The Case Against Reparations

Ta-Nehisi Coates has done a public service with his essay “The Case for Reparations,” and the service he has done is to show that there is not much of a case for reparations. Mr. Coates’s beautifully written monograph is intelligent and sometimes moving, and the moral and political case he makes is not to be discounted lightly, but it is not a persuasive case for converting the liberal Anglo-American tradition of justice into a system of racial apportionment. Mr. Coates and those who share his views would no doubt observe that the Anglo-American practice, despite its liberal rhetoric, was a system of racial apportionment, and a brutal one at that, for centuries, with real-world consequences that continue to be large facts of American life to this day — and they would be correct. But the remedy Mr. Coates proposes would not satisfy the criterion of justice, nor is it likely that it would reduce or even substantially eliminate the very large socioeconomic differences that distinguish the black experience of American life from the white experience of it.

The most valuable aspect of Mr. Coates’s essay is as a corrective to the tendency to treat the systematic political and economic repression of black Americans as though it were a matter of distant history and a question that had been for the most part settled at Gettysburg, with a few necessary legislative reforms in the following century. The process of extirpating effective racism did not end in 1868 or in 1964; even assuming a zero racial handicap on a forward-going basis, we would expect it to take decades before the average economic differences between blacks and whites were to disappear. (If, indeed, we should expect them to disappear at all.) And the economic disadvantages imposed on African Americans did not end with slavery. Mr. Coates recounts, among other abuses, how black workers leaving the South for such communities as Chicago’s North Lawndale were systematically excluded from the formal banking system, in no small part by federal housing policy that denied FHA mortgage insurance to neighborhoods into which blacks had moved or were moving, leaving black would-be homeowners with few options other than the “on contract” purchase, essentially a rent-to-own scheme that was rife with abuse and dishonesty.

Upwardly mobile blacks were fleeced by similar schemes for many years, and blacks remain to a disproportionate extent outside the traditional financial institutions — for instance, a quarter of unmarried black men have no bank account, and fewer than half of black households invest in stocks or similar financial instruments. The relatively hard time blacks have dealing with financial institutions has some truly perverse outcomes: Whites have more college degrees but less student-loan debt; white women are more likely to be homeowners than are black women, but they have smaller mortgages; blacks are less likely to be approved for credit cards, and they have more credit-card debt. While the median black household income is about a third lower than the median white household income, blacks’ median net worth is radically lower: about 5 percent of the median white net worth. The median net worth for a single white woman in her prime earning years is about $43,000; the median net worth for a black woman in her prime earning years is about $5.

There is probably a vicious circle at work here: Even controlling for income, blacks are financially risk-averse compared with whites, which probably has something to do with the history that Mr. Coates cites; but this risk aversion has the long-term effect of leaving them worse off as they forgo higher returns on their savings, which is one reason, though not the only one, that black households are likely to have less wealth than white households with identical incomes. In the matter of savings and investment, it is very likely that skeptical attitudes and relatively poor outcomes feed on each other. A similar dynamic characterizes the investment decisions of white women relative to white men.

Blacks probably should extend that skepticism, or even transfer it, to the welfare state. Mr. Coates does not spare the New Dealers, who enacted a raft of progressive policies that were in many cases designed to exclude or disadvantage African Americans. Contrary to the convenient myth related by our contemporary liberals, there was no substantial conflict between Democratic liberals and Democratic segregationists on most of the progressive agenda — the  progressives and the segregationists were, in the main, the same people, and the so-called conservative Democrats in the South were very enthusiastic about federal regulation of businesses, the minimum wage, social insurance, and welfare programs, so long as they could be structured in a way that would not benefit blacks very much. But Mr. Coates does not give much consideration to the possibility that a similar dynamic still is at work among our 21st-century progressives — not in the sense that white progressives see their own interests being in direct competition with those of black Americans, but in the sense that programs run for the theoretical benefit of the poor, who are disproportionately black, are in fact run for the benefit of the largely white upper-middle-class bureaucrats who are employed by them. The teachers’ unions’ steadfast and occasionally hysterical opposition to school-reform programs intended to help the overwhelmingly black population of Washington, D.C., is a dramatic example of that, the full import of which does not seem to have settled upon the mind of Mr. Coates, who is himself a product of the backward Baltimore public-school system.

If the enduring disparities in economic outcomes were the only concern, or even the main concern, at issue here, then our policy menu would be relatively straightforward. Blacks are disproportionately poor, and policies that encourage economic growth and robust employment, which is the only meaningful long-term anti-poverty program, should benefit blacks with roughly the same disproportion. Indeed, that has been the case for some periods in the past: Black households saw stronger income growth than did white households during the Reagan boom, and from 1990 to 2000, Census figures report aggregate growth in the black median household almost twice that of white households, 23 percent in constant dollars for blacks vs. 12 percent for whites. Had those trends continued, the racial difference in median income would have been wiped out in about 40 years. But if there were a policy or a set of policies that could be enacted guaranteeing the economic growth of that unusual decade, then they already would have been made permanent. The path from policy to outcome is a crooked one.

It is true, as Mr. Coates argues, citing Lyndon Johnson, that “Negro poverty is not white poverty,” at least as measured by many critical metrics — concentration, mobility, various life outcomes controlled for income, etc. But though he spends a great deal of time documenting economic issues, those are not, in the end, Mr. Coates’s interest here: “Reducing American poverty and ending white supremacy are not the same,” he declares. That there is some question-begging going on there — whether “white supremacy” really describes a significant motive force in American public life — goes without saying, but it shouldn’t.