Selective Capitalism and the Dehumanization of People of Color

SUEDDEUTSCHE ZEITUNG PHOTO / ALAMY; PAUL SPELLA / THE ATLANTIC

The language used to describe our community has long been deterministic and continues to lead to the dehumanization of People of Color. During slavery, we were labeled as "chattel," after slavery, we were called "vagrant convicts." Today our culture has been branded as "ghetto," our children relegated to "at-risk," our young men tagged as "thugs," and our women marginalized as "angry Black women."

You may ask how it could be possible that in 2020 we would witness the devaluing of Black lives such as Ahmaud Arbery, Breonna Taylor, and George Floyd? This dehumanization persists because leaders keep responding to the symptoms of inequality rather than addressing the underlying causal factors. Although the symptoms are many, the root causes can be distilled down to a much shorter list. In this article, I will address and unpack the implications of artificially created poverty, racial friendship gaps, and our historical amnesia. Let us begin with a look at economics as it pertains to the dehumanization of People of Color.

Artificial Poverty

For years I prided myself as a Black free-market capitalist. I read the works of Adam Smith, Milton Freeman, and Thomas Sowell and was a firm believer in the invisible hand of the market. However, there was one thing I could not reconcile as it pertained to my capitalistic proclivities. Through an economic study of American history, I uncovered what appeared to be the inconsistent and selective application of capitalism. For example, why were the 40 acres and a mule promised to Black former slaves called a government handout, but the 160 acres promised to White settlers going West was not? If government intervention is so repugnant in a capitalist economy, why then did America tolerate the economic suppressive Black Codes and Jim Crow laws? Moreover, my research also uncovered that the American Ghetto was in no way a natural economic phenomenon. Instead, it was artificially created by policies, such as redlining and the federal FHA underwriting policy of 1936, which clearly states that the federal government would not underwrite loans to "racially disharmonious people groups."

As the patterns of selective capitalism emerged, it became clear that the economic constraints created by artificial poverty would necessarily lead to the reliance on the very institutions that created the American ghetto in the first place. How so? Poverty is an industry, and every industry has an economic incentive to ensure its survival. From indentured servitude to the dismantling of Black Wall Street, the systemic suppression of Black America's contribution was predetermined, and the resulting need for governmental assistance inevitable. This deterministic causal relationship has led many to continue to dehumanize our community as lazy and the overly enthusiastic recipients of government handouts. Let us now consider the friendship gap's implications as it pertains to the dehumanization of Black America. 

The Friendship Gap

According to a study of social networks done by the Pew Research Center, 81 percent of participating White adults in the study reported that all or most of their close friends are White. This friendship gap (coined by Synapse Minnesota LLC) has multiple far-reaching implications from a social and economic perspective. Historically, this friendship or relationship gap between White and Black communities has led to a sort of economic taxation without representation; that is, policies and laws were created and imposed on our Black community without adequate representation at the tables of decision. Take, for example, the choice to build highway I-94 right through the heart of the Rondo neighborhood in St. Paul, Minnesota, back in 1956. Although there were other optimal routes, a decision was made that would displace 600 African-American families, numerous Black businesses, and Black institutions. 

As it pertains to social interactions, this lack of interracial friendships leads to extreme discomfort whenever the two are forced to interact. Because of this lack of genuine friendships, people default to second-hand accounts or stereotype caricatures of the races portrayed in the media. This is caused by what behavioral economists call cognitive easing: the ease with which your brain processes information and subconsciously impacts how positively (or negatively) you feel about something or someone. In other words, second-hand bias can, in an instant, cause a narrative to form in your mind that determines whether you see a thug or a future world changer. Let us now consider the implications of our nation's historical amnesia. 

Historical Amnesia

In March of this year, the federal government reluctantly approved the creation of the COVID-19 economic stimulus package. Their reluctance was partly because they were able to correctly project that there would be stage two and three economic implications of their decision for years to come. If their economic modeling predicted that there are taxpayers not yet born that would be paying for this stimulus, would it not be logical that there would also be a multi-generational economic impact from slavery, the Black Codes, and redlining? Instead, we are supposed to forget that any of it ever happened, pick ourselves up by the bootstraps, and apply American ingenuity to remove the yoke of artificial poverty from our neck. This, of course, without any intervention, lest there be any guilt of providing a handout. 

This historical amnesia has led many to the irrational conclusion that our community is just not trying hard enough. The truth is that we were told to compete in the free-market economic race after being economically maimed. And when we finished last, they said for us to stop making excuses. In other words, as long as people continue to discount the historical economic impact of racial injustice, they will see the problem of inequality as a burden that they have no responsibility to correct. 

At the time of this writing, my home state of Minnesota has been set on fire. The reality, however, is that these fires were burning long before the riots began. For example, the Twin Cities metro area was recently ranked the 4th worst place to live for People of Color and dead last for graduation rates for students of color. These causal factors which led to these disturbing statistics did not occur overnight, nor will they be solved quickly. What it shows, however, is the dangers of not seeing color. 

In this article, we discussed the implications of artificial poverty, the friendship gap, and historical amnesia as it pertains to the dehumanization of Black America. Furthermore, we explored the selective historical application of free-market capitalism as it relates to People of Color. So how do we respond to this? We must identify the root cause of racial and economic injustice in America, rather than continuing only to address the symptoms of inequality.

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About the Authors:

Dr. Paul Campbell is one of the co-founders of Brown Venture Group, LLC. Launched in 2018, Brown Venture Group, LLC is a venture studio venture capital firm exclusively for Black, Latino, and Native American technology startups. Brown Venture Group is writing a new playbook for both those interested in launching a minority-owned technology startup and those interested in investing in new technologies. For more information go to brownventuregroup.com.