Afro-Americans Are Suffering the Most for this Foreclosure Crisis
January 16th, 2009
A financial crisis of jumbo proportions has hit America but it is the Afro-Americans who are suffering the most from the foreclosure catastrophe. Their community shows the highest rate of joblessness, unemployment and foreclosures.
Even firms that are owned by blacks are suffering. These companies are a source of revenue and employment for the Afro-Americans. Wayne Frazier is the president of Md./Washington Minority Contractors. He said that the main problem is that financing has nearly dried up completely. There are many who engage in contractual work and not always construction. The owners expect performance bonds of over $100,000 and even that “bonding has dried up.”
The local, state and federal governments have put a brake on the majority of their ongoing projects. Thus less number of contracts are being issued and competition has become even fiercer. Big firms who would not have touched contracting hitherto are now competing with the modest minority firms. The large firms can afford to lower their prices, bid for less and thus win the contracts. He bemoans that these big firms “are just gobbling up all the work.”
Many pundits and businesspersons have lauded the strategy President-elect Obama and his teammates have chalked out to give a kick-start to the economy. It is hoped that millions of jobs will be created when big investments will be made for work related to roads, bridges, school constructions and for making energy more green and efficient.
The speaker of the house Nancy Pelosi (D-California) has already promised to see to the smooth and quick passage of a stimulus bill of $600 billion that will cover all the items mentioned. The plan is good but it has to be properly implemented. Algernon Austin who is the director of Program on Race, Ethnicity and the Economy at the Economic Policy Institute said, “Out of this crisis comes an opportunity. If we use the economic stimulus wisely there is a potential to decrease economic disparity if job creating and investments go to communities that suffer the most economically. It’s very important for public to ask when we get these jobs, will Blacks get their fair share?”
However a note of warning came from Jon Schmitt, who is the senior economist at the Center for Economic Policy Research. He said that even if the administration took the right steps the climate would not become balmy for Americans, whether black or white, overnight. This is especially so in the case of the labour market that usually trails behind the general economy.
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