Slavery, Segregation, and Stagnation
Rather than looking at America through the lens of the present — “oh my god, what did he do today!! “— I want to ask the question: has American society ever worked?
By “worked”, you can think that I mean two economic criteria. First, according to its own standards of life, liberty, and happiness. Second, a little more formally, whether its economy has ever really been capable of delivering rising living standards broadly.
I think this is an interesting question, because most of us believe in the myth of a golden age past. The American Dream, we suppose, is something that came and went. But if we look at history carefully, I think we will see that it never really existed at all.
We can divide American economic history into three periods.
The first, which we sadly don’t need to say much about, is slavery. Obviously, society wasn’t working in the senses above during this period. Whatever gains there were were largely realized at the expense of great and immoral human suffering.
The second was segregation. Segregation was of course immoral as well, in the most basic terms of equality. Economically, it was a way to preserve many of the toxic economic “benefits” of slavery, while making repression palatable and righteous. It created a low cost labor pool, abrogated those costly things called human rights, and so on.
The third period, which we are in now, is stagnation. Note the interesting fact. Segregation ended in 1964. Stagnation began in 1971. That is when wages flatlined.
There was no intervening middle era, no golden age so to speak of. The American economy went directly from segregation to stagnation.
That tells us a few interesting things.
First, it implies that the social contract of America never really worked at all. That it depended on the exploitation (aka, the coercion, if you like) of entire groups to produce benefits for others. That is not a working society in the modern sense, only in the pre modern, the feudal, one.
Second, it implies that the roots of stagnation are deeper than we think. Stagnation has many factors that caused it to continue. The implosion of unions, the evisceration of public sector employment, a tilted playing against labour and towards capital, and so on. But the cause of stagnation cannot be all those, because they simply did not exist yet. The true cause of stagnation is simpler: without a group of people to exploit, the American economy simply began to fail, because it was predicated still on that exploitation to begin with. Except now, it is more or less everyone being exploited, in perhaps softer and less visible ways.
Now, you might object here. All this goes against what you have been taught, if you subscribe to orthodox American history, doesn’t it? So think about carefully. Go ahead and see if you can poke any holes in it. Slavery, then segregation, then stagnation. No intervening grace period. If you clear your mind of ideology, and think clearly about a working society, what does it tell you?
Third, all the above tells us the American Dream never was at all. It’s a truism to say that the American Dream came with hidden costs. Pollution, NIMBYism, and so on. But there’s a deeper truth there. Costs are only one side of the equation. What about benefits? The simple fact all the above tells us is the American economy was never able to generate enough real social benefits to be broadly shared, without exploitation, forced labour, and so on. Remember, it fell it into stagnation as soon as segregation ended, and that implies that it was dysfunctional in terms of its fundamental ability to create value to begin with.
So what going directly from segregation to stagnation tells us, in the end, is this. The faces, the people, the groups involved, changed — but the pattern didn’t. The economy remained predicated, founded on exploitation, only now it was less able to do so effectively, less viciously, less visibly. Hence, stagnation. Today, the economy is still a predatory machine — only it is so for everyone, not just specific ethnic or racial groups. That is the true historic price of the toxic legacy of hate America carries.
I’m often accused of saying “we’re doomed!”. And yet I never do, do I? So the conclusion of all the above isn’t that. Rather, it’s this.
If we are able to see clearly that the American economy, the social contract, was never functional in a genuine substantive sense at all, then perhaps now we can have a more truer discussion about how to make it so. Instead of harkening back to a mythical Golden Age that never existed at all, which is what I call Vox’n’Fox thinking converges to.
Now we can ask the wiser question. What makes societies “work”? What didn’t America develop, by going straight from segregation to stagnation?
We don’t have to look very far or think very hard. What makes Canada, Sweden, etc, work, in the sense that produce shared, enduring prosperity, is public goods. They developed those in the 1950s and 60s. America went straight from segregation to stagnation because it never had public healthcare, transport, higher education, and so on. It simply started exploiting people in a different way — but faces changed, but the pattern didn’t.
Today, it still doesn’t have public goods. And it’s because it failed to develop at precisely the time it should have that it remains stuck today — stuck in the trap of exploitation, which it never really broke to begin with.
To think clearly is to see what has been with an open mind. America is not the historic success that we, educated into the annals of exceptionalism. think. That does not mean that we should feel guilty, ashamed, bad, weak. It simply means that have the opportunity to make it one. There are two choices ahead of us. The third period, stagnation, can go on, into collapse. Or there can be a fourth period, of renewal.