Will Black Americans have more spending power after receiving reparations?

Suppose that President Kamala Harris writes every American who identifies as “Black” (including Rachel Dolezal and, everyone’s new favorite Black American, Jessica Krug) a fat reparations check. Will Black Americans have greater spending power as a result?

Some Blacks are on means-tested welfare programs, such as public housing, Medicaid, or SNAP. If they receive a reparations check, maybe their “means” will now be greater and they’ll have to pay more for housing, health insurance, and food. A 2015 Census report:

At 41.6 percent, blacks were more likely to participate in government assistance programs in an average month. The black participation rate was followed by Hispanics at 36.4 percent, Asians or Pacific Islanders at 17.8 percent, and non-Hispanic whites at 13.2 percent.

The Son also Rises (Clark 2014; Princeton University Press) contains a survey of the academic literature regarding the effect of family wealth and unearned cash transfers on children. In 1832 there was a land lottery in Georgia where winners received a parcel of land roughly equal in value to the median family wealth at the time (i.e., the typical winners ended up with twice as much wealth, about $150,000 extra in today’s money). How did the children of the winners do?

They were no more literate than the children of losers. Their occupational status was no higher. Their own children in 1880 (the grandchildren of the 1832 winners) were again no more literate. Worse, they were significantly less likely to be enrolled in school than the grandchildren of the losers. … Wealth is not statistically higher for lottery winners’ children…

(Clark also reviews a study of Cherokee Indians who, starting in 1998, received substantial boosts to their income from casino profits. For children who had not been living in poverty, “there was no measurable change in any educational outcomes, including high school graduation rates…” This was despite the fact that a child who graduated high school would immediately become eligible for his or her own $4,000-per-year payment.)

“Divorce laws and the economic behavior of married couples,” by Alessandra Voena, a University of Chicago economist, concluded that an increased opportunity to obtain cash via a divorce lawsuit reduced reduced married women’s labor force participation rate. Similarly, successful child support plaintiffs generally reduce their working hours so that cash from the defendant is not turned into a higher standard of living for the child, but rather increased leisure time for the adult plaintiff.

See Long-term effects of short-term free cash (guaranteed minimum income experiments) for a reference to a paper regarding how just a few years of free government cash resulted in a lifetime of reduced labor force efforts. Those who got the cash were more likely to end up on disability and, if not Hispanic, to divorce their husbands and wives (additional gender IDs were unavailable in the 1970s).

Readers: What do you think? Will the free government cash result in higher spending power and standard of living or reduced working hours and additional leisure time for Americans who identify as “Black”?

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8 thoughts on “Will Black Americans have more spending power after receiving reparations?

  1. Someone once said if you equally redistributed the world’s wealth it would shortly end up in the same hands at the same ratio it is now. As pointed out a potentially life changing sum of money going to most people will not permanently change their lives.

    • rogan: It is always good to see a new government program that is based on skin color! So thank you. But the article says “Mayor London Breed on Monday introduced the Abundant Birth Project, which will give a basic income supplement to 150 Black and Pacific Islander women during pregnancy.” Why is it limited to 150 people who identify as “women”? Men can also give birth and nurse babies. https://www.theguardian.com/society/2016/jun/20/transgender-dad-breastfeeding-pregnancy-trevor-macdonald More seriously, why will 150 people get this magnificent benefit while others (in a rainbow of gender IDs) who are identically situated in terms of skin color and pregnancy get nothing? If this cash represents “justice” why inflict “injustice” on potentially thousands?

  2. I think for the next six months, you should dedicate the blog to describing in as much detail as possible what it is like to live under communism, to get everyone ready. When you wake up this morning, everyone should know: the clock is ticking, and the days are numbered. The way you experience life is going to change radically in 2021 as the full weight of Karl Marx’s intellect is lowered upon you like a concrete slab. Once they’ve crushed you with it, the progressives will jump on top and wave their arms in celebration of their achievement in making everyone equal. You will be dead, and the world will be a much better place in their view.

    Go out to 2:05 in this video so you can watch a crane in a test run lowing one of Marx’s Progress Slabs. The idea is: you get in there.

  3. Give a man a fish, and you feed him for a day, teach a man …

    There are some people who know how to fish while others they simply don’t or don’t want to learn. If you just keep giving them fish, they will ask for more and more and refuse to learn to fish. Period.

    Our government thinks that it can make everyone equal, you cannot, but they will keep trying till when elephants learn to fly.

    Imagine if other countries spend money the way USA is. They won’t last for a year.

  4. With the help of the Chinese Communist Party, anything is possible! So all the towns that put the banners up over their city halls (like Medford, MA) etc., should also start raising the Chinese flag every day, to show their solidarity. Don’t forget to tell President Harris to wear a CCP mask!

    “Black Lives Matter co-founder teams up with pro-Chinese Communist Party group”

    https://nypost.com/2020/09/17/blm-co-founder-teams-up-with-pro-chinese-communist-party-group/

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