With $1 trillion in spending power, Black America doesn’t have to wallow in despair, want and disaster say advocates for economic independence.
According to the U.S. Census Bureau, Blacks live 27 percent below the poverty line, compared to Whites at 10 percent, Hispanics at 26 percent, and Asians at 12 percent.
Their collective poverty ranking comes despite massive buying power, which advocates insist could be solved with unity and spending discipline.
“We’re not poor. We’re just broke. Our money goes in one direction—away from us. We’re some of America’s most conspicuous consumers and there’s tremendous economic leakage in our community, and, we’re an economically illiterate people,” stated George Fraser, CEO of FraserNet Inc., which works to increase opportunities, wealth and jobs for Blacks.
The lack of money recycling in the Black community further evidences the problem. About five percent of the Black dollar returns to Blacks in seven days, compared to seven months in the Jewish community, according to Mr. Fraser.
If Black America were a nation, it would be the 16th richest in the entire world, he argued. But, Blacks have taken the art of consumption to a whole new level, so while they account for nearly a trillion dollars, principally, it does not recycle, he said.
“We remain poor because … Slavery taught us to let someone else reap the value of our labor and production and today, we are still more comfortable with someone else doing it. Many of us just want to work for someone else.” —Toure Muhammad, Author/Publisher
According to “The State of the African American Consumer,” a report on Black spending by the National Newspaper Publishers Association and Nielsen, an information and measurement company, Black households spend more on basic food ingredients and beverages, as well as on personal and beauty care. “It’s not how much money you earn, it’s how much money you keep,” Mr. Fraser said.
For the past 25 years, his organization has focused on helping Blacks to become the number one employer of Blacks, recycle dollars and opportunities, and to help build intergenerational wealth. Recently, he helped to create the M.O.S.E.S. Movement.
M.O.S.E.S. stands for Making Ourselves Economically Successful and its goal is to help one million black people to become debt free, excluding mortgage, in the next five years. Members of the movement commit to save at least $50 a month.
Mr. Fraser believes solutions to poverty and want include becoming literate around wealth creation, economic development, and closing the income and wealth gap.
“Do we have the expertise? Yes! Absolutely! There are brothers and sisters all over America that have the economic literacy and expertise to teach us … But we have to marshall the forces, to get our people focused to begin the process of first getting back to the kitchen table then changing the kitchen table conversation so that it is focused on the inter generational transfer of wealth,” Mr. Fraser added.
Today’s Blacks have somehow lost the economic operational unity they had during the Black Nationalist and Civil Rights Movements of the 60s and 70s, said Mark Allen, Chairman of National Black Wall Street Chicago.
Then, it made no difference whether they were talking about Dr. Martin Luther King, Jr.’s Operation Bread Basket or the Honorable Elijah Muhammad’s Economic Program, he noted. Whether a nationalist or from the Civil Rights Movement the common agenda which united both was they talked about how poor people could use their own spending dollars to create and sustain their own Black businesses and jobs in their own communities, he noted.
“Somehow, during the 80s, we thought we kind of made it and we really lost that focus,” Mr. Allen said, reflecting on the era the Honorable Elijah Muhammad offered his Economic Blueprint to Black America and Dr. Martin Luther King, Jr. presented Operation Bread Basket.
“The Black man in America faces a serious economic problem today and the White race’s Christianity cannot solve it. You, the so-called American Negro, with the help of Allah can solve your own problem,” The Honorable Elijah Muhammad declared in his 1965 book, “Message to the Black Man in America.”
The truth must be recognized, he continued, that the Black man, himself, has assisted greatly in creating this serious problem of unemployment, insecurity and lack.
“Before the Black man can begin to gain economic security, he must be awakened from the dead and gain knowledge, understanding and wisdom which will enable him to follow my teachings. Islam and only Islam will point the way out of the entanglement of ‘want in the midst of plenty’ for the followers of Islam, the true religion of the Black nation,” The Honorable Elijah Muhammad wrote.
Recognize the necessity for unity and group operation; pool resources physically as well as financially; stop wanton criticisms of everything that is Black-owned and Black-operated; keep in mind jealousy destroys from within, he continued. “Observe the operations of the White man. He is successful. He makes no excuses for his failures. He works hard in a collective manner. You do the same,” he went on.
Blacks, like America must sacrifice to come out of poverty and want, said Min. Farrakhan, during his address on the 17th Anniversary of the Million Man March on October 14, 2012. Min. Farrakhan has urged Blacks to unite and pool their resources to survive.
“What are you, Black America, willing to sacrifice? We have to make some sacrifices, too. If you might say: “I already don’t have nothin’!”—wrong! So wrong! Because according to economists, last year $1.1 trillion came through the hands of Black America. But what did we spend our money on? Where did our money go? How foolishly did we use our resources,” Min. Farrakhan asked.
For Mr. Allen, efforts to help Blacks better manage money include helping to create Black business districts across the country.
“It doesn’t make a difference whether you’re Christian, Muslim, Civil Rights, Nationalist, the answer to almost all our problems right now rely in our economic conditions … Nobody will save us for us but us,” Mr. Allen stated.
He feels while there’s room to challenge the government for resources paid in tax dollars, Blacks must not be afraid to do for self, and they must regain a sense cultural consciousness, he said.
“Right now, the Minister (Minister Louis Farrakhan) has just invested a few million dollars in reestablishing The Salaam on 79th. Beautiful restaurant and all that, but you’ve still got Black people, who live right on the next block, who still either got a phobia or mental breakdown in terms of what is it about this food that is good, that you’ll walk right past it to whatever other restaurant,” Mr. Allen lamented.
“They’ve got fish in here. They’ve got chicken nuggets in here! They’ve got salads in here! So even today, you’ve got this cultural breakdown but what makes you think the food in The Salaam is not just as good as these other restaurants,” he continued.
“You can’t live in a city that has Minister Louis Farrakhan, Rev. Jesse Jackson, home of the president and home of a 40 percent Black city, and you mean to tell me that with all this power, we can’t redirect the economics … It’s economically violent to have a trillion dollars coming out of your hands every day and yet the number one employer of our young people can be the gangs, drugs … And other elements of the street economy. That makes no sense,” Mr. Allen argued.
Even though Blacks have a combined spending pattern of more than a trillion dollars, the money is not equally distributed, noted Dr. Julianne Malveaux, author, economist and commentator.
Just one to 1.5 percent of Blacks earned more than $200,000 a year while other populations earned at least eight to 10 percent, she said.
“The economic downturn has really pointed to a lot of weaknesses that’s structural. It’s not just about the economy turning down but it’s also about the structure of employment. So African American people who are not educated basically are getting the short end of the stick,” Dr. Malveaux told The Final Call.
While job creation and starting businesses are important, it’s equally important that Blacks study future trends and look at vocational and college education to participate in the economy, she said.
According to Alan Jenkins, executive director of the Opportunity Agenda, Americans understand the challenges of poverty better now, than they have in the recent past due to the economic recession’s impact on all racial and ethnic backgrounds.
What’s less understood are the obstacles Blacks and other communities of color face to equal opportunities, he continued.
“There is a lack of understanding that despite the progress we’ve made as a nation, discrimination still exists and there are significant barriers to equal opportunity in terms of quality education, housing, employment and in our criminal justice system,” Mr. Jenkins said.
On one level Americans are experiencing this crisis together but on another, in terms of geographical differences, some places are investing more in greater and equal opportunity, Mr. Jenkins continued. But, particularly in the south, there are fewer economic security protections and fewer civil rights protections, he added.
Toure Muhammad, publisher of the Bean Soup Times, views Black poverty, work ethic and creativity in the historical context of slavery.
“We remain poor because … Slavery taught us to let someone else reap the value of our labor and production and today, we are still more comfortable with someone else doing it. Many of us just want to work for someone else,” Mr. Muhammad said.
While taught early on how to work for or manage a business started by someone else, most Blacks don’t know what it takes to start businesses that will jump start an economy, he elaborated.
“We have had several examples, the two most profound where Marcus Garvey and the most Honorable Elijah Muhammad started multiple businesses that complimented one another based on producing and selling. Even today, we have many businesses but many compete with one another and are not complimentary,” Mr. Muhammad continued.
Count the many Black beauty and barber salons versus the void of Black owned barber and beauty chair designers or comb and brush manufacturers, he said. “Garvey and Muhammad showed what we can do with unity, work and vision. Both were a sign of what can be done,” he argued.
He encouraged people to listen to Min. Farrakhan’s impending Saviours’ Day 2013 address (themed “Muhammad’s Economic Blueprint: Ending Poverty and Want”). “It really boils down to us learning who we are, producing products and services and then marketing them more effectively than the competition. We can do it. We must do it,” Mr. Muhammad added.
Advocates agree, Blacks can’t continue to let someone else control and dictate their economy. If so, poverty will increase and they will cease to exist, they say.
“But, how can Black dollars recycle if Blacks don’t own anything,” noted Dr. Rosie Milligan, a Los Angeles-based estate planner, author, and speaker. Giving back to the “Blackstream economy” is difficult because Blacks don’t grow or manufacture anything for themselves, she said.
“If you don’t own the bus company, you don’t own the super market, you don’t own the few banks, and we spend a lot of our money particularly on groceries and consumer items, and we own less businesses now than we owned years ago, naturally our condition will get worse,” Dr. Milligan told The Final Call.
The Honorable Minister Louis Farrakhan and the Nation of Islam is on a campaign to raise $10 million to purchase farmland, build schools and create jobs. “Min. Farrakhan is right on the money! But we need to start now. We can’t wait until the drought comes and then start looking and that’s what Black people tend to do,” she added.
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Network economics refers to business economics that benefit from the network effect. It is also known as Netromix. This is when the value of a good or service increases when others buy the same good or service.
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