My name is Dr. Kaitlyn Henderson. I joined the Patriotic Millionaires four months ago as the organization’s Senior Director of Wage Policy and Legislative Affairs. I came from Oxfam America, where I was the Senior Researcher leading their domestic portfolio on wages and labor and the staff-elected board member. I was lucky enough to work with Patriotic Millionaires during my time at Oxfam—acting as a speaker at the spring meeting and even traveling to Whiteville, North Carolina, to talk about the importance of wage and labor policies. Now that I am officially part of the team, I am using my expertise to help our policy team advocate for change and find creative solutions.
Typically this newsletter reflects the collective voice of our millionaire members. This week though, I decided to take the reins to write a Closer Look in honor of Black History Month. We have written in the past about the long legacy of racial discrimination in policies like the tipped minimum wage, but today I wanted to give a short history lesson on how Black communities were excluded from key policies in President Franklin Roosevelt’s New Deal legislation. These exclusions, as I’ll discuss, have long legacies today of racial wealth and wage gaps and the perpetuation of occupational segregation. But before we talk about the impacts of these policy exclusions, let’s examine how they originated.
Black Americans written out of FDR’s New Deal
In 1932 on the heels of the Great Depression, Franklin Delano Roosevelt—then Governor of New York—announced his candidacy for the presidency, stating “I pledge you, I pledge myself, to a new deal for the American people.” The phrase stuck, and after his landslide victory, President Roosevelt immediately launched a series of major legislative changes meant to spur the economy and get people back on their feet. However, the legislative agenda set forth with FDR’s New Deal was not equally applied.
From the inception of New Deal policies in the 1930s—ranging from those that were quickly overturned by the Supreme Court to those still in place today—there was a consistent exclusion of key workforces: domestic workers and agricultural workers. And what did these two workforces have in common in the 1930s, especially in the South? They were predominantly Black.
When seeking congressional support for his legislative agenda, President Roosevelt confronted a deeply powerful Southern caucus, including members holding key committee leadership positions in both the House and the Senate. As a result, major compromises were required for moving bills to a vote. As legal scholar Marc Linder wrote, “President Roosevelt could be confident of the support of these leaders of Congress only ‘[s]o long as the New Deal did not disturb southern agricultural, industrial, or racial patterns.’” Welfare programs targeting the lowest earning communities would disproportionately benefit Black Southern families, so Southern congressmen pushed for the exclusion of Black workforces that had the biggest impact on both the social and economic systems of the region: agricultural workers and domestic workers. While these exclusions were racially targeted, they were also gendered. Domestic workers then, as now, were overwhelmingly women and, in the South, the majority were Black women.
The exclusions of key workforces can be seen in several pieces of New Deal legislation, including the National Industrial Recovery Act (1933) and National Recovery Administration that the Supreme Court dismantled in 1935. For this Closer Look though, we’ll focus on the ways Black Americans were written out of the 1935 Social Security Act and the 1938 Fair Labor Standards Act.
The 1935 Social Security Act (SSA) established the first real social safety net in the country, including provisions for the elderly, the disabled, aid for mothers and children, and public health. It also created the nation’s first unemployment insurance. Unfortunately, this law also showcased how Black communities could and would be written out of key New Deal legislation, including the country’s first formalized welfare system.
In a 2014 article for The Atlantic, Ta-Nahesi Coates laid out the extent of this exclusion: “When President Roosevelt signed Social Security into law in 1935, 65 percent of African Americans nationally and between 70 and 80 percent in the South were ineligible. The NAACP protested, calling the new American safety net ‘a sieve with holes just big enough for the majority of Negroes to fall through.’”
After successfully passing the Social Security Act, largely in part due to concessions for Southern congressmen, President Roosevelt turned his attention back to workers, a key component of his legislative agenda. Leading up to the 1936 presidential election, FDR had emphasized an economic message, with an explicit focus on the issue of child labor that in the early 20th century was largely unregulated and dangerous. But after the Supreme Court overturned earlier legislation, FDR would not move forward with new labor laws until he could be certain the court would play ball. It wasn’t until FDR threatened to “pack the court” and expand membership in 1937 that the Supreme Court finally indicated they would allow new labor laws to stand.
With a suddenly more amenable Supreme Court, President Roosevelt turned to his Secretary of Labor, Frances Perkins, to help craft legislation to support and protect the country’s workforce. Secretary Perkins—the first woman to hold a Cabinet position and an ardent advocate for women and children in the workplace—was the architect behind what would become known as the Fair Labor Standards Act (FLSA), a bill to provide protections for all workers in the US.
Among other things, the FLSA established the country’s first minimum wage, a framework for overtime pay that created the 40-hour work week, and the country’s first federal system of child labor protections. While these were revolutionary policies that helped create the country’s wage floor and establish essential workplace protections, yet again, key workforces were excluded from the provisions.
You guessed it. As with the Social Security Act, agricultural workers and domestic workers—translation: Black workers—were explicitly excluded from the rights included in the FLSA.
You may be wondering if the targeted exclusion of Black workers in these historic pieces of legislation was ever addressed. The answer is a very disappointing “sort of.”
The exclusion of key workforces from the Social Security system was addressed in 1950 with several amendments that expanded unemployment insurance coverage to include domestic and agricultural workers, as well as self-employed people and public sector workers. Following the success and support for these expansions, subsequent amendments through the 1950s went on to include other classes of workers such that by the mid-1950s nearly 90% of workers were covered.
The exemptions in the FLSA took longer. Labor demands were a huge part of the 1963 March on Washington—a famous union leader A. Philip Randolph introduced Martin Luther King, Jr. ahead of his now infamous “I Have a Dream” speech. Three years later, march organizers got their wish in the form of the first major overhaul of the FLSA relative to Black workers. In 1966, for the first time, the FLSA was extended to include workers in hotels, restaurants, schools, hospitals, nursing homes, construction, entertainment, and agriculture (although only some agricultural workers). This amendment to the FLSA extended protections to “nearly a third of all Black workers in the United States.” More than that, these expansions of coverage (specifically minimum wage coverage) helped reduce both the racial wage gap as well as rates of poverty at the time.
Subsequent amendments of the FLSA included expanding wage coverage to domestic workers (1974), certain large agricultural employers (1977), small retailers (1989), and most recently to direct care workers, a subsect of domestic workers that includes certified nursing assistants, home health aides, personal care aids, caregivers, and companions (2015).
Although certain occupations were written out of key labor and wage protections, this did not stop Black workers, and especially Black women, from holding these jobs. Instead, needing to make ends meet, a disproportionate number of Black workers continued to hold roles that denied basic protections all while the fight to expand them continued. This is all a reflection of what is often termed occupational segregation, or the disproportionate representation of people of color in jobs that are underpaid, often undervalued, and in some cases unsafe.
The long legacy of occupational segregation is more than contemporary job opportunities, but echoes in the ability for communities to build wealth. Importantly, the stymieing of opportunities for Black communities in the US to build wealth is not just limited to New Deal legislation, as blatant instances of exclusion can be found in other crucial 20th century policies. In his book The Color of Law, Richard Rothstein highlights the many policy areas that explicitly wrote out Black communities, which went beyond labor protections, Social Security and welfare. Government policies that explicitly or implicitly excluded Black communities ranged from housing and mortgages, veterans affairs, education, and more reinforcing systems of segregation. At every turn, Black Americans were redlined, blocked, or denied whether by de jure (legal standing) or de facto (situational reality) positions.
The impact on Black Americans today
What does it mean that Black workers were excluded from key labor and welfare provisions of the New Deal and only later included in fits and starts? It means a radical differentiation in accumulated and generational wealth.
In 2022, the wealth gap between Black and white families in the US was more than $1.4 million.
As of 2023, white families hold over 84% of US wealth, compared to the 3.4% of US wealth held by Black families. One of the traditional means of building familial or generational wealth is often through home ownership, though today the differential in home ownership between Black and white families is greater than it was in 1960.
The targeted exclusion of Black communities from minimum wage and Social Security provisions during the New Deal means that not only do Black families hold less generational wealth, but there remains to this day a wage gap based on race, to say nothing of the wage gap when considering both race and gender.
Today, there is a bill in front of Congress, the Raise the Wage Act, which would raise the federal minimum wage to $17 an hour. While we at Patriotic Millionaires do not think $17 is a high enough living wage, it nonetheless provides a useful benchmark for this conversation. (I should also note the Patriotic Millionaires is also one of the original endorsing organizations of this legislation.)
Our friends at the Economic Policy Institute created a great tool to better understand the size and demographics of the low wage workforce in America. According to the tool, 23% of Black workers and 23% of Hispanic workers earn less than $17 an hour, compared to just 15% of white workers. If we’re interested in intersectional data (or layering data considering both gender and race), as of 2024, 35% of Black women in the US earn less than $17 an hour compared to 17% of white men.
You may be left asking yourself, what is to be done about this? And the answer is simple: let’s get rid of all exceptions to minimum wage laws and raise the wage. Regardless if they’re in a tipped wage job, in the agricultural sector, doing domestic work, are a student, or have a disability, all workers must be included in minimum wage law. And we need to raise the wage to a full living wage! Our minimum wage has not moved since 2009, which is the longest it has remained stagnant since the law was created in 1938.
Beyond advocating with partners and congressional champions for a change in the federal minimum wage, Patriotic Millionaires is continuing to focus on the wage piece of our MONEY Agenda. We are thinking creatively on how to find a way around the 60-vote threshold in the Senate to raise the wage and to encourage businesses to raise their wages while Congress remains stuck. Poverty-level wages are a policy choice, but they are not an inevitability.
As a trained historian, I believe it is important to understand our own history to ensure we do not repeat it. The lessons of how Black communities were written out of key legislation offers an opportunity to further understand the power of legislative decisions to address or expand inequality. Patriotic Millionaires fundamentally believes in fairness, and one of our key tenets is to pay the people. The fight continues to do just that.