Monday, April 03, 2006

Diversity and economic disparity

Diversity brings economic disparity. Economic disparity is not good for democracy. The corollary is that diversity is not good for democracy. The optimal situation is one in which wealth disparities are naturally small without having to resort to robin hood wealth transfers.

Yet economic disparity is absolutely correlated with race. Running a regression and correlation analysis on data from the fifty states plus DC, I looked at each state's population of the four major ethnic/racial groups (non-Hispanic white, black, Hispanic, and Asian) and correlated it with the variable "
Median income as a percentage of Mean income" which was computed by dividing each state's median income by its mean income. The larger the difference between the two, the greater the economic disparity in the state (think of how much Bill Gates moves the mean while doing no more for the median than Joe accountant in the state of Washington who makes $60,000 a year).

I found that significance factor was virtually zero for whites, blacks, and Asians (in other words, there is a 99.9999999% chance that the correlation between wealth disparity and race is not random). For Hispanics, the significance factor .067, meaning that there is a 6.7% chance that the relationship was due simply to chance. That is due to the
substantial differences in the American Hispanic community (Cuban doctors in Florida vs Amerind fruit pickers in California).

The r-squared value for blacks is the highest, at .494. But the greatest correlations exist when non-Hispanic whites and Asians are combined into one group and blacks and Hispanics into another. The significance factor for both drops to virtually zero, throwing chance out the window. The r-squared value for whites/Asians is .44. For blacks/Hispanics it is .58. This means that 58% of the magnitude of wealth disparity can be explained by the percentage of blacks and Hispanics in a state. That's enormous, and though raw, it's a powerful argument against facile comparisons of this wave of immigration to the previous three that were from Europe. It was 44% for whites and Asians (the reason this correlation is more moderate is because whites represent 70% of the country and consequently are the most economically diverse subgroup). Other groupings showed no statistical significance.

As the country becomes progressively more Hispanic and black, wealth disparities are going to continue to grow. As the white/Asian group dwindles in relative size, numerical superiority is going to shift towards the poor end as the middle class dwindles. We are moving from a middle class to society to one of economic extremes. This is fertile ground for leftist populism and quasi-dictatorship. Check out the
average net worth of millionaires by continent. The fattest are in Latin America followed by Africa. Do we want to become more like Latin America or Africa?

Think it's hyperbole? As Steve Sailer has chronicled,
it's moving north. Far-left candidate Andres Obrador has a real shot at the Mexican Presidency in July. He will be even more harmful to the US than Vicente Fox has been, if that's possible (he has criticized Fox for not coming down hard enough against HR4437). Some putative conservatives want to throw caution to the wind and out-pander the left. Former RNC cacique Ed Gillespie admonished Republicans in the WSJ:
The Republican Party cannot become an anti-immigration party. Our majority already rests too heavily on white voters, given that current demographic voting percentages will not allow us to hold our majority in the future...

Hispanic voting percentages are increasingly decisive in swing states like New Mexico, Nevada, Florida, Colorado and Arkansas. Mishandling the immigration debate today could result in the Republican Party struggling in these states and others in the same way it does now in California.

Are you kidding me? All the states mentioned used to be Republican strongholds. The deluge from south of the border has turned the red purple, and more immigration is going to give it a blue hue. Prop 187's attempt to lessen the incentives for an illegal Hispanic underclass did not doom the Republican Party in California. It's failure to be implemented and built on doomed the GOP. Gillespie needs to be working to halt the influx from the south. The popular support is there.

It is self-immolation for the Republicans to turn their backs on white Americans and the middle class in general, as much as Gillespie laments the fact that the Republican Party has to rely on them. When I first learned about politics, I was attracted to the Republican Party because of their supposed core values: Small government, respect for tradition, rationality over emotion, critical thought over political correctness, individual responsibility over group obligation. In the Gillespie's Republican Party, I see none of these things. Democratic leaders, worthless as they are on the immigration issue, must be given credit for being wise enough not to moan about how they rely too heavily on blacks as they pursue of more Hispanic voters (when
it is clear that blacks, like whites, want stricter immigration control).



adog said...

Email it to me. This is another straightforward and objective way to put the burden on multicult supporters. You should throw NAs in as well since they are tracked state by state. Also you should correlate with poverty rate. It'll bprobably be stronger than the median/mean ratio.

crush41 said...


Good thought on the poverty rate--I was planning on doing that next. I'll find you before FinIII.

It is amazing that we have an historically unprecedented ethnic shift taking place in country and the burden of proof is placed on those who are skeptical of such sweeping change. And then, before we can lift that burden, we are smeared as racists (the same as racial realists in the eyes of the blank slatists). Of course, even with the burden of proof on us (I consider guys like Brimelow and Camarota as generals, VDare columnists and Randall Parkers as colonels, and boosters like you and I as privates) we win. Steve Sailer recently had a nice dicing of the flawed, elementary arguments still being put forth by the open borders crowd.

TangoMan said...


Good job on the analysis but if I can make a suggestion - you open the analysis to criticism that it is only capturing a discrimination effect, ie, blacks are discriminated against therefore their income is lower due to fewer opportunities. The criticism will be that it isn't race that you're measuring but discrimination.

To counter this you need to find data that can serve as proxies for IQ, discrimination minimizing environments, etc. I'd look at things like rates of interracial marriage being a proxy for tolerance, maybe the per capita rate of EEOC racial discrimination complaints controlled for minority proportion of the population. Further, to proxy IQ I'd look at SAT results broken down by race, HS graduation rate, etc.

Controlling for other factors will weaken the charge that you're simply measuring the effects of a discriminatory environment on racial minorities. You could also weaken that charge by focusing on Asian performance compared to white performance.

TangoMan said...

You've probably already read Amy Chua's World of Fire but perhaps others would find the book insightful.

Also, you may find the work of the economist, Garret Jones, to be of some use here.

crush41 said...


Thanks for the suggestions. I have read World on Fire and do recommend it. Chua's coined "market dominant minority" is an incredibly useful term that helps show the ubiquity of problems stemming from societies where they exist. Yet in the Southwest we are plowing towards just such a situation.

I am going to control for other factors. Even ACT/SAT scores are open to criticism because of the disparity in percentage of high schoolers who take them. The NAEP scores might be a more accurate predictor. What I'd like to do when I make the time is see how well NAEP scores correlate with ACT/SAT scores by state--it is my presumption that in states where there has been less demographic upheavel the scores will correlate more strongly.

Of course, even if it were only discrimination effects that we're measuring, it still begs the question "why make it worse?"

Half Sigma said...

The statistic only tells us that hardly any black people comprise the top 10% who boost the mean above the median.

crush41 said...

Half sigma,

Blacks have the largest proportional discrepancy between mean and median income of the four major ethnic/racial categories captured by the census. Mean as a percentage of median follows:

Non-Hispanic white: 74.8%
Black: 73.6%
Hispanic: 74.2%
Asian: 79.6%

This is probably attributable to entertainment to some extent and the inherent riskiness in the all-or-nothing gamble Steve Sailer's written about previously.

The difference b/w what constitutes top 5% status for blacks and Hispanics is marginal: $109,000 vs $114,000.

But no doubt that blacks and to a lesser extent Hispanics have smaller percentages represented in upper wealth echelons creates a lot of the effect.

I'm also going to correlate with the poverty rate. The less it matches up with the median/mean, the more right you are.