Has Black capitalism failed? Was it even given a chance? The two basic approaches to the world’s economics are – free market capitalism and planned or command economies. Blacks don’t seem to really know what’s going on in the capitalistic system around them. Year in and year out, high percentages of Black Americans display woefully inadequate understandings of this nation’s economics.
Blacks’ pattern in America’s capitalistic system in which wealth, and the means of producing wealth, are privately owned businesses and controlled rather than commonly, publicly, or state owned is government-centered. In economics the basic resources or factors are land, labor, capital and entrepreneurship. American capitalism involves “the exchange of supplies or goods between businesses and the people for money” and the social system under which we live. Under this system other ethnic groups have thrived while Blacks remained stifled. Over the past half-century Vietnamese, Koreans, Jews and Arabs have successfully mastered producing and distributing goods as American entrepreneurs and capitalists, while the majority of Black Americans sell their skills and labor for a wage or salary.
It’s as if Blacks have a “workers mentality” they can’t get beyond. Sadly, Blacks view themselves as “the working class that is being exploited by the capitalist class.” For the most part, Blacks are lackadaisical about being entrepreneurs. Yet, its entrepreneurs that drive America’s economy and account for the majority of new job creation and innovations. America’s 25.8 million small businesses employ more than 50 percent of the private workforce and generate more than half of the gross domestic product. It’s as if Blacks don’t know entrepreneurship as an employment strategy that can lead to economic and personal self-sufficiency. While Blacks shy away from self-employment, it is a vital facet of the United States economy. According to the 2014 Global Entrepreneurship and Development Index (GEDI) the USA is the most entrepreneurial economy in the world. The USA is followed by Canada, Australia and Sweden in second, third and fourth place, respectively. Between 1996 and 2004, America created an average of 550,000 small businesses each month. Nigeria and South Africa house Africa’s most vibrant economies.
Blacks are consumers rather than producers. Most often, Blacks’ lives and existence are as clients of “big government. Contemporary Blacks have low historical rates of entrepreneurship and need to cultivate entrepreneurial spirits independent of politics and who occupies the White House. Blacks often frown on capitalism and equate it with racism, saying: “whenever Blacks attempt to establish business ventures their efforts were sabotaged by White competitors and supremacists.” The truth is that the free market system isn’t racist and is the best economic system and provider for Americans of all races. Note immigrants’ economic successes here.
Black owned businesses in the United States total 1.9 million Black firms. The growing failure of Blacks to do significant business with other Blacks casts a dark shadow on Black Capitalism. What’s wrong with the Black culture is that we do nothing to help each other. Unity and collective capitalism is “out of our league.” African Americans’ annual $1.1 trillion buying power is the 16th largest economy in the world. Currently 43 million strong, African-American consumers have unique behaviors from the total market. Currently, a dollar circulates in Asian communities for a month, in Jewish communities approximately 20 days and in White communities 17 days. A dollar goes in and out of the Black community in 6 hours.
Too often Blacks’ acknowledged “leadership” is primarily politically-oriented. In regards to the February 2015 Jobs Report, Ron Busby, Sr., President, U.S. Black Chambers, Inc. said, “February’s jobs report is encouraging… with 295,000 jobs created last month and the unemployment rate dropping to 5.4 percent, we have good reason to feel optimistic about the future. However, our economy still has major disparities…and lawmakers could be doing much more to encourage Black entrepreneurship.”
For Blacks to become more effective among America’s capitalistic enterprise system it’s important that parents educate children on the importance of supporting their communities and kind by purchasing products and services from people who look like them.
William Reed is publisher of “Who’s Who in Black Corporate America” and available for projects via Busxchng@his.com.