Will economic recovery reach black neighborhoods?

Some Americans have begun telling pollsters they’re beginning to wonder when the recovery will start. African Americans are wondering if the recovery will make it to our neighborhood.

The notion of fixing the economy for everyone is an important goal, but without specific measures to address inequities facing African Americans, this goal will not be realized and Black folks will be left in last place once again.

Reading the guidance memo released by the White House Office of Management and Budget (OMB) exacerbates those fears. Nowhere in the 40-page document is race even mentioned.

The American Recovery and Reinvestment Act includes measures for reporting expenditures and tracking performance as part of its transparency and accountability provisions. But there is no requirement of transparency or accountability to track or report related to race or gender. In fact the directive never mentions race or gender.

Recipients of stimulus funds through the American Recovery and Reinvestment Act (ARRA) are under no obligation to track, monitor or report to the federal government on the race of those winning contracts or hired through job creation programs from ARRA funds. In other words, while African Americans are experiencing a greater level of economic pain, the government has no intention of finding out whether the prescribed medicine is working.

The OMB guidance memorandum reporting framework is deficient in the following areas:

1) ARRA fund recipients are not required to track and report data on race or gender.
2) Although geographical data are tracked by recipient, recipients are not required to track employee-level data.
3) Recipients are not required to track the portion of contracts that are awarded to economically disadvantaged or minority owned-business enterprises.

It’s too early to know exactly how much of the stimulus funds have been directed to African Americans because only 11.1% of the funds have been encumbered. We may never find out if the reporting standards don’t change. Without data, it will be much more difficult to accurately track what is happening, and even harder to assure that the recovery benefits all Americans, especially those hit hardest by the crisis. President Obama can and should fix this problem by directing the OMB to require recipients to track and report data on race and gender for job creation as well as for contract awards. While there are some difficult issues related to the stimulus, collecting data is not one of them.

The OMB memo would force us to ignore what is happening to the black community. Let’s look at what we already know. What began as an economic recession for most Americans has become a full scale depression for African Americans. The figures speak for themselves. In June 2009 overall unemployment was 9.5%, while unemployment among African Americans was 14.9%, and joblessness among Black youth was 37.9%. In March 2009 unemployment for African American college graduates is 7.2%, twice the rate for white graduates.

African American communities aren’t just plagued by higher unemployment, but by the effects of structural arrangements and practices that negatively influence our opportunities in education, access to capital and equitable health care. These structures are often reflected in geographic arrangement. Nearly half of all subprime loans were made to Black and Latino homeowners and homeownership among African Americans has declined to 2000 levels. Both these subprime loans and racial inequality are spatially concentrated. The situation for Blacks and Latinos related to foreclosure and other issues is simply not the same as whites. Much of our present approach ignores this in its failure to consider race.

Fixing the economy for everyone is a goal we can all embrace, but a one-size-fits-all recovery won’t work for African Americans.

For more on the impact on communities suffering depression-era economic challenges across the country go to http://www.fairrecovery.org/. John Powell is Executive Director of the Kirwan Institute for the Study of Race and Ethnicity at The Ohio State University and Chair of Americans for American Values.