Article/Column

Encouraging minority participation in America's recovery

by Congressman Elijah E. Cummings

January 20 was an historic moment for America and, especially, for Americans of Color.  President Barack Obama will be a national leader who fully appreciates the unique obstacles that minorities continue to face in this country.

Our new President's personal insight into the struggles that we face will be especially important as we work with other Americans to recover from the most damaging economic crisis in decades.  In the words of the painful old adage:

"When the American economy catches a cold,
African Americans get pneumonia."

Sadly, the growing unemployment numbers and other indicators within African American communities reflect the current harsh impact of this reality. It is essential that the President and Congress respond, both promptly and effectively.

Last year, I understood why it was reasonable for the initial federal response to be directed toward the "frozen" credit  markets.  Now, I am convinced, those banking measures must be placed under far greater federal oversight and scrutiny.

With even greater urgency, we also must begin the process of protecting and creating millions of jobs.  As President Obama declared in his Inaugural Address:

 "Starting today, we must pick ourselves up, dust ourselves off
and begin again the work of remaking America."

Toward that end, the Congress and the Obama Administration are already hard at work.  Our goal is to have a major economic stimulus bill ready for the President's signature by February 13.

In this process, political philosophy has an unavoidable role to play.

I have supported the President's outreach to Republican leaders.  We should include good ideas (like targeted tax breaks for small businesses that create new jobs) in our national stimulus plan.

There will be points, however, upon which Democrats and Republicans will not agree.  That is when the Democratic majority elected by the American people must break up any logjams.  Quite simply, we have no time to waste with unending debate.

President Obama has quite properly reminded Republican leaders that Democratic principles and priorities prevailed in the last election.  The popular mandate for progressive change that Barack Obama and the Democratic Congress received should be reflected in our work -- and it will be.

I will share with you a real-life example of what this new majority direction can mean.

Our new President understands, as do I, that minority and women-owned business have critical, job-creating roles to perform in the implementation of any successful stimulus plan.  However, we also know that these enterprises face unique challenges in making good their right to participate in public initiatives.

Incorporation of these dual insights in our federal recovery package will be important for the well-being of African American communities. That is why I recently wrote to Chairman James Oberstar of the House Transportation and Infrastructure Committee on which I serve.

I suggested that more be done to ensure that minority- and women-owned businesses can fully participate in the upcoming federal investment to rebuild our nation's roads, upgrade our public buildings, expand our transit and rail systems, better manage our water resources, and control floods and other natural disasters – collectively, a $90 billion federal outlay.

I did so in the knowledge that outstanding Federal programs that encourage such participation by minority-owned and women-owned firms already exist.  I also know, however, that external obstacles often prevent these firms from bidding on federal and state work.

This is an injustice – and an economic inefficiency – that I have been working for decades to correct.

For example, minority businesses often encounter more obstacles than majority-owned firms in obtaining the performance bonding and similar guarantees that they need from traditional sources of credit.  This roadblock was apparent even before the current "credit freeze." It is even more apparent today.

Yet, as I pointed out to Chairman Oberstar, government programs that help small, minority-owned, and women-owned businesses obtain the surety bonds and related types of financial assistance that are required can be critical to their participation in publicly funded projects – and can achieve that objective at relatively modest cost.

For example, the Maryland Small Business Development Financing Authority (MSBDFA) plays an important role in our State, assisting small businesses that cannot obtain conventional financing with the low-interest loans, bonds and other guarantees that they need.

These services have been essential to the success of many small, minority-owned, and women-owned businesses in Maryland — and between 1980 and 2007, approximately 460 small businesses in the MSBDFA program created more than 17,000 Maryland jobs.

Given a chance to participate in the new federal stimulus initiative, minority- and women-owned businesses can make the same kind of important contribution to our national economic recovery.

That is why I asked Chairman Oberstar to consider including funds for bonding assistance on the Maryland model in the stimulus bill.

The Chairman agreed and, as a result, the economic recovery legislation now being considered by the Congress includes $20 million to enable the U.S. Department of Transportation's Minority Resource Center to provide bonding assistance for "disadvantaged" businesses (as well as an additional $20 million for job training).

Congress and the Administration must get the "nuts and bolts" of stimulating our economy right the first time if our huge investment in recovery is to have the impact that our nation needs.  Effective minority participation in this effort is not only a moral imperative, it is a practical economic necessity.

- The Honorable Elijah E. Cummings represents the 7th Congressional District of Maryland in the United States House of Representatives.