Are Impact Capitalists the Moderates Dr. King was so gravely disappointed by?
Below is a repost from an article I wrote last year on my personal blog. It still resonates with me and I wish I’d had more clarity or aha moments in the year since I wrote it.
In all truth, I’ve only become more clouded as to whether I’m one of the self proclaimed “Impact Capitalists” who Martin Luther King would have derided for their moderation in “Letter from a Birmingham Jail.”
“I must make two honest confessions to you, my Christian and Jewish brothers. First, I must confess that over the past few years I have been gravely disappointed with the white moderate. I have almost reached the regrettable conclusion that the Negro’s great stumbling block in his stride toward freedom is not the White Citizen’s Counciler or the Ku Klux Klanner, but the white moderate, who is more devoted to “order” than to justice; who prefers a negative peace which is the absence of tension to a positive peace which is the presence of justice; who constantly says: “I agree with you in the goal you seek, but I cannot agree with your methods of direct action”; who paternalistically believes he can set the timetable for another man’s freedom; who lives by a mythical concept of time and who constantly advises the Negro to wait for a “more convenient season.” Shallow understanding from people of good will is more frustrating than absolute misunderstanding from people of ill will. Lukewarm acceptance is much more bewildering than outright rejection.
I had hoped that the white moderate would understand that law and order exist for the purpose of establishing justice and that when they fail in this purpose they become the dangerously structured dams that block the flow of social progress. I had hoped that the white moderate would understand that the present tension in the South is a necessary phase of the transition from an obnoxious negative peace, in which the Negro passively accepted his unjust plight, to a substantive and positive peace, in which all men will respect the dignity and worth of human personality. Actually, we who engage in nonviolent direct action are not the creators of tension. We merely bring to the surface the hidden tension that is already alive. We bring it out in the open, where it can be seen and dealt with. Like a boil that can never be cured so long as it is covered up but must be opened with all its ugliness to the natural medicines of air and light, injustice must be exposed, with all the tension its exposure creates, to the light of human conscience and the air of national opinion before it can be cured.”
In reading this, it’s hard not to contrast the idea that we must “do well to do good” as being completely antithetical to Dr. King’s goals and vision. Does our insistence that an impact investment’s IRR match that of a “traditional” investment mean that we still continue to prioritize profit over people? Or is it a necessary evil to ensure that the impacts we seek to make are sustainable? Is the calculus that incremental progress moves the needle more meaningfully than revolutionary disruption a clear eyed response to facts on the ground or a capitulation to the mass exploitation and hoarding of late stage capitalism? Is the elite back Diversity and Inclusion director or real estate developer meaningfully different from the White moderate in wanting to maintain their socio-economic positioning when so many others suffer? Truthfully, I don’t know. But I think we ought to consider the possibilities. I hope you enjoy the read.
Originally published January 19, 2019:
This year’s Martin Luther King Jr. Day comes at an interesting time for me. For the past couple of years, I’ve been interrogating income inequality with increasing frequency. I’d love to say it’s because I’ve grown as a person and a human being, but the reality is a lot of it has simply been thrown in my face in ways that are possible to ignore. It’s inescapable. Since I moved to my Capitol Hill neighborhood in Northeast washington DC, my immediate surroundings have changed dramatically. What was an up and coming H Street corridor has turned the corner to a strip of luxury apartments and quick serve restaurants. We got not one, not two, but the full trifecta of the Whole Foods effect, Starbucks effect, and Trader Joe’s effect in 18 months. The neighborhood a block away from me has seen an even steeper curve.
Washington DC, like many coastal towns, has become a city of rich people. The household income needed to support a $700,000 house is around $150k, give or take. Per the D.C. Fiscal Policy Institute As of 2016, the median annual income for black families, $37,891, was just 30 percent of the median annual income for white families, $127,369. The black median income was also down more than $4,000 as compared to 2015. While the above graph is great news for those that were able to buy houses in DC in 2013 and 2014 and frankly, every year since, it’s a crisis for poor families. Crisis is a strong word, but that’s where we are. And its a crisis replicating itself in cities across the US. In places like Seattle, San Francisco, and Boston, it’s even worse.
If you were to ask what Dr. King would think of this, well, you’d have the answer. Because he told us. Just a year before his assassination, at a Southern Christian Leadership Conference staff retreat in May 1967, Rev. Dr. Martin Luther King, Jr. said:
“I think it is necessary for us to realize that we have moved from the era of civil rights to the era of human rights…[W]hen we see that there must be a radical redistribution of economic and political power, then we see that for the last twelve years we have been in a reform movement…That after Selma and the Voting Rights Bill, we moved into a new era, which must be an era of revolution…In short, we have moved into an era where we are called upon to raise certain basic questions about the whole society.”
The words Dr. King spoke at that retreat sparked the beginnings of the Poor People’s Campaign of 1968 and the Economic Bill of Rights. The needs the platform of 1968 addressed look shockingly similar to the searing needs of today:
- $30 billion annual appropriation for a real war on poverty
- Congressional passage of full employment and guaranteed income legislation [a guaranteed annual wage]
- Construction of 500,000 low-cost housing units per year until slums were eliminated
Perhaps the only real difference is the numbers. California by itself now has a housing shortage of 4,000,000 units. The minimum wage in 1968 was $1.60, or about $11.64 in 2018 dollars. The federal minimum wage today is $7.25. The Urban Institute has staggering data on the wealth differences by race over time.
So while it may be comforting and convenient to post hopeful quotes from Dr. King about racial reconciliation and overcoming stuff today, the real question for all of us is what will we do about it? What is our moral obligation to change this trajectory? how can we look at where things are and not become despondent? Here again, we can take some advice from Dr. King himself.
“It’s alright to talk about “long white robes over yonder,” in all of its symbolism. But ultimately people want some suits and dresses and shoes to wear down here. It’s alright to talk about “streets flowing with milk and honey,” but God has commanded us to be concerned about the slums down here, and his children who can’t eat three square meals a day. It’s alright to talk about the new Jerusalem, but one day, God’s preacher must talk about the New York, the new Atlanta, the new Philadelphia, the new Los Angeles, the new Memphis, Tennessee. This is what we have to do.”
The quote is from a speech to sanitation workers in Memphis. While Dr. King occupies a space in the public imagination as a conciliatory bargainer for some nebulous idea of racial equality, the reality is that he was a radical fighting tooth and nail for economic freedom and dignity for poor and working people. When you look at the data above, I wonder personally how much I’ve been willing to commit to that fight. Sure, I know it’s a problem. But if I’m being completely honest, as much of my career has been spent serving the interests of capital as it has serving anyone else. I ride past a building under construction in the mornings when I’m taking my son to school. It’s a building I sold to a developer who’s turning it into luxury condos. I don’t know what they’ll sell for, but I know what I sold the building for. Suffice it to say poor people won’t be living there. As 2019 kicks into high gear, I’ve decided to make some changes I’ve been thinking about for a while. As the year progresses, expect to hear more about them. Expect to hear from me asking for your expertise, your partnership, and yes, your money. These may be tough asks. After all, continued Dr. King:
“That’s the question before you tonight. Not, “If I stop to help the sanitation workers, what will happen to all of the hours that I usually spend in my office every day and every week as a pastor?” The question is not, “If I stop to help this man in need, what will happen to me?” “If I do not stop to help the sanitation workers, what will happen to them?” That’s the question.
Let us rise up tonight with a greater readiness. Let us stand with a greater determination. And let us move on in these powerful days, these days of challenge to make America what it ought to be. We have an opportunity to make America a better nation. And I want to thank God, once more, for allowing me to be here with you.”
Dr. King finished the speech with what are often remembered as his most famous public words. they were his last. He was murdered the next day.
“Well, I don’t know what will happen now. We’ve got some difficult days ahead. But it doesn’t matter with me now. Because I’ve been to the mountaintop. And I don’t mind. Like anybody, I would like to live a long life. Longevity has its place. But I’m not concerned about that now. I just want to do God’s will. And He’s allowed me to go up to the mountain. And I’ve looked over. And I’ve seen the promised land. I may not get there with you. But I want you to know tonight, that we, as a people will get to the promised land. And I’m happy tonight. I’m not worried about anything. I’m not fearing any man. Mine eyes have seen the glory of the coming of the Lord.”