If you look at the economic inequities between Caucasians and African-Americans this argument makes a lot of sense to me. I have often told my children that some of the challenges to building wealth in African-American communities have been the difficulty to purchase property, which was illegal for a long time and still can be a hard to do, particularly in certain neighborhoods, to this day, and the fight to hold on to property across generations. When you look at the wealthiest families and businesses in the US, they tend to own land. Yes, the own (or are) businesses and hold other investments, but their core wealth lies in their property. That’s what gave them the ability to diversify. Look at the McDonald’s business model. Most people think McDonald’s is a fast food business. It’s not. McDonald’s is a real estate business that’s maximizing the use of that land by putting fast food restaurants on the property. The land is what creates the real wealth. Hamburgers create supplemental income.

That said, I think there are other factors involved in the income disparity. For example, wages are stagnant because companies don’t want to pay workers more. Why? Perhaps greed, a la the 1990's, has grown and hidden itself on main street since Wall Street earned such a bad reputation. Labor is the single greatest cost of any business so if you want more money for yourself who can you stiff? The employees.

Here’s another contributing factor. White flight and gentrification drive up costs in so called desirable areas while driving values down in areas considered to be less desirable. This makes it harder for homeowners in “less desirable” areas to grow wealth through property acquisition and creates other problems such as less funding for schools in those areas since school funding is tied to property taxes.

Now, I haven’t read this paper so my thoughts are not meant to be a criticism of the paper. This post is, however, a criticism of the lazy thinking that can result from articles like this one. Without a more details and complex analysis, a reader can walk away with the idea that it’s all the government’s fault that there isn’t enough affordable housing in cities like San Francisco so it’s the government’s fault there’s such a wide income gap. These issues are complex and multi-layered; therefore, they deserve more thoughtful review. Until we’re willing to dig into all of the factors contributing to income inequality and the lack of affordable housing, these challenges will not be resolved.