Reparations Won't Change History, But Here's How They Can Help Close the Wealth Gap for Black Families

As California's reparations task force moves forward in an effort to atone for the past, Black families are thinking about how financial compensation can help to close the racial wealth gap more, now, than ever.

A woman waves a flag calling for reparations from the 1921 Tulsa Massacre during the Juneteenth Festival on June 19, 2021 in Tulsa, Oklahoma.
Photo: Michael B. Thomas/Getty Images

For Black families, our financial start doesn't look like others. The forced labor our enslaved ancestors rendered created a pipeline of wealth for white families, setting them bounds ahead of us. And the subsequent political discrimination, frequent seizing of Black-owned property, and denial of reparations for the history of abuse have kept us behind, creating a massive racial wealth gap.

Recently, the wealth gap has come under the microscope again, as California discusses reparations.

On Wednesday, a state task force voted to limit reparations to Black families who could trace their lineage back to the United States before the end of the 19th century. With this move, state leaders are not only deciding that reparations are something Black Americans are owed, they're linking them with the damage done during slavery. It is one of the first steps of the task force, created by Governor Gavin Newsom in 2020, to solidify a plan.

And a plan could be game-changing for Black families still facing the repercussions of a centuries-old problem.

New York Times journalist and creator of the 1619 Project, Nikole Hannah-Jones, spoke about the need for reparations for slavery at the United Nations on International Day of Remembrance of the Victims of Slavery and the Transatlantic Slave Trade.

"It is time for the nations that engaged in and profited from the transatlantic slave trade to do what is right and what is just," Hannah-Jones said. "...This is our global truth, the truth we as human beings understand with stark clarity. There can be no atonement if there's no repair."

Economist and Duke University professor William Darity Jr. says we could argue the "wealth gap begins with enslavement because Black people were treated as a source of wealth for other people, and denied the opportunity to independently accumulate wealth of their own." The 1921 Tulsa Massacre is one example of the vicious and extreme attacks on Black communities to keep us destitute and impoverished. "Wherever prosperity was visible, virtually in all of those instances, white massacres took place and not only resulted in the killing of Black folks, but also in the seizure and appropriation of their property," says Darity.

The effects of having disproportionate opportunities to acquire and maintain wealth reverberate in the walls of Black homes today.

A 2019 survey of consumer finances showed the typical white family has almost eight times the wealth of a typical Black family. That income comparison was $188,200 for median white families to $24,100 for median Black ones. This stark contrast hits hard, but the survey further revealed that Black families possess the least gross assets and liabilities (including income, land and housing) of any other racial group. And the pandemic has only intensified these wealth inequities highlighting the lack of equal footing, both socially and economically.

Reparations Are A Real Solution to Economic Disparities

Economists have estimated that, if Black Americans receive reparations, the cost to the federal government would be trillions of dollars.

"Reparations is the repair that is applied to injuries caused by institutions that attempt to acknowledge and rectify the damage that was caused," says Andre Perry, senior fellow at Brookings Metro and author of Know your Price: Valuing Black Lives and Property in America's Black Cities. "In the American context, reparations for slavery, for Jim Crow racism, and for historic discrimination has not been done."

But it could have been done.

The first promise of reparations was during reconstruction after the Civil War. General Sherman ordered forty acres and a mule to newly freed Black people. But the government reneged on the agreement and instead granted land to white Confederates. "At a point in which you could have corrected this enormous gulf in wealth between Blacks and whites, that was a product of slavery. It's precisely what did not happen," says Darity.

The U.S. government still is indebted to make up for the years of Black poverty produced by abuse and inequality. Reparations cannot blot out this history. But if handled correctly, it can create a balance in power.

Reparations Have Been Distributed To Other Groups

Black Americans aren't the only group owed for injuries caused, but many other groups have received reparations. The U.S. government negotiated over $17 billion in restitution for Holocaust survivors or their immediate relatives.

About $1.6 billion in reparations was claimed by Japanese-Americans for their mass incarceration during WWII. In 1988, over $5 million was awarded to Aleuts, who were deported to camps by the U.S. during WWII.

"America isn't anti-reparations. They're just anti-reparations when it comes to Black people," says Jamel Donnor, an associate professor who works with the Center for Racial and Social Justice.

Despite the damage to Black communities, a federal plan to offset the imbalance of power doesn't exist. "Racism is in the country's DNA. It's in the soil," says Donnor. He says that admitting to the original sin of chattel slavery doesn't sit well with the nation. Still, it's undeniable that atonement is necessary to reverse economic disparities.

Real Ways Reparations Can Close The Wealth Gap

Experts say since this wealth gap was created by racism and backed by anti-Black policies, reparations must begin with the federal government. Here are some tangible ways they can implement:

  • Land distribution: "If Black people were landowners, we would have more say in the policies that impact our lives. We would have more resources to pass on to our children," says Perry.
  • Free college tuition: Georgetown University is one college that promised to create a reconciliation fund to make amends for selling enslaved people in the 19th century to cover their debts. But the community of descendants hasn't received it.
  • Equal housing opportunities: As of 2021, only 45.1% of Black Americans are homeowners compared to 73.8% of the white population.
  • Tax-free financial compensation: Economists say eliminating this gap would cost at least $14 trillion. Because of the sheer expense, Darity says, "It's impossible for states and localities to meet this task. It has to be done by federal government."

For a long time, sections of government have been discussing reparations, like the H.R.40 bill and the Biden-Harris administration's plan to build Black wealth. But California's vote is a sign of changing times and is the closest our country has gotten to compensation for slavery yet, making many descendants of slaves hopeful about what a realized financial atonement would look like.

The truth is, it would create economic salve, giving Black families a thriving chance instead of constantly living in survival mode. And it would offer a community-wide opportunity to build lasting legacies for our children.

"Wealth predicts everything from health to education, to your exposure to the criminal justice system," Perry says. "So our lives will be fundamentally different if we would have received reparations, but we continue to remove opportunities from families every day."

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