Book Review: The Plunder of Black America: How the Racial Wealth Gap Was Made

The Plunder of Black America: How the Racial Wealth Gap Was Made. By Calvin Schermerhorn. New Haven, CT: Yale University Press, 2025. Hardcover, 279 pp. $30.00.

Reviewed by Kevin C. Donovan

“By one recent measure, for every dollar that a median white American household has, an African American one has only sixteen cents.” (1) In his The Plunder of Black America: How the Racial Wealth Gap Was Made, Arizona State University history professor Dr. Calvin Schermerhorn seeks to explain this discrepancy both as a matter of history and through the eyes of eight representative African American families. The result is an intriguing combination of economic/political analyses and personal narratives.

Dr. Schermerhorn’s approach is sweeping. The reader meets Maiala, a woman captured in modern-day Angola and brought to Virginia in 1622, as well as Broteer Furro, son of an African prince enslaved in 1739 who ended up in Connecticut. Morris managed one of George Washington’s farms before and during the Revolution. Others who are featured carry the story beyond the Civil War into Reconstruction and up to the present, in venues including Louisiana, Michigan, Oklahoma, and California.

The common thread is the obstacles to wealth creation faced by each man or woman highlighted, as well as their families. The author observes that wealth is not simply the accumulation of money earned by labor. Although Dr. Schermerhorn calculates the effective amount of wages stolen by the masters of the enslaved, he adds that the enslaved could not pass on any inheritance to family members, depriving them of the ability to start life on a stronger financial foundation. Also, enslaved persons could not educate their children, depriving offspring of the opportunity to enhance their economic position going forward. Destruction of the family unit during slavery also robbed African Americans of stability, experience and wisdom that could have been passed down generations.

But slavery is far from the only obstacle facing Blacks. The author identifies an ever-shifting array of specific discriminatory barriers to wealth creation that evolved over the years, from Jim Crow barriers to participation in political power to discrimination in the award of New Deal agency, and post-World War II government benefits.

The devastating economic effects of residential “redlining” are the subject of special focus. The practice led to devaluation of Black-owned real estate, while making credit for home improvement or other life-altering activities (e.g., education loans) more costly. Discrimination in federal loan programs for farmers helped drive out African American farmers. The author notes the astonishing statistic that “between 1920 and 2000… African American farmers lost 14 million of the 15 million acres of land they had acquired since Emancipation.” (129) Meanwhile, the War on Drugs and the rise of mass incarceration led to vast numbers of Blacks living with conviction records, severely hampering employment and other opportunities. “A conviction could destroy family wealth…Families with an incarcerated family member had an average reduction in household wealth of 64.3 percent between 1996 and 2011.” (165)

In addition to presenting the real-world experiences of the highlighted families, including through personal interviews, Dr. Schermerhorn relies on a wide variety of academic studies of historical trends and the economic effects of discrimination to make his points, including analyses of the wealth gap between Black and white families over the decades. But his source for at least one of his claims appears subject to debate.

In positing that government anti-inflation policy of the 1970s and early 1980s “put downward pressure on worker wages” (164), causing shares of income to shift from the poorest in favor of (predominantly white) executives, Dr. Schermerhorn quotes Federal Reserve Chairman Paul Volcker as saying (in 1979), “The standard of living of the average American has to decline…I don’t think you can escape that.” (164) The author then adds that “executive pay soared while worker wages stagnated even though worker productivity rose quickly.” (164-165) The author repeats this point in claiming that at the time of the “Reagan Revolution,” “the Federal Reserve’s anti-inflation policies began decreasing worker wages” (168), all as if it were a deliberate policy choice. The support for the alleged Volcker quote appears to be an October 18, 1979, New York Times article.

The problem is that Volcker apparently never said what is attributed to him, at least not in the sense of supposedly setting forth a deliberate Federal Reserve policy of depressing worker wages. Indeed, the New York Times article was challenged as inaccurate shortly after it appeared. To the contrary, Volcker’s position in October 1979 was that because worker productivity had been dropping, that fact, coupled with high energy prices, made it inevitable that the American standard of living would fall. Volcker was simply making a prediction, not setting policy.[1] Volcker himself made the same point in an October 29, 1979, television interview.[2] Further, in 1981 testimony before Congress, Volcker objected to the prior mischaracterization.[3]

Despite the foregoing, the author’s intriguing study, his conclusions and recommendations for remedial action surely will be fodder for thoughtful discussions and perhaps policy decisions going forward. While not strictly confined to the Civil War and Reconstruction eras, Dr. Schermerhorn’s work casts a new look at an old evil.

 

[1] Tim Barker, “A Note on Paul Volcker and the Standard of Living,” Medium, Oct 19, 2017, https://medium.com/@timbarker_2092/a-note-on-paul-volcker-and-the-standard-of-living-d262f7f83b51.

[2] Paul A. Volcker, ‘Interview on “ABC News’ Issues and Answers,”’ October 29, 1979, pg. 4 of transcript, https://fraser.stlouisfed.org/title/statements-speeches-paul-a-volcker-451/interview-abc-news-issues-answers-8208.

[3] Barker, supra. In his testimony, Volcker stated: “I think you have entirely misconstrued the object of the policy and the sense of those statements I have made from time to time when asked about the implications of low and declining productivity in the economy.”