Reparations for Black Residents Would Cost California $800 Billion, Say Economists

This total is 2.5 times the state's annual budget.


"Until we reckon with our compounding moral debts, America will never be whole," reads the subheading of Ta-Nehisi Coates' provocative 2014 Atlantic article, "The Case for Reparations." For some groups, like Japanese Americans, that reckoning has already happened: Roughly 80,000 people who were interned in camps in the 1940s have been paid a total sum of $1.6 billion by the U.S. government, or $20,000 per person in 1988—$50,000 each in today's dollars.

For others, like black Americans who descend from slaves—the group on whose behalf Coates argued—that reckoning has not happened, but may soon: A nine-person task force in California has made preliminary recommendations for what the state ought to pay to its 2.5 million black residents and will finalize these recommendations by the end of June, at which point they'll have to be approved by lawmakers and Democratic Gov. Gavin Newsom.

Economists consulted by the task force say each qualifying resident may be entitled to $223,000, which amounts to $800 billion when owed to 2.5 million residents—more than 2.5 times California's annual state budget. "The task force should feel free to go beyond our loss estimates," University of Connecticut public policy professor Thomas Craemer told the task force, "and determine what the right amount would be."

"It should be communicated to the public that the substantial initial down-payment is the beginning of a conversation about historical injustices," reads one of the reports, "not the end of it." It's not yet clear where that money would come from, in what form it would be paid out, or over what time period.

The amount generated by the task force stems from attempting to tally up the damage of overpolicing, housing discrimination, and incarceration. Proof of residency and slave descent would be necessary prerequisites before money could be doled out.

In San Francisco, an advisory committee separately exploring the possibility of reparations has already recommended $5 million payouts for the city's black residents, plus debt forgiveness and guaranteed income of $97,000 annually—a proposal that has not yet been passed, but will be taken up again later this year.

When the state violates people's rights, it ought to be held accountable. One way of doing that is by forcing it to pay damages, the way a court might order one party to in a civil suit. Another way of doing that is by eliminating the state-imposed barriers currently in black residents' way—a less satisfying but perhaps more prudent approach, as it focuses on the barriers currently in place, affecting people who are living today.

Unfortunately, the harms perpetrated by the state are too numerous to tally—a point made by the task force in its preliminary report, which highlights everything from discriminatory drug policies to the destruction of communities via infrastructure projects.

You could easily add lack of school choice, or the existence of occupational licensing requirements and firearm sentencing enhancements, or the shift away from phonics instruction in schools (which has made it so that two-thirds of black Californian third-graders are not reading at grade level) as other deliberate government policy choices that have led to worse outcomes for many black people—things that could currently be tweaked to improve conditions with little to no cost to taxpayers (who, if any race other than black, tend to be wildly unsupportive of reparations proposals).

Beyond the dollar amount proposal, the preliminary recommendations report has some good ideas, like "prohibit the state prison system and local jails from cancelling family visits as a form of punishment" and "support development of policies and practices that limit the unequal citing of vice retail businesses (e.g., liquor stores, tobacco retail) in Black neighborhoods."

Other ideas—"compensate individuals who have been deprived of rightful profits for their artistic, creative, athletic, and intellectual work" and "create free healthcare programs"—are woefully untethered from both reality and smart accounting.

The project has provoked criticism from some on the left, who see California, which was never a slave state in the first place, as attempting to make residents whole when they believe that instead ought to be done at a higher level. "Calling these local projects reparations is to some degree creating a detour from the central task of compelling the federal government to do its job," Duke University professor William A. Darity Jr., a reparations scholar, told The New York Times last year.

Task forces that create compendiums of ways the government has inexcusably violated people's rights should be lauded, but the remedy most likely isn't to go deep into debt or hike taxes in the state with the highest personal income tax burden around to try to recompense people for something in the past that can never be atoned for; it's to get the state out of people's way in the present.