This is a despicable brand that Black businesses and communities have been beguiled into willingly accepting as their own. It’s come to define the space where Black businesses and communities are allowed to earn, profit, and to build their brand; within 1% of the majority. Whether information technology, healthcare, or the marketing & communications, Black vendors are participating in less than 1% of contracting opportunities with municipal and State agencies across the board. This is economically catastrophic to Black communities when you consider that Black businesses and workforces have to financially support Black families and communities on this fraction of income.
It’s a marvel that Black enterprise still exists at all considering the atrocities that numerous Black economic centers dubbed as “Black Wall Street” suffered, and the nation is bearing witness to the subsequent imbalance and general unhealthy state of Black communities.
There is $70 trillion of capital that flows down from institutional investors, according to a recent Knight Foundation report, and less than 1.5% of it is managed by firms that are owned by women and minorities combined. We need to look deep within the structures to look at who gets to manage that capital and invest that capital that goes to build businesses. We have to ask ourselves if that number was different, could we possibly see different outcomes if there wasn’t such a disparity in that flow of capital?
Here’s another harrowing fact regarding income disparity by race; For every one dollar of accumulated wealth that white families have, black families have just one cent.
That’s the finding ofa new study from Northwestern University utilizing data on consumer finances from the Federal Reserve to track changes in family wealth from 2004 to 2016.
The study found that Latino families fare slightly better, with eight cents for every dollar.
Northwestern University sociologist Christine Percheski, who co-authored the study, compared the wealth — assets minus debts — of households with children for black, white, and Latino families, noting that a family’s wealth is key to a child’s future success.
“Racial inequality in income for families with children has not grown recently, but racial wealth inequality has grown tremendously,” Percheski said. “The level of racial economic inequality in the U.S. is staggeringly high, and that is an important part of the story of racial violence and racial injustice and health disparities of the COVID-19 pandemic.”
Percheski points to discrimination in housing and mortgage lending, including predatory lending, as well as inequities in the way higher education is financed as some of the contributory factors that have created the huge disparity in wealth between black and white families. She also notes that after the Great Recession of 2008, many white and Latino families were able to regain much of the wealth they lost. That still hasn’t happened for Black families who have seen a nearly 20% drop in homeownership since that time. Coupled with the loss of over 30% of Black businesses in that economic unrest, a picture of the extraction of wealth that took place and that was followed up by a denial of opportunity becomes painfully clear. Now, this pandemic is shining a light on prevailing disparities that Black businesses and communities still endure.
“Racial economic inequality is an important part of the story of racial violence and racial injustice,” Percheski said. We absolutely need to rethink how we can start to tangibly reduce wealth inequality, understanding that it’s not going to be quick or easy, and it will require radical action.
On top of that grand consideration, there’s the dichotomy of reparations. First off, pride would have an unthinkable portion of the Black community falling on their sword rather than jump through hoops for a minority share.
Then, there’s a constant conflict between the notion of individual responsibility and the systemic pressures which have impeded crucial economic development in the Black community. While calls for greater investment in Black communities is seen by some as charity, the wealth that’s been stolen from Black Americans for generations — starting with slavery is nearly incalculable. There’s certainly no nominal threshold that could approximate an “equal share” of America…which is what Black Americans deserve and require to begin to economically and organically heal. That’s another conversation that we’ll soon revisit. Today’s message is about the other pandemic, the less than 1%.
The Illinois State Black Chamber of Commerce has ascertained from our many years of intimate engagement with State and municipal governmental agencies, as well as lengthy research and development initiatives involving the same layers of organizations coupled with major corporations and businesses, that there are virtually no procurement and contracting spaces where Black vendors are not experiencing disproportionate disparities. In fact, it is quite common and ironically accepted, that there is an egregious disparity between Black and White vendors.
This holds true across the board, from cities and counties to public park districts on the local and municipal level to State agencies like IDOT, HFS and countless universities and colleges across Illinois…and that truly just scratches the tip of the iceberg that’s threatening to sink Black businesses and communities.
These agencies are so routinely granted waivers for not meeting federally mandated participation goals that the lack of intentionality to perform good faith efforts to remove disparate barriers has become endemic. We need your support as we hold their feet to the fire and demand what’s ours!
The “Sheltered Market” is procurement law, passed by the Business Enterprise Program (BEP) Council with the Illinois State Black Chamber leading the charge, that can and needs to be utilized to begin correcting these long identified disparities. We were able to revive and mobilize it against all the odds, but we need our Black Caucus and Black businesses to rally around this law and to champion new and more Sheltered Markets in more industries.
Even more simply put, we need the General Assembly to enforce this piece of procurement law. Then, we need businesses to realize the opportunities that this procurement law creates!
It’s not just coincidence, and much more than ironic that Illinois is often at the lead of the push for equitable and progressive policies for the people.
Lastly, we would be remiss if we didn’t at least mention the lack of diversity on corporate boards as a big part of today’s national discussion. The Chamber championed HB3394 over a year ago here in Illinois, long recognizing the direct correlation between a company’s leadership that looks like us to the number of us that are stakeholders and employees.
There were only three Black CEO’s heading up Fortune 500 companies in 2018, down from 6 in 2012. In 2020, there are only four Black CEO’s leading Fortune 500 firms (less than 1%). In fact, since 1955, there have only been 15 Fortune 500 black CEOs….in total.
The Covid-19 Pandemic exacerbated and shone a spotlight on the dark manifestation of the outward systematic attacks on Black businesses and communities and the subsequent fallout and plights that ensued.
The George Floyd tragedy lit the proverbial powder keg, bringing to a head the national impasse of the endemic systemic racism cast within in the American cornerstones and reinforced by the consistent, systematic gross abuse of authority and calculated miscarriage of justice that has empowered these abuses and mores and have served to widen the racial divides across the country. The storm is no longer brewing, it is upon us, and the clouds are very dark.
If America is going to weather this storm and pull through to begin to reach its full potential, then we must address these economic disparities. We can no more afford to continue skirting around the inconvenient, inconsiderate…sometimes inconceivable truths any more than we can afford to pretend that the Covid-19 Pandemic is no longer upon us. With America breaking our own records daily for infections and deaths, now over 133k, we are quickly becoming a global pariah.
This is real. These are real people and real numbers that have been shared with you, intended to inform and incite. Now is the time to demand the changes, and we need you with us as we lead the charge!
Despite some cloudy days and a few hazy situations, the horizon is still bright for Illinois’ Black businesses and communities, so stay tuned and stay engaged! Please know that the Chamber is here to help YOU position for success! Plugging in and beginning your journey of personal and professional growth and development is very important to us!
Get a bird’s eye view of what’s important to the Black business community by texting ILBCC to 22828 for a free subscription to the Chamber Business NewsJournal.