AFRICANGLOBE – If you keep doing what you’ve always done, you’ll keep getting what you’ve always gotten.
Too often Black Americans will claim to “understand capitalism” while their very actions show the exact opposite. If Blacks understood “capitalism” and elementary economics, they’d know that if just under 1 percent of Blacks’ annual $1 trillion purchasing power is spent with other Blacks, that behavior is dysfunctional in the capitalistic system.
A major reason for Black America’s economic failure is its inability to recycle its money within its communities. Though we comprise 13 percent of the American population, Blacks own less than 7 percent of the nation’s businesses. Blacks’ behavior in the in the marketplace suggests a negative view toward African-American-owned businesses. The central problem for Blacks’ economic development and growth is that we have little orientation to own or make investments where we live. This may be a function of not having a broad and strong understanding of financial issues as Asian or white communities.
The average White household has 16 times more money than the average Black household. Too many Blacks refuse to admit that much of the Black/white wealth gap has to do with our own actions. A major reason for Black America’s economic failure is its inability to recycle its money within its communities. Though we comprise 13 percent of the American population, Blacks own less than 7 percent of the nation’s businesses. More Blacks must evolve better views and utilization of the social system in which we live. Capitalism is a social system under which the means for producing and distributing goods (the land, factories, technology, transport system, etc.) are owned by capitalists that often pool resources.
The place where Blacks’ power has grown over the years has been in “politics.” But Blacks haven’t grown beyond their political impact because political power is very empty without economic power. African-Americans’ out-of-step behavior is glaring. Blacks’ annual buying power is $1.1 trillion; yet we spend only 2 cents of every dollar with another African-American. Nearly all of Blacks’ income is spent directly outside of Black hands because Blacks do not practice group economics—pooling of money and purchasing within the group. While many Blacks lurch along, Asians have embraced and practice American capitalism and are the highest-income, best-educated and fastest-growing racial group in the United States. When will Blacks move up? Median household wealth for Asian-Americans was $75,027 in 2010. The median white household wealth was $62,545 compared with $38,409 for Blacks.
Instead of making excuses for Blacks’ dysfunctional capitalistic behaviors, more Blacks should step to the fore to help the race pull itself up through hard work and pooling of resources. Too many Blacks dispute that our race’s economic performance and practices are dysfunctional, and frequently are complacent with our economic performance. Asians keep a dollar in their community 120 days longer than Blacks do. A dollar circulates in Asian communities for a month, in Jewish communities 20 days and for 17 days in white communities. A dollar circulates six times among Hispanics, but less than 6 hours among African-Americans.
When will the mass of Blacks realize that “Nothing changes unless you make it change”? Let’s start to “Buy Black Weekly,” which means spending money with at least one Black-owned business each week. It may be unrealistic to expect the African-American consumer to exclusively patronize Black-owned businesses for various reasons including budgetary constraints, accessibility or product availability. But in those instances where you do have options (e.g., restaurants, clothing, printing services, natural hair products, etc.), answer the call to be a conscious consumer.
Black wealth builders such as Dr. Claude Anderson say that circulating more money within the Black community “is key to our economic success.” Anderson deserves attention when he says that other ethnic groups have increased their disposable income and out-produced Blacks in wealth because they practice group economics, which resulted in the creation of more businesses. If Blacks focus our own empowerment, we’ll utilize research that suggests that communities’ generational economic empowerment is linked to entrepreneurial success. Therefore, if we are serious about improving our communities, our schools, providing jobs (Black businesses are the second-biggest employer of African-Americans, after the government), we must advance and strengthen Blacks’ businesses.
By: William Reed
Mr. Reed is the publisher of “Who’s Who in Black Corporate America” and is available for projects via [email protected].
Dr. Claud Anderson: Powernomics