do the math: why reparations are the talk of 2020

April 15, 2019
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As the issues around the 2020 election begin to take shape, Democratic politicians are getting the feeling that white Americans are open to talking about reparations for slavery. Why are politicians now ready to take up a task that’s been waiting nearly 160 years for some resolution?

Until this year the subject of reparations had been politically radioactive. In 1989, Congressman John Conyers started a yearly introduction of a bill in Congress to simply set up a commission that would examine the possibility of reparations. As late as 2013, Conyers was unable even to get a hearing on the subject.    

There’s a historical irony to this. Because real-time reparations were actually enacted by the Union Army General William Sherman’s Special Field Order 15 of 1865. Sherman confiscated 400,000 acres of land in South Carolina, Georgia and Florida, dividing it into 40-acre lots for recently freed slaves. (The origin of “40 acres and a mule.”) Unfortunately the order was reversed that same year by Andrew Johnson, after he succeeded Lincoln as president.

Reparation payments for slaves were demanded by Pennsylvania Senator Thaddeus Stevens and Massachusetts Senator Charles Sumner before the end of the Civil War. Sumner even proposed land grants to newly freed slaves “to eradicate the large disparity of wealth, status and power.” Unfortunately in 1866 this legislation was rejected by Congress.  

There is also precedent in the United States of America for actually paying reparations. In 1988 President Reagan officially apologized for the internment of Japanese-American residents during World War II, and signed the Civil Liberties Act, which paid each surviving victim $20,000. The total payment was $1.6 billion.

But reparations for Black Americans are a different matter. Instead of three years of internment we are talking about centuries of slavery, Jim Crow and discrimination. Most Black Americans came this continent as a result of slavery, and there are now 37 million Black people in the U.S. (42 million if you count multi-racial African-Americans.) Even at $20,000 per person, reparations would cost the U.S. $740 billion.

Many Black and white scholars like Jim Feagin have been talking about reparations for decades. Recently writers Ta-Nehisi Coates and John McWhorter have taken on the issue of reparations for African-Americans. Coates has given a moral argument for reparations. Whereas McWhorter has claimed that Black Americans have received reparations in the form of welfare, food stamps, affirmative action and educational opportunities. While the moral argument for reparations is compelling, John McWhorter’s economic argument falls terribly short. Here’s why.

Economic estimates of labor stolen during slavery, 150 years of Jim Crow and the discrimination that continues in the U.S. today, range from $6 to 25 trillion. To put that in perspective, $25 trillion is one quarter of all the wealth in the USA. This estimate makes the $100 billion of welfare and food stamps given out each year — paid mostly to white recipients — seem paltry.

In The Poverty of Philosophy, Karl Marx put the value of slavery in simple economic terms. ”Without slavery you have no cotton, without cotton there would be no modern industry. It is slavery which has given value to the [European] colonies, it is the colonies which have created world trade, and world trade is the necessary condition for large-scale [machine] industry.” For Marx, slavery was the engine for the entire Industrial Revolution. Let that idea sink in for a minute: today’s entire industrial society was made possible by slavery. Here’s how it worked.

The slave trade was an economic engine and a vicious cycle of exploitation. The first leg of the cycle was taking European goods covetted in Africa — textiles, for one — and trading these for captured slaves. Then the slaves were transported and sold in the Americas. Profits from slave sales in the Americas were used to buy goods such as rum, coffee, sugar, indigo, and later, the most important product, cotton. These newly purchased goods were transported across the Atlantic, and sold in Europe.

During the U.S. Civil War, a Union blockade of Southern ships stopped cotton from being delivered to Europe. Cotton was so important to the European economy, that only efforts by Northern legislators stopped England and France from entering the war on the side of the Confederacy.  

In 1860, only 1% of the U.S. population held slaves. This 1%, 393,000 households out of 31 million Americans, were the real winners during slavery. When the Founding Fathers wrote and ratified the Constitution they allowed slavery. They allocated political power to slaveholders by counting slaves as “3/5 of a person,” which gave Southern slaveholders undue power and influence over Congress, the Supreme Court and the presidency. And for 250 years this 1% has used their inordinate power and influence to make extraordinary economic profits and to control society.

But what about all the time, money and effort the other 99% of white Americans spent defending the rights of the slaveholding 1%? Could white Americans be owed reparations?

Think of all the productive energy that was poured into maintaining slavery, Jim Crow and discrimination by white Americans. Think of the time, planning, effort and money that white racists have spent trying to prevent the end of slavery, to prevent integration, to prevent Black Americans from exercising their civil rights.

Imagine the productive energy used to capture, transport, buy, and control slaves; creating thousands of boats specially designed to transport slaves and prevent uprisings on board; or designing and producing implements for restraining, punishing and controlling slaves. None of which worked, since slaves in the U.S. were in a near-constant state of rebellion, and many escaped easily and spent years living free.

Think of the hours and money spent preventing slaves from escaping, searching for and capturing escaped slaves and returning them to captivity. “Slave-catching” was a lucrative profession in antebellum America..

imagine the time that the government, legislators and officials spent on slavery, Jim Crow and discrimination. In the 1830s alone, one-third of all legislation in the U.S. was concerned with controlling and inhibiting slaves and free people of color. Try to imagine the time, money and effort national, state and local governments spent trying to prevent Black Americans from voting.

Think of the time, money, and effort used to quell uprisings, stop protests, to punish and incarcerate Blacks and whites for infractions of racist laws and legislation. Think of the costs of legal battles to block access to voting rights and fair housing, to prevent the integration of schools, transportation, public and private facilities.

During Jim Crow and segregation, businesses had to duplicate services for Black and white customers, from separate Black and white waiting rooms for transportation services, to separate eating facilities for Black and white customers in restaurants. The expense of providing all these was a tremendous burden for small and large businesses alike.

Now let’s think about the loss of life. Many white Americans have been hung, burned at the stake, killed and jailed because of their involvement in slave uprisings and conspiracies. John Brown is the best-known example, but thousands of lost their lives helping slaves to freedom. Each and every one of those white Americans who gave their all fighting the evils of slavery should be considered national heroes.

500,000 white Americans lost their lives fighting the Civil War. Thousands more white Americans have been killed by slaves, in uprisings and confrontations while supporting slavery, Jim Crow and discrimination.   

Yet this racial proxy fight was carried on by middle- and lower-class whites, allowing the top 1% of the population to add to and consolidate their wealth and power. What would be the compensation for this racial proxy fight?  What about the cost of slavery, Jim Crow and discrimination paid by white Americans?

Let’s try to quantify potential reparation payments using some very simplistic, back-of-the-envelope math.

Today Americans have built up $100 trillion of wealth. Let’s assume $25 trillion of that was the amount of wealth generated by slavery. (Of course that wealth has never been transferred to people of color, who have never really had any real wealth in the U.S.)

Native Americans could be legally enslaved in the British colonies from 1620 until 1775, and in the Louisiana Territory until 1769. And thousands were sold into slavery from the South into the Caribbean during the 1700s. In 1830, President Jackson’s Indian Removal Act relocated Native Americans from their lands east of the Mississippi to lands west of the river. This opened up millions of acres of land in the Southeast to white settlement and the profits of cotton production. The 150 years of Native American slavery and their stolen lands easily generated $25 trillion.

Of the remaining $50 trillion, let’s estimate that other non-white Americans — mainly Asian-American and Latino-Americans — have generated $4 trillion. Though they’ve always faced racism, segregation and discrimination here in the U.S., they were never officially enslaved. That leaves $46 trillion.

Of that $46 trillion, let’s be extremely generous to the top 1% of the country. Let’s assume that thanks only to their “extraordinary talent” they generated 10% of this remaining wealth. So, 3 million people, the top 1% of the country, generated $5 trillion. (This, by the way, is no trivial number: it’s approximately twice the GDP of the state of California.) That leaves $41 trillion of total American wealth.

As detailed above, the balance of white Americans have been on the front lines of our country’s daily racial proxy fight. We can safely say that the benefits of this fight have not gone to poor or middle-class whites. The hours spent could have been used by white Americans to generate their own wealth  such as starting businesses, improving their homes, getting more education, or simply by doing something more positive and creative.

If we calculate American wealth — minus that generated by slavery, Native American assets, other Americans of color, and an elite 1% — at $41 trillion, what has participation in this racial proxy fight cost white Americans ? Let’s estimate they have devoted an average of 1/8 of their working hours, or 1 hour every workday to supporting—or opposing—slavery, Jim Crow and discrimination. One-eighth of $41 trillion is $5.125 trillion, so about $21,767 for every white man, woman and child in America.

Today, approximately 320 of the 400 richest Americans inherited their wealth. That means the majority of the wealthiest Americans started accumulating that wealth when slavery or Jim Crow was the law of the land. These people are not necessarily all racists, but their wealth is rooted in racist American policies. Throughout our history, these wealthiest Americans have been able to amass unimaginable fortunes, while the majority of U.S. citizens have been caught up in almost daily race-based conflicts.

By calculating American wealth informally, we arrive at $35 trillion. This is the wealth generated by America as a whole, created by and benefitting all Americans. Divided equally it comes to nearly $108,000 per person. But America’s wealth has not been distributed equitably; in fact today’s 1%, those previously mentioned 400 Americans, hold more wealth than 62% of all other Americans combined. Founded upon the atrocities of a slaveholding minority, the wealth controlled by America’s 1% has continued to balloon, beyond comprehension, beyond conscience.

To return to the original question: ,“Why are the 2020 Democratic presidential hopefuls speaking about reparations now?” Maybe income inequality in America has become so large that finally white and Black politicians have to talk about reparations? And maybe doing the math will help us make sense of what is owed, how much has gone wrong, and how we begin to correct it.