Stimulating African American Economic Development: Lessons from G.M.
Dr. Benjamin F. Chavis | 11/24/2010, 2:14 p.m.
President Barack Obama reached another significant milestone on the long difficult road toward economic recovery of the economy in the United States when General Motors (G.M.) recently launched one of the largest initial public offerings (IPO) in American history. I believe that the proper stimulus investment in the African American business community will also bring a much-needed economic recovery.
To the astounded pseudo-economists and near-sighted politicians who vociferously criticized President Obama for using federal stimulus funds to reorganize and stabilize G.M., the fact is the stimulus worked. The investment of taxpayers' dollars worked to save G.M. jobs and to catalyze a financial rebirth of G.M.
Now as a result, in Detroit and in other cities where G.M. and the automotive industry is based, there is an increase in the opportunity to regain some of the jobs and businesses that went under when G.M. went down. The nation's biggest automaker in very heavy trading closed its first day on its return to Wall Street Wall at $34.19-a share price.
Billions of dollars were raised. President Obama stated, "We are finally beginning to see some of the tough decisions that we make in the midst of crisis pay off."
Now in the African American community, we should not just be a witness to how the recovery of G.M. happened. But we must take due note and ask if there are lessons that we can learn that can be applied to an action agenda for the economic development to bring the African American community out of economic crisis to recovery?
Black-owned businesses need reinvestment, expansion, and most of all support from African Americans. The Black Press is a business as well as a community service. We need to be more supportive. We are about to enter into the biggest holiday spending season.
Even in the poverty that exists, we spend hundreds of billions of dollars annually without considering how to target our collective consumerism for more economic development of businesses that are owned and operated in the heart of our communities across America.
Yet, I believe, the first lesson is not just about money or investment capital. If you analyze what I call the Obama effect, the first lesson from the G.M. stimulus recovery is the question and issue of leadership. President Obama's leadership in facing down the skeptics and not doing what may have been perceived to be popular, but rather doing what was necessary and prudent from a financial perspective was outstanding and effective.
We need more bold, innovative, and committed African American business leaders, as well as political leaders, who will dare to fight for all that is necessary to advance the economic development interests of our communities, families, and institutions.
Secondly, we need an African American Economic Recovery and Development Plan that will set the right measurable goals and objectives for the ongoing economic benefit of African American businesses and communities.
We have many different professional business organizations from the Black MBA's, National Business Leagues, National Bar Association, National Medical Association, the National Association For Equal Opportunity in Higher Education (NAFEO), National Urban League, Congressional Black Caucus, and the NAACP along with many others not listed here that all should work together to formulate and implement the African American Economic Recovery and Development Plan.
Poverty and economic crisis should not be the reality for far too many African Americans. In fact, we have something that G.M. did not have. We have, in circulation, in the African American community nearly a trillion dollars every year. But, most of this money goes out of the African American community. The plan for recovery must address this contradiction.
We should think about this and act accordingly. It is time that we "stimulate" our own communities and businesses with our own capital. Yes, we need to do more for ourselves in terms of our own self-help and development.
Lastly, our most vital resource is our children. Thus we must do whatever is necessary to ensure the best education of our children. Our youth need to be encouraged to excel in education at all levels. We need more hands-on opportunities to literally rise up a new generation of young "freedom fighters" who are also versed and committed to the economic recovery of our communities.
We must say to our youth, "Don't leave our communities as a measure of your financial success, but rather stay to help lead our communities to new sustainable heights of wealth-building, development, and economic prosperity."
Dr. Benjamin F. Chavis Jr is Senior Advisor to the Black Alliance for Educational Options (BAEO) and President of Education Online Services Corporation