MATTAH Business movement is designed to facilitate the re-education of Black people into a highten Black consciousness, and to facilitate the economic prosperity of Black People through effectively coordinating Black consumers with Black product manufacturers, retailers, service providers, and organizations.
The cornerstone of the re-education system is the development and implementation of a comprehensive Black curriculum disseminated through the MATTAH, Black schools, faith based institutions and various media formats such as movies, music, television programming, books, audios, videos, and the web.
The foundation of the economic prosperity component is our function as a global Black channel of distribution, a bridge, connecting Black people who desire Black products and services with Black people who provide Black products and services.
We want to create; flowing through MATTAH’s channel of distribution hundreds of basic goods and services produced by Black companies from around the world. The product line, as well as the services offered, is being constantly expanded. Members of The MATTAH Movement can earn additional steams of income through direct sales and other income generating components, the MATTAH has incorporated a commissions based compensation plan similar to that of traditional network marketing.
The MATTAH Movement has developed the `Black Matrix’, a Compensation Vehicle that re-directs funds retained in the Black community to it` participants, similar to typical network marketing companies. This can cause a person looking at MATTAH to mistakenly consider The MATTAH Movement as a typical network marketing company.
While The MATTAH Movement does not criticize typical network marketing companies, it is imperative that we set the record straight on the question of whether The MATTAH Movement is a typical network marketing company. The answer is NO! The MATTAH Movement is just that, a MOVEMENT! Our `Black Matirx`is a hybrid.
MATTAH features components of network marketing and conventional retail marketing but with a distinct purpose. To retain and re-direct at least 10% of the funds spent in the Black community each month.
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Ken Bridges founder of MATTAH
by Glenn Ellis
I was one of the thousands of people whose life Ken Bridges touched personally. And like all the others, I felt my relationship with him was so personal and special.
We met during the early 1970s while Ken was working on a master’s degree in business from the Wharton School at the University of Pennsylvania. I was at the time fresh to Philadelphia from Birmingham, Ala., and an undergraduate at Penn. He was like the few other African-American students at Wharton, looking to learn as much as possible about how the American economic system worked.
Coming from his hometown of Detroit, Ken, more than most of his counterparts, arrived at Penn with the focus and vision that would allow him not to become a statistic, as did many of his African-American classmates who would not finish the MBA program.
I remember our paths crossing several years later, when his first words were ones of joy and excitement in telling me that he had married a woman from Birmingham. “Glenn, I tell you, this sister is a queen!”
For the following 20-plus years, Jocelyn never lost her place on the “throne” of Ken’s heart. No matter what he was doing, no matter where he was, no matter whom he was with – when it was Jocelyn’s time, it was Jocelyn’s time. As they began to have children and raise them, this same philosophy applied toward his family.
At this point in his professional career, Ken had his Wharton MBA, and had become one of the most sought-after marketing specialists on African-American consumers. Corporate America benefited from this expertise. Ken was responsible for the successful efforts of companies like Scott Paper; Coca-Cola; and Proctor & Gamble to reach African-American consumers.
Somewhere around this time, Ken realized that his talents and knowledge were not being utilized in ways that benefited him and his family to the fullest.
After leaving corporate America, he got involved in Amway, a multi-level marketing system, where he reached the highest rung of success—Diamond Level. He spent some time with a similar company called P.O.W.E.R., and experienced similar success in applying his efforts to enterprises that promoted self-sufficiency and economic development among African-Americans.
All of this work led Ken to become the visionary designer of the most widely executed model of African-American entrepreneurship of its time—Dick Gregory’s Bahamian Diet.
Ken developed and implemented the marketing system that saw Gregory’s product become a national phenomenon. It was a multi-level marketing system that allowed Black folks all over America to develop businesses, based on the sale and distribution of a Black-owned product, manufactured and owned by Blacks.
But it was not until after encounters that Ken had with Dr. Edward Robinson Jr., of Philadelphia, that the vision for what would become his life’s mission became clear.
It was in conversations with Robinson that Ken realized that self-esteem realized through economic development was nothing without “race-esteem.” History had shown numerous African-American millionaires, but Ken realized that ultimately, it would only be wealth in the presence of “race-esteem” that would lead to the true improvement of the quality of life for African-Americans.
This new realization led to Ken, along with his long-time friend from Wharton, Al Wellington, to create The Matah Network. The name Matah was chosen for its definition: “those people of African descent who give and buy Black.” Bridges and Wellington launched the Matah program in November 1997 with the goal of teaching Blacks the importance of redirecting their now-nearly $600 billion spending power with each other.
The Wharton School graduates came up with this concept after conducting a poll during the 1995 Million Man March sponsored by Nation of Islam leader Minister Louis Farrakhan. With a million African-Americans gathered in one location at the same time, Ken and Wellington knew it was important to find out what was on the minds of Black people. With the help of students from Howard University, the study was conducted and analyzed. Its basic finding was that Black folks were looking for economic development.
Ken Bridges’ life ended while in his continuous process of working toward the full realization of the Matah concept. The company had established itself literally all across America, with thousands of people participating in its growth, as well as purchasing and consuming the many products it distributed.
The night before he died, Ken had closed the biggest product distribution deal in the company’s history. He was en route home the next morning when, against advice from his partner Wellington, and his “Queen” Jocelyn, Ken stopped at a gas station along the interstate to fill up, instead of at a local station before he got on the road.
Anthony Phillips, a Matah company member, was a part of a conference call Ken had with regional directors and other executives of the company after the meeting. He remembers the excitement and enthusiasm in Ken’s voice during the call. “Very soon, my brothers and sisters, you will be the next 30 African-American millionaires with a consciousness,” Ken said, according to Phillips. Phillips was among the group of colleagues at Ken’s office who were waiting for his return on Friday morning. Ken never made it home that day.
Anthony Phillips left what he considers to have been his last job in corporate America to join The Matah Network. He owes a debt of gratitude to Ken, not just for sharing the plan for self-sufficiency and economic independence, but for crucial lessons in life. “Ken spent a lot of time talking with me about the importance of balance. He said it is important to make balance in life a goal. Your family, your health, your wealth, each part of your life should have its own goal, and you have to stick to it,” said Phillips.
In my own experience, out of the 30 years I’ve known Ken, I’ll always remember an incident a few years ago. I had a business disagreement with a prominent and well-respected African-American man who had spent his life serving the community, while developing independent wealth. I was clear that this man was wrong, and others agreed. I was starting legal action when I received a call from Ken. He asked me to come out and speak at one of the Matah presentations.
While there, he pulled me aside and said, “Glenn, I heard about your situation, and I want to encourage you to apologize to the other party. We have to develop respect for the elders in our community. This is not about right or wrong, it’s about recognizing our elders. If you can see the wisdom in this, it will make you a better man, and it will allow those who are elders to live in ways which make them more accountable for the role they play in our community. This has no place in a court of law. This is our business.”
I told Ken right then and there that he didn’t understand. But months later when I happened to see the man in question for the first time as we both stood, ironically, in front of a Matah exhibit booth at a Black Business Development Conference. At that moment, Ken’s spirit seemed to rise from within me. Without making a conscious effort, I rushed over and offered my sincere apology to my “elder” for any disrespect I had shown in my hasty and emotional actions. He graciously accepted, and we embraced. I saw Ken later, and tried to tell him what happened, all he said was, “Pass it on, my brother, pass on the wisdom.”
That moment embodied what I will always remember about Ken.
Friday, November 12, 2010
Powernomics: Black Power Comes Through Economics
PowerNomics™ is the guiding philosophy by which Black communities will achieve greater economic self sufficiency. Black owned businesses are key to the success of this movement.
Developed by Washington's Harvest Institute, a national Black think tank organized by Dr. Claud Anderson, author of Black Labor, White Wealth, PowerNomics™ offers Blacks new ways of seeing, thinking and behaving in racial matters.
The PowerNomics™ self-empowerment plan presents new strategies for Black America's psychological, economic, and political development. PowerNomics is based on 12 Economic Action Steps:
*Economic Action Step #1: Create an alternative economy within Black communities.
*Economic Action Step #2: Dominate business ownership and management where Black people are the majority.
*Economic Action Step #3: Focus on 'Wealth Building' and restoring the economic intent of the original Civil Rights laws.
*Economic Action Step #4: Counter the 'Brain Drain' with businesses that agressively attract Black talent from schools, the government, and corporate America.
*Economic Action Step #5: Establish solid 'Root' businesses within Black communities.
*Economic Action Step #6: Construct vertical businesses and industries that control all processes from raw resources in markets within and outside of Black communities.
*Economic Action Step #7: Stop the 'Money Drain' out of Black communties. In other words 'Buy Black' but sell to anyone.
*Economic Action Step #8: Attract semi-finished products into Black communities for value-added manufacturing, processing, and assembling.
*Economic Action Step #9: Promote the competitive advantages of Black communities.
*Economic Action Step #10: Establish 'Safe Business Zones' based upon a code of conduct in Black business communities.
*Economic Action Step #11: Amass 'Vision' capital and wealth through community-based financial efforts.
*Economic Action Step #12: Establish international economic alliances and marketing agreements between Black America, Black Africa and Caribbean nations.
While the initial emphasis of the PowerNomics™ plan is to alter certain unacceptable behaviors among blacks, the plan also calls for a broad range of economic strategies to improve conditions within black communities, including the establishment of PowerNomics™ Vision Capital Clubs and, PowerNomics™ Covenant Businesses.
Developed by Washington's Harvest Institute, a national Black think tank organized by Dr. Claud Anderson, author of Black Labor, White Wealth, PowerNomics™ offers Blacks new ways of seeing, thinking and behaving in racial matters.
The PowerNomics™ self-empowerment plan presents new strategies for Black America's psychological, economic, and political development. PowerNomics is based on 12 Economic Action Steps:
*Economic Action Step #1: Create an alternative economy within Black communities.
*Economic Action Step #2: Dominate business ownership and management where Black people are the majority.
*Economic Action Step #3: Focus on 'Wealth Building' and restoring the economic intent of the original Civil Rights laws.
*Economic Action Step #4: Counter the 'Brain Drain' with businesses that agressively attract Black talent from schools, the government, and corporate America.
*Economic Action Step #5: Establish solid 'Root' businesses within Black communities.
*Economic Action Step #6: Construct vertical businesses and industries that control all processes from raw resources in markets within and outside of Black communities.
*Economic Action Step #7: Stop the 'Money Drain' out of Black communties. In other words 'Buy Black' but sell to anyone.
*Economic Action Step #8: Attract semi-finished products into Black communities for value-added manufacturing, processing, and assembling.
*Economic Action Step #9: Promote the competitive advantages of Black communities.
*Economic Action Step #10: Establish 'Safe Business Zones' based upon a code of conduct in Black business communities.
*Economic Action Step #11: Amass 'Vision' capital and wealth through community-based financial efforts.
*Economic Action Step #12: Establish international economic alliances and marketing agreements between Black America, Black Africa and Caribbean nations.
While the initial emphasis of the PowerNomics™ plan is to alter certain unacceptable behaviors among blacks, the plan also calls for a broad range of economic strategies to improve conditions within black communities, including the establishment of PowerNomics™ Vision Capital Clubs and, PowerNomics™ Covenant Businesses.
Blacks Who Abandon Black Businesses Commit ‘Economic Suicide'
by James E. Clingman
It’s stupid.’’ Those were the words of Dr. Walter Lomax, Jr. in an interview with Chinta Strausberg of the Chicago Defender. He was referring to how black consumers turn their backs on their own businesses by spending billions of dollars in annual income with non-black businesses.
It’s “economic suicide,” for African Americans to behave in such a manner, according to Lomax. Why do we do this? Dr. Lomax, chairman emeritus of the MATAH Black distribution company, attributes much of our inappropriate behavior to integration and a lack of knowledge of black history.
Lomax bought the 570-acre Aspen Grove Plantation in Virginia, where his great-grandmother was once a slave, and spends a great deal time there reflecting on his heritage.“Our people have “forgotten their roots,” he said. “We haven’t passed on the legacy of our history to the next generation, and we have and still commit the most egregious of sins – abandoning our own businesses just to emulate and brush elbows with whites.”
Practicing medicine in Philadelphia for 30 years, Lomax also worked in his own companies: Healthcare Management Alternatives, Inc., AmeriChoice and Correctional Healthcare Solutions, Inc., where he provided health care to more than 20,000 inmates in 50 facilities located in 14 states. He urges blacks to support one another economically. That unity, he said, helps build capacity among blacks while stabilizing our communities.
This giant of a black man acknowledges the importance of understanding Black History; I mean a real understanding of Black History, not the cursory obligatory gestures made by corporate America every February.‘’Knowing black history will help blacks be more concerned about community. You’ll have more self-esteem. You’ll work harder, study harder, you won’t fritter away the $800 billion that we supposedly control now,’’ said Lomax.
‘’When you know your history, you’ll be more concerned about creating businesses in your own community. You’ll follow the principles of Claud Anderson’s PowerNomics.’’Asked who will teach blacks the principles of economic, ethnic, legacy, and survival skills, Lomax replied, ‘’It will depend upon us. What makes you think the people who have put us in this condition are going to get us out of this state? It will have to be after school programs in churches or mosques.
There has to be a concerted effort to reestablish family values, teaching the importance of education, and reestablishing the importance of economic empowerment. Not only are we following [the wrong values], we seem to be leading our own self-destruction.’’ When asked about economic leadership among blacks, Lomax retorted, “We don’t have leadership.
Most of our leaders are Black politicians and Black ministers. Traditional leadership is so preoccupied with integration, and integration for them represents being like White folks, being integrated into their society and culture,’’ he said. ‘’The only way integration can work is if it’s an integration of equals – everybody brings something to the table; otherwise, in business terms, you don’t have a merger [you have] an acquisition.”
How can African Americans become more economically empowered? Lomax says one way is through support of the MATAH Network. “If we can breathe life into MATAH and organizations like that this will help solidify the black dollar and empower the community.” Wow! I should have let Dr. Lomax write this article.Lomax said blacks probably have some African-American ‘’messiah’’ that could help lead us out of this predicament.
But, he said, until [Whites] say who our leader is, we don’t have one.‘’Black leadership is lacking. We need an ideology we can rally around - self-esteem, economic empowerment, self-preservation, do-for-self and stop trying to be integrated all the time, take advantage of your own culture...all those things that God gave us that everybody tries to emulate and benefit from. We should take them for our own benefit,’’ he stated. ‘’We’re no more than before.
We’re the slaves whether it’s sports or entertainment. We’re the work horse, and they sit on the patio and benefit from it.’’Integration? Yes, we got social integration, but not economic integration, as he puts it. Right again, Dr. Lomax. “Integration is slowly burying us as we become more politically and financially impotent - dispensable in a society that pits blacks against Hispanics for mere contractual crumbs – in a nation blacks built at gunpoint for free.
Talented Tenth? ‘’Today, the Talented Ten has been integrated,’’ said Lomax. And, if I might add, many of them have also been conditioned to hold the 90 percent down rather than lift us up. We are blessed to have man such as Dr. Walter Lomax, Jr. among us. He says what must be said, and does what must be done. “The view from his window at Aspen Grove is a stark reminder of where Blacks have been, how far we’ve come, and sadly where we are today,” journalist Strausberg wrote.
“The two cemeteries on his property tell the whole story: One for whites near the house, and one for Blacks off in the distance out of sight.”
It’s stupid.’’ Those were the words of Dr. Walter Lomax, Jr. in an interview with Chinta Strausberg of the Chicago Defender. He was referring to how black consumers turn their backs on their own businesses by spending billions of dollars in annual income with non-black businesses.
It’s “economic suicide,” for African Americans to behave in such a manner, according to Lomax. Why do we do this? Dr. Lomax, chairman emeritus of the MATAH Black distribution company, attributes much of our inappropriate behavior to integration and a lack of knowledge of black history.
Lomax bought the 570-acre Aspen Grove Plantation in Virginia, where his great-grandmother was once a slave, and spends a great deal time there reflecting on his heritage.“Our people have “forgotten their roots,” he said. “We haven’t passed on the legacy of our history to the next generation, and we have and still commit the most egregious of sins – abandoning our own businesses just to emulate and brush elbows with whites.”
Practicing medicine in Philadelphia for 30 years, Lomax also worked in his own companies: Healthcare Management Alternatives, Inc., AmeriChoice and Correctional Healthcare Solutions, Inc., where he provided health care to more than 20,000 inmates in 50 facilities located in 14 states. He urges blacks to support one another economically. That unity, he said, helps build capacity among blacks while stabilizing our communities.
This giant of a black man acknowledges the importance of understanding Black History; I mean a real understanding of Black History, not the cursory obligatory gestures made by corporate America every February.‘’Knowing black history will help blacks be more concerned about community. You’ll have more self-esteem. You’ll work harder, study harder, you won’t fritter away the $800 billion that we supposedly control now,’’ said Lomax.
‘’When you know your history, you’ll be more concerned about creating businesses in your own community. You’ll follow the principles of Claud Anderson’s PowerNomics.’’Asked who will teach blacks the principles of economic, ethnic, legacy, and survival skills, Lomax replied, ‘’It will depend upon us. What makes you think the people who have put us in this condition are going to get us out of this state? It will have to be after school programs in churches or mosques.
There has to be a concerted effort to reestablish family values, teaching the importance of education, and reestablishing the importance of economic empowerment. Not only are we following [the wrong values], we seem to be leading our own self-destruction.’’ When asked about economic leadership among blacks, Lomax retorted, “We don’t have leadership.
Most of our leaders are Black politicians and Black ministers. Traditional leadership is so preoccupied with integration, and integration for them represents being like White folks, being integrated into their society and culture,’’ he said. ‘’The only way integration can work is if it’s an integration of equals – everybody brings something to the table; otherwise, in business terms, you don’t have a merger [you have] an acquisition.”
How can African Americans become more economically empowered? Lomax says one way is through support of the MATAH Network. “If we can breathe life into MATAH and organizations like that this will help solidify the black dollar and empower the community.” Wow! I should have let Dr. Lomax write this article.Lomax said blacks probably have some African-American ‘’messiah’’ that could help lead us out of this predicament.
But, he said, until [Whites] say who our leader is, we don’t have one.‘’Black leadership is lacking. We need an ideology we can rally around - self-esteem, economic empowerment, self-preservation, do-for-self and stop trying to be integrated all the time, take advantage of your own culture...all those things that God gave us that everybody tries to emulate and benefit from. We should take them for our own benefit,’’ he stated. ‘’We’re no more than before.
We’re the slaves whether it’s sports or entertainment. We’re the work horse, and they sit on the patio and benefit from it.’’Integration? Yes, we got social integration, but not economic integration, as he puts it. Right again, Dr. Lomax. “Integration is slowly burying us as we become more politically and financially impotent - dispensable in a society that pits blacks against Hispanics for mere contractual crumbs – in a nation blacks built at gunpoint for free.
Talented Tenth? ‘’Today, the Talented Ten has been integrated,’’ said Lomax. And, if I might add, many of them have also been conditioned to hold the 90 percent down rather than lift us up. We are blessed to have man such as Dr. Walter Lomax, Jr. among us. He says what must be said, and does what must be done. “The view from his window at Aspen Grove is a stark reminder of where Blacks have been, how far we’ve come, and sadly where we are today,” journalist Strausberg wrote.
“The two cemeteries on his property tell the whole story: One for whites near the house, and one for Blacks off in the distance out of sight.”
Monday, November 8, 2010
Arab Business Colonialism in the Black Community: A Multi-Billion Dollar Bonanza
Black communities across America are economic colonies where non-Black businesses are reaping billions of dollars off economic suicidal Black consumer slaves. The following article, "Detroit's Unlikely Saviors," is an abridged version of an article that recently appeared in the Nov. 8, 2010 edition of Time Magazine:
Detroit's Unlikely Saviors
To disprove the charge that Detroit is in terminal decline, Nafa Khalaf offers himself as Exhibit A. In 1999, when he co-founded his business, which builds water systems and other public works, "people were saying the city was dying," Khalaf recalls.
But since then, his firm, Detroit Contracting, has thrived and expanded. "You want to know if Detroit has a future? Ask us Arabs," Khalaf says. "We believe in this place."
Khalaf speaks for a community that is growing and prospering alongside Detroit's decay, one of the largest concentrations of Arabs outside the Middle East.
The four-county region of southeastern Michigan has a population of at least 200,000 of Middle Eastern origin; some estimates put that number far higher. In Dearborn, home to Ford Motor Co., one-third of the citizens have Middle Eastern ancestry - including Rima Fakih, the first Miss USA of Arab descent.
For Detroit, a city in critical condition, this new blood could make a difference. The impact is twofold: a desperately needed infusion of new citizens at a time when an exodus has drained metro Detroit of its middle class, both white and black; and an economic boost from a culture that likes to start new businesses.
The Arab-American community in metro Detroit produces as much as $7.7 billion annually in salaries and earnings, according to a 2007 Wayne State University study. (That amounts to more than twice Detroit's annual budget.)
The controversial question, though, is whether Arab-American prosperity will remain at the edges of the city, at arm's length from the predominantly poor African-American population, or produce jobs and other benefits for the whole of Detroit. On the street, the question is often put more divisively: Are Arab merchants profiteers or pioneers?
The story of Arab Detroit is more complex than the caricatures. Middle Eastern immigrants didn't arrive just yesterday, or from just one place. Henry Ford recruited thousands of Lebanese, Yemenis and others from the splinters of the Ottoman empire to Dearborn to work in his giant River Rouge complex, giving Middle Easterners their first foothold in the area. Not all were Arab.
And in contrast to the stereotype, the majority of local Middle Easterners are not Muslim but Christian, led by an early wave of Iraqi Catholics known as Chaldeans, some of whom fled Muslim persecution.
More recent times have brought an increase in Muslim immigrants displaced by war and seeking education and economic opportunity The influx keeps coming. Any concerns newcomers may have about the city's economic straits are outweighed by the comfort and reassurance of living among their own people.
When they arrive, many quickly set up businesses requiring little capital - gas stations, liquor stores and convenience shops. Ahmad Chebbani, chairman of the American Arab Chamber of Commerce, says more than 15,000 businesses in the metro area are owned by Middle Easterners.
Surely part of the attraction is that to people from countries ravaged by war and poverty, Detroit can seem like a haven. But Chebbani puts it in less fanciful terms: "There are good deals here, and as a community, we're risk takers." What they also have in common is a remarkable faith in a region where confidence has become a rare commodity.
Detroit's Unlikely Saviors
To disprove the charge that Detroit is in terminal decline, Nafa Khalaf offers himself as Exhibit A. In 1999, when he co-founded his business, which builds water systems and other public works, "people were saying the city was dying," Khalaf recalls.
But since then, his firm, Detroit Contracting, has thrived and expanded. "You want to know if Detroit has a future? Ask us Arabs," Khalaf says. "We believe in this place."
Khalaf speaks for a community that is growing and prospering alongside Detroit's decay, one of the largest concentrations of Arabs outside the Middle East.
The four-county region of southeastern Michigan has a population of at least 200,000 of Middle Eastern origin; some estimates put that number far higher. In Dearborn, home to Ford Motor Co., one-third of the citizens have Middle Eastern ancestry - including Rima Fakih, the first Miss USA of Arab descent.
For Detroit, a city in critical condition, this new blood could make a difference. The impact is twofold: a desperately needed infusion of new citizens at a time when an exodus has drained metro Detroit of its middle class, both white and black; and an economic boost from a culture that likes to start new businesses.
The Arab-American community in metro Detroit produces as much as $7.7 billion annually in salaries and earnings, according to a 2007 Wayne State University study. (That amounts to more than twice Detroit's annual budget.)
The controversial question, though, is whether Arab-American prosperity will remain at the edges of the city, at arm's length from the predominantly poor African-American population, or produce jobs and other benefits for the whole of Detroit. On the street, the question is often put more divisively: Are Arab merchants profiteers or pioneers?
The story of Arab Detroit is more complex than the caricatures. Middle Eastern immigrants didn't arrive just yesterday, or from just one place. Henry Ford recruited thousands of Lebanese, Yemenis and others from the splinters of the Ottoman empire to Dearborn to work in his giant River Rouge complex, giving Middle Easterners their first foothold in the area. Not all were Arab.
And in contrast to the stereotype, the majority of local Middle Easterners are not Muslim but Christian, led by an early wave of Iraqi Catholics known as Chaldeans, some of whom fled Muslim persecution.
More recent times have brought an increase in Muslim immigrants displaced by war and seeking education and economic opportunity The influx keeps coming. Any concerns newcomers may have about the city's economic straits are outweighed by the comfort and reassurance of living among their own people.
When they arrive, many quickly set up businesses requiring little capital - gas stations, liquor stores and convenience shops. Ahmad Chebbani, chairman of the American Arab Chamber of Commerce, says more than 15,000 businesses in the metro area are owned by Middle Easterners.
Surely part of the attraction is that to people from countries ravaged by war and poverty, Detroit can seem like a haven. But Chebbani puts it in less fanciful terms: "There are good deals here, and as a community, we're risk takers." What they also have in common is a remarkable faith in a region where confidence has become a rare commodity.
Black Economic Miseducation and the Failure to Teach Black Youth Economic Self-reliance
“What Negroes are now being taught does not bring their minds into harmony with life as they must face it. The greatest indictment of such education as Negroes have received, is that they have thereby learned little as to make a living for themselves.” ~ Carter G. Woodson
The severe economic problems in Black communities are a reflection of the massive economic mis-education and ignorance that has caused us to assist in our own exploitation in the past, and continue to the present.
This economic mis-education is a result of Blacks suffering from historical unconsciousness, as Prof. Amos Wilson stated: “Because we have forgotten our history and our tradition and will not identify with it, we can only enrich other people. Then we say, ‘history ain’t gonna make you money.’ No, it the lack of knowledge of history that doesn’t make you money.”
In the late 1960’s and early 1970’s, the Black middle-class leadership of the Civil Rights Movement, along with their white liberal backers advocated non-economic liberalism of just voting and pushed education as a social ‘cure-all’; while the real issue was Blacks controlling the economics in their communities.
In his book, “The Great School Legend”, Colin Green demonstrates that education was not a significant means of mobility for the various immigrant nationality groups in America.
Contrary to those who blame the Black economic malady on educational deficiency, Green and other Historians indicate that for every ethnic nationality that has attained any mobility in the United States, economic development came first and was only then followed by educational achievement.
The educational achievement fallacy was pointed out years ago by historian, Carter G. Woodson when he stated: “In the schools of business administration, Negroes were trained exclusively in the psychology of, and economics of Wall Street and are, therefore made to despise the opportunities to run ice wagons, push banana carts among their own people. Foreigners who have not studded economics but have studied Negroes, take up this business and grow rich.”
While Blacks have achieved more education in the post-civil rights era, it did not increase Black economic independence. Blacks with college degrees are like poor Blacks, both are dependent on the government for income.
Over 50% of all Blacks with college degrees work for the government. With the ‘reactionary withering away of the state’, government downsizing, Blacks are losing aid and jobs. Corporate downsizing is eliminating more Black employees with degrees.
Faced with a racist white backlash, downsizing, de-industrialization, and little business ownership, the Black community has left young Blacks caught between a ‘crack rock’ and a 'hard place' to find a job. The Black community must be held responsible for not educating our youth with economic self-reliance.
We send our youth out into a society that is racist, unequal, and hostile with little but a hope and a prayer; hope they can get a job and pray they don’t get killed or jailed.
We spent our purchasing power with non-Black businesses, we did not come together and invest our money to build economic foundations and institutions that would help our youth survive and progress. We’ve left our youth with only degrees on a mantle and our spending legacy of enriching others.
Today, Black youth have been successfully brainwashed by the white power structure’s mass-media to live their one life on earth for nothing more than the latest fads in popular music, sit-coms, dances, video games, cell-phones, sports, drugs, clothes, jewelry, cars, and hair styles.
The only sign of development that Black youth see in their communities is the growing phenomenon of immigrant owned businesses.
Since most of our youth live in economically distressed communities, they provide jobs for themselves by selling drugs, and they create businesses with crack houses; Over 70% of Black males incarcerated in federal prisons were sentenced on drug charges.
The fact that the majority of young Blacks have no real economic future, comes as a result of neglect. The legacy of our struggle for economic development has not passed from one generation to the next.
Lerone Bennett highlights the significance of this legacy when he stated: “The story of Black people in America is, among other things, the story of a quest for the hard rock of economic security. This quest, under girding all, gives shape and body to all the strivings of Black men and women. Behind the demonstrations, behind the petitions and protests and revolts, behind Jamestown and Montgomery and Watts, lies this deeper and more basic struggle for bread, shelter, clothing, land, raw materials, resources, skills, and a space for the heart.”
At the present time, and going into the future, we as Black people must realize the need and the necessity to understand the importance of cooperative economic development.
As a people, for the most part we face the grave, impending reality of economic elimination in a global economy. The severe problem we face today of becoming economically obsolete is just as destructive as the slave trade was to our Ancestors.
Thus far we have ignored the warnings of the present and the past; as Marcus Garvey stated:“I have also held and still believe that it is only a questions of time when the Negro, economically dependent as he is on the white man, would be forced to the wall, and that the solution of the problem in the future would not be so much by wholesale killing or wiping out of Negro populations by fire or force of arms, but by a well-organized plan of economic starvation.”
The failure to come together and rebuild economically at this critical time will greatly affect our future and our childrens’ future. We can’t continue to leave our youth with a legacy of economic dependence and consumerism.
Our youth can no longer grow up with false consciousness, believing that in a racist society you can depend on your enemies for financial sustenance. They must understand that economic power imbalances are the basic underlying causes of political-social conflicts; the struggle over values and claims to resources in which the aims of the exploiters and oppressors are to keep their victims subjugated.
We must re-educate Black youth that they have the right and responsibility to control the economic resources in their communities. We must expose them to great Black leaders, like the remarkable Paul Cuffe, who took up the challenge to create economic development to assist the cause of Black independence during slavery.
In order to create cooperative economic development, we must create the new Black youth who will not promote and perpetuate a self-impose trade embargo which comes from distrust, no trust – no trade!
This sabotaging behavior was analyzed by Prof. Amos Wilson: “If I’ve got the money I can help you, but if I distrust you, I won’t help you and you may not make it. It’s not the absence of money, it’s the presence of mistrust. If I will not cooperate, if you cannot rely on me, then we cannot have an economic system, even though we may have money. In other words, a people must trust, be reliable, be dependable, have respect for each other, if they are to develop a viable economic system.”
To develop a viable cooperative economic system, we must first conduct a massive economic literacy campaign. W.E.B. DuBois recommended that this campaign must organize Blacks for social and economic power by developing effective associations.
The campaign should organize our strengths as consumers and train producers and entrepreneurs. The goal of the campaign is to create, new progressive social relationships among Blacks. These new social relations will create our economic system that can create new social institutions to educate and develop economic self-reliance in Black youth.
We must realize that if we ever needed a plan for economic change and survival in our communities, it is now! Facing an increasing external economic embargo from without, we can no longer accept Black economic suicide from within.
The severe economic problems in Black communities are a reflection of the massive economic mis-education and ignorance that has caused us to assist in our own exploitation in the past, and continue to the present.
This economic mis-education is a result of Blacks suffering from historical unconsciousness, as Prof. Amos Wilson stated: “Because we have forgotten our history and our tradition and will not identify with it, we can only enrich other people. Then we say, ‘history ain’t gonna make you money.’ No, it the lack of knowledge of history that doesn’t make you money.”
In the late 1960’s and early 1970’s, the Black middle-class leadership of the Civil Rights Movement, along with their white liberal backers advocated non-economic liberalism of just voting and pushed education as a social ‘cure-all’; while the real issue was Blacks controlling the economics in their communities.
In his book, “The Great School Legend”, Colin Green demonstrates that education was not a significant means of mobility for the various immigrant nationality groups in America.
Contrary to those who blame the Black economic malady on educational deficiency, Green and other Historians indicate that for every ethnic nationality that has attained any mobility in the United States, economic development came first and was only then followed by educational achievement.
The educational achievement fallacy was pointed out years ago by historian, Carter G. Woodson when he stated: “In the schools of business administration, Negroes were trained exclusively in the psychology of, and economics of Wall Street and are, therefore made to despise the opportunities to run ice wagons, push banana carts among their own people. Foreigners who have not studded economics but have studied Negroes, take up this business and grow rich.”
While Blacks have achieved more education in the post-civil rights era, it did not increase Black economic independence. Blacks with college degrees are like poor Blacks, both are dependent on the government for income.
Over 50% of all Blacks with college degrees work for the government. With the ‘reactionary withering away of the state’, government downsizing, Blacks are losing aid and jobs. Corporate downsizing is eliminating more Black employees with degrees.
Faced with a racist white backlash, downsizing, de-industrialization, and little business ownership, the Black community has left young Blacks caught between a ‘crack rock’ and a 'hard place' to find a job. The Black community must be held responsible for not educating our youth with economic self-reliance.
We send our youth out into a society that is racist, unequal, and hostile with little but a hope and a prayer; hope they can get a job and pray they don’t get killed or jailed.
We spent our purchasing power with non-Black businesses, we did not come together and invest our money to build economic foundations and institutions that would help our youth survive and progress. We’ve left our youth with only degrees on a mantle and our spending legacy of enriching others.
Today, Black youth have been successfully brainwashed by the white power structure’s mass-media to live their one life on earth for nothing more than the latest fads in popular music, sit-coms, dances, video games, cell-phones, sports, drugs, clothes, jewelry, cars, and hair styles.
The only sign of development that Black youth see in their communities is the growing phenomenon of immigrant owned businesses.
Since most of our youth live in economically distressed communities, they provide jobs for themselves by selling drugs, and they create businesses with crack houses; Over 70% of Black males incarcerated in federal prisons were sentenced on drug charges.
The fact that the majority of young Blacks have no real economic future, comes as a result of neglect. The legacy of our struggle for economic development has not passed from one generation to the next.
Lerone Bennett highlights the significance of this legacy when he stated: “The story of Black people in America is, among other things, the story of a quest for the hard rock of economic security. This quest, under girding all, gives shape and body to all the strivings of Black men and women. Behind the demonstrations, behind the petitions and protests and revolts, behind Jamestown and Montgomery and Watts, lies this deeper and more basic struggle for bread, shelter, clothing, land, raw materials, resources, skills, and a space for the heart.”
At the present time, and going into the future, we as Black people must realize the need and the necessity to understand the importance of cooperative economic development.
As a people, for the most part we face the grave, impending reality of economic elimination in a global economy. The severe problem we face today of becoming economically obsolete is just as destructive as the slave trade was to our Ancestors.
Thus far we have ignored the warnings of the present and the past; as Marcus Garvey stated:“I have also held and still believe that it is only a questions of time when the Negro, economically dependent as he is on the white man, would be forced to the wall, and that the solution of the problem in the future would not be so much by wholesale killing or wiping out of Negro populations by fire or force of arms, but by a well-organized plan of economic starvation.”
The failure to come together and rebuild economically at this critical time will greatly affect our future and our childrens’ future. We can’t continue to leave our youth with a legacy of economic dependence and consumerism.
Our youth can no longer grow up with false consciousness, believing that in a racist society you can depend on your enemies for financial sustenance. They must understand that economic power imbalances are the basic underlying causes of political-social conflicts; the struggle over values and claims to resources in which the aims of the exploiters and oppressors are to keep their victims subjugated.
We must re-educate Black youth that they have the right and responsibility to control the economic resources in their communities. We must expose them to great Black leaders, like the remarkable Paul Cuffe, who took up the challenge to create economic development to assist the cause of Black independence during slavery.
In order to create cooperative economic development, we must create the new Black youth who will not promote and perpetuate a self-impose trade embargo which comes from distrust, no trust – no trade!
This sabotaging behavior was analyzed by Prof. Amos Wilson: “If I’ve got the money I can help you, but if I distrust you, I won’t help you and you may not make it. It’s not the absence of money, it’s the presence of mistrust. If I will not cooperate, if you cannot rely on me, then we cannot have an economic system, even though we may have money. In other words, a people must trust, be reliable, be dependable, have respect for each other, if they are to develop a viable economic system.”
To develop a viable cooperative economic system, we must first conduct a massive economic literacy campaign. W.E.B. DuBois recommended that this campaign must organize Blacks for social and economic power by developing effective associations.
The campaign should organize our strengths as consumers and train producers and entrepreneurs. The goal of the campaign is to create, new progressive social relationships among Blacks. These new social relations will create our economic system that can create new social institutions to educate and develop economic self-reliance in Black youth.
We must realize that if we ever needed a plan for economic change and survival in our communities, it is now! Facing an increasing external economic embargo from without, we can no longer accept Black economic suicide from within.
Wednesday, November 3, 2010
Black Community a Leaky Bucket: Losing Our Dollars
What is obvious, crystal clear, in Black communities is the small number of Black owned businesses you see. Economically, Black communities are dominated by non-Black businesses (Arabs, Chinese, East Indians, Koreans, etc.); this foreign business monopoly causes a ‘leaky-bucket’.
For example, if you needed water for drinking, cooking, and washing, and you poured it in a bucket full of holes it would all leak out before you could use it – benefit from the water. It is the same with Black dollars, they leak out our communities, not recycled back to create a ‘multiplier effect’ of business expansion, new business development, and jobs.
It is estimated that this year, 2010, Black people will spend about a trillion dollars. Because of a ‘consumer-slave mentality’ and ‘non-entrepreneural outlook’ almost all of the trillion dollar in spending power leaks out of the Black community.
For every dollar of the trillion we spend we’ll keep about 3 pennies, how can 3 cents lead to any type of economic development, it’s impossible, it can’t!! However the other 97 cents tremendously benefits non-Blacks economically; it creates wealth, investments, business expansion, new business development, and jobs for them!!!!!
What Blacks have to face today is a conservative - racist backlash period in America coupled with a global economy where we are becoming more and more economically marginalized. We can expect little or no corporate 'external' economic development to come into our communities, in a period of less and less government aid we should expect little or no economic stimulus from it.
The 3 cents we spend with ourselves represents that only 3 percent of the businesses in America are Black owned. As Blacks we are about 12 percent of the U.S. population, we should have it least 12 percent of the businesses! Indeed, we suffer from economic exploitation and Black business underdevelopment!
The only economic development we can expect is ‘internal’ – what we do for ourselves by plugging up the holes that leak Black dollars through business development intervention: competing, obtaining, and retaining our dollars!!!
For example, if you needed water for drinking, cooking, and washing, and you poured it in a bucket full of holes it would all leak out before you could use it – benefit from the water. It is the same with Black dollars, they leak out our communities, not recycled back to create a ‘multiplier effect’ of business expansion, new business development, and jobs.
It is estimated that this year, 2010, Black people will spend about a trillion dollars. Because of a ‘consumer-slave mentality’ and ‘non-entrepreneural outlook’ almost all of the trillion dollar in spending power leaks out of the Black community.
For every dollar of the trillion we spend we’ll keep about 3 pennies, how can 3 cents lead to any type of economic development, it’s impossible, it can’t!! However the other 97 cents tremendously benefits non-Blacks economically; it creates wealth, investments, business expansion, new business development, and jobs for them!!!!!
What Blacks have to face today is a conservative - racist backlash period in America coupled with a global economy where we are becoming more and more economically marginalized. We can expect little or no corporate 'external' economic development to come into our communities, in a period of less and less government aid we should expect little or no economic stimulus from it.
The 3 cents we spend with ourselves represents that only 3 percent of the businesses in America are Black owned. As Blacks we are about 12 percent of the U.S. population, we should have it least 12 percent of the businesses! Indeed, we suffer from economic exploitation and Black business underdevelopment!
The only economic development we can expect is ‘internal’ – what we do for ourselves by plugging up the holes that leak Black dollars through business development intervention: competing, obtaining, and retaining our dollars!!!
Sunday, October 31, 2010
Black Cooperation is the Key to Black Business Development
by Jim Clingman
As Black people we must demonstrate our capacity to cooperate among ourselves, instead of constantly demanding external economic development from those who have historically neglected us. Developing internal businesses is the ultimate test of our ability to cooperate. Somehow we must learn this fundamental lesson.
It will be costly; there will be some loss in the process, but we must keep it up until we have developed within the race a group of people of definite capacity and unquestioned integrity, who can lead the way to larger achievements for the benefit of the whole race.” (R.R. Moton, President, National Negro Business League, 1928).
It seems so difficult for Moton’s message to sink in and be implemented by many of our business owners. You would think that during the last 82 years since he spoke those words Black folks, collectively, would have built hundreds of business associations, thereby commanding a much higher percentage of purchasing power than we do today.
Moton, and others of his time, were passionate about working together, pooling resources, and cooperating with one another. They knew that if we would survive and thrive in this country as business persons, and if we would empower ourselves as consumers, we would have to work together in support of one another.
The same principle applies today, probably even more so. For example, all across this country Black people are battling to be included in construction projects in a meaningful and significant way.
Despite Black tax dollars being spent to help fund building projects, e.g. stadiums, convention centers, highways, schools, Black construction workers and Black contractors have to fight tooth-and-nail just to have the opportunity to even bid on such projects.
Special policies have to be written, and strictly enforced, to attain even a modicum of Black participation. We always seem to be the 'excluded' rather than the 'included'. That reality speaks not only to closed-door policies, exclusion, and discrimination; it also speaks to what R.R. Moton was saying back in 1928: our unwillingness to cooperate among ourselves.
Unfortunately, some of our brothers and sisters operate in a scarcity mode rather than an abundance mode. Sadly, some of us are willing to sellout as front companies and pass-through companies, thus, allowing the “includers” to maintain status quo when it comes to the lack of meaningful “inclusion.”
Even worse, the percentage (payoff) received by the front or pass-through company is minimal and the Faustian deal to which these business owners agree contributes to Black unemployment and the continued lack of growth among Black businesses.
Blacks in America are too far behind in the economic race; we are too near last place all along the economic continuum. We must establish and grow more businesses, invest in income producing assets, and form alliances with one another, in order to improve our lot both nationally and globally.
Yes, we can brag all day long about our annual income of $900 billion, but those dollars will never make sense if we fail to aggregate them in support of true economic empowerment for Black people.
We can complain all we want about racism and the lack of economic inclusion, which is a legitimate complaint against economic injustice, but while we fight against exclusionary practices we must also accept our own culpability in this issue. Much of what we fight against can be stopped by our own power to control ourselves. We always have the choice of engaging in economic self-reliance.
If each of us would give more consideration to the collective (Ujimma) and cooperative economics (Ujamma) rather than the individual, as Moton suggested, when the deal makers come knocking at our doors, rather than bending over, we will stand tall.
As Black people we must demonstrate our capacity to cooperate among ourselves, instead of constantly demanding external economic development from those who have historically neglected us. Developing internal businesses is the ultimate test of our ability to cooperate. Somehow we must learn this fundamental lesson.
It will be costly; there will be some loss in the process, but we must keep it up until we have developed within the race a group of people of definite capacity and unquestioned integrity, who can lead the way to larger achievements for the benefit of the whole race.” (R.R. Moton, President, National Negro Business League, 1928).
It seems so difficult for Moton’s message to sink in and be implemented by many of our business owners. You would think that during the last 82 years since he spoke those words Black folks, collectively, would have built hundreds of business associations, thereby commanding a much higher percentage of purchasing power than we do today.
Moton, and others of his time, were passionate about working together, pooling resources, and cooperating with one another. They knew that if we would survive and thrive in this country as business persons, and if we would empower ourselves as consumers, we would have to work together in support of one another.
The same principle applies today, probably even more so. For example, all across this country Black people are battling to be included in construction projects in a meaningful and significant way.
Despite Black tax dollars being spent to help fund building projects, e.g. stadiums, convention centers, highways, schools, Black construction workers and Black contractors have to fight tooth-and-nail just to have the opportunity to even bid on such projects.
Special policies have to be written, and strictly enforced, to attain even a modicum of Black participation. We always seem to be the 'excluded' rather than the 'included'. That reality speaks not only to closed-door policies, exclusion, and discrimination; it also speaks to what R.R. Moton was saying back in 1928: our unwillingness to cooperate among ourselves.
Unfortunately, some of our brothers and sisters operate in a scarcity mode rather than an abundance mode. Sadly, some of us are willing to sellout as front companies and pass-through companies, thus, allowing the “includers” to maintain status quo when it comes to the lack of meaningful “inclusion.”
Even worse, the percentage (payoff) received by the front or pass-through company is minimal and the Faustian deal to which these business owners agree contributes to Black unemployment and the continued lack of growth among Black businesses.
Blacks in America are too far behind in the economic race; we are too near last place all along the economic continuum. We must establish and grow more businesses, invest in income producing assets, and form alliances with one another, in order to improve our lot both nationally and globally.
Yes, we can brag all day long about our annual income of $900 billion, but those dollars will never make sense if we fail to aggregate them in support of true economic empowerment for Black people.
We can complain all we want about racism and the lack of economic inclusion, which is a legitimate complaint against economic injustice, but while we fight against exclusionary practices we must also accept our own culpability in this issue. Much of what we fight against can be stopped by our own power to control ourselves. We always have the choice of engaging in economic self-reliance.
If each of us would give more consideration to the collective (Ujimma) and cooperative economics (Ujamma) rather than the individual, as Moton suggested, when the deal makers come knocking at our doors, rather than bending over, we will stand tall.
Why Do Koreans Own The Black Beauty Supply Business?
by R. Asmerom
It’s odd but not so odd at the same time. By now, many people expect to walk into a beauty supply store and see a Korean store owner manning the register. Whether you’re in the suburbs of Houston or on MLK Blvd in Anytown, USA, you know what to expect.
And yet, walking down a street in a Black neighborhood with Black residents and Black customers buzzing about the retail shops, that image of the few Koreans in the neighborhood only existing behind the cash register of liquor, beauty supply and other retail shops is still perplexing.
But what can explain the seemingly random attraction of Black hair to Korean entrepreneurs? Is it that they love Black hair so much? Was there a plan amongst the first wave of Korean immigrants to hone in on the black hair care industry and dominate the beauty supply store market? From a business perspective, it was no coincidence.
The wig business and the explosion of the wig business in South Korea in the 1960s is instrumental to understanding the Korean ownership of beauty supply stores.
According to the book “On My Own: Korean Businesses and Race Relations in America”, the rise of the YH Trade wig manufacturing company was significant. Founder Yung Ho Chang, conceived the idea of the company while working as the vice-director of Korean Trade Promotion Corporation in the U.S. Between 1965 and 1978, his company exported $100 million worth of wigs.
The wig business was doing so well, especially amongst African-American consumers that the Korean Wig Merchants pushed to corner the market. “In 1965, the Korean Wig merchants joined together and convinced the Korean government to outlaw the export of raw hair,” said Aron Ranen, a filmmaker who has documented the marginalization of African-American entrepreneurs in the hair care industry in the film Black Hair “[This ban] made it so that one can only buy the pre-made wigs and extensions.”
In other words, Korean hair could only be manufactured in Korea. “Six months later, the United States government created a ban on any wig that contains hair from China,” effectively putting South Korea in prime position to exploit the market.
The business structure helped set up many Korean entrepreneurs in the sale of wigs and over the past five decades, wig stores have evolved to become full fledged beauty supply stores where hair for weaves and extensions represent the top selling products.
Since then, it’s been a chain reaction as one store beget another; family members and employees of one store owner duplicated the business.
According to said Dr. Kyeyoung Park, associate professor of anthropology and Asian American Studies at UCLA, competition also played a role in the proliferation. “Korean immigrants are more concerned with peer competition,” she said. “If one is running a business so well, then another Korean will open up a similar business very quickly.”
Today, there are over 9,000 Korean-owned beauty supply stores serving a billion dollar market for Black hair. Between manufacturing, distributing and selling these hair care products, Korean entrepreneurs appear to control all major components. Ranen was inspired to make his documentary because of what he saw as the injustice of unfair business practices.
“It’s really about allowing black manufacturers to get inside the distribution channel,” he said. “‘I mean, if you ask me, ‘what is your vision for the future?’” Well, right away, it’s a 100 black-owned stores opening up right next to Korean stores – a boycott until the Korean stores accept at least 20% black-owned manufactured products. Then we are talking about money in the community.”
According Ranin, there are only four central distributors serving beauty supply stores in the country and these Korean owned distributors discriminate against Black store owners in order to maintain their monopoly in the market.
Ranin interviewed Lucky White, the owner of Kizure Ironworks which specializes in making styling tools like curling irons, for his 2006 documentary. Ms. White claimed that distributors told her that her products were no longer in demand as an excuse to turn away her products in favor of knock-offs produced by Asian companies.
Devin Robinson, an economics professor and author of “How to Become a Successful Beauty Supply Store Owner”, organized a boycott last November against Non- Black Owned Beauty Supply stores. “The problem is with the distributors.” he has stated. “Distributors are mainly Non-Blacks and they handpick who they will distribute products to. This oftentimes leaves aspiring black owners disenfranchised.”
But Robert Cleary, a former director of the Dashing Diva [nail salon]franchising corporation , said that although he did witness discrimination in the Korean-dominated nail salon business, he doesn’t believe that the discrimination on a business level is exclusively race based.
“The central Korean distributors actively work to create barriers of entry to any group- even other Koreans to protect the status quo,” he said. “The Koreans used the [nail and hair industry] to get a foothold in this country. They were doing something, as many immigrants do, that the people who lived here didn’t want to do or didn’t have an interest in. They found a need, they found a niche and they made it their own. The concentration in these businesses promoted a shroud of secrecy and protectiveness that became hard to penetrate.”
The business methodology is highly cultural, said Cleary, only to be understood by many other Koreans who accept and conform to the way of doing things. Other elements of the business are highly controversial and susceptible to scrutiny to those who are not comfortable with the way things works.
“The [nail] salons they distribute products to employ many illegal aliens and the distributors themselves often employ illegal workers as well,” he said. “This adds another layer of secrecy and motivation to keep things tightly controlled and quiet.” The issue of taxes and cheap labor also enforce the secrecy.
“Many salons pay for their supplies with cash therefore a large part of the business at all levels is cash and rarely reported – just enough to fly under the IRS radar,” he said.
Regardless, this shroud of protectiveness fueled part of the tension between Korean business owners and the urban African-American community which famously erupted during the the 1992 Los Angeles riots.
Korean entrepreneurs in the inner city usually maintain a separate existence, living outside of the urban communities in which they serve. Despite the fact that Koreans may be competitive even amongst one another, like many other ethnic groups, they have fostered a collaborative entrepreneurial spirit through establishing banks and business associations.
“In the 80s, they organized rotating credit associations,” said Dr. Park. “The way they formulate capital isn’t very different from other Americans.” Interestingly enough, Park says, what appears to be a strong relationship between entrepreneurship and Korean immigrants is not strong historically.
“For a long time in South Korea, because of Confucianism, it was looked down upon to be a merchant,” she said. “These days, in South Korea, because of neo-liberal restructuring and other things [like lack of life long employment], Koreans are now thinking of opening up their own businesses. Until the 1980s and early 90s, opening up a small business was the last thing people would [want] to do.”
When Chris Rock’s “Good Hair” came out last year, it shed a lot of light on the origins of the hair used for weaves and the relationship between black women and their hair. But Ranen, who is a Jewish filmmaker, still believes that the powers that be in the African-American business community need to take a stronger stand in highlighting this issue.
“They’ve watched my movie but no one has done anything about it,” he said, revisiting his dream of seeing 100 black owned beauty supply stores open and establish a funnel to black-owned distributors and manufacturers.
“There are people on Wall Street who can fix this in a minute and create some kind of dynamic kind of stock offering, completely above the board to open and fund the stores and give out shares.” It’s a vision that may not be wildly popular but one that addresses the passivity that hovers over the challenge of African-American empowerment by way of business and investing.
It’s odd but not so odd at the same time. By now, many people expect to walk into a beauty supply store and see a Korean store owner manning the register. Whether you’re in the suburbs of Houston or on MLK Blvd in Anytown, USA, you know what to expect.
And yet, walking down a street in a Black neighborhood with Black residents and Black customers buzzing about the retail shops, that image of the few Koreans in the neighborhood only existing behind the cash register of liquor, beauty supply and other retail shops is still perplexing.
But what can explain the seemingly random attraction of Black hair to Korean entrepreneurs? Is it that they love Black hair so much? Was there a plan amongst the first wave of Korean immigrants to hone in on the black hair care industry and dominate the beauty supply store market? From a business perspective, it was no coincidence.
The wig business and the explosion of the wig business in South Korea in the 1960s is instrumental to understanding the Korean ownership of beauty supply stores.
According to the book “On My Own: Korean Businesses and Race Relations in America”, the rise of the YH Trade wig manufacturing company was significant. Founder Yung Ho Chang, conceived the idea of the company while working as the vice-director of Korean Trade Promotion Corporation in the U.S. Between 1965 and 1978, his company exported $100 million worth of wigs.
The wig business was doing so well, especially amongst African-American consumers that the Korean Wig Merchants pushed to corner the market. “In 1965, the Korean Wig merchants joined together and convinced the Korean government to outlaw the export of raw hair,” said Aron Ranen, a filmmaker who has documented the marginalization of African-American entrepreneurs in the hair care industry in the film Black Hair “[This ban] made it so that one can only buy the pre-made wigs and extensions.”
In other words, Korean hair could only be manufactured in Korea. “Six months later, the United States government created a ban on any wig that contains hair from China,” effectively putting South Korea in prime position to exploit the market.
The business structure helped set up many Korean entrepreneurs in the sale of wigs and over the past five decades, wig stores have evolved to become full fledged beauty supply stores where hair for weaves and extensions represent the top selling products.
Since then, it’s been a chain reaction as one store beget another; family members and employees of one store owner duplicated the business.
According to said Dr. Kyeyoung Park, associate professor of anthropology and Asian American Studies at UCLA, competition also played a role in the proliferation. “Korean immigrants are more concerned with peer competition,” she said. “If one is running a business so well, then another Korean will open up a similar business very quickly.”
Today, there are over 9,000 Korean-owned beauty supply stores serving a billion dollar market for Black hair. Between manufacturing, distributing and selling these hair care products, Korean entrepreneurs appear to control all major components. Ranen was inspired to make his documentary because of what he saw as the injustice of unfair business practices.
“It’s really about allowing black manufacturers to get inside the distribution channel,” he said. “‘I mean, if you ask me, ‘what is your vision for the future?’” Well, right away, it’s a 100 black-owned stores opening up right next to Korean stores – a boycott until the Korean stores accept at least 20% black-owned manufactured products. Then we are talking about money in the community.”
According Ranin, there are only four central distributors serving beauty supply stores in the country and these Korean owned distributors discriminate against Black store owners in order to maintain their monopoly in the market.
Ranin interviewed Lucky White, the owner of Kizure Ironworks which specializes in making styling tools like curling irons, for his 2006 documentary. Ms. White claimed that distributors told her that her products were no longer in demand as an excuse to turn away her products in favor of knock-offs produced by Asian companies.
Devin Robinson, an economics professor and author of “How to Become a Successful Beauty Supply Store Owner”, organized a boycott last November against Non- Black Owned Beauty Supply stores. “The problem is with the distributors.” he has stated. “Distributors are mainly Non-Blacks and they handpick who they will distribute products to. This oftentimes leaves aspiring black owners disenfranchised.”
But Robert Cleary, a former director of the Dashing Diva [nail salon]franchising corporation , said that although he did witness discrimination in the Korean-dominated nail salon business, he doesn’t believe that the discrimination on a business level is exclusively race based.
“The central Korean distributors actively work to create barriers of entry to any group- even other Koreans to protect the status quo,” he said. “The Koreans used the [nail and hair industry] to get a foothold in this country. They were doing something, as many immigrants do, that the people who lived here didn’t want to do or didn’t have an interest in. They found a need, they found a niche and they made it their own. The concentration in these businesses promoted a shroud of secrecy and protectiveness that became hard to penetrate.”
The business methodology is highly cultural, said Cleary, only to be understood by many other Koreans who accept and conform to the way of doing things. Other elements of the business are highly controversial and susceptible to scrutiny to those who are not comfortable with the way things works.
“The [nail] salons they distribute products to employ many illegal aliens and the distributors themselves often employ illegal workers as well,” he said. “This adds another layer of secrecy and motivation to keep things tightly controlled and quiet.” The issue of taxes and cheap labor also enforce the secrecy.
“Many salons pay for their supplies with cash therefore a large part of the business at all levels is cash and rarely reported – just enough to fly under the IRS radar,” he said.
Regardless, this shroud of protectiveness fueled part of the tension between Korean business owners and the urban African-American community which famously erupted during the the 1992 Los Angeles riots.
Korean entrepreneurs in the inner city usually maintain a separate existence, living outside of the urban communities in which they serve. Despite the fact that Koreans may be competitive even amongst one another, like many other ethnic groups, they have fostered a collaborative entrepreneurial spirit through establishing banks and business associations.
“In the 80s, they organized rotating credit associations,” said Dr. Park. “The way they formulate capital isn’t very different from other Americans.” Interestingly enough, Park says, what appears to be a strong relationship between entrepreneurship and Korean immigrants is not strong historically.
“For a long time in South Korea, because of Confucianism, it was looked down upon to be a merchant,” she said. “These days, in South Korea, because of neo-liberal restructuring and other things [like lack of life long employment], Koreans are now thinking of opening up their own businesses. Until the 1980s and early 90s, opening up a small business was the last thing people would [want] to do.”
When Chris Rock’s “Good Hair” came out last year, it shed a lot of light on the origins of the hair used for weaves and the relationship between black women and their hair. But Ranen, who is a Jewish filmmaker, still believes that the powers that be in the African-American business community need to take a stronger stand in highlighting this issue.
“They’ve watched my movie but no one has done anything about it,” he said, revisiting his dream of seeing 100 black owned beauty supply stores open and establish a funnel to black-owned distributors and manufacturers.
“There are people on Wall Street who can fix this in a minute and create some kind of dynamic kind of stock offering, completely above the board to open and fund the stores and give out shares.” It’s a vision that may not be wildly popular but one that addresses the passivity that hovers over the challenge of African-American empowerment by way of business and investing.
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