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It is important to restate and ensure clarity about this framework. We believe that the reduction of poverty for African Americans and the accompanying wealth gaps associated with poverty can be mitigated by also focusing on closing the wealth gap for both the existing African American middle class along with poor African Americans. Sustainable successful economic conditions for low wealth African Americans are interrelated with the successful economic outcomes for African American businesses and African American middle class citizens. 

National longitudinal data reported by the Pew Charitable Trust, in their study of the Economic Mobility of Black and White Families, supports that for the first time being African American middle class does not guarantee that your children will be middle class. These children, for the first time, are in fact dropping out of an economic middle class status.

On the flip side of the equation, we also know that African-American businesses with the ability to hire workers, often hire African Americans at a greater rate than non-African American businesses.  So how do we significantly propel African American businesses to increase in size and scope to become major businesses?

Baltimore’s African American middle income households are largely women.  Yet we lament the outcomes for African American men but fail to understand the role of lifting them up economically will and can make a difference for their families’ economic health. Doesn’t a well paying job that provides opportunity and respect also provide greater options than crime for so many of our young black men?  If yes, then why do we so often fail to understand and thus invest in strategies that link them to workforce training for real career options. 

More in the Middle is an economic agenda with the intent of reducing poverty among African Americans and ensuring a sustainable reduction by closing the wealth gap for African Americans below and up to middle class.

Ultimately, President Obama’s small business assistance plan brings more confidence to the banking industry to encourage loans to small business borrowers, especially during this recession period.  Obama made the announcement just after noon today to reporters after an earlier meeting with Treasury Secretary Tim Geithner, Small Business Administration (SBA) representatives and several representatives from community banks and small businesses themselves.

According to a CNN article, “The president called small businesses ‘one of the biggest drivers of employment that we have’ and said his administration is ‘working diligently to increase liquidity throughout the financial system’.” http://www.cnn.com/2009/POLITICS/03/16/obama.small.business/index.html?iref=topnews

The President went on to caution that this is a part of a multiple step strategy towards what he predicts will be a long-term credit bolstering effort.

According to McKoy, the plan’s outline fits well with ABC’s More in the Middle initiative, which includes a focus on the employment growth found in small businesses as they grow and expand, especially African American businesses. As these businesses grow their employee base, often they make these opportunities available to work-ready low skill and low income workers. These same business owners also make significant civic contributions to the communities in which they reside. Their growth thus provides another way to attack the significant wealth gap among African Americans in the region and throughout the country.  ”The Associated Black Charities’ More in the Middle initiative is all about closing the wealth gap and how critical small businesses are in growing the economy.  Any type of targeted assistance to small businesses in addition to the President’s workforce resources in the stimulus bill will go a long way in marrying opportunity between small businesses and low-skill citizens – each group significantly contributing to the economy and creating a greater path for sustainable assets,” said McKoy. “This is one of the core elements of More in the Middle, and we need to continue to look for other state and federal policy options that will lend themselves to making these kind of opportunity marriages.”

Part of today’s announcement entailed a program to benefit small businesses and community banks by revitalizing the SBA’s frozen 7(a) loan program – its flagship initiative to guarantee loans to small businesses.  This is a critical piece of the Financial Stability Plan and includes:

• SBA will guarantee up to 90% of each 7(a) loan made by private sector lender
• The borrowers upfront fees on 7(a) loan will temporarily be eliminated
• The 21 largest banks, who received funding through the rescue package will have to provide monthly reports on their lending to small businesses.
• All banks will have to report quarterly on their total lending to small businesses.