I’m an African American baby boomer. Like many of my peers, I’ve watched the millions protesting in the U.S. and around the world for racial equality in recent weeks and felt gratified. Even though we’ve been having the same conversations about race for decades, it feels like something has shifted — the status quo feels untenable, and ideas that once seemed like thought experiments seem not only possible, but perhaps necessary corrections.
If it’s going to be different this time around, we need a bolder stroke, and that should include a nationwide conversation around reparations.
I’m not a political activist — I’m a businessman. I’ve benefited from the “affirmative action” policies of the 1970s in my long corporate career. And over the years, I’ve watched commitments to advancing racial equity come and go. After all that, we’re left with a lopsided world where white people have some 10-20 times the net worth of Black people and we are severely underrepresented in white collar jobs in general. And the list goes on: There aren’t enough Black owned businesses, Black CEOs, or Black board directors. The effects of these inequities can be felt throughout the whole of the U.S. economy, too:A McKinsey racial wealth gap analysis estimates a $1 trillion negative impact to GDP using econometrics modeling.
So, let’s keep the emotion out of it and review some facts. To start, our collective memory of African slavery in the U.S. has faded. Most American immigrants to this country arrived after the Civil War had ended. The original Civil War restitution promise of “40 acres and a mule” was never delivered to newly freed slaves. And the descendants of these African slaves lived through everything from Jim Crow laws to lynchings, housing segregation, police brutality, mass incarceration and much more. Even the important and hard-won gains from the 1964 Civil Rights Act and the 1965 Voting Rights Act didn’t right these systemic wrongs.
For decades, fragmented public and private sector efforts have been unable to mobilize enough resources to truly move us closer to racial equality. It is encouraging to see new and necessary conversations emerge around criminal justice and police reform. But it can’t stop there — we need to more formally recognize racial disparities in educational opportunities, jobs, and home ownership. Companies and Boards of Directors need a firm position on racial equity and the role of public policy as part of their corporate social responsibility agenda. In my view, that should include public support for reparations. I believe a strong reparations program would accelerate economic growth and kickstart a new era of public discussion around racial equality and anti-racist policies. But to get there, we need a broader discourse on what reparations are and why they make sense.
Arguments for reparations have been made for years, and there’s more than one vision for what shape they might take. So, if you’re not well informed — or if you’re skeptical — about the idea, consider this a reading list for getting up to speed on some of the arguments and program proposals I find most useful:
“Why We Need Reparations for Black Americans,” from the Brookings Institute: This report from April 2020 walks through key historical background and reviews some of the common aspects of reparations proposals, including:
- Direct Cash Payments to Descendants of African Slaves
- College tuition remissions
- Student loans forgiveness
- Housing down payment grants and low interest loans
- Business start-up capital and investments
From Here to Equality, by William Darity and A. Kristen Mullen: In a comprehensive analysis of reparations and the economic impacts of slavery, Duke University Professor William Darity Jr and A. Kristen Mullen write in their book about the three essential elements of a reparations program. This June 2020 essay in Nonprofit Quarterly is an excerpt from the book and outlines some details on how a program might be managed. Their plan includes:
- Acknowledgement, including a national apology
- Redress or restitution
- Closure and atonement
They explain: “Specifically, restitution for African Americans would eliminate racial disparities in wealth, income, education, health, sentencing and incarceration, political participation, and subsequent opportunities to engage in American political and social life.”
“What Is Owed,” New York Times Magazine essay by Nikole Hannah-Jones: This in-depth essay published in June 2020 explores the full historical case for reparations. It builds on the magazine’s 1619 Project, which re-examines the legacy of American slavery.
Ms. Jones writes: “Freed people, during and after slavery, tried again and again to compel the government to provide restitution for slavery, to provide at the very least a pension for those who spent their entire lives working for no pay. They filed lawsuits. They organized to lobby politicians. And every effort failed. To this day, the only Americans who have ever received government restitution for slavery were white enslavers in Washington, D.C., who were compensated for their loss of human property.”
“The Case for Reparations,” The Atlantic essay by Ta-Nehisi Coates: This groundbreaking 2014 article carefully details housing discrimination practices in Chicago and how government programs including the New Deal and GI Bill after World War II actively discriminated against Black people.
Mr. Coates writes: “And so we must imagine a new country. Reparations — by which I mean the full acceptance of our collective biography and its consequences — is the price we must pay to see ourselves squarely. The recovering alcoholic may well have to live with his illness for the rest of his life. But at least he is not living a drunken lie. Reparations beckons us to reject the intoxication of hubris and see America as it is — the work of fallible humans.”
Arguments from Black business leaders: There are two statements that I find particularly important. First BET Founder Robert L. Johnson has challenged business and government leaders to consider $14 trillion in reparations and wealth transfer to the descendants of African slaves to close the wealth gap: “I’m calling for reparations and asking for two things. First, that white Americans recognize that reparations is a payment to atone for the largest illegal wealth transfer in this nation’s history; and second, to understand that the phrases equal justice and economic equality will ring hollow to Black Americans until they are made whole.” You can read more on how he reached that number in this essay.
And Robert Smith, the CEO of Vista Equity Partners, has proposed a corporate “2% solution,” which includes funding Black-owned banks and businesses. In his vision, 2% of net income of the nation’s largest corporations (approximately $25 billion annually) would be invested over the next 10 years. This effort would provide much needed capital to minority communities. While not a public policy route per se, a recent Forbes article describes the effort this way: “Smith argued that pumping in what he described as “reparative” capital and investing directly in financial architecture would be a fast way to advance economic justice for Black Americans. ” Such an idea isn’t just theoretical — Netflix has announced a $100 million commitment to a similar type of approach, where the company would bank a portion of its holdings with lenders who focus on Black communities.
When it comes to government action, as of this writing, Congress has stalled discussions on HR 40, a bill that will “study” the issue. But momentum is building elsewhere. The California State Legislature overwhelmingly passed a bill for a task force of scholars to analyze the economic benefits of slavery to owners and businesses and report back to the assembly. (Interestingly, California was not a slave holding state.) The U.S. Conference of Mayors also has included reparations analysis and congressional lobbying on its 2020 agenda. And earlier this month, the Asheville, North Carolina city council, voted 7-0 to take action to provide its Black residents reparations in the form of community investments. State legislatures and city councils should take up similar votes throughout the country.
I’m hopeful that people and corporations can move beyond incremental change and help drive needed policy action. National healing and reconciliation is the goal. The world is watching — and, I hope, actively encouraging us to succeed.
