Is South Carolina better for minorities than North Carolina?

North Carolina, with liberal enclaves like Chapel Hill and a national political profile as a "purple" state, tends to think of itself as a more progressive place than South Carolina.

A new study out today suggests we might want to think again. The report, from consumer finance website Wallet Hub, ranks South Carolina far more favorably in measuring states with the highest and lowest financial gaps by race and ethnicity. Wallet Hub reached that conclusion after studying 21 metrics across all states, including unemployment rates, home ownership rates, household income rates and educational attainment figures.

Source: WalletHub

The result: Florida comes in at No. 1, having the smallest overall income gaps by racial and ethnic groups. South Carolina ties with Indiana for the 27th spot. North Carolina lands at No. 39, just below North Dakota and just above Georgia. Key stats for North Carolina:

• A 37.41 percent gap in median household income between whites and blacks.
• A 42 percent gap in home ownership rates between whites and Latinos.
• A 177 percent gap in poverty rates between whites and Latinos.
• A 60 percent gap in highest educational attainment between whites and Latinos.

Why such big gaps? Is it institutional racism and the residual legacy of Jim Crow segregation? Are minorities  not trying hard enough to earn their fair share of the American Dream? Or is the answer more complex for either of those questions?

The study doesn't spell out exactly why North Carolina might fare better or worse than other states on specific measures. But Wallet Hub did ask several economists and scholars for their overall take on the persistence of financial inequities in America.  The growth in real estate values and the rise of the tech economy have contributed to the widening of the wealth gap, several said, since minorities still lag in home ownership and higher education.

One of the experts questioned was Omar Ali, a history professor in the African Diaspora Studies program at UNC Greensboro. Interestingly, he singled out the two major political parties, which he said essentially work in tandem to promote the interests of wealthy individuals and companies that finance their political campaigns. He suggests their policies -- even those by a sitting African American president -- tend to boost established powers more so than the interests of the disadvantaged, who tend to be mostly people of color.

"But it's not the wealthy who are to blame," he adds. "They are simply doing what's most rational (I'm not saying ethical); the problem is at the public policy level, where the parties (which are private entities) have substituted themselves as public entities. We need to increase the power of ordinary voters and decrease the power of the parties in the U.S."

What do you think? Are you surprised that South Carolina ranks better on these measures than North Carolina? Does Ali have a point?

--Eric Frazier

Why North Carolina is losing the biggest battles in the job recruitment war

Chalk up another loss on the economic development front for North Carolina.

Mercedes-Benz, after considering several cities in the state, is reportedly taking its U.S. headquarters to Atlanta. The luxury automaker joins a growing list of prestigious business brands who have thought about moving major operations to the Tarheel State, only to bypass us for other suitors.

Last year, a $107 million offer couldn't land Toyota's U.S. headquarters in Charlotte. They picked Plano, Texas. A whopping $683 million offer couldn't land Boeing's new 777x jetliner plant, which Washington state secured with a massive $8.7 billion incentives deal, then the largest corporate tax break in U.S. history.

Also in the last two years, the state lost out to Lancaster County on a $218 million Chinese textile plant and to Chester County on a $560 million tire plant. S.C. officials offered an incentives deal 10 times larger than North Carolina for the textile project and a deal with tens of millions more in tax savings on the tire project.

Gov. Pat McCrory, left, and Sealed Air CEO Jerome A. Peribere announced last year that the firm will move its headquarters to Charlotte, bringing 1,262 jobs.

Read more here: http://www.charlotteobserver.com/2014/07/23/5061311/another-charlotte-job-announcement.html#.VKwT1yvF9TI#storylink=cpy

To be sure, there have been big job recruitment wins in recent years, such as Sealed Air Corp.'s decision last year to move its headquarters and nearly 1,300 jobs to Charlotte, and MetLife's decision the year before to move about twice as many jobs to Charlotte and the Triangle. Still, there are signs of frustration setting in for Gov. Pat McCrory. He told business leaders at a gathering in Durham Monday that he doesn't have the tools he needs to attract big industry. He's asking for major legislation from lawmakers in the first two weeks of their new legislative session. He's said in the past that he needs a "closing fund" like S.C. Gov. Nikki Haley has for last-minute pot-sweetening, and administration officials have said the state's Job Development Investment Grant fund has been running low.

Clearly, something needs to be done. And Republicans running the legislature, bless their fiscally conservative hearts, haven't shown much appetite for throwing ever-bigger wads of cash at corporate suitors. But rightly or wrongly, job recruiting has devolved into a state-eat-state bloodsport. Either you outbid the competition, or you offer such a superior quality of life and workforce that the money doesn't matter. (Hint: Google and Facebook aren't in California for the tax rates).

North Carolina used to have something like that California approach to economic development. We didn't sweat the bidding wars. We invested in schools and universities to make them among the strongest in the region. We developed a reputation, as the New York Times put it in a 2013 editorial, "as a beacon of farsightedness in the South." Despite a legacy of not offering the biggest pots of money to relocating corporations, we still ranked at or near the top of business climate and job creation lists for much of the past two decades.

Nowadays, we're struggling to keep our teacher pay respectable and keep teachers from leaving the state. Lawmakers have a decision to make: either go all-in on the bidding war, as the governor seems to be asking, or increase funding for the state's true job creators -- its schools and universities. Our recent history suggests the latter economic development model works just fine.

-- Eric Frazier