Why are black Americans so persistently confined to the margins of society? And why do they fail across so many metrics—wages, unemployment, income levels, test scores, incarceration rates, health outcomes? Known for his influential work on the economics of racial inequality and for pioneering the link between racism and social capital, Glenn Loury is not afraid of piercing orthodoxies and coming to controversial conclusions. In this now classic work, reconsidered in light of recent events, he describes how a vicious cycle of tainted social information helped create the racial stereotypes that rationalize and sustain discrimination, and suggests how this might be changed. Brilliant in its account of how racial classifications are created and perpetuated, and how they resonate through the social, psychological, spiritual, and economic life of the nation, this compelling and passionate book gives us a new way of seeing—and of seeing beyond—the damning categorization of race.