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Friday, January 23, 2015

American Roulette: The economics of race relations in America

We've all heard of Russian Roulette, but none of us has played it, I hope. But, unfortunately, whether we like it or not, all of U.S. have been playing this other kind of roulette.

It is a game that has big winners and big losers. It is a game of economics or asset building. American white males started the game and eventually American blacks and even the Native Americans got to play. And later, almost as an afterthought, women got to play too.

It is a game not unlike the one played in casinos across the country.

You know the one, where a wheel is spun, a ball is released that bounces around and lands in one slot of the wheel. If the bettor is lucky enough to have his chips in the right slot, he wins big and if he is unlucky enough to have his chips in the wrong slot he loses. Of course, in the casino game, the odds of winning are much higher, 2.63% if you bet the right number and lots of people just bet Red or Black where there is a 47.37% chance of winning.

But in American Roulette, that's not really an option. 

So, here’s how American Roulette has been played throughout history. Land owners owned the casinos. Slave owners had some of the most profitable ones around. Their wealth increased exponentially with slave labor. Others land owners, who had no slaves themselves, came to play. They traded with slave owners, bought their crops and made business deals with them. They may or may not have disapproved of slavery in principle, but they liked how the system worked to create wealth, so for the most part they played along.

And, of course, everyone refused to let slaves play, so slaves never won, and slave owners almost always won BIG.

You know the saying, “The house always wins.” If the house didn’t always win, then the house would go out of business. So, it just makes economic sense. Slavery continued because slavery was profitable. Slavery made slave owners wealthy.

In fact, with American Roulette, many Americans believed that slave owners had an unfair advantage over non-slave owners. So, as our forefathers were figuring out representation and taxation in the federal government, the politicians came up with a compromise. A slave would be legally counted as 3/5 of a person. Politically, it wasn’t a perfect compromise, but at least the slave owners had to pay a little more taxes even if it meant they had a little more pull in the government.

Morally, that’s a whole different story. This country decided (now remember blacks and women were excluded from this decision making process, so we should say, white men decided…) that slaves were not people in the sense that other people were people. They were less human than other people … white men, to be exact. Remember slave owners agreed to this but so did non-slave owners.

Then one day, the powers that be, led by the President of the United States of America, Abraham Lincoln, decided that we shouldn’t be allowed to use people as tokens to play American Roulette any more. Through the Declaration of Independence and the civil war, we were able to finally declare legally that slaves were human beings and must be treated as such.

Great! But now what… The white males in charge didn’t know what to do with the millions of freed slaves. Fortunately, they also had confiscated hundreds of thousands of acres of land from the Confederate states.

So, Lincoln sent his secretary of war, Edwin M. Stanton, to Savannah to meet up with the very successful Major-General, William T. Sherman, to figure it out. “Stanton and Sherman met with 20 men on the evening of Jan. 12. All were ministers or lay leaders from the city’s black churches, and 15 were former slaves. Stanton posed a dozen questions to the group. Asked to draw a distinction between slavery and freedom, 67-year-old Garrison Frazier, a former slave who had been selected to act as spokesman, responded

“Slavery is, receiving by irresistible power the work of another man, and not by his consent.  The freedom, as I understand it, promised by the proclamation, is taking us from under the yoke of bondage, and placing us where we could reap the fruit of our own labor, take care of ourselves and assist the Government in maintaining our freedom.” (from the University of Maryland)

What they desired sounds eerily similar to the desire of Martin Luther King Jr. and even the desires of many impoverished African-Americans today: the desire to earn a living wage from their labor, to provide for their own needs and have adequate representation in the government and military to protect their interests for the long term success of African-Americans and the country as a whole.
With great discernment, when asked whether they would prefer to live interspersed amongst whites or to live segregated into all-black communities, Frazier spoke for 19 of the 20 men when he responded:

“I would prefer to live by ourselves, for there is a prejudice against us in the South that will take years to get over.” (from the University of Maryland) Little did he know that the prejudice he feared existed throughout the North as well. Sherman himself showed severe prejudice against the freed slaves and refused to have blacks join his army.

But, seeing an opportunity to resolve Lincoln’s concerns and find a way to get rid of the flocks of freed slaves that were following his army, he issued Special Field Order No. 15 four days after the meeting. This order gave up to 40 acres of confiscated Confederate land per freed slave for them to work until such time as the national government gave them the opportunity to purchase the land.
New communities sprung up quickly and as per the Special Order were completely segregated and self-governed. 40,000 ex-slaves were transplanted on 400,000 acres of redistributed land within six months of the meeting.

“And what happened to this astonishingly visionary program, which would have fundamentally altered the course of American race relations? Andrew Johnson, Lincoln’s successor and a sympathizer with the South, overturned the Order in the fall of 1865, and, as Barton Myers sadly concludes, ‘returned the land along the South Carolina, Georgia and Florida coasts to the planters who had originally owned it’ — to the very people who had declared war on the United States of America. (from

“Even staunch Confederate sympathizers bridled at such injustice. When a federal soldier told Mrs. George J. Kolluck that ex-slaves would be forced to return to work for wages for their former owners, she reported to her son that she answered, ‘very quietly, “this is what your Government calls ‘Freedom’? The injustice to us in robbing us of our property does not begin to compare to the cruelty to the negro himself.” (from the NY Times)

“Try to imagine how profoundly different the history of race relations in the United States would have been had this policy been implemented and enforced; had the former slaves actually had access to the ownership of land, of property; if they had had a chance to be self-sufficient economically, to build, accrue and pass on wealth. After all, one of the principal promises of America was the possibility of average people being able to own land, and all that such ownership entailed. As we know all too well, this promise was not to be realized for the overwhelming majority of the nation’s former slaves, who numbered about 3.9 million. (from

And, so American Roulette was opened briefly to the freed slaves. The house was forced to give each freed slave some of its own stash of chips and welcome them into the game. They had a dream and a promise.

But, within months, during the fall of 1865, the land was returned to its former owners.

Many of the ex-slaves were so limited in their options, that they continued to work the land for former slave owners. Many became sharecroppers limiting their ability to gain wealth and to add insult to injury, their hard work continued to enrich former slave owners. Infuriating.

In the century ahead, laws were written, later called Jim Crow laws, that were designed to provide “separate but equal” resources for blacks and whites, but actually only worked to keep blacks and whites separate. These were a constant reminder to former slaves and their descendants that legally they were second-hand citizens.

In effect, the ex-slaves were given a seat at the Roulette table, but only allowed to place one bet and hope for the best. Maybe one in a 1,000 or one in a 100,000 made the transition from slave to property owner with the ability to achieve the goals that were set out in that ground-breaking meeting with Stanton and Sherman.

One hundred years later, after the civil rights movement of the 1960’s, the laws changed. The descendants of slaves were given protection under the law. Many hurdles still existed though.

And, now American Roulette was opened to all … with one caveat. You could only play with the chips you had. Some descendants of slaves had begun to amass wealth and reach their economic goals despite the huge obstacles they had faced. But, the large majority lived and worked in inner cities and were plagued by poverty.

The other reality is that white males still owned 99.9% of the casinos. And the house always wins.

With only a limited capacity for making money, amassing true wealth was about as likely for the descendant of a slave as the ball landing in the 00 of the Roulette wheel. Some African Americans have hit it big, been successful in business, achieved academic degrees, and amassed wealth for themselves and their descendants.

But, for most, the American Dream remains a fairy tale.

Before you judge the rest of African-Americans, those trapped in poverty, think about the odds. Think about this game that we play, American Roulette. Think about the history that has created a culture and a mindset among impoverished African-Americans that cannot easily be untangled. At every turn, the house has had the advantage. And, at every turn, whites have owned the house.

So, don’t judge African-Americans by the success of whites and ask, “Why can’t they just be like me? I worked hard and found a way to make the system work for me?”

Don’t judge African-Americans by the success of other African-Americans and declare, “We have a black president, black Supreme Court Justice, black leaders in every field. There is no discrimination anymore! They need to quit complaining and get to work!”

In fact, don’t judge African-Americans at all. The Bible is clear, “Do not judge, or you too will be judged. For in the same way you judge others, you will be judged, and with the measure you use, it will be measured to you. (Mathew 7:1-2)

So, “If we can’t judge them, what should we do?” Glad you asked.

First, stop referring to them as Them. They are Us. And, so some of Us are in this predicament.

Then, We need to walk together through this. We need to begin where it all began and have White leaders and Black leaders, probably from the church or at least those who are community minded and not politically-minded sit down together and make a plan.

Many African-Americans (as well as many whites from all ancestries) have systematically and intentionally been hindered from acquiring wealth. Together there must be a systematic and intentional plan made to undo what can be undone and move forward with what cannot.

It doesn’t help to fight amongst ourselves about it. It’s time to make changes and transform the culture and mindset of our country. It’s time to stop playing American Roulette with its few Big Winners and multitude of Poverty-stricken Losers.

The odds are always in the favor of the house. Who owns the house today?

As, the saying goes, “Follow the money.”

It’s time for all of US to stop playing into the system and start building real wealth. We can’t get side-tracked by racial differences and we need to start to address the injustices of wealth distribution. We need to dream a way for the American Dream to be accessible for all. We need to talk.

Saturday, January 10, 2015

Suburban Legend: White Flight, Black Flight and Inner City Blight

Most of us have heard an urban legend or two.

But have you heard of a Suburban Legend. Here’s one: The wealth of people who live in the suburbs has grown tremendously while the wealth of those who were stuck in the central city has never materialized. Unfortunately, this suburban legend is true. A 5-bedroom house in Harlem or downtown Philadelphia is worth a fraction of what a 5 bedroom house in the suburbs is worth.

If you live in the suburbs, like I do, you may be thinking, “Great! What luck! So glad I got out when I did!”

(If you are aware of our history as a nation, then nothing I’m about to write will surprise you. But, seeing that I am just learning all of this, I decided to write about it just in case anyone else is left who is as ignorant as I was before this week.)

Several weeks before his death in 1968, Dr. Martin Luther King, Jr., told a group of sanitation workers in Memphis:

“Now our struggle is for genuine equality, which means economic equality. For we know now that it isn’t enough to integrate lunch counters. What does it profit a man to be able to eat at an integrated lunch counter if he doesn’t have enough money to buy a hamburger?”[1]

Makes sense, right? But, then again, I always admired Dr. King and thought that he made a lot of sense.

Here’s the part I didn’t know:
A huge number of people in our country were screwed out of the ability to increase their wealth. As a country, we played a game of  “3-card Monty” with them. We created huge factories in the cities. The cities had everything. Jobs. Housing. Transportation. So, we invited these people to come into the cities, work hard and get a taste of the American Dream.

When they came, homes were built for them. Lots of homes, but not suburban homes. Mostly these homes were built up. Huge apartment buildings were built one after another to house these factory workers. We even used Federal money to subsidize them.

These people moved in and worked hard. (Living the dream.)

Everyone knew we needed more housing and with better transportation, people, especially the middle class, could afford to travel a little further to work. So we built suburbs. Some of these suburbs were very specific about who could and who could not live in them. Levittown is possibly the most famous example, but not an isolated one. (Google it, if like me, you had never heard of it.)

Levittown received those same government subsidies. (And lots and lots of people were shut out from receiving any of the benefit of that money.)

They were free. Free to live where they wanted, work where they wanted, and grab hold of the American Dream just like everyone else. But, they just weren’t free to live there, in Levittown or in a hundred other suburbs like it around the country. And, because of that many were stuck in the inner city.

Whites left the inner city to move to the suburbs, to find a better life. Good for them. Eventually, the jobs followed them out of the city. So, there were the blacks, left in the city, with fewer and fewer jobs, no place to move to, and free. (Free for what? Were they supposed to survive and thrive on the simple fact that they were no longer slaves?)

But, some blacks did make it out to the suburbs. Some builders were very clear that their suburbs were open to blacks. We will sell to anyone. (That makes me feel better. How about you?)

But, when someone said that, guess what happened more often than not. Blacks would buy houses and move in. Actually, just blacks would buy houses and move in. Whites usually wouldn’t.

Why? You may wonder.

Because whites are racist? Maybe some of them were. Others were just smart. A home in Levittown, which catered to 90% of the population was worth more than a home in a suburb that was perceived as catering to 10% of the population. It wasn’t a smart investment for a white to buy in these mixed race communities.

In other places, whites had already moved in and when laws changed, circumstances changed and blacks started to have greater opportunities, so they moved in as neighbors. Fearing their property values would decrease as more blacks moved in and more whites moved out, many whites bought homes further out into the suburbs, aka White Flight.

Were these fears legitimate? Yep. In almost every case, as whites left communities and blacks moved in, the property values stagnated and began to fall.

Why? Because blacks brought with them city problems higher crime, more poverty, and greater dependence on government programs? Nope. How do I know? Because it didn’t take that long for property values to drop.

They dropped fast. Too fast. So, why did they drop so fast? Because whites left these communities in droves. Supply and Demand. All of a sudden, a few black families move to a neighborhood and whether out of irrational prejudice or rational fear of losing wealth, whites fled to new communities.

If whites had stayed put, their property values would have stayed put. Since they didn’t, blacks now had a new community to move into, but there was still little true integration. And, the ability of blacks to build wealth remained stagnant.

So I can prove my point: there was a community that tried things a little differently. Oak Park, a suburb of Chicago, saw diversity as a positive thing for their community. They knew that the fears behind White Flight were legitimate, so they insured the property values, so that a family could be assured that their home would not lose its value.

As a result, whites stayed, blacks moved in and diversity was realized. Win-win.

I’m sure there’s more to it than a “They lived happily ever after,” but it serves to prove the point, that the argument has merit. White Flight is to blame for property values dropping, not an influx of blacks into a neighborhood.

So, again and again, as whites moved further into the suburbs, blacks were left closer to the center of cities. All in the name of building wealth. Blacks who were trying to better their lot in life, for themselves and their children, were shut out, again and again.

Three-Card Monty. See here it is, come get it. Oh, did you think it was there. No its here. Come get it. No, not there. Now it’s here. Meanwhile, the whites acquired wealth through hard work, careful planning, good investment, and a system that was tilted in their favor. Meanwhile blacks continued to lag behind in every respect, always fighting for a level playing field. But every argument is met by, “What about innocent whites? They didn’t do anything to you.” In other words, “Don’t blame me. I worked hard and played by the rules.”

But, the game was rigged from the start.

Forget race for a moment and think about the frustration that you would feel if this happened to you. You hear about a job opportunity, so you leave everything you know and go to a city hoping to make a better life for your family. You work hard, save your money, and see that your children aren’t safe in this neighborhood. So, your kids grow up and they decide to move out of the dangerous part of the city into a nice neighborhood in the suburbs. They work hard, save their money and move, but when they get there, the landscape begins to change almost immediately. The neighborhood they saw when looking for a home is not the one they wind up raising their children in. Many of the neighbors they had seen when shopping for a home have left, taking with them their businesses, money and the infrastructure starts to fail.

And, your kids once again are growing up in neighborhoods that aren’t safe. And. All of this. All of it is subsidized by the government.

Now remember we are back in reality, and we are talking about blacks. If you are white, none of this happened to you. So does that make it any easier to swallow?

But, the government is supposed to be the good guys. Really. The government is the provider in our minds. It was through the government that blacks received freedom from the atrocity of slavery. It was through the government that the civil rights movement made huge strides toward integration and equal rights under the law. It is the government that makes discrimination illegal in the workplace.

It is natural that blacks would look to the government to solve this problem as well.

But, it was also the government that enslaved blacks in the first place, created these laws and then loopholes in the laws that allowed blacks to be shut out from wealth.

But, then I read about a woman applying for a job year after year without success until she alters her profile slightly, only changes her name, telephone number and checks off one box differently: the white box instead of the black box. In other words, you’re trying to tell me that a qualified black woman can’t get a job that a qualified white woman can get in a heartbeat. Today! This pisses me off. (Actually, it happened 2 years ago and this is the first I am hearing about it. That just makes me feel completely out of the loop. Because I am white, I have no idea what it is like to be black. Giving your child a “black sounding name” can hinder their ability to get a job? Really? Really. What world have I been living in? A world of white privilege.)

The disparity of wealth that Dr. King saw as the next hurdle is still the next hurdle. In today’s society, there is enough blame to go around. Whites are to blame for being racist or prejudice, for working the system to their benefit while not being concerned by the negative effects to blacks, and, even if unwittingly, benefiting from a system that is tilted in their favor. Middle and upper class blacks are to blame for Black Flight which continues to have a devastating effect on primarily black communities. Poor blacks are to blame whenever they give up, stop working hard, stop trying to make a better way for their kids and turn to drugs to numb the pain, crime to take what should have been given, or wait for the government to save them.

Ok, there is enough blame to go around. Now I see that more clearly than ever before.

For whites and middle/upper class blacks, the work that needs to be done is the easiest and for poor blacks, the work is the hardest. For one simple reason… resources. We have them and they don’t. There are tremendous obstacles standing in the way of American blacks, some cultural, some societal, some internal and many external. In light of all of this, every one of us bears responsibility and has an opportunity to make change.

So, we all have a role to play in bringing about true equality. Equality of opportunity. Equality of wealth building potential. Equality of income.

So what do we do?

First things first, see reality. Blacks stuck in a cycle of poverty today need more than just a good work ethic to pull themselves out of poverty. Disparity of wealth in this country was in large part by design. It is going to take a thoughtful plan to change it.

Then, we each have to acknowledge our part in this tragic story, whatever that may be. Confess it.

But it can’t end there. There must be a change in our actions. We have to act based on that new knowledge and understanding. We have to make different choices. We have to talk differently, spend our money differently, teach our kids differently, have different relationships, live in different communities.

We need to see diversity of race and culture as a benefit worth creating, worth building together. Then we need to sacrifice in order to make it happen.

Please comment and let me know what I am missing, who else I should read, or what your thoughts are about the next steps. What is my best next step and what is yours?

Bonus tidbit about race: Race is a human construct. Scientifically speaking, there is only one human race. Skin color and other differences in appearance, shape of eyes, type of hair, etc. are not genetically significant. “On average, any local population contains 85% of all genetic variation and any continent contains 94%.”[2] This is because as a race, humans have migrated and intermarried throughout their history. There has not been enough time or isolation for us to have developed into different races.

So, what we refer to as different races, white, black, etc. are only recent additions. “When the US was founded, equality was a radical new idea. But our early economy was based largely on slavery. The concept of race helped explain why some people could be denied the rights and freedoms that others took for granted.”[3]