Hair and AO Problem?

Someone please explain to me what is going on here. I have added some hair to my socks and turned on raytraced AO with one simple lamp by the camera. The hair always comes out black! If I switch to AAO it is somewhat better, but uglier also in new ways. I just can’t get these hairs to come out white. There is something simple I am doing wrong, I know, but I have pressed every dang button one here to no effect. Please help!

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