Category Archives: capital

Towards a political strategy of increasing black sovereignty …

How white capital spreads like a virus …

I don’t think that one need go through a winding, mundane academic discourse for why blacks in the American jurisdiction need to pursue sovereignty.  Everyday, American social culture tells blacks living in the American jurisdiction that we do not belong here.  Socially, blacks have been lumped into a generic “people of color” box, on the false pretense that non-whites share the negative effects of systemic racism; that we are all in the same boat sitting in steerage while whites enjoy the privilege of capital accumulation, access to credit, better jobs, and higher income.  America’s political left argues that this unequal treatment calls for public and social policy that should somehow put whites and non-whites in equal positions economically and politically.

Members of the Left that take this position lack an appreciation for how much time and man has not changed.  Europeans came to North America, the Caribbean, and South America under a charter from monarchs that, in a nutshell, required exploitation of the land and people found in these places.  Monarchs wanted to expand their national power and enrich their coffers in order to finance the competition they experienced between each other.  They borrowed gold from wealthy members of their respective societies and encouraged their surplus labor with promises of religious freedom, greater incomes, and landownership of their own, to help conquer these new worlds.  By these initiatives, western culture would spread and flourish with non-Europeans being either absorbed as best they could or eliminated.

Non-Europeans were never meant to be included in the governance of these new lands or in the distribution of natural resources i.e. land, minerals, etc., that accompanied conquest.  Blacks were brought to the western hemisphere as chattel slaves, the tools that would plant and harvest the tobacco and cotton plantations of the American south and the sugar plantations of the Caribbean.

And like a virus, this occupation by capital of non-white spaces continues in the form of gentrification, where generous monetary policies by America’s central bank inflated assets already held mostly by American descendants of Europeans which provided the collateral that backed the loans that were used to buy homes under stress in black neighborhoods.  Americans of European descent no longer need to use armed force to wrest land from non-whites.  Central banks now aid Europeans with capital to spread their influence.

Reparations won’t happen …

For the past two or three years, a movement of American descendants of slaves (ADOS) has been advocating for government policy that delivers on past promises by the United States government to provide slaves with land as recompense for physical bondage.  ADOS believes that providing a direct capital infusion to descendants of black American slaves is the best approach to closing the wealth gap between whites and blacks while compensating blacks for the labor stolen from them and used to build the American economy.

Politically, ADOS doesn’t have a chance.  There is no definitive support in either chamber of Congress for any reparations initiative.  The only black American in the race for the Democratic nomination for president, U.S. Senator Cory Booker, Democrat of New Jersey, has not made reparations a campaign narrative. Given his standing in the polls, he does not have the political capital to offer a policy proposal on the matter.  Without a champion in the executive or the Congress providing stewardship for policy or legislation, reparations will not happen.

The current system poses an existential threat to blacks …

After 500 years in the western hemisphere, if blacks are still fighting to close a capital gap that eliminates the buffer between blacks and devastating unemployment, homelessness, and bankruptcies, then it is time to shift paradigms and create a new political economy.  Civil rights violations stemming from race discrimination. Lack of jobs stemming from race discrimination. Poor education funding resulting from racial discrimination. These issues should be non-existent where blacks are not subject to policies and laws designed by whites for the benefit of whites.

It is time for blacks living in the American jurisdiction to pursue public policy and law that generates a parallel political economy where law, technology, and politics converge to provide blacks with a sovereignty that better ensures their survival.

Blacks need to re-direct political capital to local election markets

I caught the last thirty minutes of tonight’s Democratic Party debate. I was able to hear some of their discussion on foreign policy which I did not find impressive.  Overall, these candidates tried to play both sides of the fence when it came to Afghanistan, claiming on the one hand that it is time for the United States to leave the central Asian burial ground of empires while on the other hand satisfying the sentiments of war hawks by considering the deployment of a reduced force, just in case the U.S. needed to re-insert itself.  That sure doesn’t sound like commitment to the idea of departing.

Another sign of a lack of commitment on the part of Democrats was the dearth of ethnic minorities on the debate stage.  Andrew Yang, an American of Asian descent, was the only ethnic minority participating in the debate.  That Mr. Yang is still in contention is a testament to his entrepreneurial savvy and his policy focus, specifically the idea of a $1,000 a month universal basic income payment to every eligible American.

Strong messaging on specific policy measures appears to be the sustaining formula for the debate survivors as they prepare for next February’s Iowa caucus and New Hampshire primary.  Yang, along with U.S. Senator Elizabeth Warren and U.S. Senator Bernie Sanders are doing well because, in my opinion, they have developed a narrative that they can brand themselves with and sell to the public.

Someone failed to get the important point of narrative and branding across to U.S. Senator Kamala Harris, who was not known for any specific policy  agenda, definitely not a black agenda or narrative of any kind.  The same can be said for U.S. Senator Cory Booker who was absent from tonight’s debate stage.  If their hope was to ride the Obama Coalition, that bus is being driven by former Vice-President Joe Biden, and right now appears not to be letting anyone else steer the wheel.

The lack of blacks on the debate stage is not surprising. As the Boomers get older, the sway of the Democratic Party on blacks is decreasing.  It is not unusual to hear younger blacks and even a few older blacks question the efficacy of the Democratic Party when it comes to a black agenda.  And while the Democratic Party harps inclusion and diversity, the reality is that younger blacks are seeing less of an economic and social space for them in American society.  This view will only become more precarious as the demographics continue to change and blacks find themselves an increasingly smaller proportion of the population.

Returns on black political capital will remain flat if the focus remains on national elections. The numbers are just not there no matter what Democratic talking heads keep saying.  More importantly, the issues that concern blacks most; unfair treatment by the criminal justice system, unemployment, gentrification, are not federal issues.  While national leaders maybe able to advocate for block grants and other large sources of capital to be directed toward the States, it is state and local politics that will determine how those funds get distributed to and throughout communities.  Ensuring that West End Atlanta gets its share of federal government funds compared to the affluent north side of turn will turn just as much on local politics as it does federal jawboning.

Bubba, Bonds, and Blacks …

As much as blacks loved Bill Clinton, blacks never applied the most important political lesson Bubba himself learned: He who controls the bond markets, wins. Collective or group politics hasn’t gotten blacks much of anything over the past 50 years, but a collective, focused targeting of the bond markets just might.

Yes, there are a few “here and there” types posting on LinkedIn about how well their panel discussions are going and how many awards they are receiving from some social justice warrior group, but the masses are not winning because most of the cream is staying in the cups on the top.

What Mr Clinton realized back in 1994 was that re-election hinged on a happy bond market. Maintaining an economy with low interest rates meant increases in asset prices leading to higher valued collateral upon which more credit could be issued.

Now imagine if 13% of the American population were able to take a 13% position in the bond market. The potential shock waves that synchronized buying and selling would cause would have policy makers asking that group, “Hey! What do you want?”
Blacks wouldn’t need another “get out and vote drive” ever again. The Montgomery bus boycott would pale in significance.

Unfortunately, the inside the box, plantation mentality of partisan politics, especially as orchestrated by liberals, keeps blacks in “Massa ain’t gave me permission yet” mindset. I am seeing cracks in that narrative, but there is still more work to be done….

“You mean to tell me that the success of the economic program and my re-election hinges on the Federal Reserve and a bunch of fucking bond traders?” — William Jefferson Clinton

“I used to think that if there was reincarnation, I wanted to come back as the president or the pope or as a .400 baseball hitter. But now I would like to come back as the bond market. You can intimidate everybody.” — James Carville

Capital. The true digital divide

A couple early morning thoughts on the digital divide.  So far the digital divide narrative has occupied two schools of thought that are not necessarily opposed to each other.

Race and the Digital Divide

The first school of thought revolves around race.  Given that within the black American community there is a higher level of poor households, affordability is keeping blacks from accessing the internet via high-speed broadband infrastructure.  If blacks do not have the income to sustain a broadband business model, then internet access providers are less likely to deploy facilities in poor neighborhoods.  Lack of deployment in these neighborhoods may result in a barrier to valuable information that may lead to greater economic opportunities, according to advocates seeking to close this gap.

Rural Communities and the Digital Divide

The second school of thought revolves around rural communities.  The argument is that lower population density as compared to urban areas makes deploying broadband access facilities in rural areas more expensive.  In addition, terrain, such as that faced by internet access providers in mountain states, has traditionally added to the problem of higher costs to provide broadband access facilities.

An Overlooked Divide

There is another divide, one that is often overlooked and it has to go to what is known as “first-mover advantage.” The real value generated by the internet is the ability to extract, analyze, package, and distribute information, and have that information be available digitally forever.  The focus on a gap between facilities deployed in black neighborhoods versus facilities deployed in white neighborhoods or the gap between rural community deployment versus urban community deployment goes to seeking out new suppliers of information.  The civil right veneer that has been placed over the broadband racial divide hides this supply-side characteristic from the policy debate.  It has also created the opportunity for the political left to craft an electoral package that can be sold to voters.

It is the other side of the equation, the production side, that, in my opinion holds more value.  When we look at the history of the internet, particularly the period when the internet was commercialized, its players included white venture capitalists; Web 1.0 internet service providers, i.e. AOL, CompuServ, Mindspring, etc.; and dial-up access providers such as BellSouth.

Black Americans could always access information from analog sources, i.e. television; print media; or word of mouth, but the efficient extraction, cataloging,  indexing, aggregation, and distribution of information via the internet were the domain of companies invested in and managed by whites.  As whites continued to level their first-mover advantage, this gap between producer/owner of capital and consumer continued to grow.

Capital not only seeks a vacuum, it also seeks a return.  Returns from investing in black or even rural communities were not going to be as high as returns invested in affluent neighborhoods, neighborhoods whose residents probably owned shares in the very companies that commercialized the internet in the first place.  Closing the “digital divide” means first closing the capital divide.

What will Government Do Next?

Government will do nothing from a capital perspective to close the digital divide. The Federal Communications Commission has a number of universal service funding initiatives designed to encourage mobile and fixed broadband deployment in rural areas; to facilitate the delivery of health care via broadband; and to reduce the costs incurred by low-income consumers for accessing and maintaining high-speed broadband service.  By subsidizing the consumer demand for broadband services, the Commission hopes to encourage the delivery of broadband services.  But again, the focus is on consumer demand, not bridging the capital gap.

The philosophical underpinnings of the American economy, where capital is to flow freely to its best use may prohibit government from taking any concrete action for closing a capital gap.  If blacks or rural residents had sufficient capital to purchase, construct, or maintain broadband access facilities, using their intimate knowledge of their communities to distribute services, we might see a decrease in the gap.  We should expect that government will stay on a path of incentivizing capital investment in infrastructure development versus trying to repair capital discrepancies via a capital transfer.