A common admonishment you hear from some conservatives is that Black Americans need to stop relying on the government for assistance. Former Chair of the Senate Republican Conference Rick Santorum stated: “I don’t want to make black people’s lives better by giving them somebody else’s money; I want to give them the opportunity to go out and earn the money.”[1] Jeb Bush remarked that Democrats lure African Americans with the promise of “free stuff.”[2] Ronald Reagan infamously perpetuated the stereotype of the Black single mothers as a “welfare queen” during his 1976 presidential campaign speech—thereby creating a damaging association between government assistance and African American women.[3] Former presidential candidate Newt Gingrich stated that he would “go to the NAACP convention and tell the African-American community why they should demand paychecks instead of food stamps.”[4] Additionally, Sean Hannity even claimed that Halloween teaches kids to look for handouts.[5]
The idea that Black Americans rely on handouts from the government is a harmful myth perpetuated by conservative narratives. This myth puts forward the idea that Black Americans are inherently lazy and lack ambition while conveniently ignoring the myriad of obstacles and barriers put in place by the government that have impeded African American economic and social progress. Far from relying upon government handouts, the African American community has consistently demonstrated unparalleled resilience, determination, and perseverance in the face of adversity.
The irony of the ‘Blacks are just looking for a hand out’ myth is that the white community has benefited directly from various government policies that have enabled them to accumulate wealth and prosper at the expense of Black Americans.
These policies were indeed the real handouts—often excluding African Americans—which has resulted in a legacy of staggering inequality and systemic racism that continues to ravage African American communities to this day. In this chapter, I examine the government’s history of handouts to white Americans that enabled them to accumulate generational wealth.
From Joint-Stock Companies to Land Grants: How White America Was Built on Government Handouts
The founding and development of America’s colonies is a prime example of how government assistance has been instrumental in building wealth for white Americans. In colonial America, joint-stock companies established under the permission of the royal crown incentivized subjects in Britain to immigrate to the New World by offering them “free” land to develop their plantations. The Virginia Company of London, the first joint-stock company, led the colonization and settlement of America by receiving charters from the crown to set up and settle colonies. Grants were distributed to immigrants to set up farmsteads. Other joint-stock companies followed, and the Chesapeake colonies were all settled the same way.[6]
Colonies that were set up directly by the monarchy, such as New York, New Jersey, and New Hampshire, were given to the King’s friends.[7] Furthermore, colonies like the Carolinas and Georgia were established as places of refuge for marginalized or persecuted groups in England.[8] From its inception, America was made possible with government or administrative assistance to whites. The frontier myth of rugged individualism is just that: a myth. The founding and cultivation of America’s colonies were financially supported by the monarchy.
The “free” land given to British immigrants to settle in the American colonies was a form of handout because it was a subsidy provided by the government (monarchy) to incentivize settlement and development of the colonies. The charters for the thirteen colonies all reveal that the monarchy was invested in their economic success. This effort required settlers and inevitably, slaves to ensure that the agricultural enterprise would be profitable for England. These land grants were almost exclusively restricted to whites from Europe and, as I will show, were a significant factor in the accumulation of wealth by white Americans during the colonial era. This demonstrates how government assistance and subsidies have played a significant role in the accumulation of wealth by white Americans throughout history, while marginalized groups have been left out of such opportunities.
The Homestead Act: A Handout for White Americans and a Barrier for Black Americans
The Homestead Act, which provided free land to citizens to settle and cultivate, was a form of government assistance that had significant implications for wealth accumulation and poverty reduction in America. However, this policy was designed to benefit white Americans primarily, as Black Americans were routinely discriminated against and excluded from its benefits.[9] While the Homestead Act was officially open to all citizens, in practice, Black Americans were often disqualified from taking advantage of the policy due to systemic discrimination.
African Americans were economically, politically, and socially vulnerable and lacked the resources and experience to navigate the complex bureaucracy of government programs. Moreover, African Americans were often coerced into signing year-long labor contracts that effectively re-enslaved them and prevented them from benefiting from the policy. In contrast, white Americans were able to accumulate significant wealth and property ownership as a result of the Homestead Act, which became a template for future government policies that excluded African Americans from opportunities for wealth accumulation.[10]
Thus, the Homestead Act can be seen as a form of handout for white Americans, as it provided them with free land and opportunities for wealth accumulation while systematically excluding and oppressing Black Americans. Journalist Reggie Jackson remarks:
The number of adult descendants of the original Homestead Act recipients living in the year 2000 was estimated to be around 46 million people, about a quarter of the US adult population. If that many white Americans can trace their legacy of wealth and property ownership to a single entitlement program, then the perpetuation of black poverty must also be linked to national policy. Indeed, the Homestead Acts excluded African Americans not in letter, but in practice – a template that the government would propagate for the next century and a half.[11]
Meanwhile, the exclusion and discrimination against Black Americans from this program, combined with the exploitation of their labor, led to the perpetuation of poverty and the systematic disadvantage of their communities. This legacy of discrimination continues to impact Black Americans today.
The G.I. Bill: A Handout for White America
The Servicemen’s Readjustment Act, commonly known as the G.I. Bill, is often hailed as a groundbreaking piece of legislation that helped millions of American veterans reintegrate into civilian life after World War II. However, what is often overlooked is that the bill was essentially a handout for white Americans, as its implementation was plagued by racial discrimination that ensured Black veterans were largely excluded from its benefits.
Historian Ira Katznelson, in his book When Affirmative Action Was White: An Untold History of Racial Inequality in Twentieth-Century America, explains that “the law was deliberately designed to accommodate Jim Crow. “[12] In fact, the racial discrimination that black soldiers faced during the war extended to the G.I. Bill process as well. In New York and New Jersey, for example, of the 67,000 mortgage loans that were issued, less than 100 of the recipients were Black veterans.[13]
Racial discrimination in the application of the Bill reinforced racial covenants, which were restrictive clauses in property deeds that prevented people who were not white from buying or occupying land. These were legally enforceable contracts until 1948 but were unofficially practiced well after the practice was ruled unconstitutional. Whites used these restrictive clauses to explicitly keep Blacks from owning properties. When, by some miracle, African Americans got around this barrier they were met with sabotage and, if that didn’t work—violence.
The case of Wilbur Gary and his wife illustrates this. In 1952, Black navy veteran Wilbur Gary managed to buy a house in the newly built suburb of Rollingwood, California. Virtually every house in the neighborhood had been covered with a racially restrictive covenant. It was a white fellow navy veteran who sold the property to the Gary family, anyway.[14] The response was that the homeowners’ group, Rollingwood Improvement Association, demanded that the racial covenant be enforced. This was in spite of the practice being struck down by the Supreme Court in 1948. Eventually, the NAACP got involved, and white residents came together to buy the home from the Garys. When the Garys refused to sell, a mob of 300 whites gathered in front of their house.[15] They shouted racial slurs and threw bricks. They even burned a cross in the yard. The police stood there and refused to stop the mob for most of the ordeal. They only stepped in when the NAACP pressured the governor and the local district attorney to order them to do something. The police begrudgingly did their job, but no arrests were made.
FHA Loans: A Handout for White America
The Federal Housing Administration (FHA) was established in 1934 to stimulate the housing market and encourage homeownership during the Great Depression. The FHA introduced the concept of mortgage insurance—thereby allowing banks to provide more loans with lower down payments and making it easier for Americans to become homeowners. However, the benefits of the program were not equally distributed, as the FHA systematically excluded Black Americans from its benefits, perpetuating racial segregation in housing and exacerbating the racial wealth gap.[16] The FHA’s underwriting policies explicitly prohibited loans to African Americans, creating a system of redlining that relegated Black Americans to inferior and segregated housing. The FHA used racist criteria to determine loan eligibility, such as proximity to Black communities or the presence of Black residents in neighborhoods.
The FHA also funded construction projects that built segregated housing and enforced racial covenants that prohibited the sale of homes to Black Americans in white neighborhoods. The FHA’s discriminatory policies reinforced the racial wealth gap by limiting access to affordable homeownership for Black Americans, preventing them from building equity and wealth through homeownership. In contrast, white Americans were able to take advantage of the program, accumulating wealth through homeownership and passing it down through generations.[17] Thus, the FHA can be seen as a form of handout for white America, as it provided them with access to affordable homeownership and opportunities for wealth accumulation while systematically excluding and oppressing black Americans.
White America’s Attacks When Black People Do For Self
Black Americans have showcased remarkable resilience and entrepreneurial prowess, even in the face of daunting systemic barriers and institutionalized racism. The government doesn’t merely offer handouts to Black Americans—no, it suffocates their entrepreneurial spirit with its heavy-handed tactics, kicks them out of lucrative business opportunities with its mighty legs, ruthlessly crushes their economic initiatives with its elbows, and vigorously prevents them from scaling the ladder of prosperity with its bony knees! Black Americans aren’t sitting back and waiting for government handouts; they are fighting tooth and nail to carve out a space for themselves. The government has slyly employed its hands to actively subvert and obliterate Black economic progress—leaving a trail of shattered dreams and missed opportunities throughout history.
Marcus Garvey and the Universal Negro Improvement Association (UNIA) tackled Black poverty by fostering economic self-sufficiency and Black entrepreneurship. Garvey believed that economic independence was crucial to achieving true freedom and equality for Black people. One of the UNIA’s primary objectives was to galvanize economic opportunities for Black people. Garvey exhorted Black people to initiate businesses, support Black-owned enterprises, and pool their resources to invest in economic ventures. He also encouraged Black people to procure land and establish agricultural cooperatives to promote self-sufficiency and create jobs. The UNIA established sundry economic ventures, including the Black Star Line—a shipping company that aimed to invigorate job creation and provide transportation for Black people—and the Negro Factories Corporation, which aimed to establish Black-owned factories to create jobs and economic opportunities.[18] Garvey also underscored the importance of education and self-improvement to surmount poverty. He founded the Negro World newspaper and the Universal African Legion, which offered education and training to Black people. J. Edgar Hoover’s Federal Bureau of Investigation (FBI) spied on Garvey and his followers, enlisting wiretapping, infiltration, and harassment to suppress their movement.
The Universal African Legion was a beacon of hope for Black people seeking education and training.[19] However, J. Edgar Hoover and the FBI saw Marcus Garvey and his followers as a potential source of Black radicalism. Garvey’s advocacy for Black nationalism and economic self-sufficiency threatened the established order, so Hoover took action. [20]
Surveillance was authorized, and the FBI monitored Garvey and the UNIA’s activities, tapped their phones, and infiltrated their meetings. Harassment tactics were used, including spreading false rumors about Garvey’s personal life and filing baseless charges against him. Negative information was disseminated to the media, painting Garvey and the UNIA as radical and extremist.[21]
Hoover even played a role in Garvey’s deportation to Jamaica in 1927.[22] The burstiness of their tactics, from infiltration to deportation, adds to the perplexity of the situation. Hoover’s efforts to destroy Garvey and the UNIA were a testament to the government using its hands to destroy black economic self-help initiatives.[23]
The Black Panther Party’s Free Breakfast Program burst onto the scene as a social welfare initiative that aimed to alleviate poverty and hunger in Black communities.[24] The program ignited a spark of hope in neighborhoods with high poverty rates by providing free breakfast to school-aged children. Launched in Oakland, California in 1969, the program quickly spread to other cities across the United States. The Free Breakfast Program was a culmination of the Black Panther Party’s ten-point program, which called for an end to poverty and the provision of basic necessities to all people, regardless of race or socioeconomic status. The Panthers’ analysis of the ways in which poverty and hunger were used as tools of oppression against Black communities informed the program.
The Free Breakfast Program was fueled by Black Panther Party volunteers who cooked and served breakfast to children before school—thereby providing a nutritious meal to those who might otherwise go hungry. It was more than a meal: it was a space for community members to come together, build relationships, and empower one another.[25] The program’s success was widely recognized as a valuable contribution to the community, highlighting the Panthers’ commitment to community empowerment.
The Federal Bureau of Investigation (FBI) and the Chicago Police Department (CPD) took several steps to undermine the Black Panther Party’s Free Breakfast Program. The FBI and CPD saw the Black Panther Party as a threat to the established order and sought to disrupt their efforts to build community power and address systemic issues like poverty and hunger. The FBI and CPD targeted Black Panther Party members with harassment and intimidation tactics, including frequent arrests and surveillance. They conducted several raids on Black Panther Party offices and homes, seizing equipment, including food and supplies, intended for the Free Breakfast Program. The FBI and CPD launched a smear campaign against the Black Panther Party, painting them as a violent and extremist organization, to discredit the Panthers and discourage community members from participating in their programs.[26]
Elijah Muhammad, Malcolm X, and the Nation of Islam tackled Black poverty by advocating for economic self-sufficiency, self-reliance, and entrepreneurship. They believed that Black Americans should create their own businesses, build their own jobs, and control their economic destiny.
One key principle within The Nation of Islam was “do for self,” which stressed Black Americans’ independence from mainstream systems mostly controlled by white interests. This involved setting up independent institutions, including businesses with adequate economic systems. The importance of this was highlighted through the nation’s establishment of several thriving ventures such as restaurants, bakeries, and retail stores, providing job opportunities for Black people and demonstrating the viability of Black-owned companies.[27]
Malcolm X championed the idea of Black entrepreneurship, urging his kin to prioritize self-reliance and carve out successful ventures. Elijah Muhammad recognized the pivotal role of education in combating poverty and established the Muhammad University to empower Black Americans with enriched learning experiences. The FBI, determined to undermine any threats to their entrenched power structures, set their sights on the economic programs established by the Nation of Islam. These initiatives sought self-sufficiency and job creation for Black Americans—thereby challenging the status quo. To stymie their progress, FBI agents resorted to tactics like surveillance and intelligence gathering.[28]
The FBI explicitly targeted the Nation of Islam as part of a larger strategy aimed at quashing Black activism and preserving the existing hegemonic powers. This thoughtfully orchestrated plan underscores the immense power wielded by law enforcement, who went to great lengths to undermine the potential gains of Black Americans toward economic prosperity.
Black Wall Street burgeoned into a thriving African American utopia, nestled in the Greenwood district of Tulsa, Oklahoma, during the early 20th century. It brimmed with a plethora of Black-owned businesses, including banks, hotels, and other enterprises, which fostered a prosperous economy for its citizens.[29]
However, in 1921, Black Wall Street was shattered to pieces during a racially motivated onslaught by a white mob. The government bore a colossal responsibility for the annihilation of Black Wall Street, as local authorities and law enforcement floundered in their duty of safeguarding the residents and their property.[30] The involvement of governmental officials in the destruction of Black Wall Street was significant. Local authorities and law enforcement failed to protect the residents and their property, and in some cases, actively participated in the violence and destruction.[31]
For instance, the city’s police chief at the time, John Gustafson, deputized white citizens and armed them with weapons to join in the attack on the Black community.[32] The mayor at the time, T.D. Evans also played a role in the violence by denying the authorization of a posse to help protect the community.
Additionally, the Oklahoma National Guard was summoned to assist in the violence, but instead of protecting the Black residents, they arrested and detained them. This allowed the white mob to continue their destruction without interference.
The massacre caused the deaths of hundreds of Black residents and obliterated over 35 city blocks. It was a catastrophic and devastating event in American history, and its ramifications are still felt to this day.
Contrary to stereotypes that African Americans depend on the government for handouts, the obliteration of Black Wall Street underscores how the government has sabotaged the economic prosperity of Black communities. The residents of Black Wall Street were self-sufficient and triumphant in their own right, but they were still susceptible to the racist violence and neglect of those in power. This calamitous event emphasizes the importance of government accountability and the urgency for policies that tackle systemic racism and inequality.
The government’s hand in the destruction of Black Wall Street was not restricted to brute violence but also encompassed the legal system. The government employed violence to raze Black-owned property and businesses—leaving Black residents with nothing.
Black Americans were not and are not only receiving handouts from the government. Rather, the government was using its own hand to strangle Black Americans economically—thereby obstructing them from achieving financial success and prosperity. The destruction of Black Wall Street serves as a prime example of how the government actively worked against Black economic progress, using its hands to dismantle Black-owned businesses, devastate Black wealth, and repress Black entrepreneurship.
The suggestion that hard-work or even innovation is lacking among Black Americans is entirely false—looking back at history alone, we find ample evidence proving otherwise through examples indicating their dedication, spirit of entrepreneurship, and tireless perseverance towards success and the government using their hands to choke Black people economically.
[1] Madison, Lucy. “Santorum Targets Blacks in Entitlement Reform.” CBS News, CBS Interactive, 3 Jan. 2012, www.cbsnews.com/news/santorum-targets-blacks-in-entitlement-reform/. Accessed 31 May 2023.
[2] Liptak, K. (2015, September 25). Jeb Bush says Dems lure black voters with ‘free stuff’. CNN. Retrieved from https://www.cnn.com/2015/09/25/politics/jeb-bush-free-stuff-black-voters/index.html
[3] Levin, J. (2013, December 20). Linda Taylor, welfare queen: Ronald Reagan made her a notorious American villain. Slate. Retrieved from https://www.slate.com/articles/news_and_politics/history/2013/12/linda_taylor_welfare_queen_ronald_reagan_made_her_a_notorious_american_villain.html
[4] Disis, J. (2012, January 5). Newt Gingrich: ‘I will tell black people to demand work instead of welfare’. TheGrio. Retrieved from https://thegrio.com/2012/01/05/newt-gingrich-i-will-tell-black-people-to-demand-work-instead-of-welfare/
[5] Media Matters for America. (2009, October 31). Hannity channels The Onion? Claims “liberal” Halloween “teach[es] kids to knock on other people’s doors and ask for a handout”. Retrieved from https://www.mediamatters.org/sean-hannity/hannity-channels-onion-claims-liberal-halloween-teaches-kids-knock-other-peoples-doors
[6] Yeardley, G. (1618, November 18). Instructions to George Yeardley by the Virginia Company of London. Encyclopedia Virginia. Retrieved May 31, 2023, from http://www.encyclopediavirginia.org/_Instructions_to_George_Yeardley_by_the_Virginia_Company_of_London_November_18_1618
[7] The Virginia Company of London – Historic Jamestowne Part of Colonial National Historical Park (U.S. National Park Service). (n.d.). https://www.nps.gov/jame/learn/historyculture/the-virginia-company-of-london.htm
[8] Lovejoy, D. A. (1964). Equality and Empire The New York Charter of Libertyes, 1683. William and Mary Quarterly, 21(4), 493. https://doi.org/10.2307/1923303
[9] Lipsitz, G. (2011). How Racism Takes Place. Temple University Press.
[10] Lipsitz, G. (2006). The Possessive Investment in Whiteness: How White People Profit from Identity Politics, Revised and Expanded Edition. Temple University Press.
[11] Reggie Jackson. (2020, November 1). America talks about immigrants pulling themselves up by the bootstraps, yet we didn’t even get boots | Milwaukee Independent. Milwaukee Independent. http://www.milwaukeeindependent.com/featured/america-talks-immigrants-pulling-bootstraps-yet-didnt-even-get-boots/
[12] Katznelson, I. (2006). When Affirmative Action Was White: An Untold History of Racial Inequality in Twentieth-Century America. W. W. Norton & Company.
[13] Kotz. (2005, August 28). “When Affirmative Action Was White”: Uncivil Rights. The New York Times. https://www.nytimes.com/2005/08/28/books/review/when-affirmative-action-was-white-uncivil-rights.html?_r=0
[14] Rothstein, R. (2018). The Color of Law: A Forgotten History of How Our Government Segregated America. National Geographic Books
[15] Ibid.
[16] Rothstein, R. (2018). The Color of Law: A Forgotten History of How Our Government Segregated America. National Geographic Books
[17] M. Trifun. (2009, October). Residential Segregation after the Fair Housing Act. https://www.americanbar.org/groups/crsj/publications/human_rights_magazine_home/human_rights_vol36_2009/fall2009/residential_segregation_after_the_fair_housing_act/
[18] Foster, H. (2023, March 27). Black Star Line (1919-1923) https://www.blackpast.org/african-american-history/black-star-line-1919-1923/
[19] Haugen, B. (2008). Marcus Garvey: Black Nationalist Crusader and Entrepreneur. Capstone.
[20] Garvey, M. (1983). The Marcus Garvey and Universal Negro Improvement Association Papers, Vol. II: August 1919-August 1920. Univ of California Press.
[21] Johnson, R. (1998). Race, Law and Public Policy: Cases and Materials on Law and Public Policy of Race. Black Classic Press.
[22] Johnson, R. (1998). Race, Law and Public Policy: Cases and Materials on Law and Public
Policy of Race. Black Classic Press.
[23] Ibid.
[24] Lazerow, J., & Williams, Y. (2006). In Search of the Black Panther Party: New Perspectives on a Revolutionary Movement. Duke University Press.
[25] Lazerow, J., & Williams, Y. (2006). In Search of the Black Panther Party: New Perspectives on a Revolutionary Movement. Duke University Press.
[26] Gash, A. L., & Tichenor, D. J. (2022). Democracy’s Child: Young People and the Politics of Control, Leverage, and Agency. Oxford University Press.
[27] Rogers, W. S. (2019). The African American Entrepreneur: Challenges and Opportunities in the Trump Era, 2nd Edition. Praeger.
[28] Nation of Islam Part 2 of 3. (n.d.). FBI https://vault.fbi.gov/Nation%20of%20Islam/Nation%20of%20Islam%20Part%202%20of%203/view
[29] Carson, C. (2012). Malcolm X: The FBI File. Skyhorse.
[30] Eulinberg, J. S. (2021). A Lynched Black Wall Street: A Womanist Perspective on Terrorism, Religion, and Black Resilience in the 1921 Tulsa Race Massacre. Wipf and Stock Publishers.
[31] Ibid.
[32] Ibid.