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<text id=93TT1659> <title> May 10, 1993: The Gospel of Equity </title> <history> TIME--The Weekly Newsmagazine--1993 May 10, 1993 Ascent of a Woman: Hillary Clinton </history> <article> <source>Time Magazine</source> <hdr> CITIES, Page 54 The Gospel of Equity </hdr> <body> A new generation of black leaders is preaching a monetary message: Get capital and build wealth By SYLVESTER MONROE/LOS ANGELES In Los Angeles, where convenience stores are as common as palm trees, the opening of yet another one would normally attract little attention. But in the burned-out zones of South Central, where the riots began just over a year ago, the grand opening of the Mom & Pop community convenience store was seen as a major event. The excitement wasn't just because a new business had sprung up where hundreds were destroyed last spring. It was because this particular store is financed, owned and operated by African Americans. That should not seem surprising in a predominantly black neighborhood, but in fact almost all the grocery stores in the area are owned by Korean Americans, a situation that has become increasingly politically charged. "This is black people doing something for ourselves," says Mom & Pop manager Myra Allen of the alcohol-free shop, which was funded with $500,000 from Los Angeles' Brotherhood Crusade Black United Fund Inc. "We always talk about what we are going to do and never do it. This time we're doing it." The store represents a fundamental change in the way black leaders are approaching the problems of the inner city. In the wake of the Los Angeles riots, economic development has emerged as the hottest crusade in black America, replacing the emphasis on politics, civil rights and social programs that marked the previous generation of black activists. In Los Angeles, for instance, virtually every black church and community organization now operates some sort of economic program, from economic-literacy and job-training classes to community loan funds. "You can spend all the money you want on social programs supported by liberals, you can enact all the enterprise zones and tax breaks conservatives might want, and it won't help," says Errol Smith, 37, who hosts a black-business radio talk show in Los Angeles and runs a $5 million custodial services company. "Black people need to focus on enterprise." Though the pursuit of economic power has been advocated by virtually every black leader from W.E.B. Du Bois to Jesse Jackson and Louis Farrakhan, it was never as high on the black agenda as the righting of social wrongs by marches, boycotts and voter registration. The startling revelation of the Los Angeles riots was that even in a city with a black mayor and large numbers of black elected officials, black leaders were out of touch with their communities. While waging battles in the corridors of political power, few paid much attention to the underlying economic causes of the riots. At the forefront of the new movement are two leading proponents of urban bootstrap economics: Danny J. Bakewell, a wealthy real estate developer and president of the Brotherhood Crusade; and the Rev. Charles R. Stith, president and founder of the seven-year-old Organization for a New Equality (ONE) in Boston. Both men are pushing versions of the same idea: that economics is the key building block of political power. As Stith points out, in the U.S. the median white family's net worth is about $43,000, in contrast to $4,100 for the median black household. "The inescapable conclusion," he says, "is that we need economic reinvestment and community renewal in urban America if we are going to counter the frustration that fueled the destruction and violence in L.A." Stith, 43, pastor of the 500-member Union United Methodist Church in Boston's South End, points to a potentially powerful legal tool for achieving these goals: the Community Reinvestment Act of 1977. It requires banks to make loans to low-income individuals or poor-risk companies in their own neighborhoods. It has been widely used to counter mortgage redlining and has proved a boon to the nation's 40-plus black banks. Now Stith and others believe that the act could be a significant weapon for black progress in the '90s. "It's important to be able to have access to ride in the front of the bus," says Stith. "But at some point you've got to be concerned about the ability to own the bus company. The Community Reinvestment Act is the leverage we need to get access to credit and capital to buy the bus company." Stith's ONE has invoked the act to persuade Boston banks to invest $500 million in the city's minority communities over the next 10 years. ONE has also created a network of organizations in 38 cities to bring bankers and black community leaders together. In an often acrimonious racial climate, says Stith, the network provides "a place where people can check their guns at the door and still talk about some of the real opportunities." This year Stith's group plans to launch a national campaign to improve black economic literacy. Through neighborhood classes and seminars, the effort would teach such skills as obtaining credit, shopping for interest rates and building equity. It would also teach historically bank-wary blacks, who often pay as much as 20% of the face value of checks to cash them at check-cashing outlets, how to use banks. "We need to learn how to use our money more wisely," says Stith. "We've got to begin to think with an economic mind." That message already appears to have hit many mainstream black leaders. "There are new realities that are thrust upon us, and we can't operate as if the social realities are the same as they were in 1970," says Joe Hicks, executive director of the Southern Christian Leadership Conference in Los Angeles. "The world has changed." The National Urban League, one of America's oldest civil rights organizations, has always focused on education and job training. This spring, using a two-year, $1 million grant from Atlantic Richfield, the League's Los Angeles branch will open a business development and training center to teach black would-be entrepreneurs the fine points of starting and managing their own businesses and to provide technical assistance and information for existing small-business owners. Last December, with a similar $1 million grant from the Walt Disney Co., the city's First African Methodist Episcopal Church launched a Renaissance Program of 20 entrepreneurial projects. Among them: a loan plan that the church's pastor, the Rev. Cecil Murray, says will renovate 35 existing black businesses in Los Angeles, start up 35 new ones and employ 350 people. "Spiritual development cannot take place without economic development," Murray says of the church's economic gospel. Says Danny Bakewell: "It has to be an active principle. It is not something that you can just talk about on Sunday. To make it believable, we need successes." Some of the tactics used in the service of the new gospel are controversial. Bakewell, for one, is often accused of practicing racial politics to advance his causes. Last summer he tangled with white contractors who had construction projects in South Central Los Angeles but did not employ any black workers on their crews. Even though some of the crews had Latino or Asian workers clearing the wreckage of buildings destroyed in the riots, Bakewell led marches on the sites, forcing them to shut down. "I'm saying if black people don't work, nobody works," he explains. "Latinos working is not going to feed black children. Koreans working and operating businesses is not going to help black people. We acknowledge everybody else's suffering. But who is it that cries for us? If there is anything that makes me stand out, it is that I refuse to put our agenda on the plate with everybody else's. When I show up, people know that I am there in the interest of African Americans." What also distinguishes Bakewell is his business background, since mainstream black leaders have traditionally come from the church. Formerly a bank president, he is now a developer. And since becoming president of the Brotherhood Crusade 19 years ago, he has built it into one of the most successful black charities. The Crusade, whose 11 full-time employees operate out of a brick building in South Central, is supported primarily by voluntary payroll deductions from black workers in federal and local government as well as the private sector. Total annual budget: $2 million. Bakewell donates his $85,000 salary back to the organization. The Crusade's guiding principle, now spreading through black organizations across the country, is that black people can succeed by relying upon one another without depending on money or direction from the government. "The beauty of it is that we don't have one wonderful white man giving us a million dollars a year," says Bakewell. "We've got 100,000 black people giving $10 and 100,000 black people giving us $1, and that becomes a spigot that you can't shut off." </body> </article> </text>