she had already felt like she had disappointed her parents. She eventually found a job as a labor organizer for AFSCME and relocated to Los Angeles.

This was the cruel reality for many graduates who went to college to lift themselves out of poverty. They earned their degrees at the same time 30 million individuals were losing their jobs. New graduates weren’t just competing with their peers for what few jobs there were, but with the millions of others who had just been brutally tossed into the job market.

The employment nadir came in March 2009 when 803,000 non-farm jobs were lost. Entry-level jobs became harder to get, as competition came from people with much longer resumes. A wealth of volunteer positions became available, as funding dried up essentially, everywhere. Those who had financial stability and extra time were able to leverage competitive unpaid internships and volunteerism, which could then be used as a way to make up for a lack of entry-level positions. Everyone else was out of luck.

This stunted millennials’ earnings potential for the rest of their lives. In fact, millennials had lower real incomes than previous generations. In the year 2014 (using 2016 dollars), the median earnings for millennial men and women were $40,600 and $31,200. Compare that to the earnings of Gen Xers in 1998 at $44,200 and $32,400 and Boomers in 1978 at $53,400 and $33,100 (still 2016 dollars and median earnings).

Once you start behind on earnings, you never really catch up. And it’s even worse for people of color and women, who get left behind even during good economic times. In March, a report entitled “Clipped Wings: Closing the Wealth Gap for Millennial Women” was released by Insight Center in collaboration with Asset Funders Network and Closing the Women’s Wealth Gap. The authors found that income inequality persists according to race and gender, in addition to generation.

“Young Black people earn 57 cents and Latinx earn 64 cents for every dollar earned by young White people,” the report says. Single millennial men currently have an average of 162 percent more wealth than single millennial women. College educated white women hold two-thirds more wealth ($52,406) than college educated Black ($3,316) and Latinx ($29,889) women combined.

But it’s not just income where those who graduated into the Great Recession have fallen behind. A study published last year entitled “Are Millennials Different?,” by a division of the Federal Reserve Board, found that in the year 2016, millennials were also less likely to own homes and have fewer financial assets than previous generations. They also carried debt loads larger than boomers did when they were young, thanks in part to the ballooning cost of education.

If a new recession comes before they’ve had a chance to get ahead, they likely face empty bank accounts and unknowable challenges.

Millennials without access to family wealth were less likely to benefit from opportunities that were available to their peers who had more family or inherited wealth.

Case in point, homeownership. KPCC in Los Angeles analyzed data for Federal Housing Administration loans made to Californians and found that in 2018, one in three borrowers received family contributions. This number was up from one in four in 2011.

Millennials trying to buy houses but lacking help from their family had a harder time buying a home — the very hallmark of middle-class wealth generation. Millennials of color would have been deeply affected if their parents had lost their homes and assets to the foreclosure crisis that followed the Great Recession, due to predatory subprime lending to communities of color.

This inability to build wealth was compounded by student loan debt. Young adults had accepted thousands of dollars in federal loans, in effect leveraging their potential earnings, based on the assumption that a job market would exist when they were ready for it.

Spoiler alert, it didn’t.

Ten years after the beginning of the recession, a third of millennials hold student loan debt, with black women holding the most and white men holding the least. The national student loans debt load outpaced auto loans back in the third quarter of 2009 and is now just over $1.6 trillion. Women hold two-thirds of that amount.

Recovering from a recession takes time. And things such as student debt, high costs of living, and asset and wealth depletion hold millennials, especially millennial women of color, back from choosing what they want to do over what they need. If a new recession comes before they’ve had a chance to get ahead, they likely face empty bank accounts and unknowable challenges.

I recently had dinner with a friend and fellow woman of color who also graduated college in 2009. She says she feels like she’s just now making it; working as a city planner, feeling stable in her job, able to plan for her future, and about to start an MBA program. Cavalho just got into one of the top law schools in the country, accomplishing a goal she didn’t dare admit to herself because she felt it was so impossibly out of reach.

It took us 10 years just to get our feet under us. Let’s hope we’ve gotten far enough to weather whatever comes next.

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