Race, State, and the Free Market  - Intercollegiate Studies Institute

Race, State, and the Free Market 


Black Liberation Through the Marketplace: Hope, Heartbreak, and the Promise of Black America
By Rachel S. Ferguson and Marcus M. Witcher
(Emancipation Books, 2022)

Many sermons peppered with proposals to ameliorate the plight of black Americans are motivated by an intense desire to obliterate racial disparities. On the left, such messages are usually replete with excoriations of free-market capitalism, whereas right-leaning thinkers submit that only markets can liberate blacks from the clutches of poverty. 

Black Liberation Through the Marketplace takes a clinically precise approach to the complexity of black America. Writing from a classical liberal standpoint, Rachel Ferguson and Marcus Witcher argue that blacks will prosper in a setting that encourages individual autonomy by restricting government involvement in the social and economic spheres. 

Ferguson and Witcher reject conservative tendencies to downplay the negative effects of historical prejudice on black Americans, however. By describing the human-rights abuses black people suffered under Jim Crow laws and during slavery, they remind readers that they should be sensitive to historical facts. Markets are liberating, but when black people are barred from them by racist laws that treat them like property or curtail the property rights of black business owners, we should anticipate that such policies will have generational consequences.

Despite acknowledging historical wrongs, the book does not stray from its optimistic theme. Citing the achievements of the Hampton Institute, launched in Virginia in 1868, Ferguson and Witcher show that Southern blacks managed to become predominantly literate by 1910, notwithstanding the persistence of racism. Considering the speed of this accomplishment, the economic historian Robert Higgs refers to the ascendency of Southern blacks as an accomplishment “seldom witnessed in human history.”

The Hampton Institute minted an elite group of black professionals who went on to become business owners and civic leaders. By the end of the nineteenth century, Virginia had the most vibrant community of black proprietors in the nation. The dedication of blacks to industry and learning after abolition refutes the notion that they lacked ambition.

Ferguson and Witcher avoid the pitfall of conflating slavery’s cronyism with free-market capitalism; they draw a sharp contrast between the former and the dynamism of the latter. They explain that slavery is a type of protectionism that favors special interests: citing the research of the economist Jennifer Roback Morse, the authors show, for example, that segregation in the transportation sector was driven by a few powerful racists rather than by consumers or most businesspeople. 

Even when business owners harbor racist sentiments, they are unlikely to act on them if their desire for financial gain outweighs their appetite for prejudice. And businesses that practice racial discrimination face consequences from the market. 

On the other side of the ledger, the authors investigate the legacy of the New Deal thoroughly. The National Recovery Administration actually entrenched discrimination against black labor. Racism was also ingrained in the New Deal’s labor laws. As the book notes, the minimum wage was first proposed by labor organizations to make black labor less competitive. Unions anticipated that firms would be reluctant to hire low-skilled workers, many of whom were black, if the minimum wage increased. Contrary to the claims of progressives, government centralization frequently acts as a barrier to black achievement.

Ferguson and Witcher insist that government planning is inferior to the spontaneous order of society’s evolution, and in their account the case of Brown v. Board of Education illustrates this point. Brown is credited with desegregating schools. Yet pundits tend to overlook its unintended consequences. By subjecting black pupils to teachers who were insensitive to their needs, the forced integration of black students into white schools damaged black education. And numerous black teachers were fired following the transfer of black children to white schools. (Also interesting to consider here is the argument by Stuart Buck, author of Acting White: The Ironic Legacy of Desegregation, that because of the low standards imposed on black students by racist teachers, blacks began to equate success in school with whiteness and as a result developed an oppositional culture that disdained academic achievement.)

The effects of Brown would have been less catastrophic if the government had concentrated on raising the caliber of black schools rather than mistakenly assuming that black pupils needed the presence of whites to learn. Integration is a commendable idea, but Ferguson and Witcher contend that the negative effects of forced integration could have been avoided by allowing integration to develop naturally.

The book’s primary aim is to chronicle the story of black Americans and chart a course for future success. But the authors also note the flaws of the 1619 Project, which inflames conflict by characterizing the formation of the United States as an event saturated with racism. Ferguson and Witcher argue that it is reasonable to criticize the United States for falling short of its ideals. But we must never lose sight of the bold assertions made in its founding articles, which act as a safeguard against the violation of human rights and continue to motivate freedom fighters all over the world:

The very reason that slavery in America stood out as a scar on our reputation, a taunt from our enemies, and a cause of deep sectional fear and distrust is because the Founders really believed what they said. No one is accusing Brazil, which imported ten times the number of Africans [that] America did, of being hypocritical. That’s because Brazil never claimed that all men are created equal and endowed by their Creator with certain unalienable rights. It was America’s founding that made this audacious claim, a declaration that resounded across the world.

Slavery was costly to society, although it enriched planters. The shackles of slavery prohibited blacks from pursuing professional ambitions, so a black slave with strong quantitative abilities like Thomas Fuller was never allowed to become an engineer or establish a successful business. Slavery constrained the potential for innovation in the American economy, and although black Americans were its primary victims slavery’s ill effects cut across racial lines. 

Ferguson and Witcher provide a corrective to the racialism of the 1619 Project—and identity politics more broadly—when they draw on historical sources that discuss collaboration among poor whites and enslaved blacks through underground markets. By inviting racial tensions and by obscuring the importance of class, the 1619 Project discourages solidarity. 

The authors criticize conservatives for inaction. According to Ferguson and Witcher, conservatives lament the plight of black America, yet often fail to help disempowered blacks. They claim that despite the concern expressed by white evangelicals, secular organizations like Big Brothers Big Sisters are more inclined to mentor fatherless children than evangelicals are.

Ferguson and Witcher provide a succinct overview of proposals to improve the conditions of black Americans, such as the relaxation of occupational licensing laws, which make it difficult for working-class people of all races to pursue occupations such as barbering. The authors also upbraid the upper middle class for advocating zoning regulations that keep working people from buying houses.

Overall, Black Liberation Through the Marketplace is a fine text. The authors could, however, engage in a more analytical examination of how black culture has impeded achievement. Even liberal luminaries such as Orlando Patterson and William Julius Wilson recognize that black culture can have this effect. Perhaps, since the goal of this book was to provide solutions, Ferguson and Witcher were reluctant to fixate on the pathologies of black America. Apart from this oversight, Ferguson and Witcher have written an excellent treatise.

Lipton Matthews is a researcher, business analyst, and contributor to publications including the Federalist, Mises.org, and the Imaginative Conservative.

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