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What to do about the carmakers

December 3, 2008

by William Reed

William Reed urges Blacks to support Detroit automakers in return for their record of equal opportunity. For example, he notes, “Ford Motor Co. was the first corporation in the nation to pay Blacks fair wages.”
Who questions that the automotive industry is one of the most important sectors in the U.S. economy? The manufacturing of automobiles has been a leading factor in the advancement of generations for 70 years. With the industry’s tradition of employment of Blacks in well-paid jobs and bellwether social responsibility practices, the decisions Congress makes in regard to Big Three automakers is important to Blacks. One of every 10 U.S. jobs is auto-related. What’s good for GM, Ford and Chrysler is good for the country and especially Blacks’ economic advancement. The industry is the nation’s largest economic multiplier sector in terms of jobs, compensation and tax revenues.

Among African Americans, the Big Three’s multiplier effect is critical. Black workers, contractors and consumers have a stake in how Congress reacts to Detroit’s plight. “Just do it” is what Randi Payton, publisher of African Americans on Wheels, suggests. He says they are “some of the most socially responsible corporations in the world” and because of how they impact African Americans emphasizes their “big stake” in how Congress acts on the issue. Payton says, “Social responsibility has long been a hallmark of the industry. The Big Three have consistently supported social and community initiatives, as well as small businesses. Next to the federal government America’s automotive industry leads in embracing diversity and employment of minorities”.

As of September 2008, the motor vehicle and parts industries directly employed 732,800 workers and were one of the largest economic generators for African Americans. The argument Payton puts forth is that the Big Three and their reciprocity toward African Americans should be measured by Blacks as to how these companies help in our communities compared to where the $750 billion Wall Street operatives got from the government goes.

Actually, African Americans among Wall Streeters are a rarity; therefore, there’s little possibility that financial industry bailout money will arrive in “MLK Avenue” areas. Payton says, “All corporations, especially financial institutions ‘rescued,’ should be as supportive of our society, businesses and communities as the auto companies have been. It’s no secret Republicans are in favor of allowing the industry to fail, ostensibly so they can lay the blame at the feet of Democrats. However, consumers [should pay attention] to how the industry impacts their lives.”

The issue is huge. American auto workers’ earnings will decline $150.7 billion if Detroit goes down. Black consumers spend $95 billion in annual vehicle purchases; in return the Big Three target business programs with minorities in supply contracts, dealerships and advertising. Carmakers spend billions of advertising dollars with Black agencies for minority media placements.

Payton is a leading voice on the history and achievements of Blacks in the industry and says, “Blacks’ economic history is intertwined with automobile production.” Ford Motor Co. was the first corporation in the nation to pay Blacks fair wages. During the early 1930s the vast majority of Blacks worked for Ford. The Detroit 3 have helped in the evolution of Blacks and been principal supporters of Historically Black Colleges and Universities (HBCUs) since Henry Ford made a connection with Tuskegee and George Washington Carver at the turn of the 20th century. Over the years, the Detroit Three have been responsible for increasing numbers of people of color in their businesses and engineering and educational programs.

Almost 4 percent of America’s Gross Domestic Product is auto-related. In light of money Congress has agreed to give the financial industry, Payton feels African Americans should raise their voices for carmakers. He says “Failure of the domestic auto industry” will “set back 50 years of social progress.” Payton’s points should be pondered. Blacks get no gain from Wall Street’s bailout. Low levels of African American inclusion in the financial services industry make the term “Black investment banker” unique. So, if the federal government can put almost a trillion dollars in a financial industry that poses no promise toward African American advancement, more of us should join Payton in suggesting Congress give the Big Three an opportunity to rebuild and retool. America cannot afford to lose this industry. African Americans definitely cannot!

William Reed
William Reed is president of Black Press International, Email him at

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