A favored argument by market fundamentalists is that capital markets are efficient, and will find equilibrium if left unfettered. For this argument to find root, issues of inequality, discrimination and racism must be ignored (or pushed aside), because, as the argument goes, efficient markets will themselves deal with discriminatory participants by eventually sifting them out of the system as inefficient market players. Additionally, law and economics proponents favor "post-racial" rhetoric that suggests that in 2012, the United States has entered a colorblind era of post-racialism. With an African American President and markets more advanced than at any time in history, issues of economic inequality and continuing racial division are simply no longer important considerations, per the post-racialist.
Several events in the past few weeks belie this post-racial sentiment, the following being one of the most egregious:
In Georgia this week, third and fourth grade students at Beaver Ridge Elementary School were given math problems, MATH PROBLEMS, that asked students to consider if a slave was beaten twice per day, how many beatings would the slave receive in one weeks' time? Another question on the elementary students' math homework asked them to calculate how many bushels of cotton Frederick picked? Outraged parents are meeting with school officials, who were quick to claim that nothing "malicious" was intended by these math questions, though they have opened an investigation into which teachers drafted the questions.
Post-racial?
I think you misunderstand the efficient markets hypothesis. The theory does not posit that racism no longer exists in the world. You are creating an artificial opponent, then arguing against it to try to prove a point.
ReplyDeleteGranted, I have not studied post-racialism, but for there to ever be a time when racialism is totally done with it seems to me that we would also have to do away with affirmative action. I agree that affirmative action serves a noble purpose, but does it not also create an eventual racialist problem? If affirmative action is seen as a remedy for years of wrongdoing, won't there logically come a time when equality would demand that affirmative action be stopped? And if anyone were to eventually propose that it end, won't that create racialism once again? This may raise eyebrows, but the question irks me.
ReplyDeleteI find this post particularly ironic considering the recent article by the Wall Street Journal claiming that segregation is at its lowest point in history. Based on those test questions and that WSJ article, I have to believe that there is little correlation between segregation and racism. Although our society as a whole is now integrated, apparently, racial slurs still exist in the minds of many living next door to minorities. Cities are typically more integrated than rural areas, so maybe this town Georgia is not exactly the epitome of integration but, I still find it disturbing that at a time when segregation is supposedly at its lowest, a teacher would think it’s appropriate to include a test question about Frederick picking cotton.
ReplyDeleteWSJ article: http://online.wsj.com/article/SB10001424052970203920204577193261646566778.html?KEYWORDS=racial+lowest
I would say this article is not ironic, but prescient, considering the on-going struggle to get someone to arrest Trayvon Martin's killer.
ReplyDeleteHere are a few reasons why the market fundamentalist argument ("The free market will eliminate/minimize racism.") fails:
1. It fails to take into account the fact that markets can reward racism and other isms. This can happen when markets cater to racist consumers.
2. It fails to take into account that racisms and other isms can cause actors to act in ways that do not maximize profits. A ready example is the exclusion of the talents of women from many industries for many years, despite obvious capabilities and benefits.
3. It fails to take into account that the duration of time for the racism to be eradicated is unacceptably long. Dynasties of oppression may persist for hundreds of years before social climate changes and these changes are then reflected into the market.
In sum, the free market may not correct racist practices, it takes too long when it does correct racist practices, and sometimes it even exacerbates racist practices.
--Rachel L.