A Cost Analysis of Reparations

Today in history I was a little bored so I decided to analyze reparations, the costs, the new tax increases, etc.

Rep. John Conyers has introduced a bill every year since 1989 to provide reparations to Blacks. His 2009 version calls for $1,000,000,000,000 (trillion) to be paid to Blacks for slavery and discrimination/racism.

The first thing to look at is average payout for blacks. A trillion dollars given to roughly 39,000,000 blacks in America makes $25,641 per black. For a family of 3 this would be $76,923 and a family of four would be $102,564. That is the average salary of a doctor given as a one time gift to each black family.

Now the cost:

Whites make up about 70% of the population so thus 210,000,000 white Americans. This is equal to $4,761 in new taxes for each white person in America. A family of three would pay $14,285 in new taxes and a family of 4 would pay $19,047 in new taxes.

The median income for white families is roughly $45,000. These families already pay nearly 30% ($13,500) of their income in income taxes. Thus the total take-home income is $31,500. Over ten years the total take-home wages equals $315,000 and over five years, $157,500.

If these new taxes accumulated to the amount of one trillion dollars over five years, to generate that much revenue would equate to a new tax increase on total take-home salary of 12.04%. But that is just on what they keep. $19,000 in new taxes/5 years = $3,800 in new taxes/yr. To raise taxes $3,800/yr is an increase of 8.33% on their entire income in a year, conservatively estimated.

So therefore on $45,000 income at 38% tax (sales tax on all purchases plus income tax, not including taxes for airline tickets, telephone services and other taxes such as gasoline, tobacco, alcohol, etc.), these taxes for 5 years must be increased to a minimum 47% on the entire income.

So a family of 4 making $45,000/yr will now see what they take home dwindle to less than $22,000.

Here's the kicker. The Department of Health and Human Services reported in 2008 that the federal poverty level or threshold for a family of 4 is $21,200. Because of the nature of the progressive tax, which would likely be used if reparations were approved by Congress, the new tax for reparations would have an especially devastating impact on the poor but would be nearly as devastating for the middle class. While the upper class would be paying much more they would not be hit as hard. Because a family of 4 would see their entire yearly income dwindle to less than $22,000, this would make, in my estimate, close to 50% of white households, and many more single whites, in America below the poverty line.

On the flip side of the coin, the median black household makes $29,000/yr. During the period of reparations payouts (5 years in this scenario), the average income for a black household will reach $50,000, mostly in untaxed income. The taxable earnings, which are so low no meaningful contribution to America's bank account would be expected, is left virtually untouched and so the average black family of 4 can expect $50,000 flat for 5 years.

If we are to accept these statistics it is clear that reparations cannot be awarded overnight. In fact, even in 5 years the amount of a trillion dollars would be literally back breaking to a majority of white people. Nearly all figures made here are on the conservative side and thus the true picture may actually be much, much worse. It is a no brainer: Reparations are racism of the highest form and will prove devastating to white people. With black demands of "I want it now," it seems even more absurd. If we took ten years to come up with a trillion dollars we'd still be robbed blind. This is an enormous amount of money that the human mind can't begin to comprehend.

Keep in mind, the average net worth per white household is $92,000 or over $7 trillion in total value of savings. Reparations would steal over 14% of the majority of America's hard earned savings (not just yearly pay, but entire career earnings/savings) to pay a relatively small minority that contributes next to nothing to the greater society or economy because of something that happened to one guy's father's father's father's father's father.

I will leave you with some words of wisdom from an anonymous poster at this forum.

"The problem as I see it is that realistically, only a small percentage of whites owned slaves (1.4% in 1860 out of 27 million whites), and obviously, it is not fair to financially punish all whites and make them apologize for something they had no hand in. And how do you handle the fact that free blacks were proportionately more apt to have slaves than whites. In Charleston in 1860, 125 free [blacks] owned slaves.

Included quote:

"In 1860 there were at least six [blacks] in Louisiana who owned 65 or more slaves. The largest number, 152 slaves, were owned by the widow C. Richards and her son P.C. Richards, who owned a large sugar cane plantation. Another [black] slave magnate in Louisiana, with over 100 slaves, was Antoine Dubuclet, a sugar planter..."

"The majority of slaveholders, white and black, owned only one to five slaves. More often than not, and contrary to a century and a half of bullwhips-on-tortured-backs propaganda, black and white masters worked and ate alongside their charges; be it in house, field or workshop. The few individuals who owned 50 or more slaves were confined to the top one percent, and have been defined as slave magnates."

Reference www.americancivilwar.com