by Latoya Peterson
The problem with April Fool’s Day is that you can’t figure out if news blasts are real, or just a joke. On April 1, I spotted a Gawker media item by Pareene, which read:
Six panelists, no black folks. One one hand, I could totally believe it, it’s the National Review – they have a track record of publishing racists. On the other hand, Gawker loves April Fools. So I held.
However, reader Jeff points out that (1) the article is still up on Gawker and (2) the National Review was serious. Oy oy oy.
In any event — and here I agree with Kevin — the way to fight non-p.c. discrimination is not by institutionalizing p.c. discrimination. And, for the same reason, public policies should be adopted on their merits, and without regard to the skin color of their beneficiaries.
Under the Davis-Bacon Act, signed by Herbert Hoover, companies building public-works projects had to pay the prevailing wage in areas where they worked — i.e., on the high side. This forced them to discriminate against less-skilled workers: Given the wage they had to pay, they need a lot of productivity. This in turn hurt blacks. So, of course, did FDR’s and Robert Wagner’s Wagner Act. The unions sometimes shut out blacks. They did a second kind of damage by driving the wage rate up. Minorities, especially, lost out. And that about sums it up for our postwar period.
Hassett argues that disproportionately high black unemployment today is the result of discrimination practiced by employers. I am not convinced that the studies he cites support his conclusion. It is true that many investigations find that “a large share of variation is unexplained by things we can measure”; it does not follow that discrimination is the likely missing variable.
Sigh. There were two points though that caught my eye:
SAMUEL R. STALEY:
On this point, Mr. Hassett’s assertion about discrimination, while valid, may be too facile. There should be no doubt that racial (and ethnic) discrimination persists in the labor market. I have no doubt that discrimination against African Americans is more persistent than that against other minorities. The key to lifting the economic fortunes of African Americans (and perhaps a clue to the persistent gap in employment) is imbuing an entrepreneurial ethic, and providing a policy climate, that allows them to offset the negative impacts of racial discrimination using their own skills and aptitudes.
This is one of those points that I both agree and disagree with. I whole heartedly co-sign entrepreneurship as a means to building personal wealth and creating job opportunities outside of the current job market. In my article for The Root on “Closing the Racial Wealth Gap,” I made sure to mention:
In 2008, the Women’s Initiative published a report called “Closing The Wealth Gap Through Self-Employment: Women of Color Achieving the American Dream,” noting: “There is a positive relationship between a client’s business development and their household’s financial well-being. For every dollar of business equity owned, Women’s Initiative clients have nearly two dollars of overall household wealth.”
This also supports the conclusions drawn by the Insight Center, which calls on the federal Small Business Administration to provide more assistance to “micro-enterprises”–small business and side endeavors that contribute to wealth building. Timmons concurs, saying “If you are only trading your time for money, you will never be wealthy.” Self-employment–even if it is a side business run after work hours–is a much-needed step toward independence from a paycheck, and can help fund other investments like property or assets that can provide a passive stream of income.
Self-employment is major. But in encouraging entrepreneurship, one needs to remember that everyone just doesn’t have the drive to become an entrepreneur. Launching and starting a new business (particularly without venture capital, which as we see, is also susceptible to discriminatory practices) is fraught with problems and issues, all related to gaining clients/customers, retaining clients/customers, and getting said clients/customers to pay for your services. For many, a dependable, steady income is not something they can do without for one to three years. So then what?
But Staley loses me when he continues:
Unfortunately, entrepreneurship appears to be declining among African Americans while it has increased for Latinos and recent immigrants. This is the missing link often ignored in employment data and trends, yet it is vital for understanding the success of individuals as well as groups.
But then I look at the decrease as explained in the Kauffman report Staley cites:
Non-Latino white business-creation rates increased slightly from 2007 to 2008 (0.30 percent to 0.31 percent), whereas African American rates declined slightly (0.23 percent to 0.22 percent).
So, at the beginning of the recession, the was a 0.01 percent decline in new business creation by African Americans. They dropped that quote like it was statistically significant. (And with the not so subtle insinuation that African Americans just aren’t working with what they have.)
Staley never engages with another point, one that also intrigues me: even if 100% of African Americans were committed to entrepreneurship, does that mean we shouldn’t fight to end discrimination in hiring and the workplace? In the context of the whole piece, Staley’s comments reinforce the idea that discrimination is unfortunate, but unpreventable. And this, I do not believe. So while entrepreneurship is a major part of fighting for economic justice, it isn’t the only part. Not by a long shot.
Another interesting argument was lodged by Nicole Gelinas, who focused her critique less on unemployment, but more about disparities in shelter:
Kevin Hassett writes that black Americans have disproportionately suffered during the Great Recession; conservative policies could ease their suffering. The nation’s bipartisan housing policy certainly hurts black Americans by favoring home ownership at the expense of renters. As of 2005, according to the Census, 48.2 percent of black families owned their homes, as opposed to 72.7 percent of white families.
It’s not just that the federal mortgage-interest tax deduction disproportionately benefits upper-income taxpayers (a group in which black families still have low representation). The deduction offers a huge taxpayer subsidy to middle-income families who desert rental neighborhoods. Lower-income families, then, lose the benefit of having stable middle-class neighbors around.
The tax code shouldn’t discriminate between renting and owning. New York City, where two-thirds of households still rent, proves that you don’t need universal homeownership to have stable, healthy neighborhoods. You need good public safety and good physical infrastructure.
Again, I agree and disagree, but since Gelinas did not engage with unemployment, I’ll tackle this another time.
First of all, as a few people have now noted, NRO apparently couldn’t turn up a black person to join its symposium. All six members were white. This fact is aggravating because the dominant theme of the six contributions really does seem to be, “What’s the matter with black people?” You know who might have some insight on whether something’s the matter with them? Black people. Ideally, more than one — they might even have different opinions from each other!
This isn’t entirely fair: The symposium had a decent amount of substantive discussion of policy issues. Nicole Gelinas, for example, pointed out that federal policy discriminates in favor of homeownership, rather than renting, which has a decidedly racialized impact. That’s an interesting point, though it seems to undercut the argument that “discrimination” is not to blame for economic inequality. But this useful stuff is pretty mixed in with some casual, disturbing assumptions. [...]
The issue isn’t individual “discrimination” or “prejudice”; it’s systematic and structural, embedded in our institutions. The dead hand of racism in American history is behind economic inequality. It has always been that way, it goes all the way back to slavery, and it’s not really that hard to understand. The “missing variable” that Hassett is searching for isn’t something he can plug into a model. White supremacy is part of how our economy and our politics work. The only people who should be surprised by this are the people who, as Hassett suggests, hadn’t noticed that they’re still living in segregated neighborhoods, and who can’t grasp why black people won’t vote for the Republican Party.