Racism persists in no small part because its benefits to capitalism outweigh its costs.
Racism’s persistence where the capitalist economic system prevails raises the question of the connection between capitalism and racism.
Many societies are structured and operate to subordinate one or more portions of their population — politically, culturally, economically or in combinations of these ways — while privileging others. Among the successive generations born into societies with such subordinations, some will challenge and seek to change their condition. Force can try to maintain subordination, but it is costly, dangerous and often unsuccessful. The preferred method has rather been (a) to develop an idea that justifies the subordination and (b) to install that idea as deeply as possible into the thinking of both the subordinated and the privileged.
One such idea is “race,” the notion that sets of inherent (often deemed “natural”) qualities differentiate groups of people from one another in fundamental ways. This idea of race can then be used to explain the subordination of some and the privileges of others as effects of their racial differences. The concept of race thus accomplishes a reversal: Instead of being a produced idea, an ex-post justification of structures of social subordination, race morphs instead into some pre-existing “reality” thatcaused or enabled the subordination.
We know how and why racism worked often to support slavery around the world and especially in the early United States. Masters endorsed and promoted ideas that justified slaves as subordinated because they were an inferior race. Racist ideology also sometimes supported feudalism by dividing lords and serfs into different races. Indeed, some early capitalist systems likewise racially distinguished employers from employees.
Source – Economics Professor Richard Wolff: How Capitalism and Racism Support Each Other