Summary: The Southern economic development model has failed to create shared prosperity in the region. In fact, this model was deliberately designed to do the opposite—to extract the labor of Black and brown Southerners as cheaply as possible. This report examines the racist roots of the model and provides the necessary context to challenge the enduring racial hierarchy in the South.
Key findings
- From low wages to unfair tax policies to a weak safety net, the Southern economic development model ensures that businesses continue to have access to cheap Black labor even after the abolition of slavery.
- A key component of the Southern economic development model is low wages. Twenty states still use the federal minimum wage of $7.25, and half of these states are in the South.
- On top of struggling with low wages, many Southerners—particularly Black and brown Southerners—have trouble accessing unemployment insurance and other benefits, which are often inadequate.
- Policymakers have worked to limit Southerners’ rights to unionize and bargain collectively since unions make it hard to keep wages low and benefits stingy.
Why this matters
Analyzing the roots and evolution of the Southern economic development model shows that civil rights are deeply connected to workers’ rights. We need an economic strategy that reverses the impact of 150 years of racist, anti-worker policymaking in the South.
How to fix it
The Southern economic development […]
This is an excellent report, especially the details of the “southern economic model,” which is characterized by weak regulations, low wages and the absence of a social safety net. In such a system, the benefits go exclusively to the rich.
It should be obvious that this economic model, or agenda, if you will, was implemented at the national level by Ronald Reagan and barely altered by subsequent politicians of either the Democratic or Republican variety. The Democrats never used their majorities of the past 40+ years to undo the basic structure of this model, and of course, neither have the Republicans. Until this southern economic model is dismantled and relegated to the dustbin of history, there is no hope that the US can address any of its most pressing problems.
It is shameful that the economic pretensions of the losers in the Civil War have become the economic model in the US, Canada and any other country the US can beat into submission. It is the model underlying all of the trade agreement of the past 50 years.
It is even more shameful that we are unable to vote out the type of politicians that keep this model going even though we all breathe the polluted air it produces, suffer from debased “for profit” health care, pay more for low quality goods and services because of rigged regulation and judicial systems, and, above all, are faced daily with the human consequences in the form of high un- and under-employment, low wages, homelessness, shortened lifespans and food insecurity. The fact that we are ruining the Earth’s human support systems at a rate unequaled in history is a further reason for deep shame.
Individual voters can’t fix this problem (they have been trying unsuccessfully since Ronald Reagan entered the White House): new leadership must be elected to wipe out this southern slave economic model by root and branch. Sadly, not one politician or civic leader has emerged who could pull this off, even assuming he or she had majority support.