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Pay Attention, Class

Parental income is our best predictor of children’s outcomes.

Wooden row houses in Brooklyn, New York
(Busà Photography, Getty Images)

One of the most peculiar aspects of woke ideology is that, in its intense fixation on race and human dignity, it largely ignores class and material conditions. It is rooted in the certainty that all differences between groups are the result of past or present racism or sexism, and it views economic factors as peripheral to this discussion.

Addressing discrimination offers the allure of a quick fix, with its emphasis on sensitivity training programs, rooting out implicit biases or establishing quotas. Class inequalities, meanwhile, require real sacrifices, such as more-progressive tax policy, wider distribution of property taxes used to fund public schools, or the elimination of legacy admissions at elite private schools. University of Pennsylvania political science professor Adolph Reed has put it this way, “the model is that the society could be one in which 1 percent of the population controls 95 percent of the resources, and it would be just, so long as 12 percent of the 1 percent were black and 14 percent were Hispanic, or half women.”


The woke creed is epitomized by bait-and-switch terms like “equity”—i.e., replacing equality of opportunity with equality of outcome—and it ignores decades of unequivocal research showing that the biggest obstacle children face in America is having the bad luck of being born into a poor family. 

Is it more of a disadvantage to be born poor or black? Is it worse to grow up rich in a poor neighborhood or poor in a rich neighborhood? When poverty, being black, and living in a poor neighborhood with terrible schools all predict worse outcomes, how can social scientists disentangle them? Fortunately, there are a number of straightforward methods that have been developed to solve this problem, which statisticians call multicollinearity, and decades of intensive research provide surprisingly clear answers to these questions.

Intergenerational social mobility is defined as the relationship between the income of parents and their children when they reach adulthood. The link between the financial success of parents and their children is so obvious that it might hardly seem worth mentioning. Indeed, what would it even mean to study social mobility without controlling for parental income? It is, however, the very self-evident nature of this connection that helps explain why it is so frequently overlooked.

Parental income is the elephant in the room that needs to be removed before we can move on to analyze more subtle advantages. It is both obvious and elusive, hidden in plain sight. By isolating the effects of different environments on social mobility, research using some of the largest datasets ever assembled reveal again and again how race effectively masks income, neighborhood, and family structure. Black men have the worst outcomes not because of their skin color, this research suggests, but because they grow up in the poorest families, the worst neighborhoods, and areas with the highest prevalence of single moms. 

The importance of your parents’ income has been established by an immense body of research. Raj Chetty and colleagues, in one of the largest studies of social mobility ever conducted, linked Census data to federal tax returns to show that your parent’s income when you were a child was by far the best predictor of your own income when you became an adult. The authors write, “On average, a 10 percentile increase in parent income is associated with a 3.4 percentile increase in a child’s income.”


This is a huge effect; children will earn an average of 34 percent more if they have parents in the highest income decile as compared to the lowest. It is true for all races, and black children born in the top income quintile are more than twice as likely to become rich adults as white children born in the bottom quintile. In short, the chances of occupying the top rungs of the economic ladder for children of any race are lowest for the poorest and highest for the wealthiest.

Why is having wealthy parents so important? Stanford’s David Grusky, in a paper on the commodification of opportunity, has written, “Although parents cannot directly buy a middle-class outcome for their children, they can buy opportunity indirectly through advantaged access to the schools, neighborhoods, and information that create merit and raise the probability of a middle-class outcome.” In other words, opportunity is a commodity sold to the highest bidder.

This simple point is so obvious, that it is surprising that so many people seem to miss it. Indeed, respected news outlets routinely cite statistics about racial differences without bothering to control for class. This is like conducting a study showing that children with bigger feet score higher on reading tests without controlling for age. Just like age is the best predictor of a child’s reading ability, parental income is the best predictor of adult income. 

Although there is no substitute for being born rich, outcomes for children from families with the same income differ predictably. After controlling for household income, the largest racial earnings gap is between Asians and whites, with poor white children earning approximately 11 percent less than their Asian peers, followed by a 2 percent reduction if you are poor and Hispanic, and an additional 11 percent on top of that if you are born poor and black.

Much of these differences, however, result from how we measure income. Using household income in particular conceals crucial differences between homes with one or two parents. This alone explains much of the residual differences between racial groups. Indeed the marriage rates among races uncannily recapitulates these exact same earnings gaps—Asian children have a 65 percent chance of growing up in households with two parents, followed by a 54 percent chance for whites, 41 percent for Hispanics and 17 percent for blacks. The black-white income gap shrinks from 13 percent to 5 percent after we control for income differences between single- and two-parent households.  

Just as focusing on household income obscures differences in marriage rates between races, grouping boys and girls together conceals important sex differences. Boys who grow up poor are far more likely to remain that way than their sisters. This is especially true for black boys, who earn 9.7 percent less than their white peers, while black women actually earn about 1 percent more than white women born into families with the same income. Chetty writes, “Conditional on parent income, the black-white income gap is driven entirely by large differences in wages and employment rates between black and white men; there are no such differences between black and white women.” 

So what drives these differences? If it is racism, as many contend, it is a peculiar type. It seems to benefit Asians, hurt black men, and have no detectable effect on black women. A closer examination of the data, however, reveals the source of almost all of the remaining differences between black men and men of other races: neighborhoods.

The disadvantages for black men could be caused either by what is called an “individual-level race effect,” whereby black children do worse no matter where they grow up, or by a “place-level race effect,” whereby children of all races do worse in areas with large black populations. Results unequivocally show support for a place-level effect. Chetty writes, “The main lesson of this analysis is that both blacks and whites living in areas with large African-American populations have lower rates of upward income mobility.”

Multiple studies have confirmed this basic finding, revealing that children who grow up in families with similar incomes and comparable neighborhoods have the same chances of success. In other words, poor white kids and poor black kids who grow up in the same neighborhood in Los Angeles are equally as likely to become poor adults.

Disentangling the effects of income, race, family structure, and neighborhood on social mobility is a classic case of multicollinearity (i.e., correlated predictors). Race effectively masks the real causes of reduced social mobility—parental income. The residual effects are explained by family structure and neighborhood. Black men have the worst outcomes on average in America because they grow up in the poorest families and worst neighborhoods with the highest prevalence of single mothers. Asians, meanwhile, have the best outcomes because they have the richest parents, with the lowest rates of divorce, and live in the best neighborhoods.

The fact these outcomes are driven by community characteristics that impact all races similarly poses a serious challenge to the narrative that anti-black bias or structural racism underlies all racial differences in outcomes, and suggests that the underlying reasons behind the racial gaps lie further up the causal chain in the structure of families and culture of neighborhoods. Why then do we so frequently use race as a proxy for the underlying causes when we can simply use the causes themselves? Consider by analogy the fact that whites commit suicide at three times the rate of blacks and Hispanics. Does this mean that being white is a risk factor for suicide?  

The impact of family structure on the likelihood of success first came to national attention in 1965, when the Moynihan Report concluded that the breakdown of the nuclear family was the primary cause of racial differences in achievement. Daniel Patrick Moynihan, an American sociologist serving as assistant secretary of Labor, argued that high out-of-wedlock-birth rates and the large number of black children raised by single mothers created a matriarchal society that undermined the role of black men. He wrote, “In a word, a national effort towards the problems of Negro Americans must be directed towards the question of family structure. The object should be to strengthen the Negro family so as to enable it to raise and support its members as do other families.”  

A closer look at these data, however, reveals that the disadvantage is not the result of being raised by a single mom but rather stems from growing up in neighborhoods without many active fathers. Chetty, in a nearly perfect replication of Moynihan’s findings, wrote, “black father presence at the neighborhood level strongly predicts black boys’ outcomes irrespective of whether their own father is present or not, suggesting that what matters is not parental marital status itself but rather community-level factors.” In other words, it is not really about whether your own parents are married, because children who grow up in two-parent households in these neighborhoods have similarly low rates of social mobility.

Although viewing the diminished authority of men as a primary cause of social dysfunction might seem antiquated today, the data appear to be impervious to our modern sensibilities, as evidence supporting Moynihan’s thesis continues to mount. The controversial report, which was derided by many at the time as racist, has been vindicated in large part because the breakdown of the family is being seen with eerily similar results among poor white families in rural communities today.

Family structure, like race, often conceals underlying class differences, too, and across all races the chances of living with both parents falls from 85 percent if you are born in an upper middle class family to 30 percent if you are in the lower middle class. The take home message from these studies is that fathers are a social resource and that boys are particularly sensitive to their absence. Although growing up rich seems to immunize children against many of these effects, when poverty is combined with absent fathers, the negative impacts are compounded

These studies describe the material conditions of tens of millions of Americans. We do not choose our parents, our race, or where we were born. We are all accidents of birth, imprisoned by circumstances over which we had no control. Even Americans are born into a class system in which privilege and hardship are imposed by chance. The take-home message from this research is that race is not a determinant of economic mobility on an individual level and is a shabby stand-in for the underlying causes. Privilege is real. But it is based on class, not race.