Black Women: Diversity and Inclusion Programs - Are they really assisting?
In the last few decades, researchers, policymakers, economic development experts, and analysts of public policy are increasingly concentrating on the aspect of entrepreneurship in the African-American community, with respect to devising distinct strategies for facilitating economic success. Establishment of set-aside initiatives for minorities (or disadvantaged business initiatives) is one political strategy which serves as an instrument for enhancing small, poor businesses' chances of survival. Several of these businesses were African-American-owned and -run businesses (House-Soremekun, 2007; Chatterji, Chay & Fairlie, 2013). This paper will look into the economics-politics interrelationship, by analyzing the aforementioned disadvantaged business initiatives' effect on African-American businesswomen's economic outcomes.
The research question that this paper poses is: Are the programs (such as the set-aside initiatives) that are designed to support small and disadvantaged (or minority) business owners really successful -- or do they rather perpetuate inequality in the system?
The reason this question is important is because it focuses on a real problem that researchers have exposed -- namely, the that even though African-American women are increasingly employed in the business sector, very few are business owners or shareholders. Yet federal initiatives have been developed for decades that are meant to encourage women to become business leaders. However, as researchers have noted in the past, there is a "frontier myth" that exists in the business world in America and the hero of that myth is the "romanticized cowboy" -- the African-American, much less the African-American woman, does not fit neatly into that narrative (Miller, 2004, p. 47).
The study will examine the experiences of African-American women as small business owners in the city of Cleveland, OH, in order to address this question. The study will conclude by addressing the findings and discussing what it means that African-American women are both encouraged to take ownership and yet at the same discouraged by an inherently bipolar system that strives towards two opposing goals at once.
Policy Background (IN THIS SECTION -- HISTORY OF GREAT DEPRESSION -- READ "WHEN AFFIRMATIVE ACTION WAS WHITE" AND ALSO GIVE PERSPECTIVE FROM THAT ANGLE)
Set-aside initiatives for minorities first developed during the 1930s, with President Roosevelt's Great-Depression-era New Deal initiatives for addressing economic issues (House-Soremekun, 2007). The 1933 Unemployment Relief Act prohibited discrimination against people on the basis of color, creed or race. Requirements were stipulated, making it compulsory for companies that received federal governmental contracts in metropolises inhabited by a large share of Black people to employ a particular percentage of Blacks.
The primary focus of the SBA (Small Business Administration), instituted in 1953, was small-sized largely-White American businesses, rather than exclusively minority businesses. This body grew continually until, in the year 1958, it permanently became a federal agency (Chatterji et al., 2013). In this era, a key area of focus was: offering loans as economic aid to small enterprises, in addition to aiding them with federal contract receipt.
President Nixon's Executive Order (EO 11458) of March 1969 offered the basis for establishing a national-level initiative to assist minority entrepreneurs (Chatterji et al., 2013). The U.S. commerce secretary was assigned the responsibility of overseeing this program, for developing local-, state- and federal- level processes and facilitating long-term growth of minority companies. Therefore, innumerable federal department heads had to present reports detailing the strategy they will adopt for attaining positive outcomes, to the commerce secretary. The result was the Minority Business Enterprise Office's establishment.
As Katznelson (2005) shows, the U.S. Supreme Court has had a history of interpreting the "set-aside" program of the federal government in disparate ways, and its attempts to explain it in view of the Constitution and/or codes of its own devising have caused the waters of the affirmative action movement to become muddied. At bottom, Katznelson (2005) indicates that the affirmative action policy of the federal government is only one aspect of the government's approach to minorities -- and the government is more than capable of exhibiting many faces. With the 1980 Fullilove v. Klutznick case (448 U.S. 448), for instance, the Court ruled in favor of the federal government's "10% set-aside program to aid minority business enterprise" (Katznelson, 2005, p. 219). Yet less than a decade later, the Court would offer up a different take on the issue. The 1989 ruling in City of Richmond v. J. A. Croson Co. (488 U.S. 469) was viewed as a step back for affirmative action because the Court here rejected "a minority set-aside program in Richmond,...
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