BLACK
LIVES MATTER - BLACK INVESTMENTS MATTER
"We refuse to believe there are insufficient funds in the
great vaults of opportunity of this nation." Dr. King's
"I have a Dream"
“ Un individual has not started living until he can rise above the
narrow confines of his individualistic concerns to the broader concerns of all
humanity.” Dr. King
Increased wealth creation and development of sophisticated channels to create
an efficient flow of wealth in the African American community are viable solutions
to the tragic killings and mass incarcerations of blacks in the United State of
America. This solution will be reality only if the African American community
engineers a 21st century strategy of Intra-African American investment.
In modern society, the capacity of community to create efficient mechanisms of
solidarity and cooperation, fueled by a balanced flow of wealth, are positive
functions of wellbeing. In the African American community this capacity has not
yet reached the optimum level of growth to fully play this positive function. Wealth
creation in the African American community is one of the biggest in the world. The buying power of the 41.7 million (13.2% of the U.S. population) black people in
USA is US$ 1.3 trillion annually, but only 2% is invested
in black-owned businesses. According to the World Bank, only 15
countries (USA, China, Japan, Germany, UK, France, Brazil, Italy, India,
Russian Federation, Canada, Australia, South Korea, Spain and Mexico - The
World Bank ranked 193 countries) have a GDP more than US$ 1 trillion. These 15
countries can be classified as the “Club of US$1 Trillion economy”. With a
buying power of US$ 1.3 trillion (This economic value of is growing), the African American community in United States could be the 16th member of the “Club of US$ 1 Trillion economy”. According to Cheryl Pearson-McNeil (Senior
Vice President, U.S. Strategic Community Alliances and Consumer Engagement -
Nielsen): “The size and influence of affluent African-Americans is growing
faster than that of non-Hispanic Whites across all income segments, and the
impact is being felt across industries”. Nielsen report titled: “Increasingly
Affluent, Educated and Diverse: African-American Consumers – the Untold Story”
indicated:
“Each week, compared to all Americans,
African-American adults spend 42% more time watching TV; 13% more time on a PC;
and 15% more time on a smartphone than any other demographic”.
“The rate of Black high school
graduates enrolled in college increased in 2014 to 70.9%, exceeding the rate of
all high-school graduates in the nation.”
“African-American income growth rates outpaced
those of non-Hispanic Whites at every annual household income level above
$60,000”.
“The largest increase for
African-American households occurred in the number of households earning over
$200,000, with an increase of 138%, compared with a total population increase
of 74%.”
(nielsen.com
“Nielsen: African-Americans upending stereotypes in education, income, media
and more”- 09-17-2015)
The Dynamic of this success
demonstrates the extraordinary capacity of African Americans to create wealth
and the importance of our contribution to the economic growth of the United
States of America. But, this tremendous amount of wealth
and success do not reflect the living condition of the majority of African
Americans. Unemployment in our community was 8.3% in December 2015. For the
same period it was 4.5% for whites, 4% for Asians, 6.3% for Hispanics and 5%
nationwide. Unemployment rate for black youths is 30%, but represents 17.2% for
whites. Last year the US poverty rate was 14.8% (46.7 million), but represented 27.2% (10-11
millions) in the African American community. The median
household income was $ 53,657 in 2014, but represents $35,398 for African
Americans, $ 42,491 for Latinos, US$ 60,256 for whites and $ 74,297 for Asians (census.gov). These realities demonstrate that our
economic success has a limited impact in the daily life of the majority of
African Americans. This limitation is also visible in the wealth of African
American families. A report from the Urban Institute titled: “Nine Charts about
Wealth Inequality in America” (apps.urban.org)
indicated that in 2013, the average wealth of white families was more than
$500,000, but only $95,000 for African Americans and $112,000 for Hispanics. This huge gap also
exists in the investments of wealthy black and white families. In a study
titled: “Wealth patterns among the top 5% of African-Americans”, Credit Suisse
and Brandeis University's Institute on Assets and Social Policy demonstrates
that wealthy African American families invest more conservatively than white
families. We invest less in the market (stocks, bonds and other financial
assets). Our investments are more centered on safer assets such as real estate,
savings accounts, life insurance and CD’s. This reality explains partially why
black wealth grows less rapidly than white wealth. The study indicate that the
top 5% of African-Americans invest 41% of non-financial assets in real estate
outside their primary home, but in the white
community it represents 22% (cnbc.com: Investing habits of wealthy black
families by Robert Frank-Thursday, 12 Feb 2015). In this
market driven capitalism African Americans take less risk, this is why Intra-African
American investments have not reached the optimum level of growth by investing
in black businesses and black intelligence.
We are a community of wealth creators
and we have the power to change the lives of black women and men, if we make
the effort of solidarity and cooperation to invest more consistently in our own
community. A new culture of investment will add value to “Black lives matter”. This culture of investment will transform our
political conscience and develop political movement base on our success. In
modern society, the solution to the well being of populations is not limited to
the good health of macro-economic fundamentals. Community’s intra-investment is
also a determinant factor of this wellbeing. Communities are a strong
alternative source of funding, creation of private enterprise and economic
growth. But, in the African American community intra-investment is weak. Strengthening
Intra-African American investment will create thousands of jobs, substantially
lower poverty, and eliminate individual existential risk in our community. If
our financial capital, economic strength and ingenuity are totally focused on
investment in our community, black women and men will be less vulnerable to institutional
violence, injustice, and inequality. Our capacity to energize the dynamic of
intra-investment is bigger today because we are creating more wealth, but with
limited flow in the social fabric of the African American community.
Today, we have more black billionaires
and millionaires. This dynamic can play a positive function in our wellbeing if
this small group significantly increases their activities in the deployment of
Intra-African American investment. There are all leaders of wealth creation. The
social and political investment of the civil rights movement was an imperative
of the previous centuries. Intra-African American investment is the imperative
of the 21st century. This is why the role of our black billionaires and
millionaires could be determinant. Oprah Winfrey (CEO of Harpo Productions-Net worth $3.3
billion, #211 Forbes 400-2015) have been join in the club of black billionaires by Robert F. Smith (CEO
and founder of private equity firm Vista Equity Partners - Net worth $2.5
Billion, # 268
on Forbes 400-2015) and Michael Jordan (Owner of NBA team Charlotte Hornets - Net worth $1.1
billion-#513 in United States-Forbes). They are follow by blacks multimillionaires
such as Sean-Diddy- Combs (hip-hop stars -Net worth
$735 Million-Forbes), Dr. Dre (CEO of Aftermath
Entertainment and Beats Electronics - Net worth
$700 Million-Forbes), Tiger Woods (American
professional golfer- Net worth $700
Million-Forbes), Sheila Johnson (cofounded
TV network BET, CEO of Salamander Hotels and Resorts - Net worth $700
Million-Forbes), Robert L. Johnson (Founder of Black Entertainment
Television and chairman of “RLJ Development - Net worth: $550 million), Jay-Z (hip-hop star - Net Worth $550 Million - Forbes), Mariah Carey (Singer - Net worth $520 million- realtytoday.com),
Magic
Johnson (CEO
of Magic Johnson Enterprises (MJE)-Net worth of $500 million- MJE worth $1
billion-Fortune), Tyler Perry (Actor, director, screenwriter,
playwright, producer author and songwriter-Net worth $450 million- celebritynetworth.com) and William Henry Cosby (Comedian, television star and producer- Net Worth: $400 Million- therichest.com). In the near future, many members of our community will join this list. This statement of Dr. King define the
philosophy of Intra-African American investment: “ Un individual has not
started living until he can rise above the narrow confines of his
individualistic concerns to the broader concerns of all humanity.” Our capacity
to change the life of others will define our greatness.
An observation of the origin of this important wealth shows that the big
majority comes from the entertainment, media and sport industry. We can create
more black billionaires, millionaires, jobs and private enterprises if we
diversified the origin of this wealth. Industries such as technology, energy,
health care, logistics and transportation are very good sources of diversification.
More Intra-African American investment in the technology industry will define
our leadership in the digital transformation of American society and the world.
Many black young women and men could be transformative leaders in the
technology industry if more “black $” were available to them. We have young
black women and men with the capacity to create transformative technologies and
global companies that could change the world. Technology is an accelerator of economic
growth that creates efficient flow of wealth in human organization. This is why
the technology industry must be a priority in the new dynamic of Intra-African
American investments. The recent deal ($3.2-$3.5 billion) between Dr. Dre and
Apple put light on this reality. According to Pew Research Center (African Americans
and Technology Use, A Demographic Portrait by Aaron Smith-January 6, 2014) 24% (16 million people)
of Twitter users are African American and reach 40% among 18-29 year old. This huge
percentage demonstrates the importance of the African American market in social
media industry. Our dominant position in Twitter has created the phenomenon of “Black
Twitter”. We have dominant positions in many industries; this is the rationale for
“Black Investments Matter”. Fortune 500 companies have created African American
advertising teams because of this dominant position.
Across all industries, 12% of the
workforce is black in United States. But black employment in the technology industry
is weak. Apple has 8% blacks, Google, Facebook and yahoo have 2 %, Twitter 1.7%
(49 black people out of a total workforce of 2,910 in USA)
and
LinkedIn 1%. Demand for more inclusion of African Americans
in the technology industry is legitimate, but our goal must be to put them in
the position of leadership. Technology is an instrumentalization of
intelligence. The objective of the African American community must be to invest
in black intelligence and create transformative technology that will increase
our wealth. Investment in black intelligence will elevate our community from
the position of job seeker to a position of transformative leader owner of
technological assets. We are in the period of the 3rd-4th
industrial revolution and the world is now a digital platform. Communities that
lead the global economy control innovative technology and our digital sphere.
We are building the “Civilization of Intelligence” this is why investment in
black intelligence in an imperative. The Internet of things (IOT) is an extraordinary
opportunity for the deployment of intra-African American investments. This is
how John Chambers (Chairman and Chief Executive Officer of Cisco) evaluates the
internet of things (IOT): “The increased connectedness we’re beginning to
experience equates to a US$ 19 trillion global opportunity to create value over
the next decade through increased profits for businesses as well as cost
savings, improved citizen services and increased revenues for governments and
other public-sector organizations.” (http://www.weforum.org: Are you ready for
the Internet of everything?). The world is in constant technological transformation;
this is what defines “Black Investments Matter”. Investing in the future is an
imperative of this transformation.
Increased investment of African
American financial capital in black businesses and intelligence will give us
better control of our destiny. It will create healthy channels in the social
fabric of our community and help us reach the optimum level of economic
development with private sector development, job creation, better education,
housing, and health. Strong Intra-African American investment will end the weak
circulation of $1.00 in our community. One dollar ($1.00) circulates in the Asian
community 19-25 times; it is 17 times in the white community, but only 0.5
times (less than six hours) in the black
community. This poor performance is the biggest weakness of the African
American community in The United States of America. In the 21st
century this poor performance is inacceptable and we have the capacity to
change it. In 1910, “Black Wall Street” (Greenwood -Tulsa,
Oklahoma) circulated $1 from 36 to 1000 times and could reach one year. “Black
Wall Street” (Little Africa) is a historical precedent that demonstrates the
exceptional capacity of the African American community to invest strongly within
itself. “Black Wall Street” is the most successful center of wealth creation in
the African American community and is the rationale of “Black Investments
Matter”.
“Black Wall Street” is a model of Intra-African
American investment that can be replicated, but since 1910, the successive
generations have not been able to recreate this phenomenal success. This is how this historic economic success is
describe by “officialblackwallstreet.com”, the digital platform that promote
black-owned businesses:
“Yet even in Tulsa, Oklahoma, Jim Crow laws
were at large, causing the town to be vastly segregated with most African
Americans settling in the northern section of the town. From that segregation
grew a black entrepreneurial mecca that would affectionately be called “Black
Wall Street”. The town was established in 1906 by entrepreneur O.W. Gurley, and
by 1921 there were over 11,000 residents and hundreds of prosperous businesses,
all owned and operated by black Tulsans and patronized by both whites and
blacks.”
“One of the most prominent entrepreneurs was Lola T. Williams who owned
The Dreamland Theatre and a small chain across Oklahoma. The theater seated
close to 1,000 people for live musicals, films and more. This was only one of
four theaters in the area. Not too far from Mrs. Williams’ theater was the
Stradford Hotel on Greenwood Avenue. Owned by J.B. Stradford, it was one of the
largest and most successful black-owned hotels at the time. Prior to opening
the hotel, Stratford bought large tracts of land in Tulsa and sold them
exclusively to blacks, subscribing to the belief that they had the best chance
at economic success by pooling their resources and supporting one another’s
businesses. “
“Greenwood flourished and became a symbol of black wealth, pride, and
unity. At its height, the business center boasted of various grocery stores,
nightclubs, drug stores, churches, funeral homes, restaurants, banks, hotels,
and the likes. The community was completely self-sufficient and became the home
of many black multimillionaire entrepreneurs.”
Parrish Street (Durham-North Carolina) and Jackson
Ward (Richmond, Virginia) was also named “Black Wall Street”. Parrish Street was the hub of African American financial activity and Jackson Ward was a center of black commerce,
entertainment and religion
The leaders of Black Wall Street were, among others, O.W. Gurley, J.B. Stradford, Lola
T. Williams, Maggie L. Walker, John Merrick and Charles Spaulding. They were leader of wealth creation armed with the
belief that the success of African American businesses is base on the pooling
of resources fueled by infallible unity, cooperation, and collaboration.
“Black Wall Street” was a culture and philosophy that must guide our community’s investment strategy in the 21st
century. Investing in our community must be a way of life, the idea that shapes
our everyday action to buy black and sell black. “Blacks in
America” is one of the most important sources of funding in the world. But, this
source of funding will play a positive function in the well being of our people
only if it is first centered on building black assets supported by the creation
of mechanism of intergenerational transfer of wealth. Absence of this mechanism
is one of the biggest weaknesses of black wealth in United States. Today, each
one of our black entrepreneurs can play the role of O.W. Gurley or J.B. Stradford.
They can energize the dynamic of Intra-African American investment. Our civil
rights leaders have made an extraordinary contribution to the political and
social investment of our community, the same contribution can be made by black entrepreneurs in the 21st
century.
We must create new political consciousness
that goes beyond the punctual creation of political slogans, movements, and
organization of protest marches. Our position of victim is incompatible with
the important economic and financial success that we build for many centuries. This
is why “Black Investments Matter” could be an important contribution to “Black
Lifes Matter”. The African American community investment in the economic
success of The United States is enormous. But our community is characterized by
high rate of unemployment, poverty, and high rate of individual existential
risk creating a paradox in the American society. We build the most prosperous nation
in the world, but we cannot build a better life for Eric Gardner, Michael
Brown, Walter Scott, Ezell Ford and our people who
are living in poverty. Our total wealth does not represent our phenomenal contribution
to the success of The United States. Black households
are worth only $1.4 trillion of the $80 trillion of total U.S. household net
worth and represent 1.4% of the top 1% of households. The median net worth of
black households in the top 1% is $1.2 million dollars, and the average net
worth for all black households is about $6,000. But for white households in the
top 1%, the median net worth is $8.3 Million dollars and the median net
worth for all white households is $112,000.
We can eliminate this paradox if we invest
more black dollars in the African-American women-owned businesses. Growth of the number of African American women-owned
business was 258% and revenue increase by 231% from 1997 to 2013 (1.1 million
companies, 272 000 workers and US$ 44.9 billion in revenue). This growth is
higher than any other minority women owned business in United States (The 2013 State of Women-Owned - Businesses Report commissioned by American
Express OPEN). Investing in the African-American
women-owned businesses is key to the new dynamic of creation of black assets.
Nationwide business assets as a percentage of total assets is 17%, but
represent 19% for whites and only 4% for blacks. (Harvard
Business Review: How America’s Wealthiest Black Families Invest Money, by Sarah
Green Carmichael, February 10, 2015). Today, the
imperative of “re-industrialization” of The United States of America with
creation of “Made in America” is an extraordinary opportunity to create new
African American business assets. The middle market companies are very well
suited for this new dynamic. Baltimore and Ferguson can be the perfect location
for the creation of “Made in America”. It is an opportunity to diversify the
origin of black wealth and create world-class African American companies. We
have the financial capital, the human resources, and the intelligence to
manufacture “Made in America” in all industries.
In the last 40 years, a process of deindustrialization
and failure of American democracy have characterized The United States. The
consequences of these 2 phenomenons are: dismantlement of our industrial
fabric, disappearance of the middle-class, increased inequality, massive
poverty, poor functioning of the 3 branches of power (the approval rate of US
Congress is only 9%) and emergence of “Sub-Capitalism”. Deindustrialization and
failure of American democracy are results of the shift from industrial capitalism
to financial capitalism. This shift has created an accumulation of disequilibrium
that degrade the wellbeing of the American people. The American dream is dead! In
this period of electoral campaigning, the increased restrictions on the vote play
a negative function in the electoral process and the future of our democracy.
The introduction of money in our political system has totally corrupted our
electoral process and marginalized millions of American voter. Researches show
that 50% of the money
raised by 2016 presidential candidates comes from 400 families. Total spending
by all candidates, political parties and special interest groups could reach
$10 billion. A study from Princeton and Northwestern University by Martin Gilens and
Benjamin I. Page describes the functioning of our political system as follows: “Despite the
seemingly strong empirical support in previous studies for theories
of majoritarian democracy, our analyses suggest that majorities of the
American public actually have little influence over the policies our
government adopts. Americans do enjoy many features central to democratic
governance, such as regular elections, freedom of speech and
association, and a widespread (if still contested) franchise. But we
believe that if policymaking is dominated by powerful business
organizations and a small number of affluent Americans, then
America’s claims to being a democratic society are seriously threatened”. (scholar.princeton.edu:
Testing Theories of American Politics: Elites, Interest Groups, and Average
Citizens by Martin Gilens of Princeton University and Benjamin I. Page -
September 2014).
This statement is a description of an oligarchy. Our political system is
structure as a democracy (separation of power, regular elections, freedom of
speech and association, very weak labor organization) but the power of decision
belongs to a small group of individuals, families, corporation and special
interests. The US Supreme Court decision “Citizens United v. Federal Election Commission” (January
21, 2010) contributed to the formation of American oligarchy. The emergence of
Donald Trump as the possible nominee of the Republican Party is a consequence
of the transformation of American democracy to an oligarchy. More American
billionaires could joint Trump in this conquest of the White House. The Los
Angeles Time announces the possible entry of Michael Bloomberg in the
presidential race. Mr. Bloomberg could spend $1 billion (Los Angeles Time: A new
2016 twist, from the center, by Lisa Mascaro-January 24,2016). This dynamic will increase
the number of wealthy individuals in our political competition. The Republican
Party is at the origin of this transformation, this is why the party
establishment is the 1st victim of the emergence of Trump. The
presence of Trump demonstrates the total failure of the leadership of the
Republican Party accompanied by an ideological degeneration. The political
dynamic create by Donald Trump in the Republican Party could severely damage
the GOP and eventually break up this party.
We
are in a dynamic of failure of US democracy characterized by an increase
restriction of freedom that undermines the voting right of African Americans
with mass incarceration, very high rate of existential risk, elimination of early
voting, requirement of voter ID, limitation
of same-day voter registration-SDR (voter turn-out with SDR
states average 71%, but represent 59% for non-SDR states) and
limitation of automatic voter registration (except North Dakota) (exclusion of
55% of black youth, 45% of Latino youth, and 61% of white youth). Restriction of freedom is the result of a well thought social
engineering developed by the leadership of the Republican Party and their
funders. This political reality is the rational of “Black Life Matter” and how this movement is
shaping our political conversation. “Black Life Matter” could have an important
impact on the result of the 2016 presidential election, if this political
movement helps increase the number of voters. The best winning strategy in US
elections is to increase the number of Americans that will exercise their right
to vote the day of the election. In The United States, voting turnout is 53.6% (pewresearch.org); it is one of the lowest in
industrialized nations. In 2012 presidential race, limitations of automatic
voter registration keep about 20 million Americans out of ballot box. The leading position of the presidential candidates (Bernie Sanders and
Donald Trump) that are “Not In Line” to be the next President of The United
States is an expression of the failure of bipartisanship. The structure and
political substance of bipartisanship can no longer play a positive function in
our political system this is why 2 outsiders are leading the pools in both
parties. Bernie Sanders (Senator-Vermont, Independent and democratic socialist)
and Donald Trump (Billionaire-New York) are factors of disruption of
bipartisanship and re-organization of our political system. Current success of
both candidates is supported by a strong populism. The energy of this populism
is fuel by the total dissatisfaction of the American people. Strong anger is
emerging from this reality, but in political competition anger of voters can
create radical result.
The African American community is the most
affected population by the failure of American bipartisanship and democracy. In
the 21st century, the imperative to invest “black $” in the African American community
define a new vision, cooperation and solidarity. It is the most viable solution
to the problem of institutional racism, poverty and unemployment in our
community. We must build a new identity of the African American community base
on our success. Investment of our financial capital in the future of black
women and men will improve our wellbeing. The success of a community is measure
by its capacity to create, manage and transfer intergenerational wealth. This
is why “Black Life Matter” and “Black investment matter”.
Aboubacar Sissoko
