Racism Made Black Americans Poor
Free enterprise has many virtues, but we can’t ignore that early American markets were interwoven with a race-based slave economy.
Reason magazine published a piece in their upcoming issue by economist and professor Deirdre McCloskey, “Slavery Did Not Make America Rich.” In her piece, McCloskey argues that market innovations and not slavery made America wealthy. The broader context for her argument is a growing number of economic histories that discuss American capitalism as relying on or originating with slavery. These are often cited as evidence capitalism itself is bad. McCloskey contends that, inter alia, a) slavery was not economically efficient and thus suppressed wealth creation and, b) some of these economic histories use bad data by Thomas Piketty regarding cotton’s contribution to American GDP at the time and thus overstate slavery’s contribution to American wealth today. Economists can debate those claims empirically, but whether McCloskey is right or not, her piece and those like it will likely be misused to discredit the present-day claims of American racism.
McCloskey is making an argument cabined to one specific issue about the history of American wealth creation to defend market capitalism more broadly. She was saying slavery qua slavery didn’t make America rich, which is a plausible claim in economic terms. McCloskey does not address current claims of racism or its potential effects on wealth, income, or other inequalities among races, though she does complain about the long history of assaults on capitalism from the political left.
The American political left, broadly speaking, also complains a lot about racism. Wealth and income gaps, disparities in law enforcement, access to quality education, and other public policy conversations very often come back to race. That’s because the racism that made chattel slavery possible long outlived the institution itself. America got rich at the same time it was exploiting, terrorizing, and oppressing black Americans both before and after Emancipation. This timing is undeniable, regardless of whether slavery as an institution aided or hindered economic growth in the aggregate.
Nevertheless, many people in this country have been invested in downplaying the socio-economic effects of American racism, often with specious statistics and moral assertions far removed from practical public policy. There is little to suggest that McCloskey had any intent to support such arguments, but she may have inadvertently done so. This possibility should not have dissuaded her from tackling the subject at all, as the entire premise of academic discourse is to challenge the assumptions and findings of others.
However, McCloskey did not make her argument in a political vacuum. Although American slavery is inextricably linked to American racism, she mentions neither racism nor discrimination in her Reason piece at all. The most generous reading is that McCloskey was making a limited critique of slavery’s wealth creation, but the books and scholarship she questions are fundamentally concerned with the history and legacies of slavery. Any structural analysis of outcomes should include a reckoning with the racist foundation upon which American slavery and Jim Crow were built. I do not mean to impugn McCloskey’s motives in the least, but racism is an omission so large that many reasonable readers would consider it a serious error.
Moreover, it is no secret that other self-described libertarians have been openly hostile to anti-racism in some form or another. While McCloskey addresses the Civil War issue — unequivocally distancing herself from “libertarian” revisionists who claim secession was not about slavery and that the “South was Right” by calling the war “righteous altogether” — so much remains unsaid. Because the worst recurrent themes in right-of-center writings about race and economics range from misguided tracts lamenting cultural pathology to musings about intellectual inferiority, a broadside against histories of racial exploitation adds to the perception that the liberty of black Americans remains an afterthought in the defense of market capitalism.
McCloskey and other libertarians are correct that markets need not be exploitative to function. Indeed, opening up markets around the world have dramatically reduced global poverty over the past several decades. But libertarians ought to address the fact that early American markets were interwoven with a race-based slave economy that has a legacy that far outlived its eradication in 1865. The post-Reconstruction Redemption, Jim Crow, redlining, lynchings and other race-based terrorism undoubtedly affected intergenerational wealth as well as current educational and employment disparities that cut across racial lines. If McCloskey is right that America built its wealth not because of slavery but in spite of it, the country nevertheless must grapple with its policies and institutions that put that wealth in white hands and kept it out of black ones.
