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The Many Problems with Race Reparations in the United States (Part Two)

(Gabrielle Demczuk/The New York Times via Redux Pictures)

The analyses attempting to quantify reparations, cited above, will likely encounter strong and ongoing resistance, if only based on the price tag alone.”

Editor’s note: The following constitutes the second installment of a two-part piece on the topic by Jonathan Church. The first installment can be found here

Two Models of Reparations: Tort Model (Corrective Justice) and Atonement Model (Distributive Justice) 

In his 2004 book Atonement and Forgiveness, Roy Brooks devotes chapters four and five to two principal models for reparations discussed in the literature: the tort model and the atonement model. On the tort model, he writes:

“Whether white or black, opponents as well as proponents of the black redress movement typically conceptualize the question of slave redress through what can be called the ‘tort model.’ Although it can appear in legislative form, the tort model is primarily a litigation approach to slave redress. It operates upon a certain set of premises—compensation and, for some proponents, punishment or even white guilt. Many proponents of the tort model would be satisfied if the government or a private beneficiary of slavery were simply to write a check for X amount of dollars to every slave descendant. In response, some white Americans, such as the neoconservative Charles Krauthammer, would gladly have the government write that check as a means of closing the books on the American race problem—a kind of justice on the cheap.”

In contrast to the tort model, which is rooted in corrective justice, Brooks favors an “atonement” model, which is rooted in distributive (what he calls restorative) justice:

“Some might say that racial reconciliation is unnecessary or the the past should remain buried. These good people miss many points. They miss the point that the federal government committed a horrific racial atrocity for which it has never apologized. They miss the point that the government has little credibility on racial matters with the great majority of its black citizens. They miss the point that black Americans continue to suffer the lingering effects of slavery and Jim Crow. They miss the point that it is all about due respect—as one of the architects of Los Angeles’s slavery disclosure ordinance has said: ‘I don’t want a check. I just want fairness.'”

This path to slave redress—the atonement model—embraces the core belief that redress should be about apology first and foremost. It rejects the tort model’s preoccupation with compensation and punishment. Focusing on compensation before apology is the moral equivalent of placing the cart before the horse. And the attempt at punishment slakes the appetite for revenge but does little to foster racial reconciliation in a society like ours.

Atonement, then, is defined here as apology plus reparations.

After further sketching the moral anatomy of an apology as a foundation of atonement, Brooks describes what reparations under an atonement model would look like. Emphasizing that reparations are necessarily “asymmetrical,” he writes that “[o]nly victims of the atrocity are eligible to receive a reparation.” He proceeds to delineate the details of what reparations would look like.

To begin, he provides a preliminary definition of corrective justice and distributive justice by distinguishing between compensatory and rehabilitative reparations:

“Compensatory reparations are directed toward the individual victim or the victim’s family. They are intended to be compensatory, but only in a symbolic sense; for nothing can undo the past or truly return the victim to the status quo ante. In contrast, rehabilitative reparations are directed toward the victim’s group, or community. They are designed to benefit the victim’s group, to nurture the group’s self-empowerment and, thus, aid in the nation’s social and cultural transformation.”

With this distinction in mind, he describes his two preferred components of rehabilitative reparations which constitute the atonement model:

“The two rehabilitative reparations I favor most are a museum of slavery and an atonement trust fund. The former would be a memorial to the slaves, and the latter would be a governmental response to some of the capital deficiencies today’s have inherited from their ancestors.

My second proposal is the atonement trust fund. As envisioned here, the federal government would finance, and reputable trust administrators selected by prominent black Americans would administer, a trust fund for every newborn black American child born within a certain period of time—five, ten, or more years. The Supreme Court seems to view racial progress in increments of twenty-five years, a generation, but the eligibility period can certainly be negotiated. The purpose of the trust fund is to provide a core group of blacks with one of the most important resources slavery and Jim Crow have denied them—financial capital, family resources, or an estate, handed down from generation to generation. Subject to the restrictions mentioned in a moment, each black child within this group would receive the proceeds from the trust fund annually or upon reaching a certain age. He or she would then have the financial wherewithal to take a meaningful step toward a successful future, including enrolling in and graduating from college. The atonement estate would also be earmarked for elementary and secondary education, allowing parents to take their children out of inferior public schools.”

Forgiveness by the black community is another key component of the atonement model. However, for purposes of developing a reparations policy guided by the principle of distributive justice, Brooks’s “atonement trust fund” establishes a clear material benefit for the descendants of victims upon which people can express their support or opposition through how they vote for the political leaders who would then be responsible for enacting the necessary legislation. The trust fund stands in contrast to “writing a check” as part of compensatory reparations guided by the principle of corrective justice (though “only in a symbolic sense; for nothing can undo the past or truly return the victim to the status quo ante”).

Brooks provides us with an informed overview of what a tort model and atonement model of reparations would each look like, grounded on principles of corrective and distributive (restorative) justice, respectively. But he does not provide a clear-cut price tag on the cost of either plan. William J. Darity, Jr. and A. Kirsten Mullen, however, review several proposals of reparations that directly attempt to quantify the price tag on reparations.

Like Brooks, they urge a legislative rather than judicial approach, stating that “the invoice should go directly to the U.S. Congress.” Arguing against the judicial approach, they write:

“Jurisdiction over the matter of black reparations should be removed from the judicial system for three fundamental reasons: (1) Lawsuits brought against corporations, colleges, and universities for their participation in slavery are unlikely to succeed because slavery was legal at the time that they engaged in the practice. Their activities were undoubtedly immoral, but they were not illegal at the time. (2) In order to sue the U.S. government for reparations for the continuation of racial violence and discrimination in the post-Civil Rights legislation era, one would have to establish that U.S. government agencies knowingly and intentionally did not enforce the new laws. This would require an effort of Xena-esque proportions. (3) The courts do not have the capacity to implement or enforce any legal mandate they might hand down for black reparations.”

Next, after advancing “two criteria to determine eligibility for a black reparations program” ((1) “U.S. citizens would need to establish that they had at least one ancestor who was enslaved in the United States after the formation of the republic,” and (2) “they would have to prove that they self-identified as ‘black,’ ‘Negro,’ ‘Afro-American,’ or ‘African American’ at least twelve years before the enactment of the reparations program or the establishment of a congressional or presidential commission ‘to study and develop reparations for African Americans’—whichever comes first.”), they ask: “How much should be paid for black reparations? What is the size of the bill?”

There is no one definitive answer, but the methodological approach common to “[s]everal strategies [which] have been advanced for calculating the monetary value of a reparations bill” would “require a present-value calculation for unpaid wages, the purchase prices of the human property, or the land promised to the formerly enslaved.” The basic framework is in accord with discussions above about comparing incremental value as a function of the difference between but-for and actual worlds.

For example, Roger Ransom and Richard Sutch define “slave exploitation as the difference between the value of what was produced by enslaved Africans and the value of what was given to them for maintenance in the form of food, shelter, or other consumption items.” In other words, “Ransom and Sutch sought to calculate the pure profit of the slave system to measure an appropriate bill for reparations,” and come up with an “estimate over the interval of 1806 to 1860 compounded to 1983 [which] came to $3.4 billion.” Darity and Mullen extend the compounding to 2018 “at 4, 5, and 6 percent interest rates,” arriving at new estimates of “$14 billion, $19.7 billion, and $27.7 billion, respectively.”

These estimates are on the “lowest bill for black reparations among those [Darity and Mullen] examine” and, according to Darity and Mullen, are also “problematic for at least three reasons: it excludes the profits from slavery during the first thirty years of the nation’s existence; profits from the slave trade are not taken into account; and astonishingly, those enslaved are charged with the maintenance expenses of their own coerced labor.” Charging slaves for their maintenance expenses is indeed perverse under conditions of coercion, but it is not necessarily ill-aligned with the basic accounting of cost-benefit analysis in arriving at an estimate of incremental value. Is there a more refined approach? Darity and Mullen describe economist Larry Neal’s procedure:

“Neal’s procedure also charges the enslaved for their own maintenance expenses but is slightly different from the Ransom and Sutch method. Neal subtracts slave owners’ average expenditure for the maintenance of each of their enslaved Africans from the wage paid to nonenslaved laborers in the interval between 1620 and 1840. Neal’s estimate comes to $1.4 trillion when compounded to 1983. By 2019, at each of the three interest rates we deploy here, present values are $5.7 trillion, $8.1 trillion, and $111.4 trillion, respectively.”

Once again, the approach is not perfect. Darity and Mullen note that Neal’s estimate “omits the twenty years immediately before the Civil War” and does not “take into account the extent to which the availability of enslaved laborers reduced market wage rates.” Neal’s estimate, however, is much more in the range of estimates provided by other analysts. The following table provides a summary:

Authors Methodology Estimate
Roger Ransom and Richard Sutch difference between the value of what was produced by enslaved Africans and the value of what was given to them for maintenance in the form of food, shelter, or other consumption items, 1806 to 1860 compounded to 1983 $3.4 billion (Darity and Mullen update to 2018: $14 billion, $19.7 billion, and $27.7 billion, at 4, 5, and 6% compound interest rates)
Larry Neal subtracts slave owners’ average expenditure for the maintenance of each of their enslaved Africans from the wage paid to nonenslaved laborers in the interval between 1620 and 1840 $1.4 trillion when compounded to 1983 (Darity and Mullen update to 2019: $5.7 trillion, $8.1 trillion, and $111.4 trillion at 4, 5, and 6 % compound interest, respectively)
Thomas Craemer multiplies the prevailing average market wage by the number of hours “worked” by those enslaved over the interval of 1776 to 1865 (which assumes “each full twenty-four hour day was stolen from the enslaved”) $14.2 trillion in 2015 at 3% (Darity and Mullen update to 2019: $15.7 trillion; using their interest rates of 4, 5, and 6%, they obtain, respectively: $16.4 trillion, $17 trillion, and $17. 7 trillion)
James Marketti income diverted from enslaved persons $2.1 trillion as of 1983 (Darity and Mullen update to 2018 at 4, 5, and 6% interest: $8.6 trillion, $12.1 trillion, and $17.1 trillion)
Darity and Mullen calculate the present value of the wealth held in property in enslaved persons, based on Judah P. Benjamin’s statement on December 31, 1860: “Our slaves…directly and indirectly involve a value of more than four thousand million dollars.” $2 trillion, $9.3 trillion, and $42.2 trillion in 2019, based on compound $4 billion in 1860 at interest rates of 4, 5, and 6%. This would result in per capita reparations for 40 million black Americans today of $50,000, $232,000, and $1,050,000
Anuradha Mittal and Joan Powell calculate the present value of total value of the projected distribution of land to the freedmen after the Civil War, estimated at $400 million in 1865 $168 billion, $733.2 billion, and $3.1 trillion at 4, 5, and 6% interest, respectively
Darity and Mullen “At the time of emancipation, some observers interpreted each of the freedmen as being eligible to receive forty acres of land as an allocation. Indeed, such an allocation would have been equivalent to the average size of land grants given to white families under the Homestead Acts between 1868 and 1934″ (160 acres, or 40 acres per member of a family of four).

“This larger allocation would have led to a much higher total value of the land to be distributed to freedmen after the war…”

$671 billion, $2.9 trillion, and $12.6 trillion in 2019, compounded from $1.6 billion in 1865 at 4, 5, and 6% interest
Bernadette Chachere and Gerald Udinsky estimate monetary benefits to whites gained from employment discrimination in the interval of 1929-69, assuming that 40% of the black-white income gap was due to discrimination in the labor market $1.6 trillion (gains to whites by the mid-1980s)
David Swinton subtracts total cost of social transfer programs (Social Security, Medicare, Medicaid, unemployment insurance, and other welfare programs) from the Chachere and Udinsky estimate over the same time span $500 billion (net benefit to whites from employment discrimination by the mid-1980s)
Boris Bittker calculate the difference between black and white per capita incomes $15,973 to each black American 15 years of age and older (based on 2017 United States Census Bureau Current Population Survey estimate of mean per capital income for whites 15 years of age and over of $49,609 and $36,636 for blacks in the same age range)
Darity and Mullen calculate mean shortfall in net household wealth (net worth being “a more powerful measure of economic well-being than income”) $7.95 trillion, based on multiplying $795,000 (gap in mean household wealth by race derived from the 2016 Survey of Consumer Finance) by the United States Census Bureau’s estimate of approximately 10 million black households
Darity and Mullen calculate the amount needed to give eligible black Americans a share of the nation’s wealth comparable to their share in the nation’s population (13%) $13.91 trillion, which is 13% of nation’s total household wealth of $107 trillion in the 2nd quarter of 2018

“If, as an upper bound, black Americans are currently estimated to hold 3 percent of the nation’s wealth, that amounts to $3.21 trillion. To eliminate the difference will require a reparations outlay of $10.7 trillion, or an average outlay of approximately $267,000 per person for 40 million eligible black descendants of American slavery.”

Given these estimates in the many trillions of dollars, it would seem reasonable to expect insurmountable opposition to reparations on sheer cost alone. The size of reparations in relation to American Gross domestic product ($24 trillion), debt ($30 trillion), total personal income ($21 trillion), or total household wealth ($142 trillion) is not trivial. It also reflects an assumption that trillions in reparations would result in per capita distributions that undoubtedly would be considered too costly to many people, especially considering that the United States’ median household income is  $67,521. Nevertheless, the basic principle which guides all of these estimates is distributive reparations. For Darity and Mullen, distributive justice should be focused centrally on wealth redistribution:

“However, since today’s differential in wealth captures the cumulative effects of racism on living black descendants of American slavery, we propose mobilizing national resources to eradicate the racial wealth gap. The magnitude of ongoing shortfalls in wealth for blacks vis-à-vis whites provides the most sensible foundation for the complete monetary portion of the bill for reparations.”

After so much tallying, the question remains: how to distribute? “Outlays under the reparations program,” Darity and Mullen write, “can take multiple forms under an arrangement that can be called a ‘portfolio of reparations.'” They then run through these forms, including direct payouts allocated over time, a “trust fund to which eligible blacks could apply for grants for various asset-building projects” (homeownership, educations, etc.), or endowments for historically black colleges and universities. But whether the payment comes in the form of direct checks to black Americans or institutions relevant to black Americans, “[f]or both symbolic and substantive reasons, an effective program of restitutions must include direct payments to eligible recipients.”

There is also the question of how to fund a “program that would require a combined expenditure as large as $15 to $20 trillion.” Options include “sequencing the payments over a series of years” to facilitate financing by conventional means such as money issuance, government borrowing, or new taxes; a federally administered “reparations superfund that would pool government funding with contributions made by institutions and organizations that benefited from slavery, Jim Crow, and the continued subordination of black Americans”; and directing the Federal Reserve to fund the program in part or in total. A Reparations Supervisory Board would administer the program, with responsibilities such as staggering disbursements and distributing portions of reparations in the form of less liquid assets in order to control inflation, as well as finding creative ways to preclude any exacerbation of intra-racial inequality.

Finally, what remains is “how we create the political conditions that will lead the U.S. Congress to enact a program of black reparations.” Darity and Mullen emphasize consolidation of support within the black community, encouraging whites whose ancestors included slave owners “to build a lobbying organization to advocate…for reparations for black Americans” and challenging student activists on college and university campuses to take up the cause.

Conclusion

For reparations to have any chance of realization, it is necessary to cultivate broad public support to convince enough politicians to support the effort in Congress. This effort cannot rely exclusively on an understanding of the moral case for reparations based on either corrective justice or distributive justice. The analyses attempting to quantify reparations, cited above, will likely encounter strong and ongoing resistance, if only based on the price tag alone. Other reasons for resistance may be based on differences of opinion about the relative importance of corrective justice and distributive justice, as well as differences about the specific nature of the harm to be addressed. They may also include differences of belief on how deserving are all black Americans given both the time that has elapsed since slavery, as well as differences of opinion about the degree to which meritocracy and equality (of opportunity) currently prevail in society. In addition to differences of opinion about the relative value imputed to corrective justice and distributive justice for “legacy victims” rather than original victims, as well as differences of opinion about the degree to meritocracy and equality prevail in society, it is necessary to consider the inherent motives of people who express their support or opposition in how they vote.

When one adds it all up, the chances seem slim to none.

Jonathan David Church is an economist and writer. He is a graduate of the University of Pennsylvania and Cornell University, and he has contributed to a variety of publications, including Quillette and Areo Magazine.

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