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How Wall Street Funded Slavery

A Wall Street sign near the New York Stock Exchange in New York City on Feb. 1, 2024. Credit - Michael Nagle—Bloomberg via Getty Images

In 1855, when Stephen Duncan, the largest enslaver in the United States, reaped a windfall from his cotton plantations across Mississippi, he tasked his banker to ship the crops North, to sell the cotton for cash, and to invest the proceeds into Northern corporate stocks, plucking up prized Manhattan real estate on the side. He had made such investments for almost 30 years. Duncan, who enslaved as many as 2,200 Black people, including many hundreds of children, died after the Civil War a very rich man, his reviled fortune handsomely intact, passed on to his heirs. Duncan’s banker was Charles P. Leverich, Vice President of the Bank of New York, a Wall Street tycoon. In fact, it was Leverich who managed the sumptuous riches of Mississippi’s other leading enslavers, ensuring that their vast fortunes—the proceeds of slavery laundered into coin and currency—endured well after the war, into the 20th century.

As a researcher of Wall Street’s role in financing slavery, I spent the last three years tracking that there were hundreds of New York and Boston bankers like this, not to mention industrial magnates and corporate directors—Northern men who, working hand-in-glove with Southern enslaving families, crystallize a crucial history: that contrary to popular belief, the wealth of slavery did not disappear after the Civil War, burned in the fires of conflict; it endured, in the form of private and public wealth, in the form of institutional fortunes. The wealth that many corporations and banks enjoy today is directly derived from this stolen wealth. As such, corporations, including many of our nation’s leading banks, have a critical obligation not only to acknowledge this history—something most have not done—but to outline meaningful ways to address these wounds through reparations to Black Americans.

Many are the myths that warp America’s history of slavery, one of which is the failure to identify that slavery was the cause of the Civil War. It’s an equally self-deluding myth for some to think that the fortune of slavery, all the tremendous wealth that white people sieved for generations from enslaved Black people, from decimated families and stolen children, could vanish into thin air. Consider how that defies logic: according to U.S. Treasury figures, enslaved Black people in the South produced, in the period between 1851 and 1860 alone, a bounty of cotton amounting to $1.5 billion then ($54 billion today)—and we are speaking only of cotton, and only one decade. The amount of wealth that enslaved peoples generated throughout the life of the Republic before Emancipation, though difficult to precisely detail, surely amounts to hundreds of billions of dollars then, and likely trillions today.

Read More: Colonial America Is a Myth

Though the supposition that it “disappeared” seems, practically speaking, preposterous, it lives on, as a kind of emotional, psychological crutch. It would mean that nothing from slavery had been gained in the end, that any sense of white guilt, of accountability and culpability, should vanish too. Leading corporations, certainly, have adopted this mindset. Side-stepping their accountability first in the horrors of enslavement, in the nation’s original sin, has only snowballed a deeper corporate culture of avoiding accountability, when what we need and expect today is the opposite: ethical standards, and fiscal responsibility toward the communities from which they derive their wealth.

The origins of the myth of disappeared slavery wealth are to be found in the Lost Cause, that falsified mythology of the Old South, which, in seeking to ennoble the dehumanizing greed of slavery, widely broadcast how Southern “planters” were reduced to ruin by Northern aggression. The same myth still holds up a cornerstone of Civil War history, positing that the war obliterated the southern aristocracy, and that, as postwar historian C. Vann Woodward, put it  “no ruling class of our history ever found itself so completely stripped of its economic foundations as did that of the South in this period.” And though he extrapolated his claim from a single survey, conducted in 1920, no less, and using a sample of just 254 southern industrialists, Woodward’s rendering came to dominate our view of history for generations.

Naturally, Woodward did have a point. Of course, it is true that during the Great Conflict parts of the South burned; that during his famous march to the sea, Union general William Sherman confiscated 400 thousand acres of land and caused $2 billion worth of damage in today’s dollars. And yet, in 2019, a groundbreaking study published by the National Bureau of Economic Research found, using US Census data, that white slave-holding families had dramatically reinvented themselves after the Civil War and recovered their wealth. They did so in just one generation, the study found, redirecting their capital into the modern economy. These findings help amplify the larger point: that the vast portion of American wealth generated by enslavement did not go up in smoke.

The story of Duncan and Leverich shows why: the riches that Black people created for white Americans, though physically produced in the South, were not ultimately reaped by the South, nor invested into the South. Abolitionists at that time, Northern observers, and even Southern enslavers all knew this to be true: that Northern merchants owned the greatest shipping fleets of their commercial age, causing the prodigious output wrought by Black people’s labor—billions of pounds of cotton, sugar and rice, not to mention turpentine, hemp, and gin—to flow North, to be sold, to be transmuted from agricultural wealth into many other things. And there, in the vaults of Wall Street, and invested into the coal fields of Pennsylvania, into the corporate bedrock of America’s Industrial Age, this money, stolen from the energy of Black people’s hearts, hands, and minds, took on a new life, and grew.

At the famous City Bank of New York, President Moses Taylor conducted immense sums of money from slavery—both in the South but also Cuba—into industrial development and modern corporations, including many, like Consolidated Edison, that still exist today. This is history that echoes. Leading corporations, having based their models of success on ruthless exploitation back then, continue to do so now, though, rather than exploiting workers for the benefit of executives and stockholders, they should be accountable as much to the citizens and communities whose lives and labor make possible their wealth.

The figures who peopled America’s repugnant history of slavery, as with the institution of slavery itself, may all be gone, but it is the wealth that remains. Our failure to recognize so is dangerous, the breeding ground of inequality and myth. Projecting that the vast contributions of enslaved people are gone, that nothing remains, makes it easier today for corporations to side-step their ethical obligations, to downplay what’s in need of repair, and to dismiss what Black people are owed.

Contact us at letters@time.com.