Last month, I was invited to appear on Goodfellows, a podcast hosted by economist John H. Cochrane, former White House National Security Advisor H.R. McMaster, and historian Niall Ferguson. It was a penetrating discussion of race, culture, and economics that delved into some personal matters as well.

In the transcript below, I address what think of as the cultural aspects of the problems many poor black communities face. Of course, I’m an economist. I think that, in order to know what’s really going on in any society, you need hard data. Sometimes the data can help you design social programs that can incentivize behaviors that will start to ameliorate the problem you set out to solve. But the deeper seated those problems are—when they inhere in the upbringing or even the self-conception of individuals—the more difficult they can be to address with social programs.

I’m talking about existential problems: What do I value? What is my place in the world? How do I deal with conflict and adversity? How does my environment shape me? If we can’t acknowledge the central role of these questions—and the failure to address these questions—in the shaping of black communities, we’re going to keep running into the same brick wall again and again.

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JOHN H. COCHRANE: Well, Glenn, this is sort of a bifurcation, it seems, to one extent. So I used to live on the South Side of Chicago. Now I live in very white Palo Alto. And it's clear that a lot of this is a fashion among guilty white people who live in rich, very white suburbs. And then there's a bifurcation among blacks. There's a successful black middle class, which I hope you'll talk about some, and an underclass, both black and white, which is showing signs of just drifting into worse and worse situations.

That seems like three different issues. It's not clear that a lot of the current stuff is coming from black people in general, as opposed to guilty white people who want to foist some new set of ideas on you.

GLENN LOURY: Well, I don't know quite what to say about that since I don't have the ethnographic insight into guilty white people.

JOHN: Well, you know what's going on among black people. So how much of the current stuff is coming from the actual desires of black people?

Oh, I think there's a lot of diversity. I don't have opinion research to cite, but the wokesters don't necessarily speak for the people who go to an AME church and who are just trying to get their kids to school safely and stuff like that. They're Democrats. Now, these people are gonna be Democrats, but they're likely maybe to be pro-life as opposed to pro-choice, so they have a lot of doubts about it. They don't mind the cops. They want more cops, a lot of them. And many of them look askance at Black Lives Matter and they want to know follow the money. The question about BLM is follow the money. So I take that point.

But, you know, why is Joseph Biden receiving the family of George Floyd at the White House in a acknowledgement of the anniversary of the death of George Floyd? That's not elite, effete, precious white people who are obsessed with being on the right side of history. That's power politics from the White House. That's the Democratic Party trying to drive black people to the vote by scaring the hell out of us that the sky is falling. Excuse me if that's too partisan. Is that too partisan for Goodfellows?

JOHN: Well, there's the successes and failures of both parties and the Democratic Party, certainly in Chicago, that pretended to help black people for years and years and has not done much good for them is, you know, that's a fact. Let me get back to you. I want to ask one more question then—I tend to ask too many.

You brought up, I think, the important issue, the issue of the inner-city, black underclass separated from the resurgent middle-class and the continuing troubles they have, perhaps personified by George Floyd himself, who, despite his tragic death, personified many of the struggles that black men face in that society. You've written about culture versus incentives. And I'm curious, in your view, how much of this is the destruction of the black family thanks to the federal government?

As economists, we looked at those disincentives. But as larger thinkers, which you are, you look to cultural things, cultural things that are also hurting Charles Murray's Fishtown. The white underclass is behaving much in the same way. How much of it is family and youth? The South Side of Chicago where I grew up, I knew many young black kids, and I could tell right away. My wife spoke of two kids she met on the playground who had cigarette burns on their arms at age six. You can tell this isn't going to end well, no matter how much universal pre-K or government programs come out. You certainly need intact families, which both the white and black underclass have failed. But how much of that is culture? How much of that is government? How do we get out of that? And not just by letting them grow up and choosing between prisons and programs.

Yeah, well, gee. I guess I'm the guy on the hot seat here, huh?

JOHN: Well, that's what you know about!

H.R. MCMASTER: Glenn, I've heard you speak eloquently about outside-in and inside-out impediments and obstacles. And outside-in, I don't think any of us would deny, there is a legacy of slavery. There is a legacy of the de jure segregation and inequality of opportunity. But what you've been able to do, I think, is highlight some of the inside-out priorities, that we have to remove barriers to the great promise of America. So I wonder if you might share some of your thoughts on some of these outside-in needs for reform and collective effort.

Okay, thanks H.R., and thanks, John. And I want to say a number of different things. So this is not a scientific question that's being asked here, at one level. I mean, it is an issue on which data can be brought to bear.

The question about the condition of the family, kids out of wedlock and marital instability and child neglect and abuse and social pathology, one could even say, and about the extent to which the history of the welfare state with incentives, encouraging patterns of behavior. Certainly, that's gotta be a part of it. And so how much? And then also with respect to the larger culture, you know, the effects of the transformation of American attitudes more generally about family life, the advent of gay rights and changes in the roles of women and marital things and whatnot. Divorces up, and so forth. So I think, whatever cultural argument you would want to tell, you want to nest it within the larger dynamic of American culture.

I think there are a lot of cultural complicities of one kind or another. I think, for example, the commercial entertainment habits of adolescent white kids in middle-class neighborhoods might have an impact on what rap musician artists decided to put on the tracks that they put out there, because they're going to try to appeal to a market. A market which is driven by a white kid's imagination of what a raunchy black kid would be saying. So I think you could make observations like that.

But here's what I'd say. I'd say, I join Amy Wax the law professor at Penn—controversial conservative law professor—who says in her book called Race, Wrongs, and Remedies, if I step off the curb and a bus driver who's texting and not paying attention hits me and crushes my leg, there's no doubt that I've been victimized just very wrongly by circumstance. But if I want to walk again, I have to go to physical therapy. I'm the only person who can do that. And likewise here, the legacies of the post-World War II transformation of the American welfare state and of American domestic culture about family life and how that impacts on blacks is an external factor.

But we're the only ones who are in control of how our children get raised. There are no doubt a million studies in sociology and economics and political science journals about how the violence that you see in urban communities—Chicago—is related to one thing or another, whether it's drugs or it's poverty or it's whatever. I've seen many of these studies. But these kids are making choices about whether or not to take each other's lives. And I can't—I'm sorry, I'll answer in a very personal register here—help but think that it's what they believe, it's the values that they embrace. They are not automata. They're not just driven like machines. They have free will, I want to say. And I want to say that the community is responsible for a big chunk of that.

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