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Putting people first.

Sixteen African-American leaders explore how the Clinton economic agenda will impact your job, finances and business.

As the Clinton administration approaches its 100th day, Americans are waiting to see if the new president, sidetracked by international events, can make good on his promise to "put people first."

But after a decade of broken promises, can Clinton be for real? If his economic conference, held in Little Rock last Dec. 15 and 16, is any indication, the answer may well be yes. For a change, African-Americans were invited to the party, which included some of the sharpest minds in economics, business, finance, education and health care. In fact, roughly one in six of the conference's 300 participants were African-American.

To get a sense of how black entrepreneurs, executives and families may fare over the next four years, BLACK ENTERPRISE spoke with 16 of the African-American leaders who participated in the summit. What, we asked them, does a Clinton administration bode for the country in general, and for blacks in particular?

Energized at the prospect of being consulted as ambassadors to the future, these leaders offer insightful suggestions, concerns and hopes for a Clinton presidency.

As each person made clear, there are no easy solutions to such complex problems as unemployment, lending bias, the deficit and urban decay. And the participants don't necessarily see eye to eye. What unites them, however, is a sense of urgency and optimism. The consensus: Clinton's summit hit an intellectual high note. We hope these voices will sustain a long-awaited dialogue on issues of concern to African-Americans.


Frank Brooks, Chairman and CEO, Brooks Sausage Co., Kenosha, Wis.:

Minority business will play a vital role in Clinton's small business agenda. Why? Because I don't envision major corporations bringing jobs back into the cities. Jobs will arise from small companies, especially minority firms. These firms have traditionally been more willing to take on the task of rehiring and retraining.

Clinton should look at the Small Business Administration (SBA) and put a little more money into its loan programs. The investment tax credit is a good program that will help all firms, certainly minority-owned ones. Any credits for the investment in equipment and machinery pushes companies toward manufacturing, an area, I think, where job growth will occur.

As for enterprise zones, I'd look at them a bit more closely. But I'm not convinced that the program has worked as well as was expected, Instead, Clinton has got to push for incentives. For instance, there ought to be some inducement for me to put money in a start-up instead of in a CD.

Earl G. Graves, Chairman and CEO, Earl G. Graves Ltd. (Publisher of BLACK ENTERPRISE) New York, N.Y.:

Under Ron Brown's leadership at the Commerce Department, Clinton should establish a White House initiative for minority business enterprises (MBEs). I am convinced that this initiative must be at the executive level, which has the authority to coordinate efforts and draw on the resources of all federal government agencies.

I recommend that state and local programs receiving federal funding be required to have an MBE program in place. The scope of the program must be based on needs, evidence of discrimination against MBEs and contract participation levels.

Underscore the original intent of enterprise zones (EZs) to help rebuild and develop economically disadvantaged areas. Consider a federally directed EZ program--linked to a national infrastructure redevelopment plan--to help revitalize the nation's distressed areas, boost employment and increase consumer demand.

Robert L Hurst, President and CEO, Michigan Bell, Detroit, Mich.:

Clinton wants the public to become more knowledgeable about the realities of our economy. He obviously wants to hear different points of view. That's a positive sign.

Although he has not articulated a specific plan, my sense is that there will be a commitment in the way of job creation--maybe through investment tax credits--to stimulate job growth. His orientation seems to be less on focusing on unemployment, and more so on employment.

It is clear that Clinton will attack the issue of health care. He'll try to find creative ways to put a lock on rising costs; for some businesses, premiums are rising as much as 20% a year. I'm also happy to see that Clinton is concerned about the 37 million uninsured Americans. I suspect that some national health care policy integrating the public and private sectors will come out of the conference.

Marilyn French Hubbard, President, Marilyn Hubbard Seminars Inc., and Founder, National Association of Black Women Entrepreneurs, Detroit, Mich.:

I'm concerned about black women in particular. There are 175,000 black women entrepreneurs in the United States. But if we don't organize and put pressure on the administration, we'll fall through the cracks. Minority usually means black men, and women usually means white women. Clinton needs to recognize that, and make the effort to include black women in all phases of policy-making.

Clinton and his boys want to win. Blacks can be winners, too, but many want to continue to be victims. Racism and sexism are givens. If we continue to dwell on them, we'll perpetuate them.

Clinton wants to retrain America, and we must focus on training if we're to remain competitive as a nation. But are we, as minorities, going to take this idea seriously? We've known this new economy was coming for a long time. It's not all on Clinton. If you're an entrepreneur, you should be giving your employees some training, especially in the areas of technology, math and quality control. That's what will make this nation tick.

Raymond J. McClendon, Vice Chairman, Pryor, McClendon, Counts Inc., Philadelphia, Penn.:

Clinton is concerned about rebuilding our cities--creating the infrastructures that will smooth development in the black business sector. This reflects his deeper commitment to building the economy from the ground up. More than 80% of job growth today is derived from small businesses. Over the past three years, ethnic businesses have hired a disproportionate share of minorities.

The selection of Ron Brown as Secretary of Commerce sends a signal to the entire business and capital market network. This president wants opportunity not only for the good-old-boy network, but also for minorities and women.


Johnnetta B. Cole, Ph.D., President Spelman College, Atlanta, Ga.:

It looks as if the Clinton/Gore team is making us fall in love again with our own possibilities. Woe unto us as African-Americans if we think Clinton and Gore can turn around our situation. We must remain active in the process.

First, education must not be divided up; it should be seen as a seamless web. By that, I mean we should not pit elementary and high school programs against postsecondary and graduate degree programs. Second, nothing is more essential to investing in our future than education.

Marian Wright Edelman, President and Founder, Children's Defense Fund, Washington, D.C.:

Let me make two suggestions for the Clinton administration. First, we can make sure that every one of our children is born healthy and is immunized against preventable diseases. It is scandalous that in most states fewer than 60% of preschool children are fully immunized. Second, this country must see to it that every one of our children is given an advantage by fully funding the Head Start program--make it a full-day, year-round program and take it down to earlier ages. For every dollar we invest up front, we will save almost $3 on the other end. Unless we meet the school readiness goal, we won't achieve the educated work force that is crucial to long-range productivity.

William H. Gray III, President and CEO, United Negro College Fund, New York, N.Y.:

The long-term issue in the nineties must be steady deficit reduction, with cuts in spending in nonessential areas and revenue changes. The argument that you can't cut spending and raise investment isn't true. We must increase investment in areas that promote long-term growth, and rebuild "human" infrastructure via education, targeted job training, health care and nutrition. Our human capital is the basis for all long-term growth. It is not an either or proposition; you can do both. But it means eliminating spending in areas that are not high priority; for instance, cuts in Medicare and agriculture subsidies for large corporate farms. Most of the funds spent go to the middle class, not the poor. When there are benefits to those at the bottom, and not just those at the top, that's when Black America will benefit.

Wilbur F. Hawkins, Regional Manager, Community Diversity Development, Tennessee Valley Authority, Memphis, Tenn.:

Clinton has to make certain that the growth of America is balanced. We need to see deficit reduction, but it should not have to be at the expense of new jobs. At the same time, as he seeks to rebuild infrastructures, Clinton must strive for diversity and participation at all levels.

Any action toward job creation and growth should be funded by the peace dividend or other deficit neutral programs within the federal government.

A multitude of policies and programs are already on the books to assist African-American and poor communities. Yet they have often been poorly implemented. One example is at the Commerce Department, where 8(a) companies are presently segmented out as "special" businesses. These companies need to be mainstreamed.

It is important that African-Americans not take these bridges of hope and change for granted. Black America does not have a holistic agenda for the 21st century. What we need is development capital and a process that displaces the tremendous amounts of money that come into our community in government transfers.

Vincent Lane, Chairman, Chicago Housing Authority, Chicago, III.:

Clean and decent housing must be the center of the urban community restoration process. We must redefine housing delivery systems at entry level to encourage a socioeconomic mixing of communities. This can be achieved through joint federal, state and local programs.

The administration needs to target and integrate programs such as Ginnie Mae, Fannie Mae and Freddie Mac to promote homeownership and mixed multifamily rental housing. First, I suggest we use a transferable tax credit ($2,500 to $7,500) to encourage inner-city homeownership. Second, we should finance down payments for families earning less than $50,000 a year; the money would be repaid at sale or upon increase of family income.

Finally, President Clinton should appoint a commission to evaluate, consolidate and streamline federal programs in conjunction with state and local governments. The objective would be on eliminating waste and duplication and maximizing performance.


Derrick D. Cephas, Superintendent of Banks, New York State Banking Dept., New York, N.Y.:

Economic prosperity is not sustainable in the United States without a healthy banking system. Unfortunately, the public at large and many policy-makers have failed to grasp the connection between bank profitability and the overall health of the economy. Some people do not want to be seen as "helping out the banks." In reality, unless we help the banks, the banking sector will be in no position to finance broad and even growth throughout the economy.

I advocate a revision in the Community Reinvestment Act (CRA), the statute requiring banks to address the credit needs of the communities in which they do business. The enforcement of the CRA should be greatly reduced and bank compliance with CRA should be measured by quantitative analysis. This would result in an increase in bank investment in local communities--especially in small business lending--and a substantial abatement in the polarization and animosity between banks and community groups, which now pervade the CRA enforcement process.

Alvin J. Boutte, Chairman and CEO, Independence Bank, Chicago, III.:

I think Clinton can work with the regulatory agencies to make it easier to spur small business lending. If banks increased lending by 4%, $80 billion in private investment would be produced and jobs created. Clinton needs to encourage regulators to reduce the stringent capitalization standards they put in place in an overreaction to the savings and loan crisis. I think that could be done without any cost to the country or to the taxpayer.

The president could embark on an accelerated public works program, spending between $20 billion and $50 billion. This would immediately create jobs and put a short-term spur in the economy. It would also reduce the deficit slightly. Black America would benefit because the country would be getting better.

Paul Hudson, Chairman and CEO, Broadway Federal Savings and Loan, Los Angeles, Calif.:

Clinton and his cabinet must take a hard look at the regulations governing banks and savings and loans. Working together, they can do a lot to ease credit into the marketplace. Clinton is going to have a major impact in terms of access to capital and economic stimulus. His community development bank proposal, for instance, is clearly directed at low-income communities.

Already, Clinton has made a statement with his appointments. And the economic conference itself portends greater access than African-Americans have ever had before.

Charles R. Stith, President Organization for a New Equality, Boston, Mass.:

The new administration needs to set up some sort of capital reserve fund to ensure that black-owned financial institutions have the resources to serve our community needs. The name of the game in America is not just income--it's equity. It's not what you buy, but what you own. You must have access to capital.

I think that community development banks (CDBs) represent a problem. The idea of directing capital to communities that have been starved for credit is on the money. But setting up marginal institutions in communities that are already in the margins is a contradiction. We won't own CDBs, and they won't result in dollars being turned over more than once in our community. Instead, we need more relationships with mainstream institutions.

Clinton needs to ensure that the SBA is fully funded. Last year, $6 billion was authorized, but only $2.3 billion was appropriated by Congress. It is critical to support small business, because for every billion dollars that banks lend, 10,000 to 15,000 new jobs are created.

Rural America

Larry N. Farmer, President and CEO Mississippi Action for Community Education Inc., Greenville, Miss.:

We cannot take for granted that rural America will necessarily be helped by Clinton's presidency, or that we will be at the forefront of a Clinton/Gore agenda. Those of us in rural America must make certain we are on their agenda.

If we're putting people first, let's start within the local community by asking that business and government participate. Corporate America has a parasitic relationship with rural America--they pull from it, but put nothing back. There is no strategy for corporate development of rural America, except for the farmers. There must be a gathering of rural development practitioners to devise a comprehensive economic development strategy, a Marshall Plan, for rural America.

Calvin R. King, Executive Director, Arkansas Land and Farm Development Corp., Brinkley, Ark.:

We need to revitalize rural America through investments in family farms and minority farmers. We need to focus on improving the infrastructure and business and rural development. We need to develop new markets and alternative crops for small farmers, and create agricultural enterprises that will offer a higher return on investments and show economic vitality for small and minority farmers.

Clinton has demonstrated that he wants to be sensitive to the issues, understand what they are and hear proposed solutions. I sent a package [to the Clinton team] of alternative delivery systems for small farms. I suggested assigning troublesome loans to nonprofit organizations to assist farmers in finding and growing alternative crops.

I definitely feel that we will be better off under a Clinton administration. I've seen the benefits that have gone to his constituents since he's been governor, and how his efforts have impacted Arkansas as a state. He started a co-op loan program and small loan initiatives for entry-level farmers and farmers converting to alternative farms. I feel very confident he will continue these types of initiatives nationwide. These programs will benefit disadvantaged people at the city and state level.
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Title Annotation:16 African-American leaders discuss impact of Bill Clinton's economic agenda
Author:Whigham-Desir, Marjorie
Publication:Black Enterprise
Date:Mar 1, 1993
Previous Article:Hot industries for small businesses.
Next Article:The new powers that be: the Clinton challenge.

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