Reparations Are Racist and Regressive—Let Economic Freedom Liberate Us All

“It is white Americans’ centuries-long economic head start that most effectively maintains racial caste today. As soon as laws began to ban racial discrimination against Black Americans, white Americans created so-called race-neutral means of maintaining political and economic power.”

New York Times Magazine, June 28, 2020, “What We Owe,” pp. 34 –35

 
“What We Owe” is the yellow screamer headline that in billboard letters filled the entire black cover of the June 28 New York Times Magazine. Surely, it is one of the longest articles ever run by the magazine: some nine pages enlivened by photos of Black protests in each decade.

What is “owed” are reparations, a check paid by the federal government to any of 40 million Black Americans who can trace at least one ancestor to American slavery. That punchline comes after many pages of history, historical interpretation, economic statistics and analysis, demographic arguments, and appeal to American ideals and pride.

If the crusade seems radically leftist even for today’s Times, you may have missed the Times’s 1619 Project, for which Hannah-Jones received the 2020 Pulitzer Prize for journalism.

This article, by Nikole Hannah-Jones, in the U.S. “newspaper of record,” obviously editorially cheered by the Times, is the most prominent appeal ever advanced for “reparations”—an idea cooling its heels for decades in a bill before Congress never brought out of committee. If the crusade seems radically leftist even for today’s Times, you may have missed the Times’s 1619 Project, for which Hannah-Jones received the 2020 Pulitzer Prize for journalism.

In a way, she is the model of the new Times reporter, schooled in the dogmas of postmodernism and, in politics, neo-Marxism. Hannah-Jones joined the Times already on record as a doctrinaire anti-capitalist, pro-socialist. Indeed, she seems to have grown up (in all-white Iowa schools) loathing America as she knew it, especially capitalism. In graduate school at Notre Dame University, she wrote an op-ed that compared Columbus to Hitler and referred to the “white race” as devils. What looked to her preferable to America? In a fellowship year from 2008 –2009, she traveled to Cuba to study the communist health care system under Raul Castro.

An ideal candidate for staff reporter at the resolutely postmodernist, neo-Marxist New York Times! A few years after she arrived in 2015, she began what became the “1619 Project,” which filled a whole issue of the Times magazine. The essays, reports, and poems all were intended to “reframe the country’s history by placing the consequences of slavery and the contributions of Black Americans at the very center of our national narrative.”

Among contents of the magazine were:

1. “America Wasn’t a Democracy Until Black Americans Made It One” by Nikole Hannah-Jones.
2. “American Capitalism Is Brutal. You Can Trace That to the Plantation” by Matthew Desmond.
3. “What the Reactionary Politics of 2019 Owe to the Politics of Slavery” by Jamelle Bouie.
4. “Why Doesn’t America Have Universal Healthcare? One Word: Race” by Jeneen Interlandi.
5. “Why American Prisons Owe Their Cruelty to Slavery” by Bryan Stevenson.
6. “How America’s Vast Racial Wealth Gap Grew: By Plunder” by Trymaine Lee.

For masterminding this project, Hannah-Jones was awarded the 2020 Pulitzer Prize for Journalism.
 

Neo-Marxism, not American History

As a matter of history, the wealth of America was not created in the feudalist-agrarian South.

By the way, the thesis of the 1619 project, carried over into “What We Owe,” is little more than the often-refuted Marxist claim that wealth is created by physical labor but stolen by managers and owners who do not labor. Thus, slave labor created the wealth at the foundation of future American prosperity. Slaves (unlike free, paid labor) did create wealth seized by slave owners. Slaves were deprived of the fruit of their labor—and worse. But, as a matter of history, the wealth of America was not created in the feudalist-agrarian South.

Wealth was created in the Yankee innovation-oriented, industrial, world-trading, American North. No menial physical labor, to which slaves were restricted, and no physical labor of persons freed from slavery (who had few other alternatives), could have propelled the historical miracle of American economic triumph in the 19th century. It was invention, innovation, optimal investment under economic freedom, the thrust of manufacturing with assembly lines and interchangeable parts, savings and investment in a low-tax and zero-inflation environment, the freedom of entrepreneurs to make fortunes that drove ever-greater demand for skilled labor that made America a near-miracle of wealth creation in the 19th century glory years of capitalism.

“What We Owe” reiterates the frank absurdity that slavery made America the most productive, fastest-growing, most competitive nation on earth. That polemical argument for the superiority of the slave economy over all other economic systems frankly scares me.

But “What We Owe” speaks the truth that, when freed, the people who had been enslaved got nothing for a lifetime, or generations, of labor. Black Americans, Hannah-Jones argues, to this day have never overcome that wealth gap; it exists today. Nor did more than 70 years of civil rights legislation, affirmative action, or any other bid for “equality” make a difference.

Furthermore, since 1865, decades of Southern segregation, economic exploitation, the outright violence of lynching and mob attacks—plus national policies such as the Homestead Act and federal housing programs—have resolutely favored white wealth-building and left Blacks nothing.
 

Repairing a 150-year-old Injustice

“Reparations” is first a legal concept, as when courts require the convicted to pay damages.

“Reparations” is first a legal concept, as when courts require the convicted to pay damages. It is also prominent in international law. In the wake of WWI, at the Versailles conference, the victors demanded payments to repair the damage done by Germany. Germany was powerless to resist, although economists, including a young John Maynard Keynes, predicted the victors were planting the seeds of WWII. It probably did lead to the historic German runaway inflation, utter destruction of the German middleclass, and a weakening of the German governments struggling for a democratic Germany.

The Times article has a thesis: the four million African slaves “freed” by the Civil War had no land, no money, no education—no capital and no way to get any. No reparations ever were made to them for the catastrophic damage to their lives. They began their lives as American citizens with nothing. And that initial huge “wealth gap” American Blacks on average—as a race—never have managed to close. It is the lingering “damages” of slavery delivered upon generation after generation. And only “reparations” at last can repair the criminal injustice of slavery.

The article’s argument proceeds as follows:

During the exceedingly brief interval of true “reconstruction,” with federal troops occupying the South, there were repeated pleas for distribution of the plantations of former slavers to the freed people—for some beginning, some hope of independence. The only such action was by General Sherman under President Lincoln, ordering breakup of some plantations to give small holdings to former slaves. But with the assassination of Lincoln and the succession of Andrew Johnson, a loyal Southerner, these plans were dropped—and no other initiative ever taken toward reparations for the freed slaves.

With Lincoln’s murder and withdrawal of federal troops, the antebellum economic, political, and social structure rapidly regrouped and reasserted power. But, above all, Hannah-Jones argues, the lack of any wealth, any ability to invest in land or homes or businesses or anything else, left Black families spread-eagled before the revenant forces of white dominance.

Opportunities like the Homestead Act, opening huge tracts of the American frontier to settlers willing to cultivate 40 acres of land, were the start of much American family wealth. But to purchase a wagon and mule, buy seed, build a house—even to survive until farming income first materialized—was impossible if you had zero capital. The wealth gap.

Thus, South and North, in different ways, lack of family wealth for some 150 years curtailed advancement of American Blacks. Better education, health care, better homes, and businesses all may be the legacy of one generation to the next. But with no wealth, there is no legacy. Blacks have not attained on average more than one-tenth of average white wealth—and that has been decisive.

The supposed great change in the fortunes of Black Americans, the Civil Rights Act of 1964, and subsequent legislative and legal protections of Black rights, have not addressed the truly pivotal issues: the wealth gap.

That gap, traceable to 1865, has been maintained by racial suppression: lynching and mob attacks on wealthy Black areas, redlining for mortgages, nonexistent or negligible high-school education for Blacks in the South … And effects of the gap have been as fundamental as average health status and longevity, which correlate closely with economic status.
 

The “Wealth Gap” Today

In brief, decade after decade, despite legislation and court decisions and administrative dictates to give Black Americans equal opportunity, the “wealth gap” has not narrowed. And now, as the article argues, the COVID-19 economic devastation has hit Black Americans hardest. Half of Black Americans are now unemployed and Black businesses, the article says, have been short-changed on government bail-out funds.

Hannah-Jones seeks to rebut, one by one, the arguments that the broken “Black family” is the problem; that Black high-school performance is the problem; that success of some Blacks demonstrates that economic barriers are down; that MLK’s sole ideal was a “colorblind America” not special treatment (apparently his follow-up demand was for reparations).

Hannah-Jones argues that none of these supposed explanations of “the gap” stand up to scrutiny. No, it all goes back to “wealth”—back to 1865, when newly freed Black people began with no wealth. That could have been remedied, but national policy, “white supremacy,” racism, and “oppression” have prevented successive generations from closing the wealth gap.

And so the historic remedy. The United States of America, acting through its federal government, sanctioned slavery in the Constitution and at every step. Therefore, it is not “white Americans” who must make things right by paying reparations.

It is the federal government.

Surely the timing of a revived recommendation to mail checks to any Black American with a slave ancestor was inspired by the national payday during the COVID-19 pandemic and by the protests/riots that have embattled cities across America—and elsewhere in the world. Hannah-Jones begins by meditating that perhaps “things are different this time,” if the death of George Floyd in police custody, and the subsequent uprising that brought out so many whites as well as Blacks, have shown Americans vividly on video “systemic racism,” a “lynching,” and “unrestrained” violence by responding law enforcement officers.

Indeed, the first third or more of the article is devoted to recitation of official and unofficial white violence against Black Americans. The goal is to “set the table” for Americans at last to take in and digest that racial discrimination, injustice, and inequality have not been resolved.  In fact, the article argues, barely addressed in any effective way.
 

Making Reparations Plausible 

Covid-19 and the “protests” (“What We Owe” does not mention any looting, arson, or attacks on police until far into the article—and then in only one sentence), argues Hannah-Jones, have “radicalized” Americans. It is a classic concept and tactic of the Left, Old and New, and a corollary of the postmodernist view that all social and economic relations are between oppressors (white males) and the oppressed (e.g., Blacks, women, and categories of sexual types)—and all ideas mere rationalizations for that oppression.

The pandemic dramatized the potential of demanding that overnight Congress increase national debt by $2 trillion to make tens of millions of payments to Americans in a few months.

So no big deal, right? Some significant percentage of 40 million Black Americans, descended from slaves, could receive a check from Washington to bring their wealth up to the average level in America. Ticking off “white” misconceptions of the plight of Blacks and what reparations would mean the article emphasizes that reparations would not be paid by whites. No, but by the “federal government.” For in the U.S. Constitution, the handling of reconstruction, the century or more of delay in addressing racial inequality, programs that hugely favored the white middleclass over Black families—was the agent of this centuries-long injury to Black Americans. And the federal government must pay reparations.

Readers may protest: There is no “federal government” money. We are talking about taxes and borrowing.

Readers may protest: There is no “federal government” money. We are talking about taxes and borrowing. Always it is someone’s individual wealth that is involved—including the wealth of generations not yet born saddled with the national debt or individuals who are cheated when government defaults on its debt—either “honestly” by repudiation or by inflating to nothing the value of the borrowed dollar.

Someone always pays.

But the author of the Times article, and those who accept her logic, can hardly be faulted for confidence that individuals do not pay, the government pays. When COVID-19 struck, tens of millions of Americans got checks from “the government,” thanks to some $2 trillion in additional national debt. But few challenged the notion that “government” was giving us all money.

Every Black American who can establish at least one slave ancestor is to be provided with a check from the U.S. Treasury large enough to become an instant American of “average wealth.” (The median wealth of America’s Black families is $17,000, while the median wealth of white families is $170,000). So millions of new fortunes would be mailed to Black families. Thereby, America finally would have “repaired” the centuries-old injustice that wealth created by slaves never went to them, depriving them of capital to invest in building family wealth, and after slavery “brutal capitalism” maintained a century and a half of economic domination by whites. In addition, all present protections of equal rights in areas like education, criminal justice, and housing loans would be strictly enforced.

And then we are “quits,” at last?

The original sin and historic crime against justice that have compromised America—its stature and the morality of non-Black Americans—are a debt paid?

Readers might conclude that. But as Hannah-Jones insists, the capital will not repair a low-quality or missed education, a culture acquired in neighborhoods shaped by violence and drugs and other crimes, a lack of a family atmosphere of education, resolutely destructive health habits, and absence of community institutions of all kinds endowed with wealth.

Hannah-Jones takes pains to argue that Black and white families with the same average wealth behave in very similar ways. Unfortunately, that says little about how big windfalls of new money distributed to tens of millions of Blacks—perhaps a dozen or more in a single extended family—will be spent. The longevity of financial windfalls in hands not used to budgeting, saving, or investing is painfully short. It is possible to imagine other outcomes. Say if one response to reparations were creation of effective organizations to consolidate and manage the new wealth on behalf of families. Obviously, financial institutions would swarm to claim a piece of the action in investing.
 

What “Big Problem”?

Hannah-Jones says that the big problems are with political will. I believe that the “big problems” are philosophical, especially moral.

Hannah-Jones says that the big problems are not with practical implementation of the reparations (look at the “stimulus” checks), but with political will.

I would agree with the first half of the assertion, more or less; but I believe that the “big problems” are philosophical, especially moral.

Hannah-Jones is a postmodernist with a consistently collectivist outlook: racial groups, ethnic, sexual groups categorized as oppressors or oppressed. In this collectivist universe, no moral problem is posed by reparations paid by one racial group—not one of them guilty of the crime—to another racial group—whose ancestors were harmed more than 150 years ago.

By the way, I am dismissing, here, the transparently false idea that the “federal government” has resources taken from no one to pay reparations. Government has resources taxed or borrowed. (A tiny percentage of money “earned” by government services is produced by government employees paid from taxes or borrowing. Reparations, if not paid from specially designated taxes, would be borrowed with the debts paid by future generations. The national debt incurred by our government now is a burden on our great-grandchildren. Or, far more likely, the debt will be inflated away, as it has been for decades with a plunging value of the dollar. That dishonestly robs our creditors. Therefore, the “federal government” will not pay reparations. Americans of all races will pay them. I wonder if Hannah-Jones has admitted to herself that funds for reparations might well come from one of America’s major creditors, the People’s Republic of China. And even as we speak the huge debt borrowed from wealth created by the Chinese people is being inflated away by depreciation of the dollar.

Part II of this essay, “Laissez-Faire Capitalism as a Far Superior Solution to Reparations,” is here.

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About the Author: Walter Donway

Walter Donway contributes to Savvy Street on political economy, science, and trends in fiction, film, and culture. Walter Donway’s most recent book is Donald Trump and His Enemies: How the Media Put Trump in Office (Romantic Revolution Books: New York, September 2017). His Amazon profile can be found here