A functioning democracy is essential to a functioning economy.
A robust, multiracial democracy is critical to achieving a thriving, equitable economy. In recent years, our democracy has suffered significant blows—from the Supreme Court’s Citizens United v. FEC decision, which has allowed dark money to infiltrate our political system and heavily influence elections and nominations, to its decision in Shelby County v. Holder, which gutted the Voting Rights Act and has led to restrictive voting laws and partisan gerrymandering practices throughout the country. These assaults on our democracy have had wide-ranging implications—among the most consequential, an increasingly inequitable economic system that favors the few over the many.
Along with other antidemocratic measures, the Citizens United and Shelby County decisions have played a significant role in shifting power from everyday Americans to corporations and special interests, resulting in unprecedented levels of inequality, wealth hoarding, and the concentration of economic power among a handful of billionaires. A small group of individuals have, in large part, rigged our economy. And their disproportionate economic power translates into equally disproportionate political power, playing an increasingly outsized role in shaping the way our society functions—and for whom.
The concentration of economic power among a wealthy few hurts all Americans, but it is especially detrimental to people of color. The 400 richest Americans—the overwhelming majority of whom are white and male—own more wealth than all Black households and a quarter of Latinx households combined. Even among less wealthy Americans, white people still fare far better than people of color, with the median Black household owning $24,100 in wealth and the median Latinx household owning $36,050, compared to the $189,100 in wealth owned by the median white household.
Our economy and our democracy are mutually reinforcing.
There is a strong, symbiotic relationship between democracy and the economy. For example, research indicates that Section 5 of the Voting Rights Act of 1965—which mandated that states with histories of racially discriminatory voting laws seek permission from the federal government before making changes to their voting laws, but that has been rendered inoperable in the aftermath of the Shelby County decision—narrowed the racial wage gap by 5.5 percentage points in the areas where it was most rigorously enforced. Reducing the racial wage gap, in turn, has a clear economic benefit: One report shows that closing the Black-white wage gap alone would add $2.7 trillion to the US economy.
A broken democratic system also stymies the enactment of progressive economic policies that enjoy broad public support—policies that would help all Americans, but especially people of color.
Similarly, after Shelby County largely stripped away the Voting Rights Act’s power to protect racial minorities’ right to the franchise, Aneja and Avenancio-León (2019) found that the racial wage gap began to widen once again: For every 1 percentage point increase in a county’s Black population, the racial wage gap increased from 0.65 to 0.80 percentage points in the public sector, and 0.49 and 0.59 percentage points in the private sector.
That the racial wage gap fluctuates in response to the presence or absence of federal voter protection measures should come as no surprise. Strong voting rights laws allow for individuals of all racial identities to participate in our democracy. Access to the ballot box means that Americans can vote for representatives and policies that most benefit them, economically and otherwise. Greater democratic power will therefore naturally result in greater economic prosperity for all.
A broken democratic system also stymies the enactment of progressive economic policies that enjoy broad public support—policies that would help all Americans, but especially people of color. Take public sentiment regarding the federal minimum wage as an example. A substantial majority of Americans are in favor of raising the minimum wage from $7.25 to $15 an hour. A $15 minimum wage would help most Americans, but Black Americans—whose earnings would increase by 38.1 percent (compared to white workers, whose earnings would increase by 23.2 percent)—would especially benefit from such a policy. Yet despite widespread public support, the Senate, which is an inherently antidemocratic institution due to its structure and which gives outsized political weight to those living in states with lower populations, has refused to pass legislation that would increase the minimum wage.
In turn, a broken economic system that exclusively benefits a minority of wealthy, white males at the expense of the majority of Americans erodes democracy by making it difficult for those who shoulder the burden of exploitative economic policies—particularly communities of color—to prioritize civic engagement and participate in the political process. This creates a vicious cycle in which both our democracy and economy are continually weakened and threatened by the failure to meaningfully include representation for all Americans.
It is clear that senators cannot expect to foster a thriving, equitable economy while continuing to neglect our democracy. The Senate was willing to change the rules of the filibuster to prevent a disruption to our economy, and now it must do the same to protect our democracy. As Dr. Martin Luther King Jr. Day—the deadline to vote on the filibuster exception—approaches, the Senate must act to safeguard these entwined institutions of our economy and democracy and pass the Freedom to Vote: John R. Lewis Act.