foxex: Celebrating Martin Luther King, Jr.

The Market Sum | Insight after the bell

By Caleb Silver, Editor in Chief

image courtesy LOC.gov

The Economic Message Behind Dr. King's Famous Speech

The team is off today in honor of Dr. Martin Luther King day. We'll be back tomorrow.

In honor of Dr. King, we thought it would be fitting to present his "I have a Dream" speech in the economic context in which it was originally written. Many remember the speech as a rallying cry for the equality of all people, which it was. But its original intention was to call for an end to economic inequality for all people and to demand the right to gainful employment.

The full text and audio of the speech can be found here. It is worth both the read and the listen.

Dr. King delivered the speech on August 28, 1963 from the Lincoln Memorial at the March on Washington for Jobs and Freedom. It was an homage to President Abraham Lincoln's Gettysburg Address and also aimed to pay tribute to the centennial anniversary of the Emancipation Proclamation (signed January 1st, 1863).

Most of us remember these thunderous and passionate lines from the speech:

"…I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin, but by the content of their character. I have a dream today!"

In the beginning of the speech, in the third paragraph, King addresses the economic inequalities suffered by African-Americans since emancipation, and the righting of those wrongs.

"We've come to our nation's capital to cash a check. When the architects of our Republic wrote the magnificent words of the Constitution and the Declaration of Independence, they were signing a promissory note to which every American was to fall heir…Instead of honoring this sacred obligation, America has given the Negro people a bad check, a check which has come back marked 'insufficient funds.' But we refuse to believe that bank of justice is bankrupt."

King's point was that the American economic system had left African Americans and poor people behind entirely. Sadly, U.S. income and wealth inequality have grown substantially over the past 60 years. Wealth is concentrated in the hands of very few, while most of the world lives on wages that most of us wouldn't be able to buy lunch with today. For those fortunate enough to have stable jobs, inflation-adjusted wage growth has been stagnant for 40 years. The path to a stable, middle-class life has disappeared for millions of hard-working people who live paycheck to paycheck, unable to save or invest in their future.

Later in the speech, King talks about the 'market operation of our economy' that creates unemployment and idleness. King had no idea that technology, artificial intelligence, and robots might one day come for our jobs. He was referring to the profit-driven motivations behind our market system that compel executives to maximize profits and boost share prices. While we root for higher profits as investors, we don't think enough about creating a sustainable economic system that ensures the welfare of all people and the planet. King was addressing the former with these words:

"We have come a long way in our understanding of human motivation and of the blind operation of our economic system. Now we realize that dislocations in the market operation of our economy and the prevalence of discrimination thrust people into idleness and bind them in constant or frequent unemployment against their will. The poor are less often dismissed from our conscience today by being branded as inferior and incompetent. We also know that no matter how dynamically the economy develops and expands it does not eliminate all poverty."

King's solution, controversial then as now, was to create a jobs guarantee, with the government ensuring that there was a job for anyone willing and able to work. King believed that people had a fundamental right to work so that everyone could reach their potential and become consumers to keep the economic pump primed. In his own words:

"The problem indicates that our emphasis must be two-fold. We must create full employment or we must create incomes. People must be made consumers by one method or the other. Once they are placed in this position, we need to be concerned that the potential of the individual is not wasted. New forms of work that enhance the social good will have to be devised for those for whom traditional jobs are not available…"

This wasn't King's only economic speech, either. On April 3, 1968, the night before he was assassinated in Memphis, TN., he delivered a speech in support of striking sanitation workers at the Masonic Temple: "I've Been to the Moutaintop". It's worth a read.

While some may not agree with Martin Luther King's ideas or the principles for which he stood, his impact is undeniable. Dr. King connected the rights of all people to the economic systems in which they lived and the injustices they suffered through his essays, speeches and teachings. In doing so, he profoundly altered the moral consciousness of this country.

For that and for so many other reasons, we celebrate him on this day.