How Reparations Fit Into New Push for Racial Justice: QuickTake

As protests against police violence against Black Americans spark larger discussions about racism, an idea long relegated to the political fringes -- reparations for slavery and the discrimination that followed -- is going more mainstream. A bill under consideration in the U.S. House of Representatives would create a commission to study reparations for the descendants of slaves. The issue also has traction in the U.K., where financial institutions have wrestled with the ways they benefited from slavery.

1. What are reparations?

The term is usually used to mean monetary compensation for widespread injustice. But it can be applied more broadly. The United Nations, which says states “are under legal obligation to provide reparations for gross violations attributable to them,” says they can take the form of restitution, rehabilitation, compensation, satisfaction (apologies) and guarantees of non-repetition.

2. What’s the issue in the U.S.?

When the federal government ended slavery in the District of Columbia during the Civil War, it paid slaveholders $300 for every emancipated slave, while enslaved people were only offered assistance if they agreed to emigrate to Africa. As he led Union armies through the South, General William T. Sherman promised formerly enslaved Black Americans 40 acres of confiscated Confederate land. President Andrew Johnson put an end to that plan in 1865, and ex-slaves never received compensation for the wealth they generated.

3. Why address that now?

Scholars William Darity and Darrick Hamilton argue that generations of unequal treatment have contributed to the disparities Black Americans face in the workplace, financial sector, health care arena and classroom. In an influential 2014 essay in the Atlantic, author Ta-Nehisi Coates described reparations as “more than recompense for past injustices -- more than a handout, a payoff, hush money, or a reluctant bribe. What I’m talking about is a national reckoning that would lead to spiritual renewal.”

4. What’s the issue in the U.K.?

The U.K. abolished slavery in 1833, but slaves received nothing and had to remain “apprentices” for several years. Slave owners, however, were compensated by the government from a fund that was equivalent to 40% of the annual budget then, a payout that amounted to multiple billions of dollars in today’s money. Researchers at UCL uncovered the slave-based origins of some the country’s most influential companies. In response, two firms, Lloyd’s of London and Greene King have announced what some have called reparations in the form of investments into Black, Asian, and minority ethnic communities.

5. Have reparations been given in the past?

Yes. Perhaps the most famous example is Germany paying reparations to Holocaust survivors following World War II. Those have varied in amount and form, but historians estimate that Germany has made over $80 billion in social welfare payments to Jewish people who suffered under the Nazi regime. In 1995, the South African government established the Truth and Reconciliation Commission to publicly confront its history of apartheid and later paid reparations to 18,000 victims who gave testimony. In 1988, the U.S. gave $20,000 to each of the 82,219 Japanese Americans who survived internment during World War II.

6. What forms might new reparations take?

The simplest would be a cash payout. Alternatives proposed in the U.S. include scholarship funds and trust funds for the descendants of the victims. Senator Cory Booker of New Jersey, among others, has suggested so-called baby bonds: annual payments into an account for children set up at birth and cashed out at age 18. Some argue that broader efforts to change the nation’s culture, such as education programs and historical markers, are important ways of reducing racism. When the city council of Asheville, North Carolina passed a resolution in 2020 supporting reparations in their community, members said they supported making investments in areas like affordable housing and minority business ownership meant to close the wealth gap.

7. How much might U.S. reparations cost?

Economist Robert Browne argued in 2000 that between $1.4 trillion and $4.7 trillion is needed to “restore the black community to the economic position it would have if it had not been subject so slavery and discrimination.” The amount is what Browne calculates as the income produced by enslaved people for their White owners prior to 1860. Yahoo Finance reporter Kristin Myers estimates a $17.1 trillion price tag on compensating African Americans for the cumulative damage of slavery, segregation and the present inequalities in American society. BET founder Bob Johnson called for reparations of $14 trillion, the amount he said was needed to equalize wealth between Black and White households.

8. What do critics of these ideas say?

On a practical level, they point out that determining who is or isn’t a descendant of the U.S. slave force would be next to impossible. Prominent U.S. Republicans such as Senate Minority Leader Mitch McConnell argue that White Americans should not have to pay for acts that predated their birth, a position seconded by Tim Scott, the only African American Republican senator.

9. What do polls show?

In the U.S., reparations has never been a broadly popular idea. In 2019, 29% of Americans believed that the government should make cash payments to Black Americans who are the descendants of slaves, a Gallup poll reported, but that number was up from 14% in 2002. In the newer poll, 73% of Black Americans supported the idea, up from a simple majority before; support among Whites went from 6% to 16%. The 2019 poll showed a partisan divide: Only 5% of Republicans supported reparations, compared with 42% of Democrats.

The Reference Shelf

• Two U.S. cities, Evanston in Illinois and Asheville in North Carolina, offer diverging models on reparations.
• Essays by Ta-Nehisi Coates in the Atlantic on “The Case for Reparations” and by Nikole Hannah-Jones in the New York Times Magazine on “It Is Time for Reparations.”
• A study by the Brookings Institution: “Why we need reparations for Black Americans.”
• Bloomberg Opinion columnist Mark Whitehouse: “Racism is America’s Pre-Existing Condition.”
• A book on reparations by William A. Darity Jr. and A. Kirsten Mullen, “From Here to Equality.”

--With assistance from Matthew Boesler.

To contact the reporter on this story:
Ryan Williams in Houston at rwilliams445@bloomberg.net

To contact the editors responsible for this story:
Jacqueline Simmons at jackiem@bloomberg.net

John O’Neill, Rebecca Greenfield

© 2021 Bloomberg L.P. All rights reserved. Used with permission.