Robert Johnson, founder of Black Entertainment Television, told CNBC on Monday the U.S. government should provide $14 trillion of reparations for slavery to help reduce racial inequality.
The wealth divide and police brutality against blacks are at the heart of protests that have erupted across the nation following last week’s killing of George Floyd during an arrest in Minneapolis.
“Now is the time to go big” to keep America from dividing into two separate and unequal societies, Johnson said on “Squawk Box.”
“Wealth transfer is what’s needed,” he argued. “Think about this. Since 200-plus-years or so of slavery, labor taken with no compensation, is a wealth transfer. Denial of access to education, which is a primary driver of accumulation of income and wealth, is a wealth transfer.”
Johnson, 74 made history as America’s first black billionaire when he sold BET to Viacom in 2001. Shortly after the sale, he started the investment firm The RLJ Cos. He’s no longer on the Forbes billionaires list.
Calling reparations the “affirmative action program of all time,” Johnson said they would send the signal that white Americans acknowledge “damages that are owed” for the unequal playing field created by slavery and the decades since with a “wealth transfer to white Americans away from African Americans.”
“Damages is a normal factor in a capitalist society for when you have been deprived for certain rights,” he said. “If this money goes into pockets like the [coronavirus] stimulus checks … that money is going to return back to the economy” in the form of consumption. There will also be more black-owned businesses, he added.
Johnson said the need for reparations has been on his website since last year. “I’m not new to this challenge.” He said he’s not advocating “more bureaucratic programs that don’t deliver and don’t perform.” He stressed, “I’m talking about cash. We are a society based on wealth. That’s the foundation of capitalism.”
Later on “Squawk Box” Merck Chairman and CEO Ken Frazier, who is black, expressed doubts about whether reparations would be possible. “I don’t believe we’ll be able to get anything like that through our political system.” However, he said, “Leaders in the business community have to be a unifying force. They can be a source of opportunity. They can be a source of understanding.”
“We as business leaders can step up and solve many of these economic problems for people,” Frazier added, saying that education, particularly financial literacy, is the “great equalizer.”