I think it's fallacy to argue that there's no genetic basis to race by claiming that the within-race variability is much larger than the between race variability. So what.
The "within-race" variability IS much larger than "between race" variability. Prescribing the word "fallacy" to it will not do anything to reality. Richard Dawkins' pointed out that what people call "race" is only accountable for about 6% of human genetic diversity, and most of our genetic diversity can be found in one "race". I'll have to find the exact book later, since it's been a while.
Isn't it true that our dna differs from chimp dna by some small fraction (1%?) or is this an urban legend.
Yes, but that really doesn't mean much.
Let's keep it basic and consider what a gene actually codes for: a protein. Our DNA is 99% similar to that of chimpanzees, because we contain a lot of the same types of protein channels, g-proteins, histones, enzymes, and any other protein coded by a homolog.
Let's look at an example of a gene that is in question in this thread: TYR.
TYR codes for tyrosinase, a protein that oxidizes tyrosine in the process of melanin formation (pigment!)
Here's the ensembl database entry for TYR.
When we look at the orthologs, we can see that it is 100% similar in humans and chimpanzees.
I would like to add here that if an individual were to lack this gene, they would be albino, not "white." They would have difficulty seeing, repairing extensive damage to their genetic material from sunlight, and some problems with brain functions in certain areas.
An effect size of just .20 would show massive overlap among race distributions, but aggregating that out to population effects, the results would be striking and could potentially explain well-being differences across race.
Pure speculation, and no, it wouldn't explain well-being differences. As I explained above, genes code for proteins, which have specific functions, but they can be used in many ways. Tyrosinase makes melanin, which we usually associate with skin, eye, and hair pigment, but the
exact same protein is found in neurons, and it is concentrated in some brain structures. Another example is Na/K ATPase, which is generally associated with neurons, as it maintains a negative membrane potential. It's also in the lumen of the small intestine and many other areas of the body.
You are simplifying genetic variance too much here. Consider the fact that
chimpanzees show much more genetic diversity than humans, and their separate cultures are not affected by these differences.
A better way to study differences in well-being in our economic system is to measure gene expression levels pressured by environment. It is not really related to genetics in humans, but upbringing and environmental factors have a much stronger effect. The long-used analogy of DNA as a "blueprint" is false and misleading. Gene expression levels vary based on environment and upbringing.
Epigenetic influences can also directly explain disparities in behavior. In areas with high poverty, women will have children with many mental deficiencies. A great study that established this is the Irish potato famine study.