Photo: Former California State Sen. Holly Mitchell, D-Los Angeles, was chair of the Senate Budget and Fiscal Review Committee. Here she discussed the budget before the Senate at the Capitol in Sacramento, June 25, 2020. (AP Photo/Rich Pedroncelli, File)
On March 29, California’s reparations task force voted that only Black Californians who can prove a direct lineage to enslaved ancestors will be eligible for the statewide reparations initiative to repair the harms and enduring legacy of slavery.
But now some say the state is too broke to pay an estimated reparations cash amount of $680 billion.
California is the state with the largest economy. Its gross domestic product (GDP) was about $3.09 trillion in 2020 and $3.35 trillion in 2021, accounting for 14.6 percent of the total U.S. economy. If California were a country, it would be the fifth-largest economy in the world, more productive than India and the U.K.
It comes down to whether California reparations will be distributed by cash or other methods. According to some economists, California might not be able to afford cash payments.
The nine-member task force voted 5-4 in favor of defining eligibility for reparations based on lineage “determined by an individual being an African American descendant of a chattel enslaved person or the descendant of a free Black person living in the US prior to the end of the 19th century,” the motion read.
“How exactly will we capture these qualitative elements associated with emotional harm and distress from a system that has been so extracting and so damaging?” asked economist Kaycea Campbell.
To determine compensation, the task force agreed to use what economists call a state-specific harms model.
The model would examine what specific harms California should pay for, including unjust property seizures, housing discrimination, unwarranted police violence, and labor discrimination, for example.
The task force rejected using what economists call the national model for reparations which calculates an amount due to those eligible and divides that number among the group.
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Economists urged against using the national model because they explained that if the goal of compensation was to address the wealth gap between Black and white Americans, then each eligible Black person could be owed more than $300,000, Fox 40 reported.
That would cost the state about $670 billion. Reportedly, California cannot afford this. The entire 2022-2033 state budget is estimated to be less than half that amount at $286.4 billion.
Still, what the economists seemed not to have considered is that reparations payments would not have to be made in total. They could be broken up and paid over a period of time. If payments were spread out over 20 years, it would be at a much lower cost to the state of $34 billion a year. This would equal about $15,000 annually for each eligible person.
Photo: Former California State Sen. Holly Mitchell, D-Los Angeles, was chair of the Senate Budget and Fiscal Review Committee. Here she discussed the budget before the Senate at the Capitol in Sacramento, June 25, 2020. (AP Photo/Rich Pedroncelli, File)
