This June, the House Judiciary Committee finally debated HR 40, which would form a commission to study the legacy of slavery on U.S. society — and how to make reparations for it.
Opponents of reparations, like Sen. Mitch McConnell, argue it doesn’t make sense to address old grievances this way. But for those of us who support reparations, it’s not about ancient history. We’re looking for policy to address today’s divisions — and create a better future for the entire nation.
The legacy of slavery is a history of racial wealth inequality that started with the foundation of this nation: Black people in this country were used as wealth, and denied any opportunity to build their own. That legacy continued through segregation, redlining, mass incarceration and other policies that have left an enormous racial wealth divide today.
That divide is where history shows up in the present. There’s no myth of hard work or deservedness that can justify why white median wealth in the United States is 41 times median black wealth. Or that the home-ownership rate for whites today is 70%, compared to just 40% for blacks.
These differences are the result of our centuries-old failure to make economic atonement for slavery and all the other policy violence that followed. Policy created the racial wealth divide, and we need policy to fix it.
Still, prosperity is hardly shared uniformly. White people with little in the bank to show for their racial advantage may see this as a reason not to support reparations. If they never owned slaves — and neither did their ancestors — why should they, as taxpayers, have to pay?
It’s not an unfair question. On the one hand, all white people in this country benefit from a social and economic infrastructure that was built on black exploitation. On the other, they don’t all benefit equally.
Real wages have been stagnant for over half the population of any race, as wealth has concentrated in fewer hands over the last four decades. Today, the wealthiest 400 billionaires in the United States have as much wealth as the entire African American population — and over a quarter of all Latinx households — combined.
The biggest bill for reparations, then, can go to the ultra-wealthy Americans who’ve benefited most from this inequality — who are, not accidentally, almost entirely white. With that in mind, several concrete mechanisms could fund a national Reparations Trust Fund.
The first is a graduated tax on wealth and inherited assets.
Sen. Elizabeth Warren, for instance, has proposed a 2% annual tax on wealth over $50 million, with the rate rising to 3% on wealth over $1 billion. Such a proposal would generate an estimated $2.75 trillion over the next decade. A progressive tax on inheritances over $10 million, meanwhile, would also generate substantial revenue, almost entirely from extremely wealthy families.
Second, we propose hefty penalties on wealthy individuals and corporations that hide their wealth offshore or in complicated trusts to avoid taxation. Part of the austerity many of our communities face is the result of the 8 to 10% of all global wealth that’s now hidden offshore. A tax on wealth and stiffer penalties on tax dodging would benefit all workers, not just those who face racial exclusion.
A third source of financing would be to fix the tax code. The United States currently provides more than $600 billion a year in tax subsidies — such as home-ownership subsidies and retirement savings programs — that overwhelmingly benefit the wealthiest households. Shifting these expenditures toward wealth-building programs for low-wealth people would have a monumental impact.
The conversation centered on reparations is truly reflective of the struggle this nation has always had in living up to its ideals and admitting its past and current sins.
White wealth in this country was built by slave labor on stolen land. Until we face the reality of our history — and our present — our society will continue to be marked by arrested development, unequal opportunity and an immoral, living legacy of white socio-economic supremacy.
The greatest beneficiary of America finally investing in reparations won’t be only the low-wealth population that deserves this investment. It will be the moral foundation of our country.