President Obama leaves out Black businesses
It is almost a given that African Americans are going to be proud of the first Black president of the United States. In the elections of 2008 and 2012, African Americans voted for Barack Obama at rates well above 90 percent. Additionally, African American voter-turnout was higher than that of the general population in either election, per the University of Michigan’s Social Science Data Analysis Network and CNN. With such exuberance, it would be reasonable to expect tangible outcomes for such loyalty.
African Americans would then be able to hold the president accountable to those expectations. Unfortunately, that does not seem to be the case. According to an article in the Wall Street Journal, SBA loans — loans backed 85 percent by the government’s Small Business Administration and issued by banks or other financial institutions — are disproportionately going to groups other than African Americans.
In fact, in fiscal year 2012, African American-owned businesses only received 1.7 percent of such loans, a figure significantly lower than the proportion of African Americans in the overall population. This figure is also lower than the 8.2 percent of loans received by African Americans in fiscal 2008.
The failure to address such a problem by the Obama Administration is bad enough; however, consider the assault on African American businesses does not end there. In 2012, the administration announced plans to close the Office of Minority Business Development.
This office, started in 1969 by Republican President Richard Nixon, was created to promote competitiveness and provide access to capital and contracts to minority businesses. The reason cited, according to some Congressional members present at the announcement was cost savings. This is troubling considering the Obama Administration has sought an increase in federal spending on prisons every year since President Obama took office.
The administration’s failure to address the needs of African American small businesses does not end there. According to an article by Bloomberg, minority business owners won only 16 percent of government contracts in 2012. Additionally, African American businesses won only 8.4 percent of that business.
Ironically, the president has issued an executive order to ensure that workers on federal contracts receive the minimum wage, yet he has not issued any statement to discuss the disproportionate awarding of contracts by his own administration. Worse yet, those African American-owned businesses that actually do win contracts now have to pay much higher rates. Those businesses tend to be smaller in terms of the number of employees and overall revenue — higher staffing costs could hurt them more.
The lessons learned here are clear. We as African Americans can be proud of our president, but we need to ensure we hold him accountable to a holistic agenda that includes the needs of African American businesses and entrepreneurs, not just what certain self-acclaimed “leaders” say is the “Black agenda.”
Additionally, although the president will not be up for election again, we need to avoid blindly giving our votes to one party and instead make sure we are developing a well thought-out agenda to represent our community as a whole for members of all parties to address. That is what holding leaders accountable is all about.
Hughey Newsome is a business consultant in the Washington, D.C. area and a member of the national advisory council of the Black leadership network Project 21. He blogs at The Objective Citizen.