Monthly Archives: April 2017

Colin Kaepernick & Craig Hodges: The Mistake of 1947


“History shows that where ethics and economics come in conflict, victory is always with economics. Vested interests have never been known to have willingly divested themselves unless there was sufficient force to compel them.” – B.R. Ambedkar

Hindsight is 20/20. (Actual) history is not meant to be revised, but it is meant to be analyzed. Unfortunately, that analysis can prove to be difficult often because we have a tendency to romanticize people and their decisions, ultimately leaving us vulnerable to making the same ones again. Objectivity to history is fundamental if we are truly to learn from it.

Seventy years ago, Jackie Robinson took to the field for the Brooklyn Dodgers. The move would effectively mark the end of African American ownership in sports. It was almost forty years prior to Robinson’s MLB debut when Rube Foster, considered the father of Negro League Baseball,  made a bold move to organize the African American baseball clubs and increase African American franchise ownership. “As early as 1910, Foster started talking about reviving the concept of an all-black league. The one thing he was insistent upon was that black teams should be owned by black men.” In the era of Marcus Garvey, this was very much in line with the belief that African American labor should be rewarding African American ownership. After a few hundred years of African American (free) labor building much of European American wealth, this was not asking a lot.

In fact, when we examine the period of 1865 through 1939, African America was on a building and ownership spree. African Americans built towns, businesses, banks, hospitals, boarding schools, colleges, and even an automobile company. This period, it could be argued was the apex of African American wealth and self-sufficiency in this country. A Great Depression, World War II, and Civil Rights Movement later, and African America’s economic self-sufficiency was virtually wiped out. Replaced by a culture of dependency and chasing of others’ colder ice. And we have to ask ourselves objectively, what did that get us? Very little. We went from over 100 banks and boarding schools down to 20 and 4, respectively. The African American private sector has been so decimated post-Civil Rights Movement that the African American unemployment rate is always twice the national average. As for sports, we went from dozens of African American owners to taking almost seventy years before seeing one after Robinson’s move.

Today, PWIs and 140 of the 141 professional sports in America make over $30 billion annually off the labor and sweat of African American athletes. Jerry Jones, the owner of the Dallas Cowboys and most valuable American professional team, made $300 million in profits in 2016 – without taking a hit, while the highest paid African American athlete, LeBron James, made only $77 million. It is not a secret that you can own a team a lot longer than you can play the sport. Jordan serves as anomaly of sorts, being an athlete able to gather enough wealth to buy a team and that was after something of a fire sale by Bob Johnson, who was in desperate need of liquidity for his other investments. This was mainly thanks to Jordan’s deal with Nike, which for all intents and purposes his popularity built. But while Jordan is worth $1 billion, Phil Knight, the owner of Nike, is worth a staggering $25 billion. Phil Knight and his wife have been able to pump hundreds of millions of dollars into the University of Oregon thanks to the company that Jordan “built”. Meanwhile, Michael Jordan’s philanthropy has been virtually nonexistent in helping empower African America’s institutions. The reality is that as much as it seems like players are making, the value of those teams rise faster than the players’ salaries, otherwise what would be the point of owning them? Remember, George Steinbrenner paid $10 million for the New York Yankees in 1973, the team is now worth $3.7 billion. In terms of highest paid athletes for perspective, Dick Allen of the Chicago White Sox in 1973 was making $200,000 versus today’s highest paid athlete being LeBron James who makes $31 million(salary, not including endorsements). The value of the Yankees has increased 370 fold versus the highest paid athlete’s salary at 155 fold. Or as famed comedian Chris Rock so eloquently puts, “Shaq is rich, but the white man who signs his check is wealthy.”

It has only been in recent years that African American athletes have begun to reclaim their ability to be voices of social commentary after a long slumber from the African American athletes of the 60s and 70s who were regaled and revered by the community for their usage of their platforms for social, economic, and political progress. In the 80s, 90s, and early 2000s, most African American athletes were too afraid of scaring potential sponsors or getting blacklisted to remotely speak out. Those that did like Mahmoud Adul Rauf and Craig Hodges of the 90s who did speak out found themselves blacklisted from the NBA faster than Usain Bolt running the 100 meters. Both exceptional players in their own right, but their boisterousness about African American issues turned off white owners and fans who think African American athletes should be seen and not heard, something eloquently analyzed by William Rhoden in his book 40 Million Dollar Slaves. It has been even more complicated since the turn of the millennium when athlete salaries skyrocketed thanks to television contracts for the major sports. This was especially sensitive at a time when many Americans have seen their wages stagnant for the past four decades across the country. Despite the owners making far more than the players, the majority of fans do not know who their teams’ owners actually are or how much they pocket from the ownership of the team.

The only African American who even attempted to buy an NFL team was Reggie Fowler, an Arizona businessman who was set to buy the Minnesota Vikings from Red McCombs back in 2005 for $600 million. Without ownership, sports franchies often reflect their owners’ network which means they have been slow to include other groups not within their social circles in key positions of power. Everything from general managers, coaches, and executives of teams have been and still largely are white males because that is who the owners’ circles entail. The real power was and is behind the scenes and this is ultimately what was forsaken by African America when they did not demand that the Negro Leagues/MLB and Black Fives/NBA/ABA be mergers of equals instead of acquisition of labor. With no African American perspective in any owners’ meetings outside of the NBA (and Michael Jordan has always been socially oblivious), it is likely that these men (and they are 99 percent men) are often tone deaf to racial and gender issues that impact their leagues and the environments from which the athletes who constitute their labor come from. We see this especially projected in the NFL’s ability to deal with domestic violence and Colin Kaepernick’s decision to protest continued police brutality. This is why at one point, we suggested that one of the major sports leagues should be adamant about recruiting Oprah Winfrey to buy a team (or two). Instead, the NBA at a moment when it could have done so after the Donald Sterling debacle simply goes and puts in place the same old hat in an act of pure tone deafness.

What would have happened if Oprah Winfrey owned a team? Well, just look at her management team at Harpo Productions. Women are well represented and more importantly so are ethnic minorities. The likelihood is that her team ownership would result in many more women, minorities, and HBCU graduates getting an opportunity to be decision makers and that issues such as race and gender would not be simply public relationed when an incident occurred, but instead proactively engaged.

Ultimately, history has shown us what not having ownership brings about in terms of social and economic impact. It is creating a space that allows for an employee like Colin Kaepernick to speak about an issue that is also part of the owner’s reality and allowing him to do so without retribution. It is also the circulation of the economic capital that flows between labor, ownership, and communities. This conversation is by no means limited to sports, but all of our economic behavior as it relates to how we view labor and ownership. Being accepted as someone else’s labor will always leaves you vulnerable to their interest, which can run counter to your community’s interest. Jackie Robinson may have broke a labor barrier into the major sports for African Americans, but the decision also built a wall to ownership and power for African Americans we have struggled to climb over ever since.

Advertisements

HBCU Money™ Business Book Feature – Garbology: Our Dirty Love Affair with Trash


A Pulitzer Prize–winning journalist takes readers on a surprising tour of the world of garbage.

Take a journey inside the secret world of our biggest export, our most prodigious product, and our greatest legacy: our trash. It’s the biggest thing we make: The average American is on track to produce a whopping 102 tons of garbage across a lifetime, $50 billion in squandered riches rolled to the curb each year, more than that produced by any other people in the world. But that trash doesn’t just magically disappear; our bins are merely the starting point for a strange, impressive, mysterious, and costly journey that may also represent the greatest untapped opportunity of the century.

In Garbology, Pulitzer Prize–winning author Edward Humes investigates the trail of that 102 tons of trash—what’s in it; how much we pay for it; how we manage to create so much of it; and how some families, communities, and even nations are finding a way back from waste to discover a new kind of prosperity. Along the way , he introduces a collection of garbage denizens unlike anyone you’ve ever met: the trash-tracking detectives of MIT, the bulldozer-driving sanitation workers building Los Angeles’ immense Garbage Mountain landfill, the artists in residence at San Francisco’s dump, and the family whose annual trash output fills not a dumpster or a trash can, but a single mason jar.

Garbology
digs through our epic piles of trash to reveal not just what we throw away, but who we are and where our society is headed. Are we destined to remain the country whose number-one export is scrap—America as China’s trash compactor—or will the country that invented the disposable economy pioneer a new and less wasteful path? The real secret at the heart of Garbology may well be the potential for a happy ending buried in our landfill. Waste, Humes writes, is the one environmental and economic harm that ordinary working Americans have the power to change—and prosper in the process.

The Finance & Tech Week In Review – 4/15/17


 

Every Saturday the HBCU Money staff picks ten articles they were intrigued by and think you will enjoy for some weekend reading impacting finance and tech.

Have your students (gr. 4-12) play the Stock Market Game to learn about #investing / Council 4 Econ Ed. ow.ly/kqyS30aJOlo

College students become economic forecasters by playing FREDcast for class / St. Louis Fed bit.ly/2p3Rmp6

R&D investment is increasingly concentrated in a few top firms. / HBR ow.ly/Qoif30aSc8t

This robot farmer can grow your food for you / WEF wef.ch/2o5jaq1

 Lucid Motors Air Prototype Hits 217 MPH / Clean Technica ow.ly/DOAy30aSbKI

Where your children grow up will impact how much they earn as adults / WEF wef.ch/2p9apKP

Deep in the ocean, evidence that there may be a biosphere even further down than we imagined / Nat Geo goo.gl/6HfcHD

Hallucinogenic commonly drunk in South American religious rituals may help people w/ depression / New Scientist to.pbs.org/2ovDLny

Start-up uses biometrics to tailor music for good night’s sleep / New Scientist bit.ly/2oA8jGo

Here’s why your shoelaces always come undone. / Science News ow.ly/s1Bh30aSb1D

 

From HBCU To Bank CEO: 4 HBCU Alums Help Lead America’s Black Bank Revival


“If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” – John Quincy Adams

What good is a pipeline if it is not used, promoted, strengthened? Going to an HBCU or graduating from is not the beginning or ending of the African American ecosystem, but it is a key part of it. Unfortunately, the data shows that African American intellect and labor (even HBCU graduates) are primarily being used to build up firms owned by other communities. Recent data from the US Census shows that it is likely that less than one percent of African Americans work for an African American owned firm. It stands to reason that the subdata for HBCU graduates working for an African American firm is likely to parallel.

If HBCU business schools are not being trained to run African American firms and the unique path that they face, then what is the point of having them? Goldman Sachs, J.P. Morgan Chase, Bank of America, and Citigroup all have CEOs that attended PWIs (shocker) and even more to the point, attended Ivy League colleges. It would be fair to say that of the almost 7,000 banking institutions in the United States, if you were to subtract out the African American owned banks, that 75 percent of those banks would not be being run by those who went to HBCUs. However, that is exactly what is happening in the African American banking and private sector in general. The vast majority of our institutions operating in isolation, not in conjunction with each other. HBCUs are not banking with, training for, or encouraging their graduates in choir with African American banks and private sector so therefore the institutional leadership at most of our financial institutions and private firms is using a playbook not tailored to our needs.

However, there does appear to some change on the horizon. OneUnited Bank, headquartered in Boston, Massachusetts, and headed by one of the most powerful women in banking Teri Williams, although not an HBCU alum herself is showing herself to be a strong HBCU advocate, and the bank has two HBCUs banking with them in Roxbury Community College (MA) and Florida Memorial University (FL). Something that should lead to many future opportunities for graduates of the two institutions in the future both through internships and employment creating a future pipeline for more HBCU graduates to head up African American owned  firms. So who are the HBCU graduates sitting in African American owned banks c-suites helping lead the current #BankBlack revival that has seen millions of dollars in deposits over the past year?

Dr. Deborah A. Cole; Tennessee State University

As the president of Citizens Bank, headquartered in Nashville, Tennessee and noted as the oldest African American bank still in operation, Dr. Cole has led an impressive increase in the bank’s balance sheet with assets increasing 5.6 percent over 2016, third among the 20 AAOBs.

Ms. Jacquitta Powell Green; Alabama A&M University

A dual role, Ms. Green as she heads up Mobile, Alabama’s Commonwealth National Bank as CEO and Chairwoman of CNB Bancorp, the bank’s holding company. “Mrs. Green is the Vice President of Northside Exchange, which has offered financial services to the unbanked and underserved of the Mobile area for more than 30 years. In 2001, a national tax preparation franchise extended her an offer, and she established Envision Enterprises to offer unbiased and honest tax preparation services.”

Mr. James A. Sills, III; Morehouse College

Mr. Sills heads up one of the most prominent and well known brands among African American owned banks, Mechanics & Farmers’ Bank in North Carolina. The bank has changed its name to M&F Bank a few years ago in an effort to rebrand and attract a young demographic. “Prior to starting his own company in 2007, Mr. Sills was an Executive Vice President of MBNA America Bank (now Bank of America), the largest credit card institution in the world. In this capacity, he served as the Director of Corporate Technology Solutions for the $80 billion US Card Division.”

Ms. Evelyn F. Smalls; North Carolina Central University

Lastly, Ms. Smalls is the President and CEO of United Bank of Philadelphia. The only HBCU graduate heading up a bank outside of the South. “With over 30 years experience in banking and community development, Mrs. Smalls is responsible for the leadership and management of the Bank including setting the direction of the organization, communicating its vision and adapting the culture and operations to achieve success. Her leadership helped transform the Bank’s strategic focus into a “Business Bank” to ensure small businesses have access to affordable loans through the SBA 7A program.”

 

Unemployment Rate By HBCU State – February 2017


STATES WITH RISING UNEMPLOYMENT: 5

STATES WITH DECLINING UNEMPLOYMENT: 15

STATES WITH UNCHANGED UNEMPLOYMENT: 4

LOWEST: MASSACHUSETTS – 3.4%

HIGHEST – ALABAMA – 6.2%

STATE – UNEMPLOYMENT RATE (PREVIOUS)*

ALABAMA –  6.2% (6.4%)

ARKANSAS – 3.7% (3.8%)

CALIFORNIA – 5.0% (5.1%)

DELAWARE – 4.5% (4.4%)

DISTRICT OF COLUMBIA – 5.7% (5.7%)

FLORIDA – 5.0% (5.0%)

GEORGIA – 5.3% (5.5%)

ILLINOIS – 5.4% (5.7%)

KENTUCKY – 4.9% (5.0%)

LOUISIANA – 5.8% (5.9%)

MARYLAND – 4.2% (4.2%)

MASSACHUSETTS – 3.4% (3.2%)

MICHIGAN – 5.3% (5.2%)

MISSISSIPPI – 5.2% (5.5%)

MISSOURI –  4.1% (4.2%)

NEW YORK – 4.4% (4.6%)

NORTH CAROLINA – 5.1% (5.3%)

OHIO – 5.1% (5.0%)

OKLAHOMA – 4.6% (4.7%)

PENNSYLVANIA – 5.0% (5.2%)

SOUTH CAROLINA – 4.4% (4.4%)

TENNESSEE – 5.3% (5.4%)

TEXAS – 4.9% (4.8%)

VIRGINIA – 3.9% (4.0%)

*Previous month in parentheses.