The Impossibility of Reparations

Considering the single most important question about racial restitution: How would it work?
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The United States government launched its reparations program to African Americans in autumn of 1969. Originally known as “the Philadelphia plan,” the program set quotas for black employment in construction trades. Over the next decades, such quotas would spread from industry to industry, and would expand into higher education and public contracting. 

The plan is usually credited to the Nixon administration. Sometimes it’s even described as a secret scheme to split the Democratic base. The history is more prosaic. The plan originated under the Johnson administration, following President Johnson’s pledge in his 1965 Howard University speech to seek racial equality as a result, not merely as a theory.

In this month’s Atlantic, Ta-Nehisi Coates makes an eloquent case for restitution to black Americans, not only for wrongs done before 1865, but as much or more for wrongs done in the century of segregation that followed. Yet this powerful essay explicitly disavows any consideration of the single most important question about the restitution he has in mind: How would it work?

The affirmative action experience since 1969 offers some insights into what is likely to happen next:

1) The program will expand to additional groups.

Within only a very few months of the implementation of Philadelphia plan, preferences of various kinds were extended to women, Hispanics, and other groups. With any program of reparations, likewise, other claimants will come forward. If African Americans are due payment for slavery and subjugation, what about Native Americans, who lost a whole continent? What about Mexican-Americans, who were deprived by the Mexican-American war of the right to migrate into half their former country? Japanese Americans, interned during World War II? Chinese Americans, the victims of coolie labor and the Oriental Exclusion Acts? Members of these groups may concede that they were not maltreated in the same way as African Americans—and may not be entitled to exactly the same consideration. But if black Americans are entitled to almost a trillion dollars in compensation (Coates suggests a figure of $34 billion a year “for a decade or two”) surely these other maltreated groups must be entitled at least to something?

Coates’s essay is built on an unstated assumption that America’s racial composition is essentially binary, a white majority that inflicts inequality; a black minority that suffers inequality. Others enter into his imagination only at the hazy edges: "One cannot escape the question by hand-waving at the past, disavowing the acts of one’s ancestors, nor by citing a recent date of ancestral immigration. … A nation outlives its generations.”

But the “others” are now 25 percent of the nation and rising fast. Does the Fujianese delivery man pedaling through the brownstones of Fort Greene owe a debt to the people whose food he carries? How much? The reparations idea—so long politically outlandish—has become thinkable today because of the gathering power of the Obama political coalition. But nothing would blow that coalition apart faster than the internal redistribution Coates contemplates from some constituencies to others. And if the idea is that the newest arrivals to America will be persuaded to accept paying reparations as a cost of immigration—or that new Americans can be cajoled to pay a symbolic something because the bulk of the burden will be carried by the dwindling white majority (a majority that already feels ever more culturally insecure and economically beset)—well, that’s a prescript for an even more dangerous political explosion.

2) The question of who qualifies will become ever more contested and embittered.

Under today’s racial preference rules, a nephew of the King of Spain or the daughter of the chairman of the biggest bank in Chile would both qualify for Hispanic preferences if they resided in the United States. Harvard can (and does) meet its African American diversity requirements with the children of recent African immigrants, whose families never experienced slavery or segregation in this country.

The problem of “who qualifies?” is explosive enough with hiring and admissions preferences. As the benefits at stake expand to the vast dimensions urged by Coates, the question will become more explosive yet. Does a mixed race person qualify? How mixed? What about recent immigrants from Africa or the West Indies? What about future immigrants? What about illegal immigrants from Africa who subsequently gain legalization—would amnesty come with a check attached?

3) Side effects will be large and unexpected.

Affirmative action characterizes some parts of the American economy more strongly than others, and in particular the public sector more than the private sector. This pervading fact has shaped the growth of the black middle class. Black Americans are 30 percent more likely than non-blacks to work in the public sector, where they earn higher wages relative to whites than they do in private employment. This strategy brought security to many black families in the years between 1970 and 2008.

But the strategy came at a cost.

First, the strategy tethered black economic advancement to the growth of government. That growth has become ever more fiercely contested in recent years. Since 2008, it has abruptly halted and reversed.

Second, the strategy detoured talented people away from the higher risks and rewards of the private sector, and especially from entrepreneurship. Black Americans are less than half as likely as white to own their own businesses.

A reparations plan is likely to prove even more distorting.

If paid to individuals as an income stream, reparations would dis-incentivize work.

If paid to individuals as a lump sum, reparations would expose one of America’s least financially sophisticated populations to predatory practices that would make subprime lending seem socially responsible by contrast.

If paid to institutions or collective entities … well, let’s look at that under another header.

4) The program will work severe inequities.

Affirmative action’s quirks and injustices are notorious. But they will be nothing compared to the strange consequences of a reparations program. Not all black people are poor. Not all non-black people are rich. Does Oprah have a housecleaner? Who changes the diapers of Beyonce’s baby? Who files Herman J. Russell’s taxes? Will their wages be taxed and the proceeds redirected to their employers?

Within the target population, will all receive the same? Same per person, or same per family? Or will there be adjustment for need? How will need be measured? Will convicted criminals be eligible? If not, the program will exclude perhaps one million African Americans. If yes, the program would potentially tax victims of rape and families of the murdered for the benefit of their assailants.

And if reparations were somehow delivered communally and collectively, disparities of wealth and power and political influence within black America will become even more urgent. Simply put, when government spends money on complex programs, the people who provide the service usually end up with much more sway over the spending than the spending’s intended beneficiaries. The poorer the beneficiaries, the more powerfully this rule holds—and it has held strongest of all in programs intended to aid the black poor. The District of Columbia public schools have excelled at delivering stable jobs to their unionized employees. They have failed their students.

5) The legitimacy of the project will rapidly fade.

Affirmative action ranks among the least popular thing that U.S. governments do. When surveyed, white Americans crushingly reject race preferences, Hispanic Americans object by a margin of 2 to 1, and black Americans are almost evenly divided, with only the slightest plurality in favor.

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David Frum is a senior editor at The Atlantic.

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