We Need a Black Economic Renaissance

Your Take: Innovation and entrepreneurship are the only ways to combat African-American unemployment.

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When the U.S. Census Bureau reported that 46.2 million Americans were now living in poverty, it wasn't a stretch to guess which group of Americans topped the list: African Americans. This was no surprise, given the black unemployment rate of 16.7 percent, nearly double the 9 percent national rate. The Pew Research Center recently noted that the median wealth of white households is 20 times that of black households. If current economic trends hold, that income gap will likely grow.

Some lawmakers, pundits and academics have insisted that President Obama should come up with an economic plan targeted at helping the hardest-hit African Americans, but it is no fairer to expect Obama alone to fix the problems of black America than it is to suggest that he created the country's economic dilemma in the first place.

The reality is that the good manufacturing and blue-collar jobs that were once a ticket to the middle class for many people had been drying up for years, long before the recession began. As America redevelops its economy, now is the time to redesign a black economic infrastructure, rooted in innovation, entrepreneurship and global trade -- all of which are important for job creation.

President Obama made this very point during his speech at the Congressional Black Caucus gala on Sept. 24. "This is the land of opportunity," he said. "I want you to go out, start a business, get rich, build something."

The fact is that over the last three decades, new startups by innovators and entrepreneurs -- companies less than five years old -- have accounted for nearly all newly created jobs in the private sector. The scarcity of these dynamic, fast-growing companies in black communities has contributed to some of the chronic unemployment we see today.

Rediscovering a Black Tradition

Innovation and entrepreneurship aren't new ideas in the black community. From Thomas Jennings, the first black patent recipient -- for a dry-cleaning process -- to Lewis Latimer, who invented a method of making carbon filaments for the electric incandescent lamp, African Americans were prolific innovators and entrepreneurs during the 19th and early 20th centuries.

In 1907 Booker T. Washington said, "Every member of the race should strive to be successful in business, however humble that business might be." More than 100 years later, African-American men are one third as likely as white men to be self-employed. In addition, African Americans are seriously underrepresented in corporate boardrooms and the upper echelons of fast-growing smaller companies. There are arguably structural factors that have caused this imbalance, such as lack of capital and credit, lack of knowledge about business opportunities and lack of professional networks needed for business success.

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The Obama administration has been working diligently to create an environment for businesses to start and flourish in several ways: by working to free up credit, increasing small-business loan guarantees, enhancing opportunities for small firms to do business with the federal government and opening additional markets abroad through new trade agreements. Closer to home, we simply must focus on owning more businesses and creating high-paying jobs in all communities.