At a Racial & Economic Justice Virtual Town Hall in April, organized and hosted by Roland Martin, Robert F. Smith discussed how to direct capital for the purpose of ending systemic inequities in the Black community. The talk, which covered a range of topics from corporate responsibility to economic activism, was part of the “Roland Martin Unfiltered Daily Digital Show” on YouTube. The episode featured guests including Smith, Rev. Al Sharpton, Jennifer Jones Austin, Dr. David Jefferson, Sr., Esq. and John Rogers.
Martin introduced to the discussion the limited access Black community members have to capital. Community members participate in the economy but the funds they invest in, the example used was the pension system, are not managed in a way to benefit their own communities.
“We need to get our folks to understand that billion dollar companies have been built upon the contracts from city, county, state and federal government. They don’t call it a hand out, they call it investment,” Martin said.
Smith agreed in principle. “Access to capital is access to opportunity,” Smith said as he explained that how to access it and manage that money in a way to benefit the Black community was key.
Why We Should Be Driving Capital to CDFIs
The idea for deliverable economic justice is to drive capital into the community to supply the loans needed to buy homes and invest in businesses. Smith asserted that this had to be done intentionally.
“The vast majority of our community needs access to credit,” Smith said. “And if we don’t have banks and the Community Development Financial Institutions (CDFIs) and the Minority Depository Institutions (MDIs) aren’t modernized well enough to actually deliver these sorts of loans to our businesses, that’s the challenge.”
Smith cited a positive change at the federal level, with the Cares Act in December, which will invest approximately $12 billion dollars for CDFIs and MDIs. He said a portion of those dollars needs to go into infrastructure to modernize and convert banks onto digital platforms which will connect those smaller banks to the kinds of channels where access to capital is available.
“That’s what I call the critical heavy lift,” Smith said regarding the necessary upgrades to make CDFIs viable in the digital economy.
Listen to Smith explain his ideas regarding racial and economic justice on YouTube.
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