Approximating Reparations

In the spirit of Martin Luther King Day, I recommend that all who have not already done so read Ta-Hehisi Coates The Case for Reparations. It is grim reading at times, but a must read for those in denial.

What I find particularly appealing about the article is that his case is fundamentally conservative. He opens his article with quotations from Deuteronomy and John Locke’s “Second Treatise.” These are hardly socialist works to say the least. A by-the-letter Constitutionalist conservative who finds parts of the Civil Rights Act to be unconstitutional should still be moved.¬† Whereas forcing private businesses to abide by the 14th Amendment is technically unconstitutional, having the government provide reparations for violations of the 14th Amendment is not.

And for the libertarians in the audience, I would note that egregious rights violations without compensation is a greater violation of the Zero Aggression Principle than collecting the taxes required to provide reparations.

There are some reasonable objections. One could claim that the statute of limitations has run out, that the generations that committed the crimes are now in nursing homes. One could argue that reparations payments today would be paid by the innocent. There is the very real worry that instead of promoting a national healing, debating the issue of reparations openly would stir up old grievances. Given the ongoing grievance industry on college campuses today, this objection has the most merit.

In theory, reparations done right should kill the grievance industry. Reparations should be a lump sum — or a fixed set of divided payments. Once paid, the issue should be officially closed.

But trusting the political process to do the right thing is a dangerous gambit. Having the government officially verify people’s racial categories¬† in order to divide out the reparations can lead to future troubles.

If you wish to proceed anyway, you have my blessing, but my support is likely to remain passive.

Instead, allow me to recommend a less politically dangerous, albeit imperfect, alternative: free money for everyone. The case for reparations has an economic component as well as a justice component. Many people are still trapped in poverty due to past injustice. When an entire community is poor, there is no place other than government or charities to look for a hand up. Free money for everyone provides a substitute for the inheritance missing due to past injustice. It is capital to start a business, have a down payment for a home, or simply start up one’s career without undue debt. It is a bouncy safety net that allows one to take financial and career risks which are potentially profitable.

It is not welfare. Welfare requires proof of need. This motivates the wrong actions, and the wrong mentality.

Nor is it a narrow benefit. As Mr. Coates observed, supposedly progressive policies in the past were designed to bypass the negro population. FHA loans and the home mortgage deduction were benefits aimed at the white population. As libertarians point out, when the Agricultural Adjustment Act of 1933 paid farmers not to plant, it paid farm owners. Sharecroppers lost their livelihoods.

A citizen dividend is property, it is a share of the gigantic corporation known as the United States of America. I don’t know how big we can make this dividend. Suppose we go pessimistic and limit it to $500/month. That is $6000/year. Assuming a 4% return on investment in the stock market, this is the equivalent of $150,000 in wealth. If we succeed in doing something in the higher end, say $1000/month, we are now talking the equivalent of $300,000 in wealth. Adequate compensation? You decide.

For those who have prospered despite past injustices, the windfall will be less. The free money comes at the expense of tax breaks. For those people, U.S. citizenship has proven valuable despite past injustices. Free money for all makes U.S. citizenship valuable for all citizens.

Finally.