ComebackTown is published by David Sher to begin a discussion on a more prosperous metro Birmingham.
Today’s guest blogger is Bob Dickerson. If you’d like to be a guest blogger, please click here.
If we close Birmingham’s racial wealth gap we all benefit.
If you’re black and you’re reading this then you know exactly what I mean by the racial wealth gap. If you’re white there’s a chance that you might not realize and worse, might not have ever focused on the problems that this gaping disparity cause.
The racial wealth gap
Perhaps you also haven’t considered whether there is any benefit to you to closing it. I hope I begin to change your mind.
Facts show that that Black America’s wealth pales in comparison to that of white America. Studies suggest that family net worth, the difference between assets and liabilities, is $6,000 on the average for blacks and $90,000 for whites. That is an astounding and discouraging difference to any fair minded person.
Why is there a racial wealth gap?
Let me remind us of some of the causes, factors that contributed and continue to contribute to the gap. Centuries of economic robbery and economic detours, Jim Crow laws, discrimination, housing codes, redlining, unequal pay and opportunity, lack of access, and could go on. I suppose that as you are reading this you may have reasons to add.
This piece is not intended to cast blame but rather issue a call to action because I am convinced that we can close the gap in Birmingham and the one of many strategies I’ll put forward here is to galvanize behind a community wide effort to grow the Black Business class.
Change is possible
Successful businesses create wealth. Pure and simple–Birmingham is creating millionaires who are small business owners but there are too few black companies benefiting from Birmingham’s thriving economy and emerging emphasis on supporting business development and, it is my belief the we can change that.
I’d estimate that the Birmingham Metropolitan area, which is over 25% black, produces about $100 billion in business revenue annually. Black companies, despite their efforts, generate less than 1% of that total.
I believe that a concerted community wide effort, established and executed publicly, supported by public policy and major stakeholders, with published goals and results can help us move the needle.
Concentrate on our 20 leading procurers
For example, if our 20 leading procurers of products and services committed to using their ingenuity to increase their spending with black businesses, the entire community and marketplace would benefit.
There are some examples, best practices if you would, from across the nation, however I’d like to think that Birmingham would look at them yes, but craft our own solution.
Birmingham protagonist of modern civil rights
In that this city served as the protagonist of the modern civil rights movement and was the incubator for the great A. G. Gaston and his enterprises, what better place than this to recognize the problems caused by wealth inequality and opportunity deficits and to do something about it.
The good thing about Birmingham is that we’re small enough, connected enough and hopefully cooperative enough to get this done. Is this ambitious? Yes! Is it doable? I believe so. Is it worth trying? Absolutely! Birmingham can be the national model and we should.
What will success look like?
Here’s a short list of the positive results, benefits I expect to come from this effort.
An increase in Black wealth as a result of entrepreneurial activity; increased employment, and keep in mind the fact that 80% of the people companies hire look like the owners. In a city our size we’d virtually eliminate unemployment and likely spur population growth making us the Magic City once again–increased consumption of durable goods and real estate, leading to stabilization of our local housing market and increasing values and equity. An increase in real estate value, especially in Birmingham’s neighborhoods, once again adds equity, increases net worth and starts to close the gap.
Progress in this as well as in any area wide initiative promotes a greater sense of pride, optimism, and enthusiasm. More opportunity also equals better schools, lower crime rates, a better Birmingham.
The bottom line for me is embodied in the theme we’ve promoted for years at our A. G. Gaston Conferences, “Economic Empowerment through Enterprise Development”. If we want to close the racial wealth gap in Birmingham, working to help start, grow, further develop Black Enterprise is a winning strategy.
Bob Dickerson is executive director of the Birmingham Business Resource Center and co-chair of the A.G. Gaston Conference. The A.G. Gaston Conference, February 12-13, will explore many of the issues presented in this piece.
Let’s turn Birmingham around. Click here to sign up for our newsletter. There’s power in numbers. (Opt out at any time)
David Sher is Co-Founder of AmSher Compassionate Collections. He’s past Chairman of the Birmingham Regional Chamber of Commerce (BBA), Operation New Birmingham (REV Birmingham), and the City Action Partnership (CAP).
Invite David to speak to your group about a better Birmingham. dsher@amsher.com
Who’s been stopping you from doing this? I don’t see any laws or regulations that prohibit blacks from being entrepreneurial, owning businesses, getting a solid education, or becoming successful.
You didn’t mention good remedies except for more affirmative action when you said there needs to be better public policies to move the needle.
There is absolutely nothing holding blacks back now days. The road may be bumpier but we’re all given a path and the opportunity is there.
“Let’s galvanize behind” is not a solution. It’s a generic term you often hear in business like “synergy”. You have not offered an workable ideas besides more public policy to unfairly give blacks more advantage.
I get that the whole point of this article is to point out that an entire race of people has been culturally, politically, and systematically disenfranchised, and that’s something this city has an abhorrent national reputation for.
And if the fix for this disenfranchisement is to help boost my local economy by patronizing the business of my neighbor, I’m more than happy to help out.
I see you, I see your struggle, and I’m happy to advocate for you.
The root cause for the wealth gap lies in the fact that the majority of Birmingham city families are not intact. Most children grow up without a father in their home. Where there is no father, the mother is dependent on welfare for the care of her children. Mothers are married to the welfare system which is designed to help out with basic necessities (food, housing, schooling, and healthcare), but it will never allow them to prosper. The struggle I see is in restoring the family unit in the black community, where men are given back their dignity to protect and provide for their family. Statistics show that where there is a father in the house, the numbers in school drop outs, teen pregnancies, and criminal activity significantly drop. These are there real stumbling blocks to closing the so-called “wealth gap”.
https://thefatherlessgeneration.wordpress.com/statistics/
Mr. Dickerson is spot on with his assertion a more entrepreneurial and vibrant African-American business community would be great for the Birmingham MSA. However, I could say the same thing for the Latin-American business community, the Asian-American business community, and even the white business community. The goal should be to grow the entire economic pie, as opposed to the individual slices. After all, economics is not a zero sum game.
The best thing we can ALL do for every demographic in our area is to make education and worker training an overriding priority, and be willing to pay for it. What’s more, we need to do a better job determining what skills the local economy needs. I believe Mayor Woodfin’s office is making strides in the right direction here.
Spending more money and devoting more capacity to vocational training, actually teaching a marketable skill, in area schools would be an enormous leap in the right direction to achieve a more vibrant local economy.
Sir you took the words right out of my mouth, segregation is not for one race of Americans , As Americans and Alabamians we do need to come closer together. It is time for all people to realize you have to earn, save, and invest . The government funded free enterprise is a joke and does not work, In a business in order to be successful do what you say you will do, when you say you will do it. I have seen many talented people try to start a business and they failed, The biggest reason they failed was they did not know their cost. Running a business is pretty simple at first, what you take in and what you spend and what is left is a profit. Sam Walton sure new what it took, and others could follow his example. In todays economy health care , insurance , social security i think for the most part , most are better taking a skill. But learning the importance and displin of savings and Investments, Spending is opposite savings. In that is where we need to teach first, or future entrepreneur need to learn first.