The Ever Enduring Myth of Black “Buying Power” (2014)

african-american-wealth-building

My challenge of this myth began with the posts below (working bottom up) and i’ve over time looked to track some of the relevant information as it comes out and to at times intervene in some of the national dialogue on this “buying power” mythology.  Media coverage of this issue, as is often the case, does little to improve our general understanding of capitalism, wealth accumulation and disparity or the ongoing forms of poverty faced by so many – who often themselves become the target of blame associated with that poverty.  i welcome others’ input and encourage much more discussion of this myth especially when so many left-leaning spokespeople routinely incorporate this very conservative (reactionary) myth into their own analyses and too end up chastising the poor for being so.

Update September 19, 2014

I am honored to have been referenced by these brothers from Africans Arise who do an excellent job of critiquing this notion of “Black buying power.”  Their approach is far more comprehensive and global and is very well explained.

 
Update September 12, 2014
We dealt with this issue a bit in our conversation with economists Dean Baker of the Center for Economic Policy and Research and Jeanette Huezo of United for a Fair Economy, “what does this mean for Black people, Brown people and working people?”

Update September 2, 2014

Yet another journalist asked for my input on this issue, this time to respond to another popular media reference to this myth of “buying power.”  But again the story falls short.  HERE is the piece and this is what i sent to its author:

Derek,

Too bad none of my comments made it into your piece on Elder and buying power. Clementi makes good points but still misses the key point that “buying power” is a marketing phrase meant to drive corporate advertising investments and not at all about the economic strength of a community. the median household wealth of a Black family is still below $6,000. That means even your GDP math concluding in “a per capita buying power of around $23,000” also grossly re-affirms the myth of what “buying power” as a phrase does and doesn’t mean. All you end up doing is moving Black America down this already false scale of economic strength from 16 to 44. That doesn’t help address the fact that poverty and income/wealth inequality are real and worsening problems that have nothing to do with how people spend money. Finally, you list me as a source but include none of my thoughts, statements, research or general argument. It almost reads as if i co-sign your work when i absolutely do not. The falseness in the claim of Black buying power is not in the overall ranking, it is in the terribly flawed approach, totally false claim and distortion of how economics work or the means by which people are held in poverty.

jab

 

 

 

Update: May 2, 2014

The following chart from the PEW Research Center supports my argument (below) about poor people buying what is available and are not, as the myth argues, foolishly choosing to waste money while missing out on opportunities to improve themselves.  This PEW chart shows how colonial “trinkets” (as Fanon described them) are far more affordable than what is needed for the material improvements.

poorcosts

Update: February 14, 2014

Today’s “What buying power buys African-Americans,” from Marketplace also included me. However, there just is not enough time given here to address the concerns raised or to more appropriately respond to claims/points made.  In this case, i had not heard the particular argument of the other interviewee until the piece aired, but it does speak to existing and severe differences in concepts of “power,” economics and the history of Black political struggle in the U.S. For instance, and as was done in this piece, to refer to a Black presence in commercials as any kind of “power” while then also referring to this and mythological reports of “buying power” as an extension of the civil rights movement’s bus boycotts really does distort that history.  Collective economics and non-violent direct action were, if nothing else, attempts to address community needs and institutional inequality.  To equate those movements with corporate ploys to attract consumers grossly distorts their intent, as well as, diminishes further critiques of those efforts’ ability to truly upset entrenched wealth and power.  Dr. King, for one example among many others, was clear in his own lifetime that these boycotts, efforts at desegregation and the passage of legislation were all insufficient and incapable even of ridding the country of its structural racism and economic (capitalist) violence against working people and Black people in particular. Secondly, though incomplete in its arbitrarily narrow time frame, the Montgomery bus boycotts are often understood to be the beginnings of a movement, not the culminating success story this piece suggests. But, if the frame is to be that Black people today have an economic strength (that again simply does not exist) then it makes sense that to defend that position the earliest stages of the civil rights struggle would be selected as the historic example that proves this myth. This way the succeeding years of increasingly radical, globally focused, anti-imperialist, anti-capitalist and Black Power elements can all be fast-forwarded to a wonderfully powerful 2014. King’s own critique of the stagnation of a movement he is often the symbolic head of is ignored as is that of lesser known figures whose criticisms are equally omitted and valid today. Perhaps more than anything this piece is a lesson in the limits of mainstream journalism and even the well-intentioned journalists who work in that environment.

Update: February 7, 2014

“Black buying power hits $1.1 trillion. What does it mean?” Marketplace included me in this piece on “buying power.”

Update: September 23, 2013

Our interview with Ward Churchill about Native American “buying power” and other national myths…

Update: September 20, 2013 

The myth does indeed endure.  A few weeks ago I was contacted about being quoted in a forthcoming article on “Black Buying Power.”  I was initially hopeful but upon reading the piece had to unfortunately send the following to its author:

“Greetings,

I’ve just now seen the piece you wrote on Black buying power. I have to say that when you reached out to me I became a bit hopeful that you were going to add some depth to the discussion but it seems that you’ve actually avoided the issue of what “buying power” means (functionally speaking) and how these huge spending numbers are “calculated.” You do reference me but actually horribly misquote me by putting words I quoted from someone else in my mouth and truncating the statement leaving it to be out of context and absent its actual point.

Here is what I wrote, “What is there to say when gaps between demonstrable reality and people’s perceptions are as wide as the ever-widening gaps in wealth? 2010 begins with another promotional round of the popular mythology of Black “buying power.” But this economic Easter Bunny/Tooth Fairy comes at great material consequence. This “great disconnect between our people’s wishful mis-perceptions… and the objective reality that actually shapes our lives,” as Glen Ford has said recently, is in part due to misinformation and the conclusions reached by so many prominent thinkers in our world. Precisely at a time when Black unemployment is worsening and predicted to reach even further epidemic levels we also hear of research which suggests that Black Americans think their lot is actually improving.”

Here is how you quote me, ““The objective reality that actually shapes our lives is in part due to misinformation and the conclusions reached by so many prominent thinkers in our world. Precisely at a time when black unemployment is worsening and predicted to reach even further epidemic levels, we also hear of research which suggests that black Americans think their lot is actually improving,” he said.”

The first line in yours doesn’t even make sense because you left out the preceding – and really important – sentence and then I am quoted as saying what I quoted Glen Ford as saying.

But really my only issue is that you didnt leave room for any of the studied critique of how they reach these really misleading numbers which makes my quote about a system seem like just talking. You dont link to my piece or reference any of the real research I put in to debunk the numbers these “studies” keep claiming. This leads to more confusion about how poverty works and you end up supporting the myth that we just spend ourselves out of opportunities (even as you quote accurately studies that demonstrate how Black homes are purposely devalued which exposes the lie that poverty is anything but the result of intentional discriminatory practices against Black (and poor) people).

Deadlines, editors, etc. I get it but I do admit to having had higher hopes.

Take care,

jared”

This latest “study comes from the same Selig Center mentioned below and also appears as the primary reference for reports like this one which itself becomes the primary reference for articles like the one mentioned above.  Its summary includes the following:

“Minority groups in the U.S. will command unprecedented economic clout this year and well into the future, according to the annual Multicultural Economy report from the Selig Center for Economic Growth at the Terry College of Business.  The 2013 report provides a comprehensive statistical overview of the buying power (or the amount of income left after taxes, not including savings or borrowed money) of African Americans, Asians, Native Americans and Hispanics from 1990-2018. It includes national statistics as well as breakdowns for each state…  In addition, African American consumers will add $1 trillion to the 2013 market, Native Americans will contribute $96 billion, and Asian consumers will supply $713 billion.  As minority groups’ buying power continues to outpace the growth of the white market, these groups should see more tailored treatment from advertisers, producers and media outlets, said Jeff Humphreys, author of the report and director of the Selig Center” (emphasis added).”

In addition to the points made below I would only want to add here that:

A) The study itself is not easily obtained as it costs $125 which is prohibitive for most of us.  So while I endeavor below to explain how these claims of “buying power” are calculated the precise methods and details are not accessible (to me).

B) The point, as I do say below, is not how to help “minorities” to invest all of this “power” so as to increase their actual wealth – because this is not an option, there are no stocks and properties, etc. available waiting for purchase from otherwise foolish spenders.  The point is to, as the above quote makes clear, help corporations target these communities for worthless spending, to turn “minority buying power” into corporate profit.  It makes no sense to refer to these “studies” in order to demonstrate the poor spending habits of poor people.  This report that refers to the Selig one (as is always the case) is not a guide for increasing Black wealth.  It is a falsely-balanced guide for corporations to know how to target Black people and a guide to Black people on how to be better consumers.  In other words, it is a guide for turning Black income in to White corporate wealth. So, again, it makes no sense at all to reference these studies as part of a critique of Black people’s complicity in their own poverty.  Black people are not poor because they are poor consumers.  Poor people are poor so that there can be rich people.  Poor people, as this report shows, are targeted to spend their income which becomes the unearned income (or wealth) of the rich who own the companies and products being bought.  This is how the wealthy stay wealthy, by assuring that the poor stay poor.

Update: February 5, 2010

A new BET “study” which is based on a “comprehensive” survey of “80,000 African American consumers” concludes that because of an increased Black population, one which spends more on technology and is predicted to have a “buying power that will reach $1.2 trillion by 2013, that there is an economic strength among Black people that simply does not exist.  Again, “buying power” is a marketing phrase meant to define the ability of a demographic to spend its money with this or that corporation.  It is not an indicator of income, wealth or access to assets (such as land, stock, rental property, etc.) all of which are real indicators of economic power and all of which point (as described below) to an absolute lack of power in Black America.  From these misleading numbers and conclusions we get equally misleading analysis that suggests – and by design reaffirms the lie – that, as the esteemed Black spokesperson Dr. Boyce Watkins said in response to this latest “study,” “Unfortunately, when African-Americans make money, we spend it. We don’t use it to invest or produce… When we get our tax refund, we go straight to the store.”  This is an absurd explanation of poverty.

This “great disconnect between our people’s wishful mis-perceptions… and the objective reality that actually shapes our lives,” as Glen Ford has said recently, is in part due to misinformation and the conclusions reached by so many prominent thinkers in our world.  Precisely at a time when Black unemployment is worsening and predicted to reach even further epidemic levels we also hear of research which suggest that Black Americans think their lot is actually improving.

As we have been arguing here there is no collective $1.2 trillion that wealthy investors choose to spend frivolously.  These numbers are aggregates of money spent by millions of hard working, mostly poor people spending in relatively small amounts on items which are available to them.  There are no offers of stock, nor is there land and property all awaiting sale but being ignorantly passed up by foolish savages who are incapable (apparently) of making intelligent use of their billions.    Poverty is not the result of spending habits.  Poverty is a well-structured planned outcome of an economic system which demands that it exist.

It remains essential to focus on material reality as opposed to propagated myths packaged in ease-inspiring slogans or phrases.  For instance, a recent statement on “intergenerational poverty” demonstrates the point.  They write that, “The wealth gap is the most acute indicator of racial inequality. Based on data from the 2002 Survey of Income and Program Participation, white median household net worth is about $90,000; in contrast it is only about $8,000 for the median Latino household and a mere $6,000 for the median black household. The median Latino or black household would have to save nearly 100 percent of its income for at least three consecutive years to close the gap. Furthermore, 85 percent of black and Latino households have a net worth below the median white household. Regardless of age, household structure, education, occupation, or income, black households typically have less than a quarter of the wealth of otherwise comparable white households.”  Or in another installment in an annual series on these issues we learn, among many other startling facts, that Black Americans “earn 62 cents for every dollar of white income, and Latinos earn 68 cents for every dollar of white income.”

Update: Addendum December 22, 2009

I had initially put this together as an email response to some friends but have since found it to be a bit more useful and, therefore, wanted to give it an actual post.  It has drawn some criticism, some of which is valid and deserving of response.  My primary point is to challenge what remains an absolutely false notion that somehow this concept of “buying power” speaks to genuine economic strength among Black Americans (or most others).  “Buying power” is a marketing phrase designed to assist businesses, almost all white and with no concern for the lived experiences of Black people, in targeting populations based on patterns of spending.  “Buying power” should not be confused with wealth nor should it be confused with equally false notions of “progress.”  In this case “power” means an ability to enrich others’ businesses.  “Power” in this case has absolutely nothing to do with traditional struggles over control over one’s (or a community’s) land, labor, politics or culture.  This “power” means only the ability to positively impact the bottom line of a corporation.  The problem, my primary point of concern, is when this point is lost and people tout these numbers as an opportunity for liberation lost on the mindless activity of a free but irresponsible or stupid population.

One possible flaw in my argument below is that I equate credit or loans (in the example of an automobile purchase) with the marketer’s claims of “buying power.”  In fact, as the Selig Center states accurately in their own definitions and reports, “buying power” refers only to “disposable income,” or “the total personal income available for spending on goods and services after taxes.”  Further, “Simply defined, buying power is the total personal income of residents that is available, after taxes, for spending on virtually everything that they buy, but it does not include dollars that are borrowed or that were saved in previous years. It is not a measure of wealth, and it does not include what tourists spend during their visits.”  This, however, remains unclear.  Their definition of “buying power” as not including “dollars borrowed” in “previous years” seems not to discount money borrowed in that same year.  If so, my point below would indeed be sound as credit card debt or car loans from that same year would be counted as “buying power.”

However, again, the intent is to assist businesses not to alleviate planned or necessary poverty.  These arguments of “buying power” are also to assist in myths of poverty being the result of pathological habits among Black and other populations whose innate flaws are beyond even the ability of the most magnanimous of civilizations.  Then the numbers associated with this “buying power” can falsely suggest that were only these savages more responsible with their money poverty and economic inequality would simply disappear.  My own error was in not making more clear that one problem I have with these calculations is their definition or explanation of  “disposable income.”  If, as stated below, the average Black household has a median net worth of less than $6,000 and there has been a 30+ year decline in workers’ real wages overall the response to which was increased credit to maintain absurd spending levels then where is the “power?”  If most income is spent on the basic necessities of survival (food, clothing, shelter) then how is it “disposable?”  How can something be called “disposable” or meant to convey “power” when, as the Selig report says, the top 5 expenditures for Black people include “phone services, utilities and groceries?”  Are these truly to be considered gratuitous purchases along with the other clothing and footwear?  Even if we assume that most of the clothing and shoes purchases are beyond absolute necessity are we still to assume that Black people are poor because they spend too much on phone, electricity and food?  Perhaps more importantly, should buying food and phone use be allowed in any society to result in the kinds of poverty faced in the U.S. by Black people (or anyone else)?

It is for this reason that I attempt below to place Black America within a global context of colonialism.  This is the basis of my argument that Black people (indeed almost everyone) are not capable of purchasing assets (stocks, land, property, etc.) because so much of their “disposable” income is used for basic needs leaving only access to more frivolous items.  Colonized populations have no access to the most wealth-producing elements of a society and are forced/manipulated/relegated to basic necessities or the fruitless results of conspicuous consumption.  This is the point of a capitalist economy.  The goal in such an arrangement is to have that which does increase wealth (and then, of course, societal control, political power, etc.) to be in the hands of a few.  No system or society is designed to allow any and everyone an equal opportunity to rule it.  This was precisely his point when Malcolm X made clear that “It’s impossible for a chicken to produce a duck egg… a chicken just doesn’t have within its ystem to produce a duck egg.  It can’t do it.  It can only produce according to what that particular system was constructed to produce.  The system in this country cannot produce freedom for an Afro-American.  It is impossible for this system, this economic system, this political system, this social system, this system, period…  And if ever a chicken did produce a duck egg, I’m certain you would say it was certainly a revolutionary chicken!”

From Original Post March 12, 2008

Myths of Black America’s “buying power” continue to confuse just how bad things really are or how this “permanent recession” is an economic and social necessity.  This myth is meant to shift the blame of poverty onto the poor and suggests that economic inequality is more an issue of pathological behavior than a scientific inevitability.  In a speech delivered on Black Power (see below) Kwame Ture accurately cut through the morass of madness known as “economics.”  He stated simply and clearly, “a man is poor because he does not have money.  Period. If you want to get rid of poverty you give people money.  Period.”

The Myth of Black “Buying Power”

Jared A. Ball

Achieving economic clarity is a bit more difficult than it would appear.  The myth of Black “buying power” resurfaced yet again in February as more “news” was released from African American/Black Market Profile (AABMP).  The myth, now updated,  projects that this “spending power” will reach $1 trillion by 2011.  This mythology of an African America whose national economic strength rivals that of most countries is consistently misunderstood, improperly quoted and ultimately used to deny the outrageous inequality and exploitation this country still requires to maintain itself as the single superpower/empire.

First and foremost the initial report cited needs to be understood for what it is and its purpose which, as is as they say atop their report, “The Market Profiles gather and synthesize the most recent findings from dozens of sources in order to help marketers communicate more effectively with these important consumer segments” (emphasis added).  So these numbers are floated not for their accuracy regarding Black people’s economic standing but for their ability to tell which corporations should more aggressively target their marketing (psychological warfare) towards African America to get what little money actually is held there.

Part of their projections are based on the percentage (30.2) of African American households whose income is more than $50,000 per year.  Somehow this is meant to convey a sense of economic progress or sustainability.  Not considered in this report is that if the poverty line in the U.S. (a number already itself designed to hide poverty) is set so as to only count those in poverty who live in households of 4 earning less that $20,000 annually then, of course, a $50,000 would appear stronger than it actually is.

The AABMP report, however, references for its numbers a study from the Selig Center for Economic Growth whose numbers also must be held in question.  Their justification for suggesting in 2006 that that year would be one in which African America, as the “nation’s largest minority market,” would use their “economic clout” to “energize the U.S. consumer market as never before.”  They cite as evidence such misleading statistics as:

1.  Black population growth

2.  Increased job opportunities

3.  More education for Black America

4.  Only 8.1% of Black America is over 65 years of age or at “career pinnacles” at which point wage increases “decelerate,” whereas, whites are 13.5% over 65.

5.  Black people spend more than “non-blacks” on natural gas, electricity, telephone services and footwear and a higher proportion of their money on groceries, housing and women’s and girl’s clothing.

6.  And this author’s personal favorite, that despite “a substantial gap in homeownership rates” this ‘suggests a possible opportunity for market expansion in the years ahead.”

We must be clear.  Income is not wealth.  “Buying power” as a phrase and one measured in these ways offers so many illusions that contradict the previous point.  Population growth and increased jobs (increased from what?) do not, in and of themselves, say anything about economic power.  More education means little as well when advanced degrees are considered an absolute necessity for economic advancement (certainly still no guarantee) and even their own report (p. 9) shows that in 2005 only 19% of African America earned a Bachelor’s degree or higher and the percentage of that population who earned a graduate professional degree was so low as to only warrant an “N/A.”

It is also important to note that “buying power” is a confused phrase in that it, again, says nothing of a wealth Black people have little of but also suggests that this “power” is or can be for community uplift.  The fact, again, that this is target marketing material means that by “power” they mean the ability to generate money for corporations to whom this spending will be geared.  It does not mean that Black America has some un-tapped economic strength that can be marshaled to buy that which increases wealth (land, stocks, etc.) and speaks to the basics of colonial exploitation.  That is, that the colonized are left only to purchase trifling gadgets and trinkets “footwear” and “clothes,” as opposed to land, stock and other capital most of which is sequestered among the tiniest elite minority.

And finally, it is sadly laughable that too many of us are fooled into thinking our power is squandered by poor purchasing habits, again, since this is all to which we have access anyway.  The idea that land and stock is there waiting but we’d rather go to the mall for trinkets results from mass capitalist, white supremacist propaganda which too many of us have imbibed.  So, in fact, the suggestion in 2006 that homeownership represents “a possible opportunity for market expansion” was a precursor to the damage and pain most are seeing only now; predatory lending, sub-prime scandals, mortgage and home foreclosure and the what United for a Fair Economy (UFE) recently reported as “the greatest loss of wealth for people of color in U.S. history… {upwards of} $200 billion.”

Black people, like most others, are an exploited, colonized population whose wealth-generating capabilities are, just as these reports really say, for an elite who have nothing to do with Black people.  Black wealth resides in elite white enclaves here and abroad while African America devolves economically, politically and in terms of healthcare, education (quality of and access to), police brutality and mass incarceration.  And even within Black (and Latin) America 25% of the households have 90% of the wealth demonstrating a great divide within communities where Black median net worth is already a pathetic and dangerously low $5,988 and $7,932 for Latin America compared to $88, 651 for whites.  Black people have no money.  We spend on credit and loans (none of which is considered for either of these studies) so as to project a “power” that we in fact are far from having.  Rarely does anyone have in their pocket or account the $20,000 for a car or $30,000 (and way up) for one year of college.  We take loans for these and other purchases which then count towards our “spending power.”  The debt we fall into this way and others (i.e. credit cards) is counted as a “positive” by those to whom our pockets are perpetually emptied.  But this is not and can never be “power.”

Anyone, including Black “leaders,” who parade fanciful numbers before their unsuspecting audiences so as to, again, suggest that irresponsibility is the cause of Black poverty need to be checked, vigorously.  We need to get back to an increased intelligent and honest discussion of economics so we can be where Ture was when he left, as he and his comrades always said when answering a phone and saying goodbye, “ready for the revolution.”

12 Responses to “The Ever Enduring Myth of Black “Buying Power” (2014)

  • Thank you for this. It is as clear as it could be and applicable to Africa especially in terms of real investments in education and assets as opposed to conspicuous consumption….all the way from the slums, via the small farmer and the middleclass office worker.

  • [Black] People need to know that just because they [we] live in a predominately capitalist system, does NOT make them capitalist nor even ‘entrepreneurs’. Most white folks in the US [let alone Black folks] are NOT capitalist [though most likely neither are they socialists], but are rather consumers of products [often 'junk'] made by, &/or [most often under-paid] labor for, &/or even victims of- this capitalist system.
    If you’re nowhere near the income level of Lebron, Kobe, RG3, Mike Vick, JZ & Beyonce’, Kanye’, Denzel, Venus & Serena, Tiger Woods, etc- but you think you’re a so-called ‘capitalist’, you’re simply fooling yourself. In fact IMO even most of these so-called ‘success’ stories are actually ‘quasi-capitalists’ IE: just well-paid ‘hired-guns’ for real capitalists [Oprah, Michael Jordan, Magic & Bob Johnson MAY actually qualify as real capitalists].

    Black folks [& people generally] need to understand what capitalism really is & what qualifies you as a real capitalist- before they give knee-jerk reactions against so-called ‘socialism’. For a working-stiff ‘slaving’ on 2 gigs trying to make ends meet or some unemployed guy who’s struggling to even find work- argue vehemently for capitalism & against so-called ‘socialism’- is proof just how much capitalist PR propaganda has warped most folks thinking.

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    When it comes to the [NOI's?] adage ‘Buy from self’ & ‘Do for self’, IMO there’s basically 2 models- 1 small business owner / entrepreneurs [IE: mom & pop stores & old fashioned family farms] & or worker &/or community owned / run business co-opts. But the fact is BIG BIZ capitalists have nearly swallowed-up &/or driven out of business traditional small businesses [ala mom & pop stores] & even family farms. Under the current circumstances the only independent [of the standard capitalist model] businesses that have a chance for survival let alone thriving is worker &/or community owned/run co-opts [IE: towards a more 'socialist' model]. Otherwise the average ‘consumer’ [Black or otherwise] is forced to spend their hard-earned $$$ w the Wal-Marts, Sears, Jewels & Dominicks of this capitalist system!

  • Good article. The way you describe buying power you make it seems as only a one way street that goes in the directions of the corporations. Businesses do respond to their customers’ buying habits and preferences and they respond it kind. Buyer have a lot influence over the color, shape, taste, smell, and feel of a product. They also influence how a businesses employees interact with the customer or customer service. That’s the basic premise behind a boycott. People stop shopping with you and your business suffers. It works all the time.

    Having said that business generally benefits more than the consumer. That’s because there are more consumers than businesses. So, if a 100 consumers give $5 each to one business owner, he just made $500 or 100 times what they spent because 100 went to 1 person instead of 100 people going to 100 other people. Large amounts of income can be made if you own a business than if you work for someone else because money is concentrated in one area instead of scattered among the many. But, you seem to be against this in favor more govt. jobs or jobs dependent on govt. spending or the outright handing over of money by the Govt./business/the rich. I don’t think you have to equality in every facet of life in order to have prosperity or success for individuals or groups. Even in Cuba or the former Soviet Union there was income inequality and wealth and power are concentrated in the hands of the few vs. the many. The Castro Bros. are doing quite well compared to the average Cuban who if he/she has a car, it’s an 1960s or 70s soviet vehicle. I would like to see socialists and communists who criticize capitalism explain why the Soviet Union collapse and discuss the standard of living experienced by people in Russia, Eastern Europe, China, and Cuba during the height of Communism in the 50s, 60s, and 70s. We need to have a balanced discussion about economics and how it works and not just propaganda and criticism. Furthermore, we need to have a balanced and honest understanding of how human societies work. They are very hierarchical and always have been and always will be. Not only do people at the top do better than those under and even exploit those under them, people want and expect to their leaders to be prosperous. Nobody follows somebody who’s equal or lesser than they are. There will never be this Utopia of Equality that many on the left long for. We can only make structural (legal) reforms but you’re never gonna have total equality among individuals or even groups. People have different strengths, talents, or gifts. Would you put weights on the fastest sprinter’s legs in order for the other sprinters to have a chance to catch him? No. So, why put weights (heavy taxes and regulations) on those that have money or are entrepreneurial?

    The other problem I have with your premise is that denies black people have any agency or responsibility for trying to improve their plight. You seem to be saying it starts with the white man and therefore, it ends with him. Nike and these other shoe companies wouldn’t be so rich if it weren’t for black consumers. While it’s true that racism creates the conditions for people to be born in poverty, but it’s not the primary thing that keeps them there. Black people have got to get back to making tough decisions to improve their situation. Better spending habits is one simple area where we can do this.

    Disposable income is what’s left over after taxes and essential expenses. It’s for miscellaneous expenses like dining out and entertainment or for savings and investment. Now, your greatest point in the article is that most people, black or otherwise, don’t have much disposable income after taking of their living expenses. But, that’s where better buying habits, saving, and investing come into play. You can’t say you’re doing the best you can when you pay for your hair and nails no matter what, but you won’t pay for your life insurance or even your rent. It’s not white people’s responsible to take care of us. We have to do that and that’s the sentiment that’s meant to expressed when black leaders chastise their followers. It’s out of love not to browbeat or put them down.

    What I would like to know is who is keeping stocks and land from blacks who have the money and credit for them? What’s stopping people from doing their due diligence and research on an investment. A lot of people got bad loans because they were too trusting and didn’t read the fine print and ask questions. They were also being greedy and thought they were getting over and got caught up. Now, they’re paying for it! It’s not just the banks’ fault. White people have more net worth because they own land even if they are cash poor.

    Finally, this article falls short where most black analysis fall short. It failed to present and develop a solution or solutions to our problem. It just diagnoses it. What should we do independent of white folks and the govt in order to increase our wealth, health, and prosperity. A free people can’t truly be free as long as they’re dependent on others. I don’t see anything here that helps us get past that.

  • Oraluk, thanks, but there are many problems with what you said:

    1. You said, “The way you describe buying power you make it seems as only a one way street that goes in the directions of the corporations. Businesses do respond to their customers’ buying habits and preferences and they respond it kind. Buyer have a lot influence over the color, shape, taste, smell, and feel of a product. They also influence how a businesses employees interact with the customer or customer service. That’s the basic premise behind a boycott. People stop shopping with you and your business suffers. It works all the time.” There is no equal balance between labor and big business. Corporations have an increasing control over every aspect of our lives and their executives and owners are making more money than ever with greater disparities between their pay, what is produced and what labor is paid for that production.

    2. Your description of Cuba, the USSR and downfall of socialism and communism is too rife with simplicity and error for me to really deal with. But as Kwame Ture said, “you judge ideas on their principles, not their application.” What does the Russian revolution look like if the West (roughly 15 countries) don’t immediately invade, blockade, assassinate, etc.? What does Cuba look like if not cut off from the world and having to stave off the USA all this time? I don’t know. But to suggest these things are the outcome of flawed systems is ridiculous. So yes, Cubans drive older cars. But those cars work and dont require the recreation of abusive relationships to keep making more to satisfy the equally fraudulent desires for new purchases. I’ve been driving the same car for 7 years, does the mean im slowly devolving in my humanity?

    3. You’re reduction of my argument to agency and the white man is also misplaced and wildly simplistic. Telling people they are poor because they have bad spending habits and target marketing to them at the same time all occurs to blunt the agency in a people who might realize the game is rigged, organize around that fact and initiate a revolution. Encouraging people to further buy into the myths of capitalism does more to deny agency.

    4. Then here you say, “Disposable income is what’s left over after taxes and essential expenses. It’s for miscellaneous expenses like dining out and entertainment or for savings and investment. Now, your greatest point in the article is that most people, black or otherwise, don’t have much disposable income after taking of their living expenses. But, that’s where better buying habits, saving, and investing come into play. You can’t say you’re doing the best you can when you pay for your hair and nails no matter what, but you won’t pay for your life insurance or even your rent. It’s not white people’s responsible to take care of us. We have to do that and that’s the sentiment that’s meant to expressed when black leaders chastise their followers. It’s out of love not to browbeat or put them down.” This misunderstands the point you say you are critiquing. Yes, I am saying that Black people have no money and, therefore, cannot be said to be poorly spending themselves into poverty. So even, following your logic, if Black people stop buying hair, etc. and pay their “rent” as you accurately say (since so few people actually own anything) or their life insurance bill they will still be poor. Paying rent and life insurance, to my point, is not a method of increasing wealth – even income. By the way, to suggest that Black homelessness and poverty exists because people willfully choose to ignore their rent in favor of frivolous goods and therefore are put in the street suggests you know very little about poverty or the decision making processes of poor people.

    5. Then you say, “What I would like to know is who is keeping stocks and land from blacks who have the money and credit for them? What’s stopping people from doing their due diligence and research on an investment. A lot of people got bad loans because they were too trusting and didn’t read the fine print and ask questions. They were also being greedy and thought they were getting over and got caught up. Now, they’re paying for it! It’s not just the banks’ fault. White people have more net worth because they own land even if they are cash poor.” Here is part of the answer to your question,

    “In terms of types of financial wealth, the top one percent of households have 35% of all privately held stock, 64.4% of financial securities, and 62.4% of business equity. The top ten percent have 81% to 94% of stocks, bonds, trust funds, and business equity, and almost 80% of non-home real estate. Since financial wealth is what counts as far as the control of income-producing assets, we can say that just 10% of the people own the United States of America; see Table 3 and Figure 2 for the details.”
    source link: http://www2.ucsc.edu/whorulesamerica/power/wealth.html

    My point is that there is no stock to buy, even if you miraculously had the money. 1% have 35% of the stock. They are not looking to sell, this is how they ensure they will remain in the top 1%. No one is going to sell you their wealth, that is not how things work and would defeat the purpose of capitalism whose purpose is to use wealth to maintain power over the labor (and everything else) of the rest of us.

    6. And finally, I always am fascinated by those who point out the “flaws” in societal criticism that does not “offer a solution.” This, first of all in nonsense for several reasons which include the fact that this response is already in disagreement with the assessment which means they would most certainly be in disagreement with the proposed solutions. Especially in this discussion. People who believe that poor people are poor because they dont know how to spend and save their pennies cannot possibly believe in any of the proposed solutions that come from people suggesting otherwise. And of course, there is also the point that those who already accept the established myths about poverty only suggest as “solutions” that which leads people back to or keep them in poverty in the first place, “pay your rent instead of buying hair…” and the rest of that nonsense. And, of course, very lastly, and where I probably should have started; these numbers about “buying power” are absolutely unsubstantiated and based in nothing that resembles reality. So even accepting that premise means there can be no fruitful discussion, conclusion or outcomes.

  • Thank you for your reply. Most professors wouldn’t have because they have a “how dare you challenge me” attitude. I appreciate that you did respond. Your students at Morgan State are lucky to have you.

  • People who have never studied economics or have no knowledge of the tools used in calculating these numbers would believe the idiot who wrote this article. Don’t be fooled black people there is power in numbers and we do have numbers. He said we would be the 16th richest nation studies suggest the ninth. We are not African Americans we are Africans born in america! Just keep believing these house negros that don’t want to separate from their slave master!

  • Gwiz, excellent piece, but always to be read in context!
    often I wonder why this message persists, and yet, evidently, it owes to much confusion

    There was a book apparently published at the turn of the century, 12 Things The Negro Must Do For Himself by Nannie Helen Burroughs (1900s) which claimed that the nonwhites must utilise their buying power and yet, was this an “up from slavery” (boot–strap) approach which associated collaboration with liberation? if the critics rubbish this notion is it because the nonwhites do not possess enough resources to make a significant contribution to their own enterprises, never mind, to finance their liberation?
    are critics, such as Franklin Frazier (1950s) and Clarence Walker (2000s) argue against this “pooling” notion because these nonwhite denizens do not make up a significant group meaning their “purse” is of little consequence?
    I am confused…

  • You say black spending power is a myth, where you been? And that blacks have no money bullshit. We are the 16th richest nation on earth. The problem is we spend on ninety four cents of every dollar outside our community. And as for twenty grand for a car and 30k for an education, the average white family ain’t got it either. 1 percent of the population in the usa controls 96 percent of the wealth the rest of us are scraping the bucket for crumbs. Buying power got nothing to do with wealth creation, nothing. African-Americans collectively got about 700 billion in total combined annual income. Married couples in the black community make about somewhere between 60-80k a year, young single college educated folks about 35k 40k, but single moms in the black community make about 20-26k at best, especially without college education and without a diploma forget, they getting 22k if that. They out of gas. Also the out of control spending habits among the black underclass in particular is rooted in low self-esteem, low aspirations for the future, and a complex from being broke all ya life. Also it’s a focus on lack. But most importantly, it’s do to having no discipline their own lives. Group economics is the solution to all of our problems. Cause a strong economic base will provide automatically the infrastructure we need for nation building. We would own businesses that create jobs, increase tax base, finance education, and afford us healthier living. We would control the schools and the curriculum to educate our youth, and we would own homes and rental properties which would give our families and our children particularly a sense of stability. But this can work with those who have an eye to see and an ear to hear. But those who choose to forbear are gonna wish they had, but it will be too late. Like my mother always said “if ya don’t hear you gonna feel “.

    • Orlando, did you actually read and/or listen to what is posted here? Your point about the 1% and buying power having nothing to do w wealth is precisely my point. How can Black people be 16th richest nation and control no wealth? That’s illogic at its best. The fact that so much is spent outside the community is also the point. “Buying power” and “16th richest…” are marketing myths, not reality which is why there are barely any Black owned businesses to keep the money in the community. Black people do not control the economy and have little real economic power. I agree that collective economics are required so much so I claim socialism as necessary. Further, an 80k household income is not wealth and most of that money is spent on survival and cannot be used to achieve genuine power. I really wish you and others would pay closer attention to my argument and all the evidence posted here and then address the specifics of the argument and offer real proof of error rather than just saying dumbness like that’s “bullshit.”

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