Conservative claims New Deal and Democratic policies hurt black employment

[alp227]

Thomas Sowell, an economist at Stanford University's Hoover Institute and a black American, wrote this column in response to Obama's "stop whining" speech to the Cong. Black Caucus.

Unfortunately, black voters, like many other voters, often judge by rhetoric, rather than realities. When it comes to racial rhetoric, the Democrats outdo the Republicans by miles.

Even Ronald Reagan, the great communicator, had problems communicating with black voters, as I pointed out years ago in my book A Personal Odyssey (pages 274–278).

All this came back to me during a recent cleanup of my office, which turned up an old yellowed copy of the New York Times with the following front-page headline: “White-Black Disparity in Income Narrowed in 80’s, Census Shows” (July 24, 1992).

How many people in the media have pointed out that the black-white income gap narrowed during the Reagan administration, just as it has widened during the Obama administration? For that matter, how many Republicans have pointed it out?

Turns out that Sowell didn't even READ ! The message is way more complicated than the headline.

The new data provide the most comprehensive state-by-state picture of the range of incomes among racial and ethnic groups. In the Northeast and on the West Coast, where many households did well, black households generally fared better than others. In New York State, for example, among whites the median household income, adjusted for inflation, increased 19 percent to $35,811; among blacks it increased 29 percent to $24,089.

But the slumping economy of the Midwest hit blacks harder than any other racial group. Income disparities between blacks and whites widened sharply along a belt of states from Ohio to Minnesota, as the automobile-manufacturing and metal-bending industries, which attracted thousands of rural Southern blacks to urban jobs two generations ago, closed their doors on the migrants' children and grandchildren.

The states that showed the greatest income gains among blacks, like Maryland and Washington, were also states where the black population increased far more than the national rate of 13.2 percent. Maryland's black population rose 24 percent; Washington's rose 42 percent.

Then Sowell claims that New Deal policies contributed to black unemployment:

One of the first acts of the Roosevelt administration was to pass the National Industrial Recovery Act of 1933, which included establishing minimum wages nationwide. It has been estimated that blacks lost 500,000 jobs as a result.

After that act was declared unconstitutional, the Fair Labor Standards Act of 1938 set minimum wages. In the tobacco industry alone, 2,000 black workers were replaced by machines, just as blacks had been replaced by machines in the textile industry after the previous minimum-wage law.

(...)

During the late 1940s, when the minimum-wage law had essentially been repealed by inflation, 16- and 17-year-old blacks in 1948 had an unemployment rate of 9.4 percent, slightly lower than that of whites the same ages and a fraction of what it would be in even the boom years after the minimum-wage rate kept getting increased by liberal Democrats.

So suddenly just because of minimum wage laws industries decided to turn to machines instead of human labor? Or could it be that those innovations happened to be during the '30s?

And here's the history of US min. wage in nominal and 2009 dollars:



Why oh why do people buy into this theory that raising the minimum wage causes unemployment? I thought that free-market economists like Sowell would consider changes within markets. According to Economic History Services:

On the whole, migration and entry to new industries played a large role in promoting black relative pay increases through the years from World War I to the late 1950s. However, these changes also had some negative effects on black labor market outcomes. As black workers left Southern agriculture, their relative rate of unemployment rose. For the nation as a whole, black and white unemployment rates were about equal as late as 1930. This equality was to a great extent the result of lower rates of unemployment for everyone in the rural South relative to the urban North. Farm owners and sharecroppers tended not to lose their work entirely during weak markets, whereas manufacturing employees might be laid off or fired during downturns. Still, while unemployment was greater for everyone in the urban North, it was disproportionately greater for black workers. Their unemployment rates in Northern cities were much higher than white unemployment rates in the same cities. One result of black migration, then, was a dramatic increase in the ratio of black unemployment to white unemployment. The black/white unemployment ratio rose from about 1 in 1930 (indicating equal unemployment rates for blacks and whites) to about 2 by 1960. The ratio remained at this high level through the end of the twentieth century.

Then the concept of urban renewal, of which I'm not very familiar:

Urban renewal was another big Democratic liberal idea. It destroyed mostly low-income minority neighborhoods and replaced them with upscale housing that the former residents could not afford. People by the hundreds of thousands were scattered to the winds, destroying community ties between families, neighbors, and local institutions from churches to family doctors to businesses.

[OHdem10]

1. Vintage Sowell. Need i say more????

[The Wielding Truth]

2. I don't appreciate well documented propaganda.Sowell was given

a hand up. He worked hard and is very intelligent, but he somehow thinks that opposing equality in favor of an unrestrained free market is were he should devote his time. He can't recognize the trees because he is focusing on the his cronies and their forest of greed.

I am saddened that someone who could be helping to improve civil rights for all is trying to prove divisive examples of some unintended consequences of good programs.

Ripping apart our major strives is necessary for study if it is to improve the disbursement of equal treatment under the law, but when it is used to just demean a party or President who is working for the betterment of all I find it disgusting and another stab of propaganda.

He is not working for any minority when he uses his work in this way.

[Laelth]

3. Sowell regularly gets printed in my local rag.

He regularly demonstrates that he's either an idiot or a paid shill.

-Laelth

[alp227]

4. what's worse is that the RW message wins in popular opinion of economics

whether it be through Sowell's columns being syndicated in newspapers 'round the country or the "HowTheWorldWorks" YouTube channel by Competitive Enterprise Institute's Lee Doren. That's why you'll see letters to the editor, online comments, or talk radio calls repeat RW talking points "taxes take away jobs, regulations hurt business".

[Boojatta]

5. "Even Ronald Reagan, the great communicator, had problems communicating with black voters"

Do Young Earth Creationists have problems communicating with geologists? If geologists aren't persuaded, then maybe the problem is content, and not delivery.