Montgomery Revisited: So racism is bad for business you say…but whose?

Written by Serie McDougal

It was a steamy hot July in1955.  A young Martin Luther King Jr. stepped up to the podium at the Holt Street Baptist Church in the midst of a Bus Boycott to end the segregation aboard buses in Montgomery, Alabama.  He began giving a riveting speech to the crowd who was gathering confidence and inspiration that they could eventually break the back of Montgomery County and force it to end segregated seating aboard buses.  However, King noticed that people began to enjoy the carpooling system they had created as an alternative.  He had been hearing rumblings among the congregation that people were proud of the system they started because it was a creation all their own.  Moreover, they enjoyed one another’s company.  They began to get to know one another on a different level.  They enjoyed being together in the interest of advancing the Black community.  They became more interested in expanding this new experience instead of integrating Montgomery’s busing system.  As King read the crowd, he abandoned his prewritten speech as proclaimed, “I want you to realize the gravity of what you have created.  You have claimed something that Montgomery was never capable of giving you.  Something more valuable than sitting next to someone who is White?  You have claimed your freedom, and you have experienced what that feels like.  Let’s not end that!  Let’s not end this bus boycott!  Let us build and sustain it in perpetuity!  Let's call it  ‘The Harambee Transportation Company’.” The rest is history.
 
Obviously, the above is an alternative history of the Montgomery Bus Boycott.  But why reimagine such a momentous accomplishment?  More specifically, how is it relevant to the work experiences of Black people today? People tend to perform better on their jobs when they are respected at work and find their jobs interesting and fulfilling.  Many African Americans do not have this experience in large part due to racism.  In Chicago, seven African American, current and former employees of the water department are a part of a class-action lawsuit charging that they were and are subjected to systematic denial of promotions and routine racial and sexual harassment.  Yet, racism is said to be bad for business because it denies companies the best and the brightest due to their race. Well, then why engage in systematic bias over a protracted period of time and foster a culture of White supremacy if the market accepts the logic that racism is bad for business? Milton Friedman argued that capitalism was fundamentally good and racism doesn’t make sense because the pressure to make money will force employers to not make decisions based on race.  Racist math doesn’t work according to this logic.  Answering this question requires a different calculus.  The country may lose billions of dollars annually due to employment discrimination that causes loss of productivity and talent.  However, according to the crowding hypothesis as articulated by Bates & Fusfeld (2005), when Black people are crowded into lower paying jobs and systematically denied promotions, their wages will go down or do not rise. Non-Black workers benefit from this because it takes them out of competition with Black workers, making it easier for their wages to rise (Bates & Fusfeld, 2005).  The other kind of capital not accounted for in the logic that racism is bad for business is the psychological capital that is gained from the sense of superiority that is fed by routinized racial harassment.  The same logic applies to sexual harassment but combined with racism the experience is far more pervasive transcending labor markets and class divisions.    However, did the Montgomery Bus Boycott prove Friedman’s logic correct?  Did it prove that racism, in fact, is bad for business?  In fact, it resulted in a collective action model that gave the civil rights movement a blueprint.  However, racism has found new and more resilient means of resisting this economic logic, as it has in Chicago’s water department.  But, imagine for a minute, what would have happened if the Montgomery Bus Boycott had never ended.  Perhaps, the outcome would have been a Black owned transportation company.  Maybe it would have been a model for Black owned business expansion in similar cities across the country.  The Black liberation struggle has developed many methods for advancement.  For example,  the NAACP has made clear the role that legal action plays in challenging racism.  An additional solution to job discrimination may come from moving the creation of Black businesses up the priority list from an “alternative” to a “primary” method of creating work opportunities for Black people in which they are respected, fulfilled, and stimulated.
 
 
Bates, T. & Fusfeld, D. (2005). The crowding hypothesis. In C.A. Conrad,
            J. Whitehead, P.L. Mason & J. Stewart (ed),  African Americans in the US economy.
            Rowman & Littlefield Publishers, pp. 101-109.