From the U.S. Government Accountability Office, www.gao.gov Transcript for: Our Work on Racial Disparities and Diversity Issues--Special Edition for GAO's 100th Anniversary Description: This year, GAO celebrates its 100th anniversary. To commemorate our centennial, we are recording a series of podcasts about our history as an agency, and our contributions to public policy and program oversight. Today, we talk with three GAO experts with portfolios of work on racial disparities and diversity issues in health care, the economy, and education. These experts are: Nikki Clowers, the managing director in our Health Care Team; Daniel Garcia-Diaz, the managing director in our Financial Markets and Community Investment Team; and Jackie Nowicki, a director in our Education, Workforce and Income Security Team. Released: February 2021 [Intro music:] [Jackie Nowicki:] We have made strides in addressing disparities, but clearly there's just so much more to do. [Holly Hobbs:] Hi and welcome to GAO's Watchdog Report. Your source for news and information from the U.S. Government Accountability Office. I'm Holly Hobbs. This year, GAO celebrates its 100th anniversary. To commemorate our centennial, we are recording a series of podcasts about our history as an agency, and our contributions to public policy and program oversight. Today, we tackle a tough topic in GAO's work, and an issue that has once again been raised in the public consciousness as a challenge needing immediate attention. Today we talk about racial disparities and diversity. Joining us are 3 GAO experts with portfolios of work on racial disparities and diversity issues in health care, the economy, and education. Here to discuss are Nikki Clowers, the managing director in our Health Care Team; Daniel Garcia-Diaz, the managing director in our Financial Markets and Community Investment Team; and Jackie Nowicki, a director in our Education, Workforce and Income Security Team. Thank you all for joining us! [Nikki Clowers:] Thank you for having me, Holly. [Dan Garcia-Diaz:] Thank you for having me. [Jackie Nowicki:] Happy to be here Holly! [Holly Hobbs:] So Nikki, let's start with health care, since the pandemic is on everyone's mind. We've done work and are continuing to monitor COVID-19 effects on different communities, including reports that minority communities are being hit harder by the pandemic. Can you tell us what we've found so far? [Nikki Clowers:] In our November Cares Act report, we examined the issues of health outcome disparities. And in particular we found that racial and minority groups have higher case counts of COVID. There's higher hospitalization rates among minorities, and there's also higher death numbers for those minority populations compared to the White population. [Holly Hobbs:] Do we know why minority communities have been hit so hard by the pandemic? [Nikki Clowers:] There could be access issues in terms of--for example, to providers or to testing site. These sites might not be evenly distributed across all segments of society or in all locations. There could be higher rates of pre-existing conditions. There's also other patient factors and family history. But importantly, the research also points to institutional racism and the role that may play in different outcomes. We believe additional work is needed and we'll continue to study these issues in future reports. [Holly Hobbs:] And, while we're reporting on the disparities that have been highlighted by the pandemic, we've long reported on disparities in health care access and outcomes. Can you tell us a little bit about that work? [Nikki Clowers:] One of the areas that we have examined is in the area of maternal mortality. And what we found there is between 2007 and 2016, over 6,700 women died of causes related to or aggravated by pregnancy, and that's roughly about 700 women each year. The number of deaths are not equally distributed across different racial and ethnic groups. In particular Black women were three times more likely to die and Native American women were two times more likely to die compared to White women. [Holly Hobbs:] And do we know why Black and Native American women are dying at such a high rate? [Nikki Clowers:] The research suggests that there is a combination of factors that could be driving this disparity--including issues of access to care, patient history, family history, the provider experience, and the community. And there's also research that suggests that there's systemic issues within the health care system of institutional racism that needs to be further examined. [Holly Hobbs:] And we've also found disparities in health care outcomes among our nation's Black veterans. Can you talk about our work in those areas and what we found? [Nikki Clowers:] As the veteran population has grown more diverse over the years, VA has established goals for health equity. That everyone should have equitable health outcome results regardless of racial or ethnicity group. But what we see, and VA sees this as well, there are disparities in health outcomes. For example, outcomes for controlling blood pressure or blood glucose is worse for Black veterans compared to White veterans. We have also seen that the research shows that there's lower survival rate for Black veterans with cancer compared to their White counterparts. [Holly Hobbs:] Do we know why? [Nikki Clowers:] One of the limitations in our ability to understand what's behind those statistics is the need for a better data. We need more comprehensive complete data so we can better understand trends that we're seeing. And we made recommendations to VA to address this a data limitation, and they agreed to implement them. [Holly Hobbs:] So it sounds like the coronavirus pandemic has highlighted disparities in health care access and outcomes, which is an issues we at GAO will continue to monitor. But that disparities in access and outcomes are long-standing concerns that will require attention even after COVID-19. Now let's turn to some of our work on the disparities seen in our economy. Dan, minority communities also face unequal treatment when it comes to achieving things that we view as part of the American dream, such as buying a home. What can you tell us about the differences in homeownership rates when it comes to race? [Dan Garcia-Diaz:] So, we see differences. In recent years, the homeownership for say White household has been around 72%, but we see markedly lower rates of homeownership for Blacks, which is around 42%. And Hispanics, a little bit higher at around 47%. [Holly Hobbs:] Why are homeownership rates lower for Black and Hispanic families? [Dan Garcia-Diaz:] Well, no two populations are ever going to be exactly the same. Different populations have differences in income, credit history, age, household formation, education, and so on--all factors that can contribute to homeownership. But even after you control all those factors, there's probably some differences that are due to discrimination in the market. So discrimination can occur when minority borrowers are denied credit or perhaps receive less favorable or generous terms on mortgage credit, and these can frustrate minorities from becoming homeowners. [Holly Hobbs:] So if Black and Hispanic-Americans have lower homeownership rates, does that mean they are more likely to rent? And if so, can you tell us something about their affordability problems? [Dan Garcia-Diaz:] Yes, that's exactly what it means. So generally speaking, if you can't afford to own your home, you will rent. And so generally, we see that renters have lower average incomes than homeowners. And as a result, we do see in the data significant portions of renters experiencing an affordability problem across the different races. And so for instance, about 22% of White renters have a severe affordability problem. And by severe, I mean that the household pays more than 50% of their gross income in rent. And then about 29% of Black renters and 27% of Hispanic renters have a severe affordability problem. And so, these are obviously significant challenges because if you have a lower income and you're paying more than half of your income towards rent, that leaves less resources for other necessities such as health care expenses, building up the savings, college education, or even building up enough funding to buy a home in the future. [Holly Hobbs:] And so, there are some concerns about COVID-19's effects on homeownership. During the last economic crisis--the Great Recession--we reported on impacts to homeownership rates. What can you tell us about that? [Dan Garcia-Diaz:] So right before the financial crisis, most racial and ethnic groups peaked in terms of their home ownership. But after the crisis, a lot of different racial groups, in particularly Blacks and Hispanics, all significant declines from those highs right before the 2008-9 foreclosure crisis. Especially among Black families, they are struggling to see a return to the higher rates right before the financial crisis. [Holly Hobbs:] So what do we know about how COVID might impact homeownership rates? [Dan Garcia-Diaz:] It's still a little too early to tell. There are multiple protections in place to ensure that homeowners, who are struggling right now during the pandemic, can stay in their homes and not be foreclosed. One of the methods is simply forbearance. So that means, you don't have to pay your mortgage for a certain period of time and that amount that you are not paying is simply added to the end of your mortgage. And that's a clever way of addressing and delaying potential foreclosure crises among homeowners, especially those families who are economically distressed. But a lot of this is going to depend on how long the pandemic crisis continues and its impact on employment. [Holly Hobbs:] What about lending practices generally, outside of mortgages. Have we done any work on that and found disparities in lending? [Dan Garcia-Diaz:] Yeah, so we looked across all types of lending, not just mortgage lending. And there's long-standing concern that certain parts of the markets have access to credit to finance business activity and so on. And a key thing that, at least our work has shown over time, is that agencies don't always have complete data that allows them to fully understand the extent of the disparity and the reasons for the disparity. And here's the predicament, when you investigate issues like discrimination, it's a fairly intensive process and good data is a critical part of it. [Holly Hobbs:] So, we've discussed racial disparities in health care access and outcomes and the challenges minority families face in our economy--particularly when trying to realize the American Dream and purchase a home. Now let's look at our public education system. Jackie, our work has shown that racial disparities in diversity issues impact lives at a very young age. GAO has reported that unequal treatment of children can start as early as preschool. Can you talk about some of our work on this and what we found? [Jackie Nowicki:] So, you're exactly right. In 2018, we found that starting in preschool, children as young as 3 and 4 years old were suspended and expelled from school. And specifically, it's Black students and boys that were disproportionately disciplined. And we found that that pattern continued for older children as well. Probably one of the most telling facts in our report was that, although there were about 17.5 million more White public school students then Black public school students, nearly 176,000 more Black students were suspended from school. [Holly Hobbs:] And, what's the long-term impact of these patterns? [Jackie Nowicki:] So, beyond the obvious loss of instructional time, when students are suspended from school, they are less likely to graduate on time, and they're more likely to repeat a grade, dropout of school, or become involved in the juvenile justice system. [Holly Hobbs:] I think some people excuse these disparities by saying that issues with discipline or education outcomes are socioeconomic, and they're not due because of racial disparities. But we have findings on that too, right? [Jackie Nowicki:] Yeah so, the statistical models we ran showed that disparities were widespread and persisted regardless of the type of school attended and the level of school poverty. Even Black students attending wealthy schools were suspended at disproportionate rates--in fact, by more than 12 percentage points. [Holly Hobbs:] What about the quality of education students receive? [Jackie Nowicki:] So, the overwhelming majority of kids in high-poverty schools--roughly 80%--are Black or Hispanic. So, what exactly does that mean for kids? It means that Black and Brown students typically had less access to the sequences of math and science courses that most public 4-year colleges expect students to take in high school. And it means access to rigorous high school courses decreased as a level of school poverty increased. So for example, we found that almost 90% of the wealthiest schools offered physics, compared to 62 percent of the poorest schools. [Holly Hobbs:] Jackie, these disparities sound significant. What is the federal government doing to address disparities in public schools? [Jackie Nowicki:] One is to rigorously investigate allegations of discrimination and enforce the nation's Civil Rights laws. And the Departments of Education and Justice have also issued guidance to help school districts understand their obligations under these laws and develop practices and strategies to address disparities. We spend billions of dollars each year to help address these kinds of disparities in close achievement gaps. For example, about 70% of school districts qualify for Title I funds, which support schools and school districts with low-income students. And there's also a magnet school assistance program, which provides grants to establish and operate magnet schools in districts with federally mandated desegregation plans. [Holly Hobbs:] So, we've talked about racial disparities in health care, the economy, and educations--3 areas that can have a major impact on the quality of life of Americans. What should our listeners take away from our work on racial disparities? Nikki, let's start with you. [Nikki Clowers:] Our work has shown, that health outcome disparities are real. Racial and ethnic groups generally have worse health outcomes compared to their White friends and families and colleagues. There are many factors that could be contributing to the outcomes that we see and continued federal attention on this issue is appropriate and warranted. [Holly Hobbs:] And Dan? [Dan Garcia-Diaz:] Well, the bottom line is that there are significant differences across race. There are a lot of factors that explain that. Home ownership is a complex process, and it's critical that federal policy remain focus on understanding and addressing those differences. But in particular to the extent that those differences are due to discrimination, it's important that federal regulatory agencies, who are responsible for overseeing lenders, ensure that lenders are acting in a fair and unbiased manner. [Holly Hobbs:] And finally Jackie? [Jackie Nowicki:] For K-12 education, I think it's important to remember that K-12 is largely a state and local responsibility, but obviously the federal government does have a role here. We have made strides in addressing disparities, but clearly there's just so much more to do. Disparities are not new, they remain a significant barrier for a lot of kids. So I really think we're talking about a multipronged approach here, clearly not an issue that the federal government can solve on its own. [Holly Hobbs:] That was GAO's Nikki Clowers, Dan Garcia-Diaz, and Jackie Nowicki talking about our portfolio of work on racial disparities and diversity issues. Thank you all for sharing this work! And thank you to our listeners for tuning in to the Watchdog Report. To hear more podcasts, subscribe to us on Apple Podcasts. And make sure you leave a rating and review to let others know about the work we're doing. For more from the congressional watchdog, the U.S. Government Accountability Office, visit us at GAO.gov.