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Ferguson Tragedy Time Magazine Cover
Photograph by Scott Olson–Getty Images

Inside the Tragedy of Ferguson
The shooting death of Michael Brown, and the violence that has followed, have only made the town’s problems worse

Rand Paul: We Must Demilitarize the Police
Anyone who thinks race does not skew the application of criminal justice in this country is just not paying close enough attention, Sen. Rand Paul writes for TIME, amid violence in Ferguson, Mo. over the police shooting death of Michael Brown

The Coming Race War Won’t Be About Race
Ferguson is not just about systemic racism — it’s about class warfare and how America’s poor are held back, says Kareem Abdul-Jabbar

Trayvon Martin’s Mom: ‘If They Refuse to Hear Us, We Will Make Them Feel Us’

Beyond a Simple Solution for Ferguson
Why we need to address race relations in a thoughtful, provocative way

Banking Is for the 1%
Can’t get credit? You aren’t the only one. Why banks want to do business mainly with the rich

Governors Behaving Badly
Rick Perry’s criminal indictment blurs politics and the law

Backlog at the Border
Immigration courts are buckling from the influx of children

The New Rules of Viral Fundraising
How the ALS Ice Bucket Challenge made a splash

Colleges Launch New Anti-Assault Efforts for the New Year
New apps, web courses and policy changes aim to prevent sexual violence

The Most Dangerous Room in the World
Three-and-a-half years after a catastrophic meltdown, Fukushima is far from fixed

The Evolution of a Narcissist
We’re all born to adore ourselves, but not all of us grow up

The Culture

Primping Pooches at the 2014 World Dog Show
20,000 hounds hit Helsinki, all vying to be named top dog

To Be Takei Means There’s No Such Thing as Oversharing
Audiences learn even more about the very social star in a new documentary

TV Goes to the Ends of the World
How the apocalypse became fodder for mainstream television

Review: Colorless Tsukuru Tazaki and His Years of Pilgrimage
His latest book shows Murakami in Living Color

Living in a Fantasy World
In an era of techno marvels, we still crave magic

Humanities, All Too Humanities!
Incoming college freshmen should study great books rather than come up with great apps

10 Questions With Paul Ryan
The congressman on how to fix America, why Rand Paul is wrong and evading John Boehner’s toxic smoke

Pop Chart

Briefing

Milestones

Don Pardo
Iconic voice

Jim Jeffords
Former Vermont Senator

Mammograms Go 3-D
A high-tech imaging breakthrough could pick up more cancers

Everything to Everyone

What You Said About …

World

 

TIME politics

Rand Paul: We Must Demilitarize the Police

Police Shooting Missouri
Police in riot gear watch protesters in Ferguson, Mo. on Aug. 13, 2014. Jeff Roberson—AP

Anyone who thinks race does not skew the application of criminal justice in this country is just not paying close enough attention, Sen. Rand Paul writes for TIME, amid violence in Ferguson, Mo. over the police shooting death of Michael Brown

The shooting of 18-year-old Michael Brown is an awful tragedy that continues to send shockwaves through the community of Ferguson, Missouri and across the nation.

If I had been told to get out of the street as a teenager, there would have been a distinct possibility that I might have smarted off. But, I wouldn’t have expected to be shot.

The outrage in Ferguson is understandable—though there is never an excuse for rioting or looting. There is a legitimate role for the police to keep the peace, but there should be a difference between a police response and a military response.

The images and scenes we continue to see in Ferguson resemble war more than traditional police action.

Glenn Reynolds, in Popular Mechanics, recognized the increasing militarization of the police five years ago. In 2009 he wrote:

Soldiers and police are supposed to be different. … Police look inward. They’re supposed to protect their fellow citizens from criminals, and to maintain order with a minimum of force.

It’s the difference between Audie Murphy and Andy Griffith. But nowadays, police are looking, and acting, more like soldiers than cops, with bad consequences. And those who suffer the consequences are usually innocent civilians.

The Cato Institute’s Walter Olson observed this week how the rising militarization of law enforcement is currently playing out in Ferguson:

Why armored vehicles in a Midwestern inner suburb? Why would cops wear camouflage gear against a terrain patterned by convenience stores and beauty parlors? Why are the authorities in Ferguson, Mo. so given to quasi-martial crowd control methods (such as bans on walking on the street) and, per the reporting of Riverfront Times, the firing of tear gas at people in their own yards? (“‘This my property!’ he shouted, prompting police to fire a tear gas canister directly at his face.”) Why would someone identifying himself as an 82nd Airborne Army veteran, observing the Ferguson police scene, comment that “We rolled lighter than that in an actual warzone”?

Olson added, “the dominant visual aspect of the story, however, has been the sight of overpowering police forces confronting unarmed protesters who are seen waving signs or just their hands.”

How did this happen?

Most police officers are good cops and good people. It is an unquestionably difficult job, especially in the current circumstances.

There is a systemic problem with today’s law enforcement.

Not surprisingly, big government has been at the heart of the problem. Washington has incentivized the militarization of local police precincts by using federal dollars to help municipal governments build what are essentially small armies—where police departments compete to acquire military gear that goes far beyond what most of Americans think of as law enforcement.

This is usually done in the name of fighting the war on drugs or terrorism. The Heritage Foundation’s Evan Bernick wrote in 2013 that, “the Department of Homeland Security has handed out anti-terrorism grants to cities and towns across the country, enabling them to buy armored vehicles, guns, armor, aircraft, and other equipment.”

Bernick continued, “federal agencies of all stripes, as well as local police departments in towns with populations less than 14,000, come equipped with SWAT teams and heavy artillery.”

Bernick noted the cartoonish imbalance between the equipment some police departments possess and the constituents they serve, “today, Bossier Parish, Louisiana, has a .50 caliber gun mounted on an armored vehicle. The Pentagon gives away millions of pieces of military equipment to police departments across the country—tanks included.”

When you couple this militarization of law enforcement with an erosion of civil liberties and due process that allows the police to become judge and jury—national security letters, no-knock searches, broad general warrants, pre-conviction forfeiture—we begin to have a very serious problem on our hands.

Given these developments, it is almost impossible for many Americans not to feel like their government is targeting them. Given the racial disparities in our criminal justice system, it is impossible for African-Americans not to feel like their government is particularly targeting them.

This is part of the anguish we are seeing in the tragic events outside of St. Louis, Missouri. It is what the citizens of Ferguson feel when there is an unfortunate and heartbreaking shooting like the incident with Michael Brown.

Anyone who thinks that race does not still, even if inadvertently, skew the application of criminal justice in this country is just not paying close enough attention. Our prisons are full of black and brown men and women who are serving inappropriately long and harsh sentences for non-violent mistakes in their youth.

The militarization of our law enforcement is due to an unprecedented expansion of government power in this realm. It is one thing for federal officials to work in conjunction with local authorities to reduce or solve crime. It is quite another for them to subsidize it.

Americans must never sacrifice their liberty for an illusive and dangerous, or false, security. This has been a cause I have championed for years, and one that is at a near-crisis point in our country.

Let us continue to pray for Michael Brown’s family, the people of Ferguson, police, and citizens alike.

Paul is the junior U.S. Senator for Kentucky.

TIME

The Coming Race War Won’t Be About Race

Ferguson Lowenstein
A protestor during demonstrations in Ferguson, Mo. on August 17, 2014. Jon Lowenstein—Noor for TIME

Ferguson is not just about systemic racism — it's about class warfare and how America's poor are held back, says Kareem Abdul-Jabbar

Will the recent rioting in Ferguson, Missouri, be a tipping point in the struggle against racial injustice, or will it be a minor footnote in some future grad student’s thesis on Civil Unrest in the Early Twenty-First Century?

The answer can be found in May of 1970.

You probably have heard of the Kent State shootings: on May 4, 1970, the Ohio National Guard opened fire on student protesters at Kent State University. During those 13 seconds of gunfire, four students were killed and nine were wounded, one of whom was permanently paralyzed. The shock and outcry resulted in a nationwide strike of 4 million students that closed more than 450 campuses. Five days after the shooting, 100,000 protestors gathered in Washington, D.C. And the nation’s youth was energetically mobilized to end the Vietnam War, racism, sexism, and mindless faith in the political establishment.

You probably haven’t heard of the Jackson State shootings.

On May 14th, 10 days after Kent State ignited the nation, at the predominantly black Jackson State University in Mississippi, police killed two black students (one a high school senior, the other the father of an 18-month-old baby) with shotguns and wounded twelve others.

There was no national outcry. The nation was not mobilized to do anything. That heartless leviathan we call History swallowed that event whole, erasing it from the national memory.

And, unless we want the Ferguson atrocity to also be swallowed and become nothing more than an intestinal irritant to history, we have to address the situation not just as another act of systemic racism, but as what else it is: class warfare.

By focusing on just the racial aspect, the discussion becomes about whether Michael Brown’s death—or that of the other three unarmed black men who were killed by police in the U.S. within that month—is about discrimination or about police justification. Then we’ll argue about whether there isn’t just as much black-against-white racism in the U.S. as there is white-against-black. (Yes, there is. But, in general, white-against-black economically impacts the future of the black community. Black-against-white has almost no measurable social impact.)

Then we’ll start debating whether or not the police in America are themselves an endangered minority who are also discriminated against based on their color—blue. (Yes, they are. There are many factors to consider before condemning police, including political pressures, inadequate training, and arcane policies.) Then we’ll question whether blacks are more often shot because they more often commit crimes. (In fact, studies show that blacks are targeted more often in some cities, like New York City. It’s difficult to get a bigger national picture because studies are woefully inadequate. The Department of Justice study shows that in the U.S. between 2003 and 2009, among arrest-related deaths there’s very little difference among blacks, whites, or Latinos. However, the study doesn’t tell us how many were unarmed.)

This fist-shaking of everyone’s racial agenda distracts America from the larger issue that the targets of police overreaction are based less on skin color and more on an even worse Ebola-level affliction: being poor. Of course, to many in America, being a person of color is synonymous with being poor, and being poor is synonymous with being a criminal. Ironically, this misperception is true even among the poor.

And that’s how the status quo wants it.

The U.S. Census Report finds that 50 million Americans are poor. Fifty million voters is a powerful block if they ever organized in an effort to pursue their common economic goals. So, it’s crucial that those in the wealthiest One Percent keep the poor fractured by distracting them with emotional issues like immigration, abortion and gun control so they never stop to wonder how they got so screwed over for so long.

One way to keep these 50 million fractured is through disinformation. PunditFact’s recent scorecard on network news concluded that at Fox and Fox News Channel, 60 percent of claims are false. At NBC and MSNBC, 46 percent of claims were deemed false. That’s the “news,” folks! During the Ferguson riots, Fox News ran a black and white photo of Dr. Martin Luther King, Jr., with the bold caption: “Forgetting MLK’s Message/Protestors in Missouri Turn to Violence.” Did they run such a caption when either Presidents Bush invaded Iraq: “Forgetting Jesus Christ’s Message/U.S. Forgets to Turn Cheek and Kills Thousands”?

How can viewers make reasonable choices in a democracy if their sources of information are corrupted? They can’t, which is exactly how the One Percent controls the fate of the Ninety-Nine Percent.

Worse, certain politicians and entrepreneurs conspire to keep the poor just as they are. On his HBO comedic news show Last Week Tonight, John Oliver ran an expose of the payday loan business and those who so callously exploit the desperation of the poor. How does an industry that extorts up to 1,900 percent interest on loans get away with it? In Texas, State Rep. Gary Elkins blocked a regulatory bill, despite the fact that he owns a chain of payday loan stores. And the politician who kept badgering Elkins about his conflict of interest, Rep. Vicki Truitt, became a lobbyist for ACE Cash Express just 17 days after leaving office. In essence, Oliver showed how the poor are lured into such a loan, only to be unable to pay it back and having to secure yet another loan. The cycle shall be unbroken.

Dystopian books and movies like Snowpiercer, The Giver, Divergent, Hunger Games, and Elysium have been the rage for the past few years. Not just because they express teen frustration at authority figures. That would explain some of the popularity among younger audiences, but not among twentysomethings and even older adults. The real reason we flock to see Donald Sutherland’s porcelain portrayal in Hunger Games of a cold, ruthless president of the U.S. dedicated to preserving the rich while grinding his heel into the necks of the poor is that it rings true in a society in which the One Percent gets richer while our middle class is collapsing.

That’s not hyperbole; statistics prove this to be true. According to a 2012 Pew Research Center report, just half of U.S. households are middle-income, a drop of 11 percent since the 1970s; median middle-class income has dropped by 5 percent in the last ten years, total wealth is down 28 percent. Fewer people (just 23 percent) think they will have enough money to retire. Most damning of all: fewer Americans than ever believe in the American Dream mantra that hard work will get them ahead.

Rather than uniting to face the real foe—do-nothing politicians, legislators, and others in power—we fall into the trap of turning against each other, expending our energy battling our allies instead of our enemies. This isn’t just inclusive of race and political parties, it’s also about gender. In her book Unspeakable Things: Sex, Lies and Revolution, Laurie Penny suggests that the decreased career opportunities for young men in society makes them feel less valuable to females; as a result they deflect their rage from those who caused the problem to those who also suffer the consequences: females.

Yes, I’m aware that it is unfair to paint the wealthiest with such broad strokes. There are a number of super-rich people who are also super-supportive of their community. Humbled by their own success, they reach out to help others. But that’s not the case with the multitude of millionaires and billionaires who lobby to reduce Food Stamps, give no relief to the burden of student debt on our young, and kill extensions of unemployment benefits.

With each of these shootings/chokehold deaths/stand-your-ground atrocities, police and the judicial system are seen as enforcers of an unjust status quo. Our anger rises, and riots demanding justice ensue. The news channels interview everyone and pundits assign blame.

Then what?

I’m not saying the protests in Ferguson aren’t justified—they are. In fact, we need more protests across the country. Where’s our Kent State? What will it take to mobilize 4 million students in peaceful protest? Because that’s what it will take to evoke actual change. The middle class has to join the poor and whites have to join African-Americans in mass demonstrations, in ousting corrupt politicians, in boycotting exploitative businesses, in passing legislation that promotes economic equality and opportunity, and in punishing those who gamble with our financial future.

Otherwise, all we’re going to get is what we got out of Ferguson: a bunch of politicians and celebrities expressing sympathy and outrage. If we don’t have a specific agenda—a list of exactly what we want to change and how—we will be gathering over and over again beside the dead bodies of our murdered children, parents, and neighbors.

I hope John Steinbeck is proven right when he wrote in Grapes of Wrath, “Repression works only to strengthen and knit the oppressed.” But I’m more inclined to echo Marvin Gaye’s “Inner City Blues,” written the year after the Kent State/Jackson State shootings:

Inflation no chance

To increase finance

Bills pile up sky high

Send that boy off to die

Make me wanna holler

The way they do my life

Make me wanna holler

The way they do my life

TIME justice

Trayvon Martin’s Mom: ‘If They Refuse to Hear Us, We Will Make Them Feel Us’

Sybrina Fulton of Miami, Fla., mother of Trayvon Martin, testifies during a Senate Judiciary Committee hearing on "Stand Your Ground" laws October 29, 2013 in Washington DC.
Sybrina Fulton of Miami, Fla., mother of Trayvon Martin, testifies during a Senate Judiciary Committee hearing on "Stand Your Ground" laws October 29, 2013 in Washington DC. Win McNamee—Getty Images

Sybrina Fulton is the mother of Trayvon Martin and the founder of the Trayvon Martin Foundation. In a letter to the family of Ferguson teen Michael Brown written exclusively for TIME, Fulton reflects on what the families now share.

To The Brown Family,

I wish I had a word of automatic comfort but I don’t. I wish I could say that it will be alright on a certain or specific day but I can’t. I wish that all of the pain that I have endured could possibly ease some of yours but it won’t. What I can do for you is what has been done for me: pray for you then share my continuing journey as you begin yours.

I hate that you and your family must join this exclusive yet growing group of parents and relatives who have lost loved ones to senseless gun violence. Of particular concern is that so many of these gun violence cases involve children far too young. But Michael is much more than a police/gun violence case; Michael is your son. A son that barely had a chance to live. Our children are our future so whenever any of our children – black, white, brown, yellow, or red – are taken from us unnecessarily, it causes a never-ending pain that is unlike anything I could have imagined experiencing.

Further complicating the pain and loss in this tragedy is the fact that the killer of your son is alive, known, and currently free. In fact, he is on paid administrative leave. Your own feelings will bounce between sorrow and anger. Even when you don’t want to think about it because it is so much to bear, you will be forced to by merely turning on your television or answering your cell phone. You may find yourselves pulled in many different directions by strangers who may be well-wishers or detractors. Your circle will necessarily close tighter because the trust you once, if ever, you had in “the system” and their agents are forever changed. Your lives are forever changed.

However with those changes come new challenges and opportunities. You will experience a swell of support from all corners of the world. Many will express their sympathies and encourage you to keep fighting for Michael. You will also, unfortunately, hear character assassinations about Michael which I am certain you already have. This will incense and insult you. All of this will happen before and continue long after you have had the chance to lay your son to rest.

I know this because I lived and continue to live this. I have devoted my life to the comprehensive missions of The Trayvon Martin Foundation – including providing support to families that have lost a young child to senseless gun violence regardless of race, ethnicity or gender. I will support you and your efforts to seek justice for your Michael and the countless other Michaels & Trayvons of our country. The 20 Sandy Hook children. Jordan Davis. Oscar Grant. Kendrick Johnson. Sean Bell. Hadya Pendleton. The Aurora shooting victims. The list is too numerous to adequately mention them all. According to The Children’s Defense Fund, gun violence is the second leading cause of death for children ages 1-19. That is a horrible fact.

Facts, myths, and flat out lies are already out there in Michael’s case. Theories, regardless of how ridiculous, are being pondered by the pundits. My advice is to surround yourselves with proven and trusted support. Through it all, I never let go of my faith, my family, or my friends. Long after the overwhelming media attention is gone, you will need those three entities to find your ‘new normal.’ Honor your son and his life, not the circumstances of his alleged transgressions. I have always said that Trayvon was not perfect. But no one will ever convince me that my son deserved to be stalked and murdered. No one can convince you that Michael deserved to be executed.

But know this: neither of their lives shall be in vain. The galvanizations of our communities must be continued beyond the tragedies. While we fight injustice, we will also hold ourselves to an appropriate level of intelligent advocacy. If they refuse to hear us, we will make them feel us. Some will mistake that last statement as being negatively provocative. But feeling us means feeling our pain; imagining our plight as parents of slain children. We will no longer be ignored. We will bond, continue our fights for justice, and make them remember our children in an appropriate light. I would hate to think that our lawmakers and leaders would need to lose a child before protecting the rest of them and making the necessary changes NOW…

With Heartfelt Support,

Sybrina D. Fulton

Read TIME’s cover story on After Trayvon.

TIME nation

Beyond a Simple Solution for Ferguson

Why we need to address race relations in a thoughtful, provocative way

At first, it seemed a perfect metaphor for 400 years of oppression: a white police officer shoots an unarmed black teenager multiple times. He is shot with his hands up, it is reported, at least once in the back. The young man is a “gentle giant” with no adult criminal record. He seems guilty of nothing more than walking while black, albeit down the middle of the street. This takes place in a town that appears to have been cryogenically preserved from the 1960s, before the Voting Rights Act was passed. An estimated 67% of its citizens are African American; its government is melanin-deprived. The mayor of Ferguson, Mo., is white; 50 of the 53 police officers are white. Demonstrators come out to protest the atrocity–nobody is calling it an “apparent” atrocity yet–and the police respond in gear that makes a St. Louis suburb look like Kandahar.

But the perfection of the metaphor is soon blurred by facts. The gentle giant, Michael Brown Jr.–nicknamed Bodyguard by his friends–seems pretty intimidating in a surveillance video, in which he is seen taking cigarillos from a convenience store, tossing the diminutive clerk into a snack display as if he were a bag of Doritos. The alleged robbery occurs 10 minutes before the confrontation with the cop. The inevitable Rev. Al Sharpton says the video is an attempt to “smear” the young man. Then more facts emerge, and other eyewitnesses allegedly describe a more aggressive Michael Brown–more like the fellow in the video. An autopsy, requested by Brown’s parents, shows six bullet wounds; the kill shot is into the top of the victim’s head–which raises another possibility, that the officer, Darren Wilson, fired in self-defense. And now we have a metaphor of a different, far more difficult sort: about the uncanny ability of Americans to talk past each other when it comes to race relations, and also about the struggle between facts and metaphoric truths.

Sharpton has made a living off metaphoric truths since the late 1980s, when he promoted a terrified young woman named Tawana Brawley, who claimed that she had been raped by six white men, including the local prosecutor. Her story was later shown in court to be false, but the metaphoric truth was undeniable: black women have been casually violated by white men in America for 400 years. The undercurrent was strong enough that few black leaders rose up to take on Sharpton. The fetishizing of black sexuality by white men (and women) was too close to the bone, an infuriating historic truth.

But we have developed new historic truths over the past 50 years. A great many bodega owners won’t see Michael Brown as a metaphor for anything. They see potentially threatening customers every day. Blacks represent 13% of the population but commit 50% of the murders; 90% of black victims are murdered by other blacks. The facts suggest that history is not enough to explain this social disaster.

You can’t convict a terrified, undertrained cop of murder for trying to defend himself, if that’s what the facts show–but all too often in the past, we’ve exonerated racist thugs who were clearly guilty. We can’t ignore the barbarity that got us here: lynching was a fact, too, not a metaphor. Oddly, the election of Barack Obama–poor guy–has blunted the conversation about race relations, at least on the white side. We elected a black man with a Muslim name to be President. What other country would do that? The conversation has also been blunted, honorably, by the President himself in the face of some of the most tawdry race-baiting since Selma. And it has been blunted by leaders of the black community, who don’t want to harm Obama’s presidency by criticizing him. In a recent New Republic article, Jason Zengerle makes a strong case that hatred of Obama mobilized Alabama conservatives to take over the state legislature in 2010 and strip black officials of the power they had gained since the 1960s.

Race remains an open wound. There is a new generation of black intellectuals who are raising the issue in thoughtful, provocative ways. “The Case for Reparations” by the Atlantic’s Ta-Nehisi Coates is compelling, even if the case is not a particularly strong one. We’ve had 50 years of drastically improved political, educational and employment opportunities for blacks, which have produced a burgeoning middle class, but a debilitating culture of poverty persists among the urban underclass. Black crime rates are much higher than they were before the civil rights movement. These problems won’t be solved simply by the recognition of historic grievances. Absent a truly candid conversation about the culture that emerged from slavery and segregation, they won’t be solved at all.

TO READ JOE’S BLOG POSTS, GO TO time.com/swampland

TIME Economy

Banking Is for the 1%

Can’t get credit? You aren’t the only one. Why banks want to do business mainly with the rich

The rich are different, as F. Scott Fitzgerald famously wrote, and so are their banking services. While most of us struggle to keep our balances high enough to avoid a slew of extra fees for everything from writing checks to making ATM withdrawals, wealthy individuals enjoy the special extras provided by banks, which increasingly seem more like high-end concierges than financial institutions. If you are rich, your bank will happily arrange everything from Broadway tickets to spa trips.

Oh, and you’ll have an easier time getting a loan too. A recent report by the Goldman Sachs Global Markets Institute, the public-policy unit of the finance giant, found that while the rich have ample access to credit and banking services six years on from the financial crisis, low- and medium-income consumers do not. Instead, they pay more for everything from mortgages to credit cards, and generally, the majority of consumers have worse access to credit than they did before the crisis. As the Goldman report puts it, “For a near-minimum-wage worker who has maintained some access to bank credit (and it is important to note that many have not in the wake of the financial crisis), the added annual interest expenses associated with a typical level of debt would be roughly equivalent to one week’s wages.” Small and midsize businesses, meanwhile, have seen interest rates on their loans go up 1.75% relative to those for larger companies. This is a major problem because it dampens economic growth and slows job creation.

It’s Ironic (and admirable) that the report comes from Goldman Sachs, which like several other big banks–Morgan Stanley, UBS–is putting its future bets on wealth-management services catering to rich individuals rather than the masses. Banks would say this is because the cost of doing business with regular people has grown too high in the wake of Dodd-Frank regulation. It’s true that in one sense, new regulations dictating how much risk banks can take and how much capital they have to maintain make it easier to provide services to the rich. That’s one reason why, for example, the rates on jumbo mortgages–the kind the wealthy take out to buy expensive homes–have fallen relative to those of 30-year loans, which typically cater to the middle class. It also explains why access to credit cards is constrained for lower-income people compared with those higher up the economic ladder.

Regulation isn’t entirely to blame. For starters, banks are increasingly looking to wealthy individuals to make up for the profits they aren’t making by trading. Even without Dodd-Frank, it would have been difficult for banks to maintain their precrisis trading revenue in a market with the lowest volatility levels in decades. (Huge market shifts mean huge profits for banks on the right side of a trade.) The market calm is largely due to the Federal Reserve Bank’s unprecedented $4 trillion money dump, which is itself an effort to prop up an anemic recovery.

All of this leads to a self-perpetuating vicious cycle: the lack of access to banking services, loans and capital fuels America’s growing wealth divide, which is particularly stark when it comes to race. A May study by the Center for Global Policy Solutions, a Washington-based consultancy, and Duke University found that the median amount of liquid wealth (assets that can easily be turned into cash) held by African-American households was $200. For Latino households it was $340. The median for white households was $23,000. One reason for the difference is that a disproportionate number of minorities (along with women and younger workers of all races) have no access to formal retirement-savings plans. No surprise that asset management, the fastest-growing area of finance, is yet another area in which big banks focus mainly on serving the rich.

In lieu of forcing banks to lend to lower-income groups, something that’s being tried with mixed results in the U.K., what to do? Smarter housing policy would be a good place to start. The majority of Americans still keep most of their wealth in their homes. But so far, investors and rich buyers who can largely pay in cash have led the housing recovery. That’s partly why home sales are up but mortgage applications are down. Policymakers and banks need to rethink who is a “good” borrower. One 10-year study by the University of North Carolina, Chapel Hill, for example, found that poor buyers putting less than 5% down can be better-than-average credit risks if vetted by metrics aside from how much cash they have on hand. If banks won’t take the risk of lending to them, they may eventually find their own growth prospects in peril. After all, in a $17 trillion economy, catering to the 1% can take you only so far.

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