Quite frankly, I have to admit that, unless we in Philadelphia actually do something differently than we have, to date, about our economy, my expectations that we will really have a “Happy New Year” – for blacks, for minorities and for whites, are not that great.
The definition of insanity, it’s often said, is doing the same thing that you’ve always done and expecting a different outcome.
Make no mistake; 2009 was "no joke" economically, especially for black Americans, who, nationwide, suffered the highest unemployment levels, extraordinary rates of business failures, losses of up to $213 billion in foreclosure-related real estate wealth, and many broken families, as a direct result.
With all of that as backdrop, and with 2010 staring us all in the face, we simply cannot afford to repeat the same, ineffective, political and economic approaches, in the year to come.
Even as our economy continues to lose jobs at an alarming, record-setting rate, the fact is that no one in our national government is actually responsible for job creation. According to the increasingly powerful right-wing conservatives in our country, that kind of economic planning would be, somehow, too much like “socialism.” That's ridiculous.
The current business model stipulates that if large businesses want to hire people, then we will, as a consequence, have jobs. On the other hand, if they choose not to hire, then we simply won’t have jobs. That, our elected officials carefully explain, is part of the free-market system that we’ve lived by, now, for 222 years. It is, after all, the American way.
The problem is that such an approach includes absolutely no incentive for large, publicly traded corporations to create a single, new job--not one.
In fact, over the twelve-month period ending November 1, 2009, the 500 largest U.S. companies laid off 630,118 persons, including, in just the past three months, 8900 at Johnson and Johnson, 5,376 at Time Warner, 13,750 at Alcoa, 10,250 at Sprint/Nextel, 52,175 at Citigroup and 8,308 at Verizon.
Top executives at large corporations such as those get hired, promoted and handsomely paid for generating revenue, for creating ever-larger profit margins for their company’s products and services, and for doing what’s referred to as “enhancing share holder value," i.e., creating more wealth for the company’s investors. There’s absolutely nothing in the job description for most CEO’s that requires, or even, encourages them, or their companies, to create employment.
They also know that, under the current U.S. business model, the quickest way to reduce expenses, and increase margin, is to lay off thousands of people, and so they do. If they can improve their company's profits and create more wealth for their investors by having their company’s work done in places such as Indonesia, China, Thailand or Costa Rica, they do so-- in a “New York minute.” In fact, that’s precisely what they’ve been doing, and the major reason for job losses in our country.
Wage levels in the United States, according to a recent report by the World Bank, stand at $37,500. At the same time, wages in China are at $4990; in Indonesia, at $3210; in Thailand, at $7450; in Costa Rica, at $9040; in Sierra Leone, at $530, and in the Congo, at $640. It’s pretty easy to see why, when given the choice, under the current business model, our largest corporations continue to ship jobs over seas, despite all of the recent political rhetoric to the contrary.
The major source of net job creation in the United States over the past 25 years has been micro and small businesses. Those are the companies that will hire local people, if and when they do get a new contract. But, in this economy, their contracts, too, have been shipped overseas.
If we don't really address this problem, we will not have more farm workers, here; more call-center workers here; more cars, planes, DVD players, flat screen TV’s or laptop computers built here. The current crisis is not, in any way, as the tv pundits are fond of saying, just like the Great Depression, when our businesses relied almost exclusively on U.S. workers. It's worse. The economy is, simply, not going to "come back," of its own accord. This is not one in a series of normal business cycles, this is a "sea change," and if we don't take pro-active steps to fix it, the U.S. may very well become the next Portugal, the next Belgium, the next Roman Empire.
If you think I’m kidding, just go out or look online – right now – and see how many U.S.-made, flat-screen TV’s or laptop computers you can find. Or better yet, walk down the aisle at your neighborhood Wal Mart and see for yourself if it’s not true that 80 percent of every product on all of those shelves is made in China.
Years ago, products sold in U.S. stores were made largely in the U.S. Years ago, food sold in U.S. supermarkets was grown largely in the U.S. … not now. As compared to just a few generations ago when 50 percent of Americans worked on farms, today, less than two percent do.
If this is all starting to get a little too “global,” let’s break it down to a local, neighborhood level. Chances are you have heard me and others talk over the years about the need to “buy black,” if we wanted to create jobs at black-owned retailers and their suppliers.
Some people, not black people yet, unfortunately, are really starting to understand how that's supposed to work. For example, I was passing through Haddonfield, New Jersey, over the past two weeks, and saw that most of the town’s shops had little posters in their windows, with a close-up head shot of Santa Claus wearing a red, white, and blue "Uncle Sam-type" top hat. Under the picture were the words: “Buy Local.”
Haddonfield "gets it."
In the same way, over the past six or seven years, we have proposed to each of the last two Philadelphia mayors, and to each of the last two presidents of the Greater Philadelphia Chamber of Commerce, that the City, the 100 largest local corporations, and the entire five-county southeast Pennsylvania area, launch a program to begin to purchase at least 20 percent more of the goods and services they buy annually from local businesses – including a fair representation of black and minority businesses.
The annual purchases by these companies constitute billions of dollars. Bringing back just 20 percent of that amount from companies in California, Ohio, New York and India for contracts with small businesses and micro businesses, here, would definitely create new jobs.
“No skin off the companies' backs,” no significant changes in the amounts they spend overall, just a conscious plan to spend more of it locally and to include, this time, small and minority businesses.
If we’re as serious about creating new jobs in Philadelphia, as our elected officials have recently been saying we are, then we will certainly need to change our individual and business purchasing patterns, in programs such as that.
This year, let’s actually try to do something different to achieve local, small and minority job creation in the Philadelphia area---even if the federal government is, so far, still slow on the uptake.
It would be a significantly positive step for local job creation to see Mayor Nutter and the members of City Council join forces with the Greater Philadelphia Chamber and with the Black, Hispanic and Asian Chambers to get that ball rolling.
In the midst of the worst job market and economy in recent memory, just talking, once again, about jobs, in 2010, will be absolute insanity on our parts.
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