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How the Civil Rights Act saved the South's economy

President Johnson shakes Martin Luther King, Jr.'s hand at the signing of the 1964 Civil Rights Act
President Johnson shakes Martin Luther King, Jr.'s hand at the signing of the 1964 Civil Rights Act
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The Civil Rights Act is known for desegregating schools and promoting voting rights. It's not known for having boosted economic output. But the economic legacy of the Civil Rights Act is too often ignored, says Gavin Wright, professor of American economic history at Stanford University and author of Sharing the Prize, a book on the economics of the Civil Rights movement.

Below is an edited transcript of Vox's conversation with Wright.

DK: How often is the Civil Rights Act of 1964 discussed in an economic context?

GW: Civil rights gets lots of attention and it's in the schools, and by and large it's treated as a heroic matter and in some ways a triumphal matter, but mainly [it's spoken of] in terms of the moral and perhaps legal revolution. That's in recognition of some measure of equality or at least delegitimizing institutionalized forms of inequality.

But very often that will be followed by remarks to the effect of, "Well, it was very good, morally good, and perhaps benefited the middle class, but really did not do much with economic realities." And my book intended to refute that claim. I think it was an economic revolution, as well as a political and moral revolution.

But in order to see it, you really have to take a regional perspective, and I think the South continues to be certainly very different from the time this was taking place in the 60s, and I argue it's still different today.

DK: Why do you think the Civil Rights Act isn't seen as an economic story?

GW: I think the attention shifted after the emotional peak of the march on Washington in 1963 and the passage of legislation in 1964, even with the voting rights legislation of '65, the backlash was taking place, and it was a pol backlash against these measures.

Despite what I'm saying was an economic revolution in the South, many young black people in the cities outside the South couldn't see that they were getting anywhere.

And there was this impression that the civil rights movement broke up in disarray and then MLK's message [was] disregarded — that's where the spotlight turned. ... And after 1980, the country took a swing to the right and then we had widening inequality along almost every dimension since then.

So it's easy to look back and say, "Well, the promise of both civil rights as an economic matter and the war on poverty just didn't pan out."

The African-Americans I speak to are quite aware of the revolutionary change in their lives. you could summarize it under the heading of a big expansion of the black middle class, but that phrase doesn't really do justice to the fact that it's large numbers of people with a college education or more and with professional jobs, or at least white collar jobs. its' just that's another reason that I think is missed. Since 1980, almost all of the expansion of black white-collar employment shares have been in the South.

DK: What were all the factors contributing to that boom for blacks in the South?

The first part of that is not too surprising. As of 1964 the South was so far behind. And when I say "far behind," I mean that black occupational status was far below every other part of the country, and black median incomes were lower and poverty rates were higher. So part of that greater progress was a matter of starting out farther behind.

But it has continued to be greater in the South. Probably one of the single most unappreciated facts of modern demography is the black migration into the South from all other parts of the country. You commonly run across the phrase "the great migration," referring to black migration from south to north, beginning around the time of World War I.

Well, it was a big story but it has been reversed since about 1970, and I attribute it directly to the Civil Rights Act itself.

DK: What are some of the most prominent examples of the economic success stories that came form the Civil Rights Act?

It really makes a difference of — do you talk about the upper strata? That is, black, political leadership and black-owned businesses? All these show very positive trends in the South.

But it's the ones that were positive and now don't seem to be that trouble me the most. And that is the studies that show a positive impact of school desegregation. See, there's a case where you really need a long-term perspective in order to find these results because you need longitudinal data.

In some ways the economic payoff to that very revolutionary and controversial change was not very clear at all when it was happening. So many people were very upset, and you had the move into private schools, and you had the phenomenon of tracking — that is, you had schools that appeared to be racially integrated but then you take a closer look and find that there's a college prep track that's mostly white and the remedial track that's mostly black.

It's very easy to live through that and feel, "Well, we're just not getting anywhere. It's a superficial change," and yet the long-term studies show there was big positive impact. It was mainly a positive impact for the black students, but I find very little, if any, adverse effects for the white students.

So I think that's a success story: in other words, a dramatic improvement with one group without any objective costs you can identify for the other group.

And yet school desegregation has no big constituency anymore other than maybe some sociologists and historians because the courts have moved away from enforcing it.

So it's dying out, and the result is the schools are becoming resegregated. And I think that's a shame, because it was not a costly move — maybe [it was] psychologically and politically costly in terms of school budgets — and we are drifting away from it.