The economy consists of an elite
and everyone else. At times
'everyone else' has been stronger relative to the elite, at times
weaker. The elite by
definition has power over the rest.
But the economy is not so simple-- there are some who are more
elite and have more power, some who are less.
Economic power is a combination of wealth, income, status and
occupation, access to education and health care, connections, and
geographic and social mobility. These
in turn translate into political power, organization, access to media,
business and government. A
great deal of the damage done by racism is done through the economic
system. People of colour
are denied economic power, here and in many places in the world.
Having economic power or elite
status is being in an exclusive club.
How important is race in deciding who gets into this club?
Some examples: blacks search for work longer and often more
aggressively than whites and are 36-44% less likely to be hired for jobs
in mostly white suburbs even when they are just as qualified.
White males with a high school diploma are as likely to have a
job and earn as much as black males with college degrees.
When controlling for age, experience, and other relative factors,
blacks are paid at least 10% less than whites.
(Alice O' Connor, Chris Tilly and Lawrence Bobo, eds. 1999.
The Multi-City Study of Urban Inequality, "Urban Inequality:
Evidence from Four Cities." NY: Russell Sage Foundation.)
2% of lawyers and less than 1% of partners in law firms were
black, according to a 1987 survey in the National Law Journal.
A 1988 survey of Public Advocates, Inc. showed that fewer than
0.25% of partners in the US's biggest accounting firms were black (37
out of 20 000 surveyed). (cited
in Farai Chideya, 1995. Don't
Believe the Hype. New York:
Penguin Books). On average,
African Americans have only one-tenth the net worth that white Americans
do. (also in Chideya,
People with power do not give it
away out of morality or a sense of justice.
Instead they use the means at their disposal to maintain and
extend their power. They
hand out jobs and positions in society, and so have the power to
discriminate based on race (and sex) and create the kind of pyramid they
want. The consequences for
the economy are these: not only does racism cause the economy to be
stratified as it is, and place people of colour at the bottom of the
economic pyramid in terms of occupation, empowerment, income, and
wealth. Racism also splits
the 'everyone else' into racial groups with different interests, and
helps elites maintain their economic power against a divided opposition.
We have a society divided by
class: what I would call two classes of winners (owners and managers)
and one class of losers (workers, including the unemployed)-- others
might cut this finer, others rougher.
Most of the winners are white, but most white people aren't
winners, at least in the economy.
But what we also have is a society divided by race-- where the
upper caste is white, and all whites are racial winners-- even those who
are economic losers. This
scheme of things suits white economic elites-- who create and maintain
the scheme by discrimination-- just fine.
Racial privilege, in terms of status, prestige, and separation,
is much cheaper for them to give out than economic justice, full
employment at empowering work, and equality.
When white workers are
suffering, people of colour offer convenient scapegoats for structural
economic problems: overpopulation is to blame instead of corporate
destruction of resources, immigration is to blame instead of deliberate
technological unemployment. The
presence of more desperate, disempowered people of colour below white
workers on the class ladder acts as both a consolation (it could be
worse) and a discipline (your job could be given to them).
If white workers saw their interests with other workers
regardless of race, instead of with other whites regardless of class, it
would be more difficult for elites to prevent economic reforms that
ended poverty, unemployment, environmental destruction.
In the meantime, the economy
wreaks havoc on all but a very few, and worse havoc on those without the
insulations of caste privilege.
Equality is incompatible with
racism. Democracy, which is
people having a say in their government to the degree they're affected
by decisions, is incompatible with racism.
White workers will never have the bargaining strength they need
to have economic security if they choose to accept the divisions that
ensue. This is obvious even
by a quick glance at the US and Canada.
Canada has universal health care and much more progressive
taxation and a viable third party-- these are all under attack and being
dismantled, but they were won in the first place because of working
people's fighting and struggling to win them.
The US had its own labour struggles where much was won-- but
labour in the US has always been divided between fighting owners and
managers on the one hand, and bashing Black Americans and immigrants on
the other. Workers in
Canada, virtually the same as the US in most ways but lacking the
history of slavery, could focus more on their economic interests
(attacking immigrant communities on occasion, it shouldn't be forgotten)
and win more. But all this
discussion of racism's integral role in maintaining economic inequality
and insecurity in the US obscures the tragedy of a racist economy-- an
economy that wastes human potential and condemns huge numbers to misery
and poverty out of spite and cruelty.
The reason 'racist economics' is
so insidious is because it yields racist outcomes even if people are not
particularly prejudiced. It
is insidious because it makes it possible for the failure of an
agricultural program or a race riot decades ago to have an impact on
people's economic situations today.
Wealth is passed from one
generation to the next. This
means that if, in previous generations, black people or native people
had no wealth or had it stolen from them, they will have less now than
whites. This has all the
potential in the world to perpetuate itself.
Jobs and other business
opportunities are often not advertised and go instead according to
personal and family connections. Even
without severe discrimination, in a racist society people have mostly
friends and family of their own race.
If the people with jobs and opportunities to give out are white,
the people who get the jobs and opportunities will be white.
This, too, has a self-perpetuating logic.
Some specific examples are given below.
The interaction of racism and
class divisions and its effects are apparent in the context of
means, in shorthand, that the rich can take their money anywhere in the
world whenever they want. What
you as a worker have to understand about this is that if investors or
corporations can move plants and headquarters like this, so long as
there is anyone in the world who is more desperate than you and willing
to work for less, then you cannot have economic security, you cannot
make plans for your future or your family, you cannot be sure of a job
tomorrow. If white North
American workers do not appreciate this, it's because corporations try
so hard to spread the word that what's good for North American
corporations is what's good for North Americans and that foreign workers
are not potential allies but rivals.
What happens as a result is shown by a headline in the Globe
and Mail in 1997, referring to the destruction of the Asian
economies which led to much desperation, misery, and concentration of
economic power in elite hands: 'Asian heads bow to global economy'.
Closing doors and the army
One principle of racist
economics is this: if a job can be given to a white person, all things
being equal, it will be. This
means that black and Latino youths, especially in hard economic times,
have most economic doors closed to them.
One of the few that remains open is the military.
Military spending is the largest item in the US budget, and is
more than social expenditures. Communities
of colour are targeted specifically for recruitment, especially poor
communities and especially in economic downturns.
Recruiters are therefore taking advantage of racially exacerbated
economic desperation to recruit people into the army.
The result is that the US army, an instrument used to fight wars
that are never in the interests of people of colour, usually against
countries in Asia, Africa, or Latin America, has an officer corps that
is 3% Latino, while casualties tallied on the Washington Monument for
example were 28% Latino. (cited in 'Las Veinas Abiertas del Pueblo
Latino', by Mario Hardy. Z Magazine, November 1999).
The problem of unemployment
deserves special mention here. Unemployment
is wasted human potential, a horrible allocation of resources, a human
tragedy, and a huge obstacle in the way of any kind of change in the
But if it's so bad, why does it
exist? You'll hear many
justifications from economists. The
most famous are 1) if everyone was employed, they'd all have money and
want to buy things, so everyone bidding for these things would cause
prices to go up and up, the money wouldn't be worth anything and workers
would suffer anyway. This
theory says there's a 'natural non accelerating inflation rate of
unemployment' above which we can't go.
This is an elaborate story with lots of evidence against it, and
no evidence for it (see McQuaig's Cult of Impotence).
The other one is (2) the unemployed are unemployed because
workers' standards are too high-- if workers would work for less, there
would be no unemployment. The
limit of this scenario is slavery-- everyone is employed, no one gets
paid. My own answer to this
is I'll believe that when owners give up all their profits and managers
accept the same low (or zero?) salaries as their workers.
Until then, I'll think this idea is what it is-- mean ideology
pretending to be scientific economics.
No, a more convincing reason for
the existence of unemployment is that it's good for elites, and elites
won't change what's good for them.
If there was full employment, management would no longer have the
threat to fire and replace workers, workers could demand more money,
more control over their work and the company's decisions, and actually
win them. This would be bad
for elites-- unemployment is better.
So unemployment is a matter of
deliberate policy. In a
racist society, the burden of unemployment will fall hardest on people
of colour-- the unemployment rate for blacks was 14% in 1992, while for
whites it's 6%, for one example (Chideya 1995).
What does this mean? The
unemployed lack political clout, access to health care, good housing,
and nutrition; they are vulnerable to use as strikebreakers.
racially-influenced unemployment creates a permanently unemployable
class. These unemployed are
not even required by the elite to be unemployed-- they're completely
superfluous. As a result,
they're imprisoned for trivial offenses, locked into ghettos and
reserves in appalling conditions.
(more on these later)
Third World Poverty, Western Foreign Policy, and Immigration
Ecologists like Paul Ehrlich,
who advocate 'zero population growth', and argue that North America and
Europe must remain an 'island of plenty in a sea of despair', have a
position easy to fit in with racism.
Indeed the environmental movement is at its most confused when
dealing with issues like population, immigration, and poverty.
Is overpopulation in the 3rd world causing
environmental destruction? Should
the 3rd world be kept in poverty out of fear that if 'they'
consumed as we did, the earth couldn't survive?
Should 'we' restrict immigration to maintain our lands at a level
of ecological integrity?
The questions themselves betray
a misunderstanding about the relationship between the first and third
worlds. Population is not a
cause but an effect-- of disempowered females who are not allowed to
participate in society or the workforce, of poverty and insecurity
(Betsy Hartmann). People
who want to immigrate do so not because of 'population pressure' but
because of poverty. Poverty
itself is not a consequence of population but of injustice
It is worth describing the cycle of poverty of 3rd
world countries in detail
It begins with a Western
intervention re-orients the economy from self-sufficient agriculture and
industry to serve local markets to export-oriented agriculture and no
industry. This is done by
violence, debt, and bribing local elites.
The new agriculture is more productive-- not that it produces
more, but it produces different goods (goods the people who grow it
can't eat, usually) using less labour.
What happens to the agriculturalists who are no longer needed?
They go to the cities, places like Mexico City, Bombay, and
Jakarta, where they are now the most competitive labour force around
(meaning they'll work for really cheap) because they have no bargaining
power. Western corporations
are more than happy to 'invest' in such places, and leave if the
This situation is a horror for
the citizens of most of the world, and a joy for corporations.
Every third-worlder who can escape from this does their best to
do so. Hence the hated
immigrants who steal the jobs of North American workers are the creation
of North America.
But the story doesn't end here.
If in a country workers begin to organize themselves, or peasants
begin to agitate for land reforms, or a government promising to make
these changes comes to power, that country is immediately targeted for
attack. First, come bribes,
media campaigns, and subversions of the military.
Possibly mercenaries are employed.
If the people of the country keep resisting, they're bombed.
(this pattern is told over and over in William Blum's book, 'Killing
Discussions of 'population' and
'immigration' that obscure this relationship are outrageous.
I'm tempted to offer a trade: return every scrap of property held
by western corporations in the third world.
Dismantle the CIA and the US navy, airforce, and army (except
what's necessary to defend against attacks from Mexico and Canada).
Cancel all debts owed to western countries and banks.
Dismantle the IMF and the World Bank.
Give the third world ten years of commodity prices that reflect
the social cost of production of the commodities plus a reasonable
profit. Watch as the
corrupt elites of the third world are removed from power, land reforms
are enacted, and economies are reoriented.
Then, and only then, can North America unhypocritically close the
borders and get hysterical about lost jobs, immigration, dilution of
society's morals, and so on.
And of course, the flip side of
this is that the only reason immigrants are allowed in the country is
because they're wanted by corporations, to staff the sweatshops, to work
on the farms and in the laundries, to raise elites' children and clean
their houses and offices, and sometimes to program their computers.
The discussion of climate change
and environmental destruction usually goes the same way.
There are really two positions on the environment.
No one is for environmental
destruction. You're either
for your environment--
meaning you're willing to accept environmental destruction, even global
warming, so long as power relations don't change, since any costs of
such destruction can be transferred to people who don't matter-- or
you're for the environment, because you realize that people who suffer
from environmental destruction are people who haven't the power to steal
land that's lost, buy technological fixes, or move from devastated
areas. The Globe
and Mail in Canada offers the first position in a spectacular way.
If climate change makes agriculture viable in the north, we
(whites) will be able to settle the north (where the population is
mostly native). If it
causes floods and turmoil in the south, that's not really Canada's
problem is it?
The truth is that environmental
destruction is old-- at least hundreds of years old.
The destruction has always been localized and wealth has always
meant insulation from it. Elites
are not nervous about it because they know this.
Racial society adapts to it as it does to economic exploitation
and unemployment and poverty-- by transferring costs to people of colour,
and blaming them for the problems that ensue.
Winona Laduke's book 'All Our Relations' and Ward Churchill's
'Struggle for the Land' discuss case after case of environmental racism:
toxic waste sites, strip mining disposal, uranium mining, all
located on Indian reservations. This
happens in urban situations as well (Jonathan Kozol talks about it in
'Amazing Grace'), with dump sites located in ghettos.
A great deal about racist
economics can be boiled down to a single rule: When possible, a person
of colour must not have anything a white person doesn't have.
If elites of colour exist and wield power, there must be white
elites who wield more power. If
there are whites who are poor, there must be people of colour who are
more poor. More than
anything else, this has confounded and will continue to confound any
effort to lift people of colour out of poverty, starting with the
poorest. To do so would
require strong public action, whites would never stand for it: if the
government belongs to you, it should not do more for other people than
it does for you. Even when
public action is not involved, and black or native people succeed
economically as individuals, their wealth is destroyed.
When remedial actions of any kind start to succeed, racist
political interventions, sometimes grassroots, sometimes top-down, step
in to restore the economic inequalities.
I'll give three examples below.
The Prairie Agricultural Program in Canada (from Noel Dyck)
Examining the conditions of the
people trapped in the reserve/reservation system today, it is difficult
to see just how many other options were available.
One of the most vicious myths racism promulgates is that if
native people wanted to assimilate, they could.
Leaving aside the forced assimilation represented by residential
schools, and the abuses that were a part of that system, leaving aside
that forced assimilation is another term for cultural genocide, there is
still the simple fact that native people are not allowed to be economic
By the late 1870s, the Buffalo
had been destroyed as a matter of deliberate policy by North American
governments to facilitate the settlement of the west by whites.
The American Indian economies and societies dependent on the
Buffalo were also being destroyed, also as a matter of deliberate
policy. One of the
instruments of this policy was a program, called the Prairie
Agricultural Program, to turn Native groups into agriculturalists.
If it succeeded, the Cree and Blackfoot, and Metis would become
small individual farmers like the whites: full citizens in the
Serious farmers-- serious
businesspeople-- know that nothing can be done without social support,
especially at the beginning. White
settlers got land, credit, access to markets and innovations-- and
continue to (Railway owners got a lot more than that-- including help
destroying unions). To have
succeeded, Native farmers would have required no less.
But the largesse that railway
tycoons, fur trade companies, and white farmers received as a matter of
course was viewed as charity when given to Native farmers, encouraging
their proclivity to idleness. The
Prime Minister of Canada bragged to Parliament that aid was being
withheld from Native people until they were on the point of starvation.
The Native people, their old
economy destroyed and their new one sabotaged before it even started,
revolted. The government
responded by quelling the revolt with troops and hanging its leaders as
Prairie Agricultural Program in Canada", Noel Dyck, 1986.
in LF Brown and JB Waldron, eds. 1885 and after.
Canadian Plains Research Center, University of Regina Press)
The Tulsa Race Riot of 1921 (from 'Death in a Promised Land')
African American attempts at
economic success have fared no better.
After the first world war, many black soldiers returned to the US
believing that their patriotic contribution might help them gain some
justice. Expectations had
risen; black people were less likely to tolerate the contempt of a
country they had fought for, and more likely to try to defend
When African Americans reach for
dignity, the racists reach for guns.
This happened with the creation of the KKK after the Civil War,
formed to prevent and undo the possibilities for justice after slavery
which could have occurred under Reconstruction; it occurred again with
that group's response after World War I to destroy any hopes returning
veterans may have had.
The early twentieth century was
a time of lynchings. Mobs
took pride in their killing, and police, when they didn't join the mob,
certainly didn't stop it. Mobs
would kill suspected criminals, political dissidents, and, of course,
blacks. They took their
direction, in many cases, from newspapers which encouraged and
facilitated the lynchings.
In this context, black people
managed to build a small, precarious middle class and a thriving
business district in Tulsa, as in many other cities.
It was precarious because many who lived in the district worked
for whites; because the small businesses were not state supported; and
most importantly, because the community was at the mercy of the white
community it was embedded in.
Black Tulsa was aware of the
dangers of the mob, as is evidenced in its own newspapers.
Black Tulsans tried to organize themselves for self-defense.
But against the mob and the police, they were outgunned and
The awaited riot happened in
1921. A young black man was
accused of assaulting a white woman in an elevator.
He was arrested. A
white newspaper ran a headline: 'negro to be lynched tonight'.
A group of black Tulsans went to the police station to try to
protect the suspect. A
white mob arrived. The riot
While black Tulsa was looted and
burned, the police concentrated on rounding up and arresting blacks on
the streets. Estimates of
the dead run between 27 to over 250.
The most accurate estimate is around 75 deaths, 68 blacks and 9
whites. Black Tulsa was
destroyed. About half of the black population, about 4000 people was
rounded up during and after the riots.
Whites roamed freely after the riots.
Blacks were held under armed sentries and allowed to leave if a
white person would vouch for them (to let employers get their employees
back). The last of the
interned blacks were released 8 days later.
On the streets, blacks had to wear or carry special cards or be
returned to detention for a month after the riot.
The 'rebuilding' of Tulsa was as
much a betrayal as the riot itself, as whites took the opportunity to
acquire real estate they wanted. Substantive
reparations were never made, and indeed the story was quickly erased
from memory, as was the story of similar riots all over the country.
(The memory of the story isn't totally erased.
'Death in a Promised Land: the Tulsa Race Riot of 1921', by Scott
Ellsworth, 1982, Louisiana State University Press, tells it very well.)
The message: (1) Economic
success is not allowed. (2)
Self-defense is not allowed. Transgress
and be destroyed.
Proposal 209 in California
This is a slightly different
story, but follows the same rules.
Support for affirmative action flows from two simple beliefs.
The first is that ability at any given thing and potential to
develop it is randomly distributed through the population (if you don't
believe this, you believe that whites are 'naturally' better at some
things, and blacks are better at some things, and Asians are better at
some things). The second is
that opportunity is not randomly distributed-- opportunity instead flows
along networks of class, gender, family connection, and race.
These two beliefs alone are enough to make you a supporter of
affirmative action. If you
believe racism exists, and you believe people are equal, we're finished.
Knowing as well that 86% of jobs are not advertised but go by
networks helps. (National Center for Career Strategies, cited in
Gertrude Ezorsky, 1991. Racism
and Justice: The Case for Affirmative Action.
Cornell University Press.) Knowing
too that businesses cannot and have never survived long without much
help from the government also helps.
It is an assumption, but a
fairly safe one, to think that most of the Californians who voted
against affirmative action did not do so because they believe people are
not equal (although this is possible).
Many voted against it because they did not believe the system
would be unfair if left to its own devices.
But if opportunities are unequal, then affirmative action is
necessary to fix this.
Are opportunities unequal?
Some of the data presented above suggests that it is.
The educational data suggests that it is as well.
Black students who show potential equal to or above that of
whites, they are 40% less likely to be placed in advanced or accelerated
classes and 2.5 times more likely to be placed in remedial or low-track
classes. (Kunjufu, Jawanza.
1995. Countering the Conspiracy to Destroy Black Boys.
Chicago: African American Images; also, Jeanie Oakes, 1985.
Keeping Track: How Schools Structure Inequality.
Yale University; and Rebecca Gordon, 1998.
Education and Race. Oakland: Applied Research Center.) This is a
cycle. Good jobs go to
those with good educations. Only
those with good jobs can afford educations for the next generation.
Only businesses with government support can employ them.
Affirmative action is a way of forcing a racist society to allow
equal educational and economic opportunity in spite of continuing
How was it struck down in
California? It started with
an academic who couldn't get a job, and another who disliked curricular
changes. They suspected
they were losing scarce opportunities unfairly.
They began to write what they called a 'Civil Rights Initiative',
and were soon caught up in a political movement.
A charismatic black leader and lifelong beneficiary of
affirmative action and friend to the governor was found to decry the
programs he owed his success to. Television
ads emphasizing fairness and colour blindness were created.
A sympathetic Attorney-General refused to change the ambiguous
wording of the initiative. The
Los Angeles Times exit poll asked voters whether they supported
affirmative action programs "designed to help women and minorities
get better jobs and education."
54% said yes, and 46% said no.
The vote in favour of Proposal 209, however, was 54.6% and
against it 45.4%-- the reverse of the exit polls findings.
54.6 % voted to end California's
affirmative action programs. This
breaks down into 63% of whites, 26% of blacks, 24% of Latinos, and 39%
of Asians. (The whole story
of the campaign and Prop 209 is related in Lydia Chavez, 1998.'The Color
Bind: California's Battle to End Affirmative Action.'
University of California Press, Berkeley.)
That a majority of Asians voted against the initiative is
interesting, since anti-affirmative action pundits like Dinesh D'Souza
frequently say Asians are deprived as a result of affirmative action.
Let's put it another way.
A pair of men with personal axes to grind and support from
economic elites managed to use an ambiguous message of 'fairness' to
completely subvert any discussion of inequality of opportunity in the
present to take the first steps in destroying the basis of much black
economic achievement since the civil rights movement.
What would it take to protect
affirmative action? A
sincere belief in equality and an understanding that inequality exists
in the real world. But we
might ask if affirmative action is enough-- and it certainly is not.
From an anti-racist perspective, it falls short of the
multicultural vision we'll go into at the end of the instructional.
But even from an economic point of view, it is clear that no one
should have their opportunity for scarce education or job curtailed
because of an arbitrary thing like race or gender.
But the larger question is, why should jobs or education be
scarce at all? Anti-racism
is only a part of justice: it says at the very least class
stratification should not be due to race-- being of colour shouldn't
increase your chances of being poor.
The next step is to say that poverty shouldn't exist, nor class
at all. In a world where
workers control workplaces, circumstances, investment and research
decisions, without managers or owners-- a world of economic democracy--
affirmative action would concentrate on ensuring adequate representation
and decision making power for people of colour in a context of self
management (or self-determination) and not on trying to prevent the
destruction of the working and middle class of colour.
So ends the sketch of
institutional racism in the economy.
Summarized it is the following:
Economic elites who have the power to distribute economic
benefits such as jobs, wealth, and credit discriminate against people of
colour in North America, with the result that people of colour are
poorer than whites.
The poverty resulting from discrimination at home (the
international system abroad) and inability of white workers to perceive
their common interests with people of colour means reduced power for
both groups, rendering everyone vulnerable to more severe economic
vulnerability means it can be more economical to exploit people of
colour in the lowest paid, lowest status, most dangerous work,
domestically and internationally.
The rule of racist society is that people of colour must not have
something whites do not. When
even a small group of colour makes limited economic gains, political
interventions are made to try to undo these.
In the next section, we'll see
how what goes for economics also goes for geography.
Racism promotes class stratification and separation, and puts
people in different rungs of an economic ladder.
It also separates people physically.
The separation of people and control of places is a key element
Racist Geography Previous:
The Racial Caste System