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How to make black money matter in Miami-Dade

There’s a protest happening every day in Miami-Dade, but it uses credit cards, not picket signs, and checkbooks instead of megaphones.

Local black leaders are calling on the African-American community to use the power of their pocketbook to bring the changes they want to see. Yes, they say, there’s less money circulating in the black community — it makes up 19 percent of Miami-Dade’s population, but 29 percent of the population below the poverty line.

But, they argue, if people are more intentional about how they spend, they can make that money go further than it is right now, whether that means donating to political candidates from the community or patronizing local businesses instead of big box stores outside the neighborhood.

“With so many black communities being disenfranchised, we want to start patronizing institutions that invest in our communities,” said community activist Valencia Gunder.

That effort is beginning to take shape. A campaign for black banking (#BankBlack) increased business at Miami’s OneUnited, the largest black-owned bank in the country and the only one in South Florida, almost 20 times. And the community recently came together to talk about how to better pool their money for candidates and causes they care about — and make sure the next generation of leaders has the funds it needs to bring change.

The message they’re trying to send? Black dollars matter.

Why black money matters

With limited resources, community members are getting creative about how to channel their money and harness that pool of funds in meaningful ways.

“Black money matters because first and foremost money is the fuel needed to purchase goods and services and to fund city and county governments,” says Marlon Hill, a local attorney and community leader.

That’s because circulating money in black communities increases the tax base and spurs investments in distressed areas. Think of it as a multiplier effect: if more money is spent at a local business, it helps that business thrive, which means it can hire employees from the local community. That successful business then goes on to patronize other businesses, creating a thriving local economy. Eventually that means higher returns on property taxes, which provides more money for things like better roads, schools, and policing.

Minority communities have demonstrated their purchasing power here in Miami-Dade County before.

Back in 1990, black leaders across the county launched a 1,000-day tourism boycott, telling black visitors and convention organizers to stay away. They were fed up with the fact that while visitors and conventions (like the ACLU’s annual convention) contributed hundreds of millions of dollars to the Miami tourism industry, there were very few leadership or even employment opportunities for African-Americans.

The boycott cost the tourism industry almost $50 million, and led to changes in leadership and hiring practices, like hiring more black employees and putting more in managerial positions.

It’s a call to action espoused years before that by Martin Luther King Jr., in his final speech, “I’ve been to the Mountaintop.” In that 1968 speech, King called for people who wanted to see racial equity to focus on finances over fists, inspiring an economic protest. His speech called for people to start moving their money to black-owned banks, patronizing black-owned businesses, and hiring black employees.

“We begin the process of building a greater economic base. And at the same time, we are putting pressure where it really hurts. I ask you to follow through here,” King said in his 1968 speech.

Decades later American rapper Killer Mike reiterated King’s message during a town hall that aired on MTV and BET in July. His national call to action came on the heels of the fatal shootings of Philando Castile, Alton Sterling, and the deaths of five police officers in Dallas, Texas.

“We can’t go out in the street and start bombing, shooting, and killing,” he said. Instead he encouraged listeners to take the “warfare to financial institutions.”

Black money in politics

But there’s one place where black money isn’t going very far — local politics.

The black community is pretty well represented in the ranks of local leadership: four out of the 13 county commissioners are black, about on par with the overall demographics of the county. At the state level, two of the six state senators who represent Miami-Dade county are black, as well as five of the 18 state house representatives.

But when it comes to the donor pool, the presence is much smaller, according to a recent study by civil rights advocacy and public policy organization Demos. They make up just 2 percent of the total number of donors to Miami-Dade County mayoral races.

While in county commission races, black participation in the donor pool is higher, at 12 percent, that’s still not even close to being representative of the population.

That means it’s rarely an easy path to office, at least financially.

“This creates structural inequality. Equity in the donor pool as important as equity in voting and representation,” according to Emmanuel Caicedo, the senior campaign strategist at Demos.

Political campaigns are expensive at all levels, from local government to presidential. The more money you have, the more help you can get — and the farther your reach.

You’ve got to be able to afford consultants, advertisements, paid canvassers, sometimes office space, and campaign managers, explained Dwight Bullard, a Democratic state senator and high school teacher who just clinched a primary victory in a heavily Democratic district in South Dade that includes Goulds, Cutler Bay, Richmond Heights, and a sliver of Palmetto Bay, and is now headed for re-election come November.

“I’ve had to run with a very lean campaign so I don’t have the luxury of much staff outside of the volunteer realm,” Bullard said.

He says because his campaign doesn’t garner many large donations, it’s been difficult to stay competitive in an increasingly expensive race. In the 2016 August primary, his main competitor Andrew Korge received $507,851.76. in donations for his campaign. Bullard, after one term in office, garnered a third of that — $174,269.14.

“My struggle isn’t exclusive to me but generally speaking African American candidates that are representing traditional African American neighborhoods are dealing with people that don’t have the same level of needs as their counterparts,” Bullard said, implying that candidates like him can’t draw on their constituents for heavy financial support.

“My counterparts in Aventura or Coral Gables make a lot more lucrative fundraising … [when compared to] Liberty City and Overtown.”

It also means that they sometimes have little choice but to take money from special interest groups because they can’t raise much money from their low-income constituents. When it comes time to vote on legislation that affects the communities they’ve been elected to represent — say, youth incarceration — they might come under pressure from a big-dollar donor like a private prison company to vote against the community’s interests.

Think small

But while the overall dollar amount is lower than other demographics, African Americans do contribute more to the small donor pool (aka $100 or less) than the large donor pool. They make up 7 percent of those giving less than $500, but 3 percent of donors giving more than $1,000, according to the study.

What this shows is that there is a willingness to give what they can. Now it just needs to be activated across more of the community — and channeled more strategically.

For Francesca Menes, a local community leader who recently lost the Democratic primary for Florida House District 108, getting financial support from her community actually wasn’t a problem.

“I raised the most money that came from the community … I had about 405 donors, and 50 to 60 percent of that were individuals who live in the district,” Menes said.

The problem was that she was relying on lots of small donations and many of them came in just two weeks before the election. That meant she didn’t get the money she needed to hire staff to canvass until it was almost too late.

Supporting lowering campaign donation caps and encouraging public financing is one way to level the playing field and make those small donations go a little bit farther, according to Caicedo of Demos. It’s an initiative that’s actually already underway in Miami-Dade County.

This past month, a group known as Accountable Miami-Dade has been urging the county to put an item on the November ballot that would cap campaign donations and implement a public financing system, which would have the county match small donations at a six to one ratio. That could significantly amplify the black political contributions in local and state politics.

Closing the loop

But if the black community is being asked to increase its donations to political campaigns, or spend more in their community institutions, it’s on black politicians and business owners to invest back.

At Liberty City’s OneUnited Bank, for example, where the #BankBlack movement has led to an increase from 50 new accounts a day to 1,000 new accounts a day, the bank’s investment back into the community has historically lagged.

Under the Community Reinvestment Act, banks are required to reinvest in the communities they operate in, but according to a 2013 report, OneUnited made only eight loans in Florida between 2010 and 2013. That earned it a rating of “substantial noncompliance.” (That means bad.) Essentially they weren’t loaning out the local dollars that have been invested in them back into the local community. In the bank’s California branch, they were rated satisfactory, so it’s surely possible.

To get up to snuff, in 2015, the bank hired a CRA expert and begun rolling out a home loan program that will serve first-time homebuyers of low to moderate income in Miami-Dade county. And since 2013 (its last CRA review) OneUnited has made 190 loans in Miami-Dade county, of which 23 were home loans. Forty-two percent of those home loans were given to minorities, according to Teri Williams, the bank’s president.

Because of the bank’s increased commitment to investing in the local community, this year, attorney and community leader, Marlon Hill opened an account at OneUnited. He’s suggesting his clients to do the same. And if someone considers hiring a law firm or attorney, he “hopes they’ll think of [him] in that way that well.”

Because for Hill it’s about conscious decision making every step of the way.

“Everyone like nice things — good food, a safe and glittery place to go and shop — everyone wants that and deserves that, but the only way for that to happen is for all forces to be aligned to procure enough resources to generate economic activity,” Hill said. “Having money in a black bank, going to a black doctor, a black barber, a black restaurant or corner store matters because it puts more money in circulation.”

In order for the black community in Miami to flourish, neighborhoods like Overtown, Liberty City, Brownsville, North Miami, Miami Gardens, and Opa-locka need to flourish too. For that to happen, more money needs to move around in those communities, Hill explains. If you want more parks, better schools, and more local businesses, the money has to come from somewhere.

“The reason why black money matters matters so critically is that the community that wants to see the most change has to make a decision to change its own mindset.”

  • MC

    This is brilliant! First of all, thanks to the editor of The New Tropic for bringing stories like these to Miami readers. This is exactly what has been missing from other publications. We need publications that are not scared of comments (like the that of King’s below) who will lash out at stories that DIRECTLY address structural inequality. The decision to post it prominently and not have this story tucked away to a back page is commendable–bravo! And thanks to this author, Nebhrajani, for writing this very well written story.

    This is actually how many Asian groups and Jewish communities build wealth. They support each other economically in systematic ways. This is not anything new. I grew up seeing my Asian relatives support their fellow community members and invested in each other’s businesses and also lent money outside formal banking institutions through tight knit money lending rotating credit association. These are actually common in many parts of the world and it happens more often than we think within immigrant groups in the US. When faced with racism, especially in banking/housing loans, air B&B homes, etc, why not focus on a less stressful route? It makes absolute sense. Not all money is green obviously when the majority of studies show time and time again that race matters when it comes to economic transactions. This interesting story, surprisingly on CNN, shows how even the algorithms and data prevent folks from getting loans b/c they live in a particular zip code (http://money.cnn.com/2016/09/06/technology/weapons-of-math-destruction/index.html).

    I hope that a follow-up article will be a recommended list we can use when we go to the polls!

  • MC

    This is brilliant! First of all, thanks to the editor of The New Tropic for bringing stories like these to Miami readers. This is exactly what has been missing from other publications. We need publications that are not scared of comments (like the that of King’s below) who will lash out at stories that DIRECTLY address structural inequality. The decision to post it prominently and not have this story tucked away to a back page is commendable–bravo! And thanks to this author, Nebhrajani, for writing this very well written story.

    This is actually how many Asian groups and Jewish communities build wealth. They support each other economically in systematic ways. This is not anything new. I grew up seeing my Asian relatives support their fellow community members and invested in each other’s businesses and also lent money outside formal banking institutions through tight knit money lending rotating credit association. These are actually common in many parts of the world and it happens more often than we think within immigrant groups in the US. When faced with racism, especially in banking/housing loans, air B&B homes, etc, why not focus on a less stressful route? It makes absolute sense. Not all money is green obviously when the majority of studies show time and time again that race matters when it comes to economic transactions. This interesting story, surprisingly on CNN, shows how even the algorithms and data prevent folks from getting loans b/c they live in a particular zip code (http://money.cnn.com/2016/09/06/technology/weapons-of-math-destruction/index.html).

    I hope that a follow-up article will be a recommended list we can use when we go to the polls!

  • Kings

    Tl:dr…trying some editing next time.

    All money is green. But the message is: blacks should only buy from black-owned sources, bank at black banks, vote for blacks, and hire black attorneys/professionals.

    Buying local is one thing, choosing by color is another. What would you write if whites or Asians called publicly for the same open discrimination? Just curious….

  • Kings

    Tl:dr…trying some editing next time.

    All money is green. But the message is: blacks should only buy from black-owned sources, bank at black banks, vote for blacks, and hire black attorneys/professionals.

    Buying local is one thing, choosing by color is another. What would you write if whites or Asians called publicly for the same open discrimination? Just curious….