W. E. B. Du Bois and the Racial Economics of Inclusive Capitalism

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• That story would suggest that oligarchy’s devastating consequences fall heaviest on the racially disadvantaged—especially black Americans—

• What almost never comes up in this discussion is the uncomfortable truth that the American middle class is today, and has been since its very inception, disproportionately and overwhelmingly white.

• Due to longstanding overt and covert discrimination in housing and credit markets, black Americans are dramatically less likely than whites to own a home, and thus enjoy the generational benefits home ownership affords, which drives a stubborn racial wealth gap.1 For these and other reasons, blacks never gained a solid foothold in the middle class.

• Du Bois attributed the intense opposition to the Bureau to what he referred to as the “American Assumption” that “wealth is mainly the result of its owner’s effort and that any average worker can by thrift become a capitalist.

• While white planters and white workers had long enjoyed a state-sanctioned system of economic support—from public bank charters; to the financing of services, infrastructure, and industry via public debt; to the expansion of the railroad system during the antebellum era—the creation of a Bureau to establish

• By focusing on the backlash against the Bureau, Du Bois highlighted the importance of understanding capitalist democratization as a key battleground of racial contention, claims-making, and bottom-up movement-building.

• Indeed, as Du Bois chronicles in painstaking detail, the Bureau eventually collapsed under a firestorm of white backlash.

• While critics made rampant allegations of fraud and financial mismanagement on the part of Bureau, their real critique, as noted by Du Bois, attacked the very idea that blacks were worthy of economic guardianship. For example, Du Bois expressed incredulity at President Andrew Johnson’s remark that “Congress has never felt itself authorized to spend public money for renting homes for white people honestly toiling day and night, and it was never intended that freedmen should be fed, clothed, educated, and sheltered by the United States.

• The idea upon which slaves were assisted to freedom was that they become a self-sustaining population.”8

• These insights continue to prove relevant for understanding racial capitalism today

• Arguably the most important example is housing: in particular, the expansion of homeownership and its role in creating a predominately white American middle class. This extraordinary intervention made homeownership affordable, though almost exclusively for white

• At the same time, black and Latinos were largely excluded from homeownership expansion. In the infamous practice of “redlining,” federal insurers deemed properties and neighborhoods occupied by racial minorities ineligible for mortgage investment, relegating the latter to rental slums or predatory mortgages.

• “Own Your Own Home”