Eric Schansberg column sig

There’s a lot of truth to the following statement: “It’s a black thing; you wouldn’t understand.”

It’s difficult for any of us to understand each other — especially when we’re in different social classes, have different ethnicities or varying personal circumstances. At its best, the slogan is a call to learn and deepen relationships, to listen patiently and talk humbly. It’s worth the energy to read more liberally and diversify your friendships.

How about this one? “It’s an econ thing; you wouldn’t understand.”

As a labor economist, I’ve learned many things that cause me to see the world differently — in really important ways. The good news: You can understand what I see — if you’re willing to put in some work to expand your horizons and learn more econ.

Let’s talk about some popular terms. The broadest definition of “racism” is treating a moment differently — positively or negatively — because of race. For example, it would be racism of this sort, if I voted for or against Barack Obama because he is black.

But the most popular definitions of racism are narrower, focusing solely on disliking and mistreating others because of race.

Modern uses of racism often assume that you can’t be racist without “power.” You can’t act on racist beliefs without the freedom to act. But all of us have that power. So the newer definition must imply having power over others.

With a monopoly, you can only buy from me. And if I don’t like your race, I can easily exert my racist beliefs over you.

These days, there’s also a lot of talk about systemic racism — a vague term that goes beyond the individual and points to the need for systemic reform. The idea is that racism is baked into law, markets, culture and society. The resulting racism can be direct, but often is indirect and even subconscious.

As an economist, it’s interesting to me that government fits both modern definitions so well. Government certainly has considerable “power” over all of us, especially the poor and the marginalized. And government is the most obvious part of “the system.” So, efforts to deal with racism and systemic racism should start by looking at public policy and addressing government.

We’ve seen some of this in recent weeks, as people protest police misconduct. In Louisville, there’s been additional focus on how the death of Breonna Taylor connects to the “War on Drugs” — an immensely damaging policy that doesn’t get nearly enough attention.

But there are other policies that cause immense damage — consequences that are concentrated among the poor in general and African-Americans in particular.

Consider the provision of K-12 education. The government has tremendous monopoly power over those in the lower income classes. As with the police, unions protect this monopoly power and make it difficult to fire ineffective or misbehaving employees.

The outcomes are poor, especially for African-Americans. Despite spending an average of $350,000 per classroom of 25, our nation’s schools struggle tremendously. And what’s more damaging and unjust than giving kids a ninth-grade education and sending them into the world?

We also restrict or prevent younger children from working legally; make it more expensive to hire them through higher minimum wages; and hit them with a 15.3 percent FICA tax on every dollar they earn. We have a War on Drugs that establishes “organized crime” called gangs in the inner city. (Remember learning about Prohibition in the 1920s?) With their reduced opportunities for legal work, we tempt them to sell drugs (tax-free) and then throw them in prison when they’re caught.

One more government policy: With the “War on Poverty” in the 1960s, we began to give a lot more resources to lower-income women when they had children — especially if they weren’t married. Since the change in incentives was connected to poverty, it’s not surprising that this is more about class than race. For example, in 2016, mothers with no more than a high school education gave birth within a single-parent household 60 percent of the time.

But this policy has hit African-Americans harder. Their two-parent households were 80 percent in every Census from 1890 to 1960. In 1965, 24 percent of black children (and 3 percent of white children) were born into single-parent households.

But by 1990, the percentages had risen to 64 percent of blacks and 18 percent of whites. In 2016, it was 70 percent and 28 percent. While there are many fine exceptions, problems with family structure and stability routinely cause trouble for children, schools and society.

We should all be passionate about addressing poor policy, injustice and systemic racism. But let’s make sure we talk about all of the relevant issues, especially the ones that cause the most systemic damage.

Dr. Eric Schansberg, an adjunct scholar of the Indiana Policy Review Foundation, is professor of economics at Indiana University Southeast.