Civil Rights Economics [ according to Wright]

1. The Economics of Jim Crow and Apartheid: A Comparative AnalysisGavin WrightWorld Economic History CongressStellenbosch University9-13 July 2012

2. Civil Rights Economics[according to Wright] • Southern business leaders saw no conflict between segregation and economic progress • Acquiescence in 1960s only in response to economic pressures • Black economic gains were large • not just for the middle class • not mainly at white southern expense • After the fact, desegregation was an economic boon to the region as a whole

3. Per Capita Income (%US)

4. Jim Crow South as Political-Economic Equilibrium • Blacks excluded from vote, cities, industries • Separate and unequal schools • Politics dominated by black-belt planters • Chief beneficiaries of race discrimination • Economic progress for whites only

5. Per Capita Spending ca. 1915

6. Feedback: Labor Marketto Schools • Rosenwald Fund expert (1930s): “If commercial courses were offered in the negro school there would no doubt be tremendous pressure to get into them and the only result would be keen disappointment for almost everyone.” • James Field at Union Bag in Savannah (1940s) : “When I filled my application out…I put ninth grade instead of twelfth, because I figured they didn’t want…no smart black man, in order to get hired. I was hired.”

7. Survey of Alabama Employers Not a single case before 1960s where a firm “drawing on cost calculations, business norms, or abstract concept of justice chose to desegregate the work place or break down job discrimination…Even in retrospect, off the record, within the confines of their own offices, businessmen did not recall that the racial order created ‘impediments’ or ‘difficulties’ for enterprises” [Greenberg, Race and State (1980), 231, 233]

8. Black Textile Graph SC

9. EEOC Flyer

10. Unlearning Prejudice • “When I read this comment [that blacks were good workers], I was curious because, from all I have heard, the Negroes we are employing are shiftless, lazy, don’t want to work and leave as soon as they are hired.” • A systematic company study showed “no discernible difference in productivity.” • By 1969, “virtually all the large companies here have begun to preach a doctrine of equal, color-blind employment”

11. Compulsion vs. Voluntarism • Plans for Progress 1961 • Troutman: “Compulsion is not the thing. I’m a lawyer. I can show you how to get around the Executive Order. It’s got to be voluntary.” • Major progress came only with compulsion • EEOC actions • Private lawsuits • Federal contract compliance • Greatest gains at large covered employers

12. Quasi-Voluntarism & Learning “There is something about the threat of prosecution that makes voluntary programs work much better.” [Ray Marshall 1965] “By the 1980s, leading firms had troops on hand who were fighting for equal opportunity programs. They had internalized the civil rights movement.” [Dobbin, Inventing, p. 158] Gains were greatest in the South.

13. EEOC Shares

14. Black Male Income

15. Male Income

16. Net Black Migration into South1870-70 to 2005-10

17. Black Voter Registration

18. Black Elected Officials

19. % BEOs/% Population 2001

20. Southern Senators by Party

21. Southern Governors by Party

22. Poverty by Region

23. Infant Mortality by Race 1955-1975

24. Commonalities: U.S. South and South Africa • Cheap Black Labor for Farms and Mines • Coalition with White Working Class • Schooling to match segregation of labor • Black disfranchisement • Resistance to global trends 1940s-1960s • Economic modernization ≠> racial progress • “Highest Stage of White Supremacy” (Cell) • Post-Revolution Revisionism

25. Segregation and Petty Apartheid

26. Education for Segregation “The school must equip him [the Bantu pupil] to meet the demands which the economic life of South Africa will impose upon him…He must learn not to feel above his community…There is no place for him in the European community above the level of certain forms of labour…” [Hendrik Verwoerd 1954]

27. Post-Revolution Revisionism When segregation ended, “you can’t find a single white person who remembers it.” [Quoted in Chafe, Remembering Jim Crow, 182] “It was practically impossible in 1995 to find anyone who would admit to having been a supporter of apartheid.” [Clark and Worger, South Africa: The Rise and Fall of Apartheid, p. 9]

28. Contrasts (Partial List) • Demography: • SA 15%-20% White • South 20%-40% Black • Constitutional Structure: • Jim Crow South in defiance of U.S. law • Multiethnic politics, multiracial categories • Geography: Region vs. Nation • SA Job segregation legally imposed • Economic Structure (mining & parastatals)

29. Did the Apartheid Economy Fail? • Declining growth mainly from deterioration of gold mining [Feinstein, 203-210] • Colour bar adjusted to labor market pressures, whites gained [Mariotti 2010] • White poverty abolished after 1948 [Ramphale 2008] • Major decline came only with political turmoil, sanctions, capital flight

30. South Africa

31. South Africa

32. Income by Race

33. Semi-Professional % by Race

34. Routine White-Collar % by Race

35. Commonalities despite Contrasts • Regime Change only under heavy pressure Crucial difference in timing • Outcome favorable for all major groups Inman-Rubinfeld: South African federalism as credible commitment • Deindustrialization undermines gains • Rising within-race inequality What are the long-run implications?

36. Economic Legacies of Apartheid • Extreme Inequality • Poverty • Education • Health conditions • Protected, inefficient manufacturing sector • Decline of labor-intensive production [Rodrik] • High unemployment • Mismatch: economic structure and labor force