As Washington policymakers screamed bloody murder last month over bonus payments for a few hundred AIG employees, another much larger scandal flew virtually unnoticed on Capitol Hill: The divide between the wealth of blacks and whites - already gaping - grew again. Now, as Congress prepares to consider a series of consumer-friendly finance reforms, some minority advocates, researchers and lawmakers are pointing to that startling trend as another reason the reforms are urgently needed.

    "We need to work together to begin to attack the institutional and structural reasons why communities of color continue to lag so far behind white families," said Rep. Barbara Lee, D-Calif., chairwoman of the Congressional Black Caucus.

    The concerns were justified last month. According to the Federal Reserve, the net worth of the typical African-American family in 2007 was just 10 percent of the net worth of the typical white family - down from 12 percent in 2004. Put another way: For every $1 held by whites five years ago, blacks had 12 cents. Three years later, they had a dime.

    "This is not just a gap. It's a deepening canyon," Meizhu Lui, director of the Closing the Racial Wealth Gap Initiative at the Oakland-based Insight Center for Community Economic Development, wrote in a Washington Post op-ed last month. "The overhyped political term 'post-racial society‚' becomes patently absurd when looking at these economic numbers."

    The staggering statistic has taken some powerful lawmakers by surprise. Participants in a wealth gap summit on Capitol Hill last month said that House Majority Leader Steny Hoyer, D-Md., who attended the event, was shocked to learn the extent of the disparity.

    But incredulity is one thing; closing the gap is another. And congressional lawmakers with that goal in mind face a series of barriers to getting the job done. Not only is there little recognition that such a divide exists, but the causes, according to reform advocates, are so rooted in history and ingrained in policy that they're tough to iron out. Furthermore, the solutions reside largely in tax code reforms - among the thorniest issues to tackle on Capitol Hill. Advocates for closing the wealth gap say that congressional lawmakers are well behind the curve.

    "In terms of them really grappling with it," Lui said Friday, "I don't think they've done that yet. There's plenty of room for them to address this further."

    It won't be easy. Advocates are pushing to reverse the Bush-era tax cuts, like those slashing the capital gains and estate taxes, which provide handsome benefits to those with accumulated wealth, but do almost nothing to help Americans of color, whose assets are a fraction of those held by whites.

    "People aren't thinking in terms of wealth; it's always about income," Lui said of the public policy focus. "But income alone won't do it."

    Thomas Shapiro, professor of law and social policy at Brandeis University, said additional tax reforms could include a shift in the mortgage interest deduction to benefit lower-valued homes and the creation of another deduction for renters - controversial ideas that "no one's really talking about," he said.

    "When the issue is something like the racial wealth gap," he said, "it‚' very difficult to think of policy levers [as solutions]."

    That the wealth disparity is so wide is largely attributable to prejudiced policies both public and private. Advocates and academics point out that some of the largest federal benefit programs of the last century propped up whites but largely excluded minorities. The G.I. Bill, for example, provided $120 billion in low-interest mortgage loans to servicemen after World War II, yet less than 2 percent went to minorities before 1962, Liu found. And the Depression-era Home Owners' Loan Corporation, created to modify mortgages to prevent foreclosures, benefited no minorities whatsoever, she said.

    More recently, Harvard University discovered that, among blacks and whites of similar incomes, lenders targeted blacks more often for sub-prime loans, even when those minority borrowers were eligible for less risky arrangements.

    To combat that trend, advocates and some Democrats are pushing for the creation of a Financial Products Safety Commission, a concept championed by Elizabeth Warren, chairwoman of the congressional panel created to oversee the Wall Street bailout. A Senate bill, sponsored by Sen. Richard Durbin, D-Ill., would do just that. The commission would regulate financial products, like mortgage loans and credit cards, much the same way the Consumer Products Safety Commission protects buyers from faulty coffee makers and lawn chairs. Sens. Charles Schumer, D-N.Y., and Edward Kennedy, D-Mass., have also sponsored the bill.

    The release of the Fed's latest Survey of Consumer Finances, a triennial assessment of American financial trends, reveals that such policies have taken their toll. The report found that, as a group, people of color held roughly 16 cents for every $1 held by whites in 2007. For Hispanics, the figure was 12 cents. For blacks, a dime. And those figures were crunched before the collapse of the economy. Advocates fear that the gap probably widened since then because, while fewer minorities than whites own their homes, minority homeowners tend to have a higher percentage of their wealth wrapped up in their homes.

    Similarly, blacks and Hispanics have fewer credit cards, but tend to drive up higher debts per card. As a result, said Jose Garcia, associate director for research and policy at Demos, a liberal policy group, "more of [minorities'] income goes to pay debt, and less goes to buy assets."

    Minority advocates are also wary of payday lenders, who tend to charge exorbitant rates and target minority communities where traditional banks are often scarce. "Billions of dollars are being taken out of low- and moderate-income communities as a result of these alternative financing schemes," Shapiro said.

    Not that Congress isn't doing anything at all. Legislation to help homeowners by empowering bankruptcy judges to alter mortgage terms passed the House last month, though it's since stalled in the Senate. Democratic leaders are also preparing to take up bills tackling predatory lending and credit card abuses. Another proposal to rein in payday lenders is also on the Democrats' radar screen.

    Speaking at the wealth gap summit last month, Lee said that reforming these industries to protect minority communities is long overdue. "Too many communities do not have access to traditional banks and rely too heavily on payday lenders and check cashing stores that charge uncontrolled fees and out of sight interest rates," Lee said. "We must work together to use this financial storm to demand the institutional reforms that will begin to lift all American families out of this crisis."

    Reform advocates say they're heartened by such statements coming from Capitol Hill, but many remain wary that few lawmakers are sticking their necks out to close the wealth gap.

    "They were very friendly and very encouraging," Shapiro said of the congressional participants at the summit, "but nobody was stepping up and saying, 'I want to be the champion of this.'"