Thursday, October 27, 2005
Thomas Sowell on Econ and segregation.
Thomas Sowell, one of my heroes. I was privileged enough to eat lunch with him when the Review hosted. I had no idea what wonderful stuff he had written at that time!
"Those who see government as the solution to social problems may be surprised to learn that it was government which created this problem. Many, if not most, municipal transit systems were privately owned in the 19th century and the private owners of these systems had no incentive to segregate the races.
These owners may have been racists themselves but they were in business to make a profit -- and you don't make a profit by alienating a lot of your customers. There was not enough market demand for Jim Crow seating on municipal transit to bring it about.
It was politics that segregated the races because the incentives of the political process are different from the incentives of the economic process. Both blacks and whites spent money to ride the buses but, after the disenfranchisement of black voters in the late 19th and early 20th century, only whites counted in the political process.
It was not necessary for an overwhelming majority of the white voters to demand racial segregation. If some did and the others didn't care, that was sufficient politically, because what blacks wanted did not count politically after they lost the vote.
The incentives of the economic system and the incentives of the political system were not only different, they clashed. Private owners of streetcar, bus, and railroad companies in the South lobbied against the Jim Crow laws while these laws were being written, challenged them in the courts after the laws were passed, and then dragged their feet in enforcing those laws after they were upheld by the courts. "
