A blueprint for reparations in the US William Sandy Darity

I’d like to begin with a personal story

my grandmother was the daughter of a

woman who was the child of persons who

were enslaved on Rose Hill plantation in

North Carolina and as a consequence my

sister and I are the fourth generation

removed from slavery my grandmother also

lived in a town in North Carolina called

Wilson which was a tobacco stapling

Center and she lived in a town that was

characterized by the classic pattern

that that’s featured in many many

southern towns in the United States

there was a railroad track that ran

between the black side of town and the

white side of town as an act of

separation that was emblematic of the

Jim Crow period in the United States

there was a point at which I wanted to

go and see a movie happen to be a Disney

movie after all an old Disney movie

called Darby O’Gill and the little

people but it was being shown at the

white theatre in Wilson North Carolina

and my parents refused to let me go

because they said we would be compelled

to sit in the balcony and they viewed

this as an indignity that they were not

going to stomach

and so I wasn’t able to go I was very

hurt because I really wanted to see this

movie but I also came to realize as I

grew a bit older that this was an

indignity that was relatively minor in a

social context in which lynchings and

white massacres had become quite routine

so I would like to emphasize that when

we think about the case for reparations

we are thinking about a case that is not

exclusively centered on the harms and in

justices and atrocities associated with

slavery itself but we have to view

slavery as a crucible that created a

subsequent or

Raye of atrocities that are associated

with white supremacy in the united

states and those atrocities include

those that were the product of slavery

itself but also of nearly 100 years of

legal segregation in the United States

accompanied by white mob violence and

frequent frequent intervals and and so

we usually refer to that as the Jim Crow

period and I want to emphasize when

people say there no living victims of

slavery there certainly are a number of

us who are living victims of the Jim

Crow period of course if the nation

waits long enough to engage in an act of

redemption and compensation we won’t be

alive any longer but a national act of

procrastination is not a justification

for avoiding paying the debt and then of

course in the aftermath of the period of

legal segregation the post-civil rights

act error we have a set of circumstances

in which there were ongoing atrocities

inclusive of mass incarceration police

executions of unarmed blacks the

persistence of discrimination and

employment housing and credit markets as

well as something that I’m going to

emphasize and the remainder of my

comments the immense racial wealth gap

in the United States now in our book

from here to equality which is authored

with Kirsten Mullen who happens to be my

spouse in our book we define reparations

as a program of acknowledgement redress

and closure for a grievous injustice

acknowledgement constitutes a

circumstance in which the culpable party

acknowledges or recognizes that it has

committed a vicious harm and it also

acknowledges or recognizes that it has

benefited from the execution of this

vicious harm redress is the act of

restitution on the part of the culpable

party and here we’re going to talk in a

moment

about about the role of the wealth

differential in the United States

between blacks and whites as a critical

component of of a redress process for

black American descendants of us slavery

the final component is closure which is

a point at which the culpable party in

the victimized community come to an

agreement that the debt has been paid

and no further claim will be made unless

there’s a renewal of the atrocities that

have taken place in the past or a new

array of atrocities is forthcoming so I

want to focus next on the wealth

differential and the wealth differential

is best captured by the magnitude of

these types of differences in black and

white wealth black Americans constitute

approximately 13% of the nation’s

population but only possess about 2.6

percent of the nation’s wealth

collectively across the globe there’s

approximately 300 trillion dollars in

wealth a hundred trillion dollars or

about a third of that is in the

possession of American citizens and

ninety percent of that is in the

possession of white Americans so we have

a situation in which black Americans

constitute a much much higher percentage

of the u.s. population than they do in

terms of their share in in the nation’s

wealth this translates into a

circumstance in which the average black

household has approximately eight

hundred thousand dollars less in net

worth than the average white household

another way to think about this is as

the fact that there are three white

billionaires Jeff Bezos

Bill Gates and Warren Buffett who were

worth more than the collective 80

percent of black Americans who are at

the lower end of the wealth distribution

but it’s not just a matter of the

billionaires wealth that explains this

gaping differential for example white

Americans 25%

white Americans have a net worth in

excess of 1 million dollars but it’s

only 4% of black Americans and wealth is

important in terms of being

distinguished from income wealth is a

stock concept it’s the difference

between the value of what we own and

what we owe the net property of our

value excuse me the net value of our

property income in contrast is is a flow

concept that’s most closely associated

with our earnings and wealth is more

significant than income in terms of

providing us with Economic Security and

opportunities to fully participate in

the society wealthier households have

the capacity to survive income losses

that might be associated with

unemployment or medical emergencies

wealthier families can provide their

children with high quality education and

debt free education wealthier families

can have access to high amenity

neighborhoods they can also purchase

legal counsel valuable legal counsel

when confronted with the criminal

justice system wealthier families can

leave the quest to subsequent

generations to ensure their economic

security and well-being so wealth is

extremely significant and the

differentials that exist between blacks

and whites are connected to sharp

differences in Economic Opportunity and

well-being indeed it’s very important to

note that the major factor that does

that dictates what an individual or a

family’s level of wealth is is the

transfer of resources across generations

which means in turn that wealth captures

the cumulative intergenerational effects

of white supremacy in the United States

when we think about the black/white

differentials and so in from here to

equality we argue that the goal of a

reparations program a goal that is

associated with the redress component of

reparations is to eliminate the racial

wealth gap and this would be done

primarily through direct

to eligible recipients black American

descendants of us slavery in the book we

identify two standards for eligibility

the first criteria is what we refer to

as a lineage criteria an eligible

individual would have to demonstrate

that they have at least one ancestor who

was enslaved in the United States and

the second criterion is what we refer to

as an identity criterion and this is a

criterion that says that an individual

would have to show that for at least 12

years before the onset of a reparations

program the enactment of a reparations

program or the enactment of a study

commissioned for a reparations program

whichever comes first for at least 12

years before that an individual would

have to have shown that they

self-identified as black Negro or

African American the culpable party for

making the payment is the United States

government the magnitude of the payment

must be sufficient to eliminate racial

wealth differentials within the course

of a decade like to add finally that the

corona virus epidemic only further

dramatizes the case for reparations

we’ve observed excess mortality on the

part of black Americans we’ve observed a

collapse in black businesses in black

employment opportunities and we’ve

observed a high degree of crisis in

terms of opportunities for education as

our instructional environment has

shifted from the classroom into the home

via the internet so as a consequence we

argue that it’s important to continue to

commit to the case for reparations in

the midst of the pandemic it’s always an

urgent time to adopt reparations it has

been an urgent time for a hundred two

fifty five years since the end of

American slavery where no restitution

has been

provided it’s time for the nation to pay

the debt it’s time for racial justice

and borrowing from Chloe of all dari I’d

like to say that we collectively must

become enchanted with the goal of racial

equality thank you so much sandy for for

all of that and for explaining your book

a little bit and also talking to this

moment and I think in thinking about

this moment you know obviously the

subject of reparations is not a new one

it’s something that we have been having

conversations about for a very long time

and you know I think that when you think

about what we’re experiencing right now

both related to the pandemic and

violence against the black community the

conversation often does sort of look at

reparations as a way forward and I’d

love to hear you to sort of explain why

you feel this moment might be different

from others in making progress towards

towards this I think that there has been

a shift in the terrain that became

evident in 2019 even prior to the corona

virus pandemic and prior to the

widespread recognition of the phenomenon

of anti black police violence which the

black community has been well aware of

for for a long long time even prior to

that I think in 2019 there was a signal

shift in the in in the environment with

respect to attention that’s being given

to reparations I’m not sure how to

explain why that was the case but for

the first time in my lifetime we had

serious and credible political figures

who were contesting for the presidency

of the United States actually uttering

the term reparations and potentially

talking about whether or not there would

be the grounds for introducing some sort

of study commission for reparations

through congressional legislation that

had never happened before in my lifetime

and it seemed to me in 29

that the nation was having the most

animated conversation about reparations

at on the political stage that had ever

taken place since the Reconstruction era

in the United States so I think that the

more recent chain of events has produced

greater momentum for serious

consideration of this idea I think

people are no longer dismissing it out

of hand I think they’re trying to think

about what the consequences would be for

our nation of adopting a reparations

program for black American descendants

of slavery in terms of our moral future

as well as our social future

collectively and so the the idea of

reparations of course stems from this

this concept of forty eight percent of

you will write that during that the

abolition of slavery after the abolition

of slavery rather freed slaves would

receive forty acres and a mule promised

that the government of course never made

good on and so I let’s look into some of

the details of the plan that you put

forward in terms of thinking first about

what the value really is of that forty

acres in a mule today so in other terms

you know how do you quantify the full

debt that you believe is owed to

descendents of American slaves in 2020

so the the moment of the failure to

provide the forty acres is really is

really a critical epoch in American

history you know I think it shapes the

the basis for the immense racial wealth

gap that we observed today so if we

start with the moment and the immediate

aftermath of the civil war where the

formerly enslaved were promised forty

acre land allotments the minimum

estimate of what that that amount of

land should have constituted would have

been about forty million acres what

happened initially was about four forty

thousand of the formerly enslaved

individuals were settled on four hundred

thousand acres out of the allotment the

General Sherman had had specified in

special orders number fifteen which came

closer to five point three million acres

stretching from South Carolina

to northern Florida but only only

400,000 acres were actually ever settled

and toward the end of 1865 Andrew

Johnson Lincoln’s successor after

Lincoln was murdered Andrew Johnson

reverses the policy of settlement of the

formerly enslaved altogether and

restores the land to the former slave

holders now at the same time the

homestead acts were being activated in

the United States providing large tracts

of land to white settlers in the western

part of the United States on tracts of

land that had been appropriated and

seized from the Native American

population in fact those allotments were

a hundred sixty acre allotments and we

estimate today that anywhere from forty

five million to ninety million Americans

are beneficiaries of those allocations

because of the intergenerational effects

of wealth transfers so so this is the

starting point we could use the present

value of the forty million acres as an

estimate as a lower bound estimate of

what the magnitude of a reparations bill

should be and in the work that we’ve

done this comes to approximately four to

six trillion dollars depending upon

which interest rate you use to compound

to the present but in the work that we

do we also argue that what’s really

critical is to address the gaping racial

wealth gap of black white wealth

differential and to do that it would

require somewhere in the vicinity of ten

to twelve trillion dollars at the low

end estimate of what would be required

for for erasure of that of that

differential well and then from that ten

trillion dollars we’re talking about

individual payments or payments are the

two individuals this is not about money

being funneled into two programs but

actual checks that individual

descendants of American slaves would

receive is that right yes so the idea

here is that if you’re going to

the racial wealth differential you have

to do it by by taking the precise step

of providing direct payments to the

individuals who are eligible if you go

the indirect route you will have a

dilution of the delivery of the

resources to the individuals who deserve

them or merit them so for example if you

pursued some sort of neighborhood based

or community based operation in a world

in which gentrification is running

rampant it would be very difficult to

ensure that the resources would go to

the folks who are supposed to receive

them so so yes one of the central

objectives of a reparations program is

to provide direct payments to the

eligible recipients I’m certainly

open-minded about the prospect of having

other kinds of programmatic initiatives

that could be that could be pursued for

example providing resources and funds to

historically black colleges and

universities might be a potential option

of what could be done with the

reparations fund but for substantive and

symbolic reasons the preponderant use of

the funds must be direct payments to

eligible recipients and let me add when

when I talk about payments I don’t

necessarily mean cash payments per se

the objective is to eliminate the racial

wealth gap so what you really want to do

is to build assets for black Americans

and those assets could be could be built

in the form of trust accounts or

endowments not necessarily in the form

of outright cash payments so so there

they’re a number of options in the way

in which you could provide individual

eligible recipients with the resources

from a reparations project and I mean I

think one of the big questions for a lot

of people is sort of where where do we

see find this money are you do you

anticipate that it’s on the weight of

tax dollars is this something that is

you know rerouted from other programs

where do we get the money so I think

that I start with a rejection of the

scarcity principle

that underlines the view that you have

to take money from pot a to produce

money for pot B I think that our most

recent experience with the overnight

provision of approximately two and a

half trillion dollars to try to cope in

some way with the coronavirus crisis

indicates that the federal government is

not constrained by tax payments to

proceed with making new expenditures so

so from my perspective the government

can simply set up a program of

reparations payments and create the

resources or create the funds that would

that would address the needed amounts

you could do it over a period of years

to make the annual Vig not quite as high

you could do it over the course of a

decade for example but there’s there’s

no there’s no tax based constraint or

revenue based constraint on the capacity

of the federal government to make

additional expenditures the only

substantive constraint is the potential

for producing high rates of inflation

and so you would necessarily have to

design a reparations project or any new

expenditure program in such a way that

you mitigated the inflation risk but

that’s the only barrier and so I don’t

see us having to cut off cut off other

programs or avoid other kinds of

valuable initiatives for the purposes of

financing a reparations project now I

want to get into some of the the

criticisms of not just your plan but

reparations in general but first let’s

some a second question from audience so

Paul Rucker asks full reparations work

if the current system stay in place

seems like payment for reparations up

payment of reparations excuse me would

quickly go back to the white community

so there was a sketch on Dave Chapelle

show when it was still on the air

and which reparations were given to

black Americans and all the money flowed

back to white American corporations

because of their there was no

infrastructure of black businesses that

folks could actually purchase on

purchase products from so so one

response to this question is the money

wouldn’t quickly go back to the white

community if a an important aspect of a

reparations project was the development

of of black businesses or black

enterprises so that’s one one answer the

second answer is associated with the

point that I made a moment ago that

there are multiple ways in which the

payments could be made and if the

payments are made in the form of an

endowment or a trust or or what we call

in more technical language and economics

less liquid assets it’s kind of a clumsy

term but that’s that’s what we say if

the if the payments are made in that

form you wouldn’t have the money flowing

out to any one in in in an instantaneous

fashion people would have would have to

make more discrete decisions about how

to use the funds and when to use the

funds and so you potentially could have

resources being devoted by individual

black Americans to infrastructure

development within the black community

where there would be an opportunity to

actually purchase purchase goods and

services from from other members of the

black community so so I think you know

it’s it’s a question of whether or not

you have a black business infrastructure

and it’s a question of whether or not

the payments are made in such a way that

they’re not outright cash payments that

flow immediately out of people’s hands

you know one of the things that’s really

compelling for me in talking with you is

that I know that you were at one point

not supportive of the idea of

reparations and so I’m curious to hear

what sort of made you skeptical and what

changed your feelings so around 1989

an economist named Richard America

approached me about writing the

introduction to a volume that he had

assembled where he had requested a group

of economists to construct estimates of

the magnitude of a reparations program

and at the time I told Richard well you

know I think reparations is something

that’s ethically ethically sound but I

don’t think it’s ever gonna happen that

this is something that’s really in the

vein of speculative fiction and it’s

just not going to occur so why are we

going to invest time and trying to

trying to work on a reparations project

or collect essays about how much it

would actually cost and Richard said to

me and with with great wisdom I didn’t

realize the depth of the wisdom at that

time but he said read the essays and

write whatever you choose to write but I

want you specifically to write the

introduction so I proceeded to read the

essays and the more that I read the more

that I became convinced that not only

was a reparations project for black

American descendants of US slavery

something that was vital to do from a

moral standpoint but it was vital to do

from a practical standpoint and that

even if the odds were extremely long of

actually having a reparations program

come into realization that it was

something that I was obligated to pursue

and so it was in the process of working

on Richards book which was later called

the wealth of races that I came to the

point where I began to say that I had to

do research and I have to do advocacy

work in favor of reparations climbing

land let’s talk a little bit of I think

about some of the criticisms that people

do have of reparations you know I think

first one of the big ones you hear is if

if this is a way to

close the wealth gap you know is it

really fair that you know descendants of

slaves who have earned themselves into

the 1% would also be eligible to receive

these checks and how do you respond to

to those who say that could you clarify

Whitney what you mean by 1% I’m not sure

that I understand yeah I mean so

basically just if you’re thinking about

the Oprah Winfrey’s of the world the you

know descendants of slaves who are you

know millionaires and billionaires and

you know how can you justify payments

for those so a reparations project is

not an anti-poverty program it’s an act

of justice restitution that has never

been paid before and so there is no

criteria associated with the conditions

of living eligible recipients that

should block them from access now if

individuals like and Oprah Winfrey said

I’m so wealthy this this payment really

is not of importance to me I’d rather it

go to somebody else

that’s their discretion but they

certainly are eligible to receive it

when reparations payments were made to

victims of the Holocaust by the German

German government there was no inquiry

about the economic status of the

eligible recipients when reparations

payments were made to japanese-americans

in the United States to compensate to

some to some degree for their unjust

incarceration during World War two no

one asks how much is that particular

individual earning or how much are they

worth before they were we’re given their

$20,000 payments so so I think the same

is true here this is not a matter of how

well individual black people are doing

today this is a matter of the collective

difference in black wealth and white

wealth and that’s what has to be spanned

and any black American who is a

descendant of persons who was

we’re enslaved in the United States is

eligible to receive it it should be a

matter of their discretion as to whether

or not they take it and then for those

who also think you know this money maybe

we’ll be better served if it were funded

into social service service programs you

know if you’re thinking about money that

might support failing education systems

or think about money that might support

police perform in other ways that sort

of prevent black Americans from

attaining and maintaining wealth what

are your feelings about that so none of

those approaches that I’ve seen

particularly kind of social programs and

some grandsons Universal programs of

redistribution none of the ones that

I’ve ever seen would meet the task of

eliminating the black/white wealth

differential in the United States none

of them have the capacity or the

wherewithal to erase the black/white

differential and wealth and so there’s

there simply not sufficient they’re not

enough and and I’m particularly taken by

the emphasis a lot of people want a

place on providing resources for

education and as as a university

professor of course I’m fairly

passionate about educational attainment

I’d be a hypocrite if I wasn’t but but

in terms of thinking about the racial

wealth gap educational attainment

doesn’t hold much promise at all and see

here’s a notorious statistic that I

think is very telling on this score

black heads of households with a college

degree have 2/3 of the net worth of

white heads of households who never

finished high school so you’re not going

to eliminate the racial wealth gap

simply by giving black people more and

better education because you’re not

going to interrupt the intergenerational

transmission effects that are associated

with moving resources from one generator

to the next if you continue to have a

community that doesn’t have any

resources to transfer to subsequent

generations and let’s take another

question from the audience so amma asks

i’m concerned about proving eligibility

not because of the challenges of being

able to track down genealogy records but

also because of the exclusion of members

of the African Diaspora who have lived

live in the United States can you speak