Cultivating Minority-Owned Businesses to Close the Wealth Inequality Gap
On Thursday of last week, LeadBoston welcomed its alumni network, with participants spanning from the class of 1996 to 2016, and their guests to an event addressing an issue facing many Boston residents – the wealth inequality gap. Speakers focused on how to promote minority-owned business in Boston, which should help close the wealth inequality gap. The speakers included: Tom Shapiro, Pokross Professor of Law and Social Policy and Director of the Institute on Assets and Social Policy at Brandeis University; Reggie Nunnally, business consultant for the Black Economic Council of Massachusetts; Malia Lazu, president of Epicenter Community; and Irene Li, co-owner and chef of Mei Mei.
With data collected from his recently published book, “Toxic Inequality,” Tom Shapiro outlined his address with harrowing facts. The racial wealth gap is an issue of equity. For example, the return on investment in a college education is much higher for white college graduates than it is for their African American counterparts. While white college graduates may continue to receive support from parents or relatives even after employment due to increased family access to wealth/assets, graduates of color are more likely to find themselves needing to support family members with fewer financial resources. College fails to be an equalizer as the racial wealth gap widens for African Americans.
Shapiro characterizes wealth as a “protective factor,” enabling people to take risks and borrow money to pursue entrepreneurship. So how can minorities obtain the protective factor and how can we close the gap?
Our panel offered thoughtful steps toward equality.
Lazu named racism as the root of wealth inequality: “Belonging is what we need,” but “people aren’t investing time in the same way for people of color.” In a poignant analogy with a giraffe and an elephant, Lazu explains how mobility neglects people of color. The giraffe invites the excited elephant to its house, but when the elephant tries to enter the doors, it realizes it cannot fit. The giraffe decides to change its mind, ultimately telling the elephant it cannot come in because it can’t fit–the house was never built for the elephant.
Nunnally asserted that this issue requires an analysis of the Small Business Administration’s minority data. We need to disaggregate the numbers and understand who is actually “in” and who remains excluded. Li recognizes her status as the former and uses her role to promote social and economic equity in her industry and community. This includes having a diverse team and offering financial literacy training so her staff can venture into their own businesses.
The path to equality is challenging, but we can all play our roles by investing time and resources to small businesses. It begins with the end of Lazu’s analogy. Determined, the elephant pushes through and breaks down the house. Equality requires a restructuring of an unjust system through the sacrifice of losses and the reflection of triumphs. Like Shapiro says, “If we’re going to have failures, [we] want them to be heroic failures.”