We Need a Plan to Establish Minority Businesses

In the late 1970s and early ’80s, I was fortunate enough to work with the late Parren Mitchell, Democratic congressman from Baltimore. Mitchell was a small man in stature but a giant in the minority business development field. Between 1971 and 1987, he sponsored, co-sponsored or amended more than 10 bills essential to the economic development of minorities throughout the United States.

Although many of his bills were critical in establishing minority business enterprises (MBEs), I believe the most significant was his amendment to President Carter’s 1977 public works bill. The amendment required state, county and municipal governments seeking federal grants on public works projects to set aside 10 percent of contracts for minority-owned firms.

His amendment set a precedent, igniting a series of laws that further expanded minority businesses into federal agencies and authenticated their status by criminalizing front companies. These laws fostered the growth of minority business development and created opportunities directly or indirectly for veterans, women, small businesses and Native Americans. As a result, MBEs created millions of jobs in the inner city, motivated many young, minority students to enter the business field, increased the number of minority and female entrepreneurs and built public and private partnerships that did not previously exist.

According to the Kauffman Foundation, in 2000, African-Americans and Hispanics were 50 percent and 20 percent, respectively, more likely to attempt entrepreneurship than whites. Further, an increasing percentage of MBA students are minorities — 12 percent in 2000 to 17 percent in 2005. Because of Mitchell and others in the ’70s and ’80s, our nation became stronger, and the U.S. economy added thousands, if not millions, of young entrepreneurs who now embrace the free enterprise system.

Mitchell died in 2007. Since his death, I and others have been waiting for the next great leader in the field, be he or she a minority or non-minority. Unfortunately, that person has not appeared. Why not? I had to ask myself the following questions.

1. Have our elected officials lost interest in the topic?

2. Have they not witnessed the positive impact minority business has on their communities?

3. Have they not been willing and able to collaborate about major legislation?

4. Is the opposition to minority business development too strong and well organized?

5. Have the limited number of minority front companies poisoned the waters?

I have witnessed minority leaders within the Hispanic and Black Caucus take the initiative on individual bills and projects. Congressmen such as Yvette Clarke, Chaka Fattah, Bobby Rush, Bennie Thompson, Luis Gutierrez, Nydia Velazquez and Robert Menendez have made major contributions, but have not made a Mitchell-type impact.

This forced me to question my own assertion that we should anoint another leader either in or outside Congress. Maybe we don’t need another Mitchell. Maybe this is a ’60s mentality aspiration. The world has changed dramatically since the civil rights movement, and as actor Ossie Davis once stated, “It’s not the man, it’s the plan.”

We need a new plan, not a plan solely designed by old men in their 70s, but a plan designed, discussed and implemented by leadership from multiple generations, minorities and non-minorities, Republicans and Democrats. We need a plan that would solve near-term problems and create long-term opportunities. We must utilize our best minds, research departments of major universities and the goodwill and resources of major corporations.

Every year, thousands of people go to the nation’s capital and spend millions of dollars complaining about the lack of economic and social progress. These same people who visit Washington, D.C., should invest small sums of capital and speak with one voice to build this plan. If they did, we could alleviate the economic burdens that affect minorities. I do not know if this is the solution, but I know time is running out, and major changes are not occurring. I also know Parren Mitchell would be shaking his head in disbelief, saddened that the platform he so brilliantly created has not been leveraged.

James H. Lowry is a senior adviser for Boston Consulting Group and inaugural member of the Minority Business Hall of Fame. He can be reached at editor@diversity-executive.com.