A Brief Study of Minority Purchasing Power

I was having a debate with some people today about Donald Sterling and Larry Johnson.  As some of you may know, Don Sterling is the NBA Basketball franchise owner who made racist comments about Black Americans, causing a storm and debate about institutionalized racism.


Larry Johnson is a former NBA basketball player who came out advocating for a Black owned basketball league in response to the perceived institutionalized racism.  Of course, of the 192 NBA (Basketball), NFL (Football), and MLB (Baseball teams), only 3 are owned by minorities (2 Indian, 1 Black – Michael Jordan).


So the argument was that more teams should be owned by Black owners.  The debate ended up at a point where someone spoke out in support of a Black owned league, and how Black Purchasing Power was enormous and should command more respect.  And that Black Americans, as a significantly large purchasing power, should be producers as well as consumers.


So I decided to do some research and found the following article showing that the claim was true, that Black Purchasing Power was indeed impressive.  (Source:  Huffington Post)


However, after further research, I realized that while this was true, it wasn’t actually a positive for the Black community, as we need to put it in perspective of population size, income, and other factors to get a real picture where Blacks spending was indeed a positive and a negative.


In fact, as a result of my research, I came to an alarming conclusion, that Blacks may account for an enormous purchasing power, but that didn’t necessarily translate into the right expenditures or investments.  Please read my response and research below, and feel free to share your thoughts and opinions.


My Response:


You’re right about Black Purchasing Power, but it’s not something to be proud of.  If anything, Black Purchasing Power is part of the root causes why Blacks are consumers rather than producers.  There is an article I read about how it’s concerning that 13% of the population is making 30% of the purchases (Source: Politic365), and how Black Americans are not saving the money or investing it.


To put this in perspective, Asians represent only 5.4 % of the population, and their buying power is 9% (Asian buying power grew the fastest in last decade, by 164%, Native Americans at 156%, Hispanics at 142%, Blacks at 73%, and the US as a whole at 69 %).  Hispanics represent 17% of the population, but their buying power is at 10%.  Native Americans comprise 1.3% of the population, and account for 1% of the buying power.  (Source:  The Multicultural Economy 2012 at the National Minority Supplier Development Council, Inc.)


What this means is that by comparison, is that Blacks are spending more (more than double their population size).  Now that wouldn’t be alarming, if it weren’t for the fact that African Americans rank the lowest in median income.  A 2009 stat (couldn’t find anything more recent, but I doubt there are drastic changes in a 3 year period).


2009 Annual Income by Race (Source: Census):
All Familes $60,088
White $62,545
Black $38,409
Asian $75,027
Hispanic $39,730


So if you consider the above numbers, Blacks median income is nearly half to two-thirds that of Asians and Whites, and nearly equal to Hispanics.  But they spend nearly three times that of Asians and Hispanic.  In fact, you could combined the Hispanic and Asian populations (17% + 5.4% = 22.4%, or double that of Blacks, but they still spend two thirds that of Blacks).


So yes, Blacks have more buying power, but they’re not saving it, which means they’re not putting money away to start up business, and as long as they do that, they will continue to be consumers, not producers, and thus having less of a say as to how businesses treat Blacks.


To add additional perspective, figures from the Census in 2007 showed the following facts (2012 figures are not in yet, Source: Census):
There were 1.9 million Black owned businesses.  In comparison there were 1.9 Asian-owned businesses (even though they had one third the population of Blacks), and Hispanics had 2.3 million businesses.  Women owned 7.8 businesses.


In terms of revenue, Black businesses made $137.4 Billion, compared to $513.9 Billion by Asians (nearly four times that of Blacks), $34.5 Billion by Native Americans (1/13th of Black population but making 1/3 revenues of Black businesses), and $345.2 Billion by Hispanics.


So you can see from these figures, despite making less revenue and income, Blacks are spending nearly 2.3 times more than the other races, and if you combine the population of the Asians, Hispanics, and Native Americans (23.7% or nearly one quarter of the US population), they still spend less at 20% than Blacks are spending at 30%.  That’s alarming, and a big reason why Blacks are consumers and not producers.  Without savings and investments, how can you ever hope to own the businesses that produce?

On Venezuela

Many of the readers of this blog are probably following the latest events in Venezuela.  For those that are not caught up, here it is what is going on in a nutshell:  For the past few weeks, there have been protests against the Venezuelan government.  President Nicolas Maduro has continued the policies of former President Hugo Chavez and this does not sit well with much of the population.  First of all, many believe that Maduro illegally stole the election from Henrique Capriles following Chavez’ death.  Even that aside, Venezuela has one of the world’s highest murder rates and its economy has suffered miserably under Chavez and Maduro.  Many people view Maduro as a bully who stomps on his opponents, much like his predecessor.  The protesters come from across the spectrum but have found particular support with university students.

In response to protests by tens of thousands across the country, Maduro has enlisted the police and military.  A number of people have been killed but the true number is not known.  Rather than recap all of what the news media has covered, I want to briefly share two statements from personal friends with family in Venezuela.

“Yes, we have a relative in San Cristóbal, where the repression has been especially brutal, and she sent me a pvt message on FB telling me that military planes have been flying over the city since Thursday.”

“My nephew, a teenager, just witnessed cops and masked men killing a man with a rifle. They put him in the trunk and left the scene.”

I think these statements say a great deal about the government of Venezuela.

The Dishonest Media

I have a confession to make.  I love following  politics.  I have another confession to make.  I get infuriated when seeing media stories that are simply false.  The recent fighting between the Palestinians and Israelis have yielded many examples of incredibly poor reporting.  This seems to be particularly true when the media has reported on Israel.

Imagine a person getting injured in an attack…and suddenly being just fine a few seconds later.  This should probably indicate to you that the footage was staged for the camera.  Any professional news service would not fall for this, right?  Actually both the BBC and CNN fell for the faked injury.

Here is a link to the BBC failure with the key points to look for:


This link has CNN’s half-hearted apology for the same video.  Anderson Cooper of CNN blamed Reuters news service for the error.


CBS made an equally embarrassing error.  In the 7th paragraph of the article below, CBS states “At least half of the Palestinians killed in the conflict so far have been civilians.”  However, in the 13th paragraph of the same article is says, “In all, 40 Palestinians including 13 civilians and three Israeli civilians have been killed since the Israeli operation began.”  Unless the universal principles of mathematics have changed, 13 is less than half of 40.  CBS cannot get their numbers straight within one article.


CNN, BBC and CBS are major media outlets that influence world opinion.  Is it too much to ask for accuracy in their reporting?  Am I alone in my anger at poor media reporting?  What needs to change to improve their behavior?

Plan B, Implement the Blame Game

Leaders take responsibility, while losers like to blame.   That’s the simplest rule of leadership, and everyone knows it.

So it’s alarming that reports are coming out now that Secretary of State Hillary Clinton is publicly taking responsibility for the attacks on the US Embassy in Benghazi, Libya on September 11, 2012.  Irregardless of your political affiliation, it’s hard to support someone in office who spends more time blaming others.  Say what you will, Ms. Clinton seems more presidential at this point than President Obama.  One has to wonder how women voters feel about Ms. Clinton taking the bullet for the president.

Yes, the Secretary of State runs her department, but ultimately she serves at the pleasure of the President.  The CEO of a corporation can’t blame the vice-president in charge of quality control for a bad batch of medicine slipping through Quality Control, he has to accept the responsibility of his company’s failure.  Ultimately, the President’s failure to accept the failure, and instead opting to allow a member of his administration, one of the few female cabinet members, to become a scapegoat, is going to resonate with voters.

Perhaps it’s due to his plummeting poll numbers, President Obama and his supporters appear to be panicking, with much riding on tonight’s second presidential debate.  Obama has to stop the bleeding, although it has been like pulling teeth to get Obama or his campaign team to admit did poorly in the first presidential debate.  His campaign still claims that the President’s poor performance didn’t affect polling, and now they are echoing the Romney camp in claiming polls are inaccurate.

Of course, irregardless of the poll numbers, it’s not the popular vote that will determine who wins, but rather the electoral vote.   This was never more true than during the George W. Bush and Al Gore election in 2000, when Bush edged out Gore in electoral votes to win the election, but lost the popular vote.  And that could happen again.  With Romney climbing in the rankings, is this decision to defer blame going to further make the President lose in the opinion polls?



London Olympic Terrorism

As we near the start of the 2012 Summer Olympic games in London, there are many questions about whether terrorists will use this opportunity to attack.  It was 40 years ago that the first terrorist attack occurred at the Olympics, when Israeli athletes and coaches were murdered by the Palestinian Black September terrorists.  What is the chance that terrorists will strike again?

The British government certainly believes that there is a reasonable chance for terrorists to attack at the Olympics.  The head of MI-5, Britain’s intelligence agency, believes that the threat is quite real.


To ensure safetyy, there will be up to 40,000 members of the force protecting the Olympics, including 500 American agents.


Moreover, the British have put missiles throughout London to protect against attacks, including on the roof of a residential building.


But is this all just blind fear created by overly sensitive tendencies?  Perhaps not.  After all, the United Kingdom produced both Richard Reid (the Shoe Bomber) and Umar Farouk Abdulmatallab (the Underwear Bomber),
both of whom tried to destroy airplanes filled with passengers.

More disturbing are recent terror arrests in London.   Just today British authorities charged three of  its own citizens for planning terrorism.


Further, London police recently arrested a computer design expert who is accused of helping Al Qaeda recruit Western terrorists.


Though we all hope that there will be no terrorism in the upcoming Summer Olympics, unfortunately we must acknowledge that the threat is real.

Lastly, I would like all the readers of this post to take a minute to remember the victims of terrorism at the 1972 Olympic games.  Here is their story, with names and pictures of the victims:




The Real NFL Controversy

Throughout this offseason, the NFL has been filled with controversy.  Where will Peyton Manning go?  Can Tim Tebow and Mark Sanchez survive in the same offense?  And what can be bigger than the Saints’ payout of players to hurt opponents?  But there is one controversy that has slid under most radars yet far outweighs all of the other controversies combined.

As we speak, the NFL  is being sued by more than 1000  former players and their families for misleading the players about the long-term brain damage due to concussions.  That is correct, more than 1000 players, including Hall of Famer Randy White and Super Bowl winner Mark Rypien, are suing the NFL.  When you think about how few people ever play in the NFL, the magnitude of these lawsuits are amazing.  Moreover, the potential financial loss for the NFL is enormous.  The NFL is not being sued over hangnails, but over brain injuries leading to lifelong problems.  The Saints “bountygate” centered over attempts to hurt others-the concussion lawsuits include Dave Duerson’s family’s accusations that his concussions led to his suicide.  The potential financial loss for the NFL is huge.

Here are a few articles about the lawsuits:







Punishing the Family

There has been an ongoing court case in Texas that is the ultimate nightmare for many parents of special education students.  Chuka Chibuogwu is a young man with autism who was in the Alief Independent School District (AISD).  His parents decided to challenge AISD because they felt the school district was not doing its best to educate their son.  After much fighting, they gave up and pulled their son from school.  And that is when things became ugly.

AISD decided to sue the Chibuogwu family to recoup its legal fees due to their challenges.  After losing at lower courts, AISD even appealed to the Federal 5th Circuit Court, one of the highest courts in the nation.  Despite almost 6 years of legal fights, AISD has yet to triumph over the Chibuogwu family.  Yet just last month they filed another Federal appeal after failing to get the Chibuogwu family to sign a letter of apology to the district in a settlement.

At this point, the district has spent hundred of thousands of taxpayer dollars on the case.  The have lost repeatedly in the courts and even if they win, the family will be bankrupted long before the district would see all of their money.  Most observers believe that AISD is deliberately bullying the Chibuogwu family in an attempt to scare off anyone who would challenge how they educate their children.  In fact, the lawyer for AISD had previously run a seminar on how to financially penalize families who battle against schools.



So what are your thoughts on this case?  Is AISD defending itself or acting like a schoolyard bully?

The President Unveils His Proposed 2013 Budget

 The President unveiled his proposed 2013 budget today.   For once the budget seemst to offer both spending cuts, while raising taxes for families with income of over $250,000 a year.  Do you think the spending cuts are enough?  Do you think that the taxes are unfair?  And will this new budget begin the process of cutting our deficit?


 From CNN.com:

President Obama will present his 2013 budget plan Monday

By Tom Cohen, CNN
updated 9:09 AM EST, Mon February 13, 2012


Washington (CNN) — When President Barack Obama rolls out his 2013 budget proposal Monday, it’s likely to unleash another round of political finger-pointing on Capitol Hill.

The White House bills the document as a “blueprint for how we can rebuild an economy where hard work pays off and responsibility is rewarded.”

While the White House and Democrats are advocating a balanced approach to economic growth — including spending cuts, increased tax revenue and investments in rebuilding infrastructure such as highways and bridges, Republicans will argue for deeper spending cuts and lower tax rates.

Both sides contend that their positions will bring the economic growth needed to stimulate significant reductions in the federal deficit and rising national debt.

The Obama budget proposal will project that the deficit for fiscal year 2012 will top $1.3 trillion, before falling in 2013 to $901 billion, or 5.5% of gross domestic product.

By 2022, the deficit is forecast to fall to $704 billion, or 2.8% of GDP, according to the White House.

Senior administration officials who discussed details of the budget with reporters said it reflects policy themes Obama presented in a major speech last year in Kansas and in his recent State of of the Union address.

In the Kansas speech, Obama presented Americans with a choice: a “fair shot” with him, or a return to “you’re on your own economics” of the previous Republican administration under President George W. Bush.

Obama’s 2013 budget proposal had to fit discretionary spending below the limits set in the Budget Control Act approved by Congress last summer.

Over a decade, the cuts enshrined in the Budget Control Act total in the neighborhood of $1 trillion in discretionary spending.

Under the White House plan, discretionary spending — which generally means day-to-day government funding not including the military or entitlement programs such as Social Security, Medicare and Medicaid — is projected to fall from 8.7% of GDP in 2011 to 5.0% in 2022. However, details on specific program cuts were not immediately available.

A few areas of reduction are known: The Pentagon plans to spend $487 billion less over 10 years, a course that Secretary of Defense Leon Panetta has already laid out in some detail.

For example, Panetta has said the Army will save money by pulling two of its four brigades out of permanent bases in Europe to bases in the United States. Meanwhile, the Navy will be getting rid of older ships that don’t have the latest ballistic missile defense.

The budget also raises taxes by $1.5 trillion, including a provision to allow the expiration of Bush-era tax cuts on families earning more than $250,000 a year, as well as incorporating the so-called Buffett Rule that requires households earning more than $1 million to pay a 30% tax rate.

Later this month, the president will unveil a plan to reform corporate taxes, including lowering rates, administration officials said.

The administration is also proposing a series of investments focused on infrastructure, education and domestic manufacturing, including $30 billion to modernize schools and an additional $30 billion to retain and hire teachers and first responders.

In addition, the budget will also offer details on what the White House calls a Financial Crisis Responsibility Fee. The tax will raise $61 billion over 10 years from large financial institutions to help offset the cost of the TARP bailout and Obama’s mortgage-refinance programs.

With a presidential and congressional elections coming in November, the hostile political environment in Washington is expected to prevent the president’s budget plan from advancing in Congress.

Virginia Gov. Robert McDonnell, delivering the Republican weekly address Saturday, said he expected Obama’s budget proposal to “increase taxes, ignore entitlement reform and fail to address the federal debt.”

“In short, we can expect that this will not be a proactive budget built to promote fiscal responsibility and future prosperity,” McDonnell said. “Rather it appears we’ll see a bloated budget that doubles down on the failed policies of the past.”

In other budget matters, Obama’s new chief of staff stopped short on Sunday of predicting Congress would agree to extend the payroll tax cut for the rest of 2012.

The issue, a top priority of the Obama administration and the focus of congressional negotiations in recent weeks, reflects the sharp partisan divide permeating Washington as Obama prepares to his budget proposal.

Jack Lew, the former White House budget director who just took over as chief of staff, told CNN’s “State of the Union” that Congress should resolve the dispute over extending the lower payroll tax rate from 2011.

When pressed about whether a deal would get done, Lew refused to predict success.

“I believe it should get solved, and I know there are people working hard even this weekend trying to solve it,” said Lew, who appeared on CNN and four other network and cable talk shows Sunday.

Both the budget proposal and the payroll tax issue continue a political debate over government spending that has dominated Washington since the 2010 congressional elections in which Republicans took control of the House and reduced the Democratic majority in the Senate.

A protracted political fight in December brought a two-month extension of the lower payroll tax rate from last year, giving Congress more time to work out a longer-term deal.

However, the same political arguments from December continue to stymie talks being held by House and Senate negotiators.

Obama and Democrats are pushing for an extension with no strings attached, while Republicans seek to tie more spending cuts and other priorities to the plan.

A 20-member House-Senate conference committee is working to extend the payroll tax cut for 10 months before the short-term extension runs out February 29.

The tax break is estimated to affect about 160 million Americans, saving the average family about $1,000 a year.

Importance Science = Back Page?

Right now is the most exciting time in the history of the world for advancements in science.  Let me say that one more time-Right now is the most exciting time in the history of the world for advancements in science.

But from a quick perusal of the front page of almost any newspaper or news magazine you would think that nothing is going on.  Science rarely makes front page news, despite the amazing discoveries every day.  The ground-breaking current scientific research would make Isaac Newton and Albert Einstein’s minds spin yet the lastest break-up of a Hollywood star is judged far more “newsworthy.”  Surely, politicians can complain that the latest government actions are also stuck behind the dating lives of stars.  However, politics has not changed much in the last few decades.  On the other hand, science clearly has grown by leaps and bounds in both quality and quantity of findings.  Let me give a few examples of recent scientific breakthroughs in medicine:

American researchers may have found a cure for leukemia:


A Swedish doctor created a new windpipe made from stem cells and successfully transplanted it into a cancer patient:


Israeli scientists successfully tested an artificial pancreas with children who have diabetes:


American doctors were able to create new functioning liver cells from blood and skin cells to treat cirhossis:


Each of the aforementioned findings represent mind-blowing progress that was previously in the realm of science fiction, yet most people have probably never heard of even one of those findings.  Can science attract the hearts and minds of the press or will the most exciting time in the history of  science be ignored?

Verizon to add $2 bill-pay charge, admits 4G network ...

From Reuters:

Verizon to add $2 bill-pay charge, admits 4G network…

(Reuters) – Verizon Wireless, which this month angered customers with three separate data service problems, said on Thursday it will add a $2 fee for one-time telephone and online bill payments.

The planned change, to take effect on January 15, was greeted by a storm of criticism.

Consumer blog Engadget said charging customers to pay was “downright ludicrous.” Another tech website, cnet.com, said the move “made little sense.”

“The fee is designed to address costs incurred by us for only those customers who choose to make one-time bill payments in alternate payment channels (online, mobile, telephone) and who choose not to use the other options available to them …,” Verizon Wireless spokesman Thomas Pica said in an email.

Verizon Wireless rivals AT&T Inc and Sprint Nextel Corp said they do not charge their customers for any bill-payment options.

In addition, some customers complained on Verizon’s online forum on Thursday about problems activating their new phones.

The episode followed reports of a problem with the company’s high-speed network on Wednesday. Verizon said on Thursday that it had resolved that issue overnight.


Verizon, the biggest U.S. mobile service provider, admitted on Thursday it was having “growing pains” with its new fourth generation, 4G, high-speed wireless network and had suffered several separate technical problems that caused service outages.

After saying earlier in the day that services on its older third generation, 3G, network were not affected, the company admitted Thursday night that 3G customers were also affected.

Verizon said it had proactively “moved” its fourth-generation (4G) wireless users onto its third-generation (3G) network to ensure all would have a data connection.

However, Verizon admitted that for brief periods, such as on Wednesday, 4G customers could not connect to the 3G Network as quickly as the company would have liked.

The company also said that it is working closely with its network suppliers to ensure smooth functioning of its 4G network, while estimating that connectivity has been available at about 99 percent of the time this year.

Verizon Wireless statement is available at:  r.reuters.com/wav75s

Some customers had earlier complained that they were having 3G service problems, while others said their 4G service was being restored on Thursday morning. One person complained about the lack of a public announcement.

“At least acknowledge there is a problem, do you really expect your paying customers to not notice??” one person wrote on Verizon’s online message board.

Verizon Wireless spokesman Thomas Pica told Reuters that the company does not plan to compensate its customers who had experienced service problems.

Earlier this month the company, which has long boasted that its service is “most reliable,” faced two data service problems.

On December 8 some Verizon customers were unable to access the Internet on their wireless devices for about 24 hours. The company had to fix another problem on December 21.

Verizon Wireless is a venture of Verizon Communications and Vodafone Group Plc.