(Akiit.com) The latest employment figures show the Black economic condition in America worsening. I say it is time to turn to China for economic lessons.
When it comes to China, the numbers are truly astounding. The Asian giant has the fastest growing economy in the world – averaging roughly 10 percent growth per year for the past 25 years. If we in the United States grow annually by just three or four percent, our economists consider that good economic news.
Not only is China growing, but the speed of growth is astounding. For example, the city of New York recently announced that it is going to take seven years to complete a two-mile leg of the long-awaited Second Avenue subway line. During that same seven-year period, the city of Wuhan, China plans to complete an entire 140-mile subway system.
In fact, China is growing so rapidly that it expects to build a city roughly the size of New York every year for the next twenty years. As a result, the U.S.-based research company Freedonia Group currently estimates that one-half of all cement purchased in the world is going to China. Meanwhile, in a 2009 report, the World Bank praised China for lifting more than 600 million people out of poverty over the past quarter century. For example, the report found that in 1981, 53 percent of all Chinese lived in poverty. By 2001, the poverty rate had fallen to just 8 percent.
Finally, if you have been wondering where a nearly bankrupt America gets the money to finance wars in Iraq, Afghanistan, pakinstan and Libya, the answer is China. Before this nation’s current economic crisis is over, the U.S. will easily owe the communist rulers of China well over $1 trillion. China is among the world’s biggest buyers of U.S. Treasury Bonds – the instruments we use to finance much of our debt.
In sharp contrast to an advancing China stands Black America. According to the Census Bureau (2007 figures), African Americans have the lowest median household incomes in the nation. Even native Alaskans (the people we often refer to as Eskimos) have a higher median household income than we do. The reason for the income gap is the historical lack of business ownership among the country’s African American population.
The lesson China appears to be teaching Blacks and the rest of the economically underdeveloped world is electing progressive politicians is great and achieving ever-increasing levels of education is fantastic but if politics and education are not employed to produce rapid economic group growth they will largely be for naught.
But according to the Small Business Administration, Blacks have the lowest “business density” (number of businesses owned per 1,000 persons) in the nation. This means African Americans can only grow economically when some other racial group engages in profit-making enterprise and then decides to hire us. Put more simply, Blacks are economic slaves to the entrepreneurship of others.
China is the global economic power it is today because roughly 30 years ago, a short, chain-smoking, resilient revolutionary named Deng Xiaoping battled his way to leadership of the Communist Party and declared it was time to break with the old ways of doing things. He told a country where wealth was viewed as an evil that “To be rich is good.” Black America needs its Deng Xiaoping.
This is the challenge facing Black America. As a people, we have entered a post-Civil Rights era. We have elected the first African American president. But we continue to linger at the bottom of American society economically. Our lower classes are too dependent on welfare and government social programs. Our middle classes are too dependent on “good” government jobs and our rich are little more than over paid entertainers and athletes who have shown absolutely no ability to provide the leadership needed for building group wealth.
A 2006 paper by economist Robert Fairlie appears to confirm this position. He points out that only 3.8 percent of Blacks own their own businesses. This business ownership rate contrasts with a 6 percent rate for Hispanics and an 11.6 percent rate for whites and Asian Americans. Fairlie advocates a rapid increase in Black business ownership as the way out of disproportionate group poverty.
Meanwhile, in a 2004 working paper Y. Lowrey (writing for the Office of Advocacy of the Small Business Administration) estimates that increasing 1 percent of business density escalates personal income, household income and tax revenue by more than 1 percent. Thus, if Black America increases its business ownership by just 10 percent, there will be a more than 10 percent growth in personal and family incomes.
In other words, Blacks will start to have an annual economic growth rate possibly superior to that of China and the entire nation will benefit as additional tax revenues flow into government coffers.
Again, China teaches that enterprise is the way to the future.
Written By Robert Taylor