ELI STEELE: California forces companies to mine the past for slavery's sins

California just passed AB 2599, signed into law in September 2023, requiring publicly traded companies and state contractors worth $1 billion or more to disclose historical connections to slavery and human trafficking. The stated intent is transparency and corporate accountability. The bill affects roughly 1,600 companies and applies retroactively—not just to current operations but to any documented ties going back to their founding, even if that was 1887. The law's enforcement mechanism runs through the state attorney general's office, which can levy civil penalties but doesn't mandate specific remedies. No dollar amounts for those penalties were specified in the statute.

The practical stakes are twofold and contradictory. For corporations, compliance means expensive historical audits, legal review, and public disclosure that could expose them to boycott campaigns, shareholder action, or reputational damage—all for historical actions by predecessors or subsidiary companies they may have acquired decades later. For California taxpayers and school districts, the state funded the reporting requirement with zero additional money. The state's public education system faces a $25 billion deficit over the next decade, according to Legislative Analyst's Office projections. AB 2599 diverts administrative capacity toward corporate disclosure while schools have been shedding teachers and cutting summer programs.

The conservative critique isn't complicated: this is performative guilt-laundering that sacrifices material results for symbolic performance. Steele's argument—that California is asking companies to confess rather than asking the state to fix its chronically underfunded schools—has actual mechanical force. If the state's goal were reparative justice, the money spent on AB 2599 enforcement could fund literacy programs or college prep. Instead, the law transfers the work of historical accountability onto corporations while the state extracts political credit. The bill emerged from a legislature controlled by one party with no meaningful opposition to curb its scope, which is the condition under which performative legislation gets worse, not better.

Companies are now filing the first disclosures. Bank of America disclosed holdings in slave plantation mortgages in the 1800s. JPMorgan acknowledged that some of its predecessor institutions financed slavery. These disclosures are landing in September-October 2024 and will continue through next year. What matters next is whether California attorney general Rob Bonta uses the civil penalty power to fine companies or whether this becomes purely a naming exercise. If it's penalties, expect immediate litigation over retroactive liability and the definition of "tie." If it's just disclosure, watch whether major institutional investors begin divesting or whether these reports are filed and forgotten by November.