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Is Discrimination The Cause of Socioeconomic Deprivation?

“A nation will not survive morally or economically when so few have so much and so many have so little.”

— Bernie Sanders

ECONOMISTS RECOGNIZE THAT SOCIOECONOMIC DEPRIVATION IS LINKED TO RACISM—A CLAIM I SHALL EXPLORE IN THIS ESSAY.

The assertion that discrimination based on race, religion, ethnicity, tribal affiliation and gender results in poverty and deprivation amongst the afflicted and targeted communities is substantiated by this UN report.[1]

In the UK, the Bangladeshi community is poor, and is an ethnic minority that suffers enormous discrimination. The three variables are not disconnected: poverty, minority-status, and discrimination. In fact, the poverty is an effect of the twin terrors of being a minority and experiencing discrimination.[2]

Think about this: imagine you go to a community where people refuse to trade with you, hire you, provide a service to you and essentially exclude you from everything. Would you succeed financially in this environment or not?

Probably not.

It does not take scientific studies to verify this claim that being rejected by the structural and societal power-players, as well as most individuals, results in you becoming the lowest rung on the socio-economic ladder. This is exactly what perpetuates poverty, just look at the situations of the black people in the USA, the situation of the untouchables in India, the situation of Somalis in the West and so on.[3] Even Pakistanis in places like Bradford, Birmingham and Manchester are not doing particularly well, despite a hard-work ethic, a can-do attitude and family wealth and cultural capital that goes back generations.[4] [5] In fact, one paper refers to people of Bangladeshi and Pakistani heritage as the most deprived and discriminated in the UK.[6]

Furthermore, Ken Clark, a Senior Lecturer in the School of Social Sciences, has written a paper arguing that self-employment in the ethnic minority communities, particularly Pakistanis is driven by an important causal factor: racial discrimination. He alludes to this in this paper.[7]

In the Western world, anti-Semitism has always existed, and resulted in the socio-economic exclusion of Jews from mainstream society, except for in money-lending and trade.[8] This anti-Semitism stills exists right alongside its cousin, Islamophobia, in the workplace in the Western world, as per this report.[9]

In Germany, the socio-economic exclusion of Jewish people was the precursor to the murder of the six million of Jews by Adolf Hitler and his democratically elected government.[10] The German nation embraced en masse the ideology of Nazism, however, the principles and beliefs pre-existed amongst the Europeans for centuries, where they were exceptionally xenophobic, racist, and irrational.[11] If you ask the socio-economically excluded racial minorities today, little has changed in the Western world (except for the codified rules of racism and the open calls for genocide but the extreme-right wing are bidding their time).

In Sri Lanka, with its ongoing economic crisis, entire minority groups have been discriminated against for a long-time by the majority Sinhalese Buddhist people. The Tamil Hindus and the Tamil Muslims are always on the receiving end of discrimination and attack and violence. Unfortunately, those discriminatory practices created a massive problem of terrorism, as we all know of the long war between the Tamil Tigers and the Sri Lankan state.[12]

In the USA, the average salary of a black person is 30% lower than a white person. Furthermore, most black people work in low-wage occupations, that involve physical labour.[13] Ethnic minorities face enormous economic discrimination in the USA, which leads to unemployment, homelessness, and financial poverty, with the Asians and Blacks being the prime targets of this structural and systematic exclusion from participating in the markets.[14]

The evidence shows that being an ethnic minority or a religious minority has distinct negative economic consequences for those in the two categories. From the UK to Germany and the USA as well as in non-Western nations like India and Sri Lanka we see that being an ethnic or religious minority results in greater levels of socio-economic deprivation. I conclude that this is due to active discrimination by the structural systems that are disadvantageous to minorities. This makes sense, since the majority group creates structures, systems, and governance that benefits it, rather than outsiders. And they usually have a negative attitude to outsiders, a reality that is universal, across humanity.

[1] https://www.un.org/en/chronicle/article/poverty-and-human-rights-reflections-racism-and-discrimination

[2] https://www.ucl.ac.uk/history/news/2020/dec/roots-resilience-brief-history-british-bangladeshi-community-londons-east-end

[3] https://news.sky.com/story/cost-of-living-poverty-among-bangladeshi-and-somali-communities-at-record-levels-due-to-soaring-bills-and-food-costs-12520086

[4] https://www.independent.co.uk/voices/with-british-bangladeshi-and-pakistani-people-in-the-lowest-skilled-and-lowest-paid-jobs-we-know-we-have-more-work-to-do-on-bame-employment-a8504851.html

[5] https://researchbriefings.files.parliament.uk/documents/SN06385/SN06385.pdf

[6] https://www.tuc.org.uk/sites/default/files/extras/poverty.pdf

[7] https://blog.policy.manchester.ac.uk/featured/2014/04/pakistani-self-employment-in-the-recession/

[8] https://www.britannica.com/topic/anti-Semitism/Nazi-anti-Semitism-and-the-Holocaust

[9] https://www.openaccessgovernment.org/religious-groups-workplace-discrimination-muslim-jewish-christian/131473/

[10] https://www.ushmm.org/learn/timeline-of-events/1933-1938/exclusion-of-jews-from-german-economic-life

[11] https://www.bl.uk/learning/histcitizen/voices/testimonies/life/backgd/before.html

[12] https://theconversation.com/sri-lankas-crisis-is-not-just-about-the-economy-but-a-long-history-of-discrimination-against-minority-groups-186747

[13] https://www.mckinsey.com/featured-insights/diversity-and-inclusion/the-economic-state-of-black-america-what-is-and-what-could-be

[14] https://eu.usatoday.com/story/money/economy/2018/10/10/faces-poverty-social-racial-factors/37977173/

About the Author
Zalghi Khan is a former investment banker, who is currently training to become an accountant. He is the author of ten books, and specializes in economics, finance, and geopolitical issues. For him it is important to provide convincing answers to pressing questions, especially as it relates to global economic matters.