It all started with dinner.
In 2004 my husband, John, and I were celebrating our fifth wedding anniversary. That night we were the only Black people at Tru, a five-star restaurant in Chicago’s ultra-exclusive Gold Coast neighborhood. Instead of enjoying the romance of the moment, though, I ruined it by bringing up the discouraging status of Blacks in America. Although we moved on to other topics, they all seemed to lead us back to how fortunate we were and how we should be doing more to help improve the situation— The Black Situation.
John, a highly educated financial planner, talked about how too few Blacks own businesses, and this has led directly to forlorn neighborhoods and a general hopelessness that ultimately results in crime, violence, drug abuse, lousy academic performance in miserable schools, teen pregnancy, and shattered families. Eliminate economic disparity and you start to make structural progress on all these intractable problems.
Don’t get me wrong. Black people have made great progress in America. We fought for and achieved integration in housing and education, the right to vote, and equal employment opportunities. When we came together to elect the nation’s first Black president, it sparked an awareness of our power. And yet there is no awesome American success story like that of Wal-Mart, Penney’s, Hilton, Hershey, Sears, or McDonald’s coming from a Black family because there is nothing in our culture, history, or experience that tells us we can do it. And it won’t happen until we have a sense of pride in each other, like our Hispanic counterparts; until we believe in the possibility of intergenerational economic empowerment, like our Jewish friends; and until we make it our mission to become a successful group of entrepreneurs, like our Asian and Middle Eastern peers.
At the moment Blacks are a distant third to Asians and Hispanics in every measure of entrepreneurial progress, including success rates and revenue growth, even though just forty years ago we were first by a wide margin. Our neighborhoods had those grocery stores, dry cleaners, department stores, drugstores, and banks—all owned by local entrepreneurs. Now so many of our neighborhoods are run down that everyone has come to accept this as the norm. Black kids can go their whole lives without ever encountering a Black business owner.
These communities are starving to death because the money Blacks earn and spend—nearly $1 trillion of buying power—flows right out of those neighborhoods. Maybe you’ve heard the jokes about it, jokes along the lines of “Man, he was running away from the cops faster than a Black dollar out of the community!”
Only those people directly affected by these circumstances seemed to care—not people like us.
Okay, I thought. Maybe next time we’ll go to a Black-owned restaurant for our anniversary. But what would that accomplish, aside from pacifying our guilt?
Anyway, who has the time to figure this out? We had our own great lives to build. John worked his way up from a middle-class Detroit neighborhood to Harvard and then earned an MBA at Northwestern. I grew up in drug-infested Liberty City, Miami, one of the poorest, most violent neighborhoods in America, and made it to Emory University, followed by the University of Chicago for a law degree and an MBA. We had achieved great success in corporate America—John as a financial adviser, me as a strategy consultant—but we hadn’t completely lost our moral compasses.
John is active in 100 Black Men, a national mentoring organization that enhances the educational and economic empowerment of the Black community. I had been active in the Rainbow PUSH Coalition of religious and social development organizations led by Rev. Jesse Jackson Sr. We were mentoring youth at our church, and we donated to the NAACP and the United Negro College Fund.
And, along with a lot of successful Blacks—especially those born in the mid-1970s and later, after the most explosive battles for civil rights had settled into a more nuanced tug-of-war or been ignored altogether— we had developed a dangerous sense of gratification, even entitlement, which is an awful state of mind. It renders you idle and robs you of the passion to make a difference. We’d played our part in allowing the Black community to be reduced to a massive consumer segment that every other group taps for their own benefit.
Black people say stuff like, “It’s a shame how Black people think the White man’s ice is colder.” Then we get upset about how other groups— Italians, Jews, Arabs, Greeks, Asians, Hispanics—have, in effect, exploited the phenomenon. It’s a staple of Black talk radio. Tune in and chances are you’ll hear an angry exchange about how the Koreans took over the Black hair industry; or how so many major cosmetic, hair care, and toy companies have started Black product lines (Hallmark’s Mahogany cards, Dove’s “My Black is Beautiful” skin care, Mattel’s Black Barbie) that millions of us support while quality, Black-owned firms like Carol’s Daughter, Fashion Fair, and Kwanzaa Kidz struggle to stay alive; or how most poor, urban Blacks go years without seeing other races face to face, except for the shopkeepers and business owners who are draining money from Black neighborhoods.
It’s called the Middle Man Minority issue.
Black filmmakers who depict life in the ’hood, like Spike Lee and John Singleton, always show it. The famous “D motherfucka’, D!” scene in Do the Right Thing is a great example. Remember when the kid walks into a convenience store and engages in a hate-filled exchange with the two Asian owners over batteries? That scene—and the entire movie, really— was about the frustration Blacks endure because we don’t own businesses in our communities. Not one Black business owner was depicted in a movie about a Black neighborhood. There were Hispanic-owned businesses, the Italian pizza joint, and the Asian convenience store. And there was racial tension that emerged because of it.
The film was highly acclaimed and provoked some great dialogue about race relations, but nobody mentioned the core issue: economics. No one talked about money leaving the community—a phenomenon called “leakage”—and that it’s a critical reason why these communities are so battered.
Then there are popular Black comedies, such as Friday, Booty Call, and Barber Shop. Many scenes unfold in the convenience stores and beauty supply stores owned by Koreans and Indians. That fact barely registers with Blacks because it’s part of our everyday experience that we’ve come to accept. In fact, a dollar circulates among banks, shopkeepers, and other businesses for nearly a month in Asian American communities before that money flows out of the neighborhood. In Jewish communities that neighborhood circulation is roughly twenty days, and in predominantly White Anglo-Saxon Protestant communities it is seventeen days. Want to know what it is in African American neighborhoods? Six hours.
Here are a few more disturbing numbers:
—Less than two cents of every dollar an African American spends in this country goes to Black-owned businesses.
—More than 11 percent of Whites and Asians own their own businesses, compared to only 7.5 percent of Latinos and 5.1 percent of Blacks.
—White-owned firms have average annual sales of $439,579. Blackowned firms? $74,018.
—In 1997 African Americans represented 13 percent of the population but owned only 3 percent of all US businesses, which generated 2 percent of the nation’s business revenues.
The scenario is particularly galling when you consider that Blacks generally spend more on groceries, footwear, clothing, and shoes than the overall population and that Black teens in particular spend 20 percent more a month than the average US teen, especially on the categories of apparel, video game hardware, and PC software.
John and I came across statistics like this all the time. And just like us, lots of Black folks would wring their hands about it. But at the dozens of meetings we attended—including national conferences for organizations like the National Black MBA Association, the Rainbow PUSH Coalition, 100 Black Men, the NAACP, and National Urban League—no one was doing anything about it. Maybe, I thought, these problems were just unmanageable. Mainstream media only mentioned the dearth of Black business owners in passing. Universities seemed too bogged down or maybe frightened to offend benefactors; taking a stand was perhaps too dangerous, too militant.
John and I discussed these issues while we debated spending $60 for a celebratory lobster. But the irony wasn’t lost on us. At the end of our meal, as we paid our $250 dinner bill, we realized we were part of the problem. That money could have done at least a little good in a struggling Black community. Maybe it could have helped a Black entrepreneur employ more people, mentor more children, and serve as a source of pride in his neighborhood. Maybe it could have contributed to the tax base and helped to improve underfunded schools or served to defray the cost of an at-risk youth program, the kind that helps discourage drug use and teen pregnancy and reduces the number of Black men in prison. We realized something else, too, that so many others know deep in their hearts: Good intentions and spirited conversations won’t cut it. We had to act, and that action had to be distinctive, creative, and influential—something that would resonate with people who were feeling equally frustrated. We wanted to inspire, unite. We wanted to change things—or at least try.