President Donald Trump and Democratic presidential nominee Joe Biden are seeking to boost opportunities for Black-owned businesses at a time when many are facing financial challenges.
The pandemic has exacerbated racial inequity in the business community and forced Black businesses to close at alarming rates.
Biden’s plan calls for a historic effort to empower small business creation and expansion in economically disadvantaged areas. The effort comes as Philadelphia has the lowest number of Black-owned firms in relation to the total number of Black residents among five major East Coast cities.
The former vice president wants to launch a $400 billion procurement effort to support small businesses and tackle longstanding inequities in the federal contracting system. The effort aims to triple the federal goal for contracting with small disadvantaged businesses from 5% to a minimum of 15% of all procurement dollars by 2025.
Biden seeks to increase funding for the Minority Business Development Agency and strengthen federal resources and technical assistance.
He proposes to spur more than $50 billion in additional public-private venture capital to help Black entrepreneurs and other entrepreneurs of color start businesses in disadvantaged areas.
Biden would also require prime contractors to develop and fully execute plans to increase subcontracting opportunities for small disadvantaged businesses and incentivize state and local governments and private sector partners to contract with small disadvantaged businesses.
Donavan West, founder and president of the Black Business Accelerator, said Biden needs to share concrete information about his plan so people can understand exactly how it will benefit business owners.
“I’m looking for details to demonstrate that you really do understand what the main issues are for people of color and that you’ve got it carved out in that way,” West said.
“When you look at the Biden vs. the Trump plan, Biden-Harris was standing on having more details. I still think that we need to hold them to even greater accountability and say we need more details. I think that it is a good start.”
Trump recently unveiled a Platinum Plan that promotes economic policies designed to benefit Black Americans.
He pledged to increase access to capital for African-American communities by almost $500 billion within four years. Trump’s plan also calls for the creation of 3 million new jobs for the Black community and 500,000 new Black-owned businesses.
However, Ken Scott, a local business leader, questioned the timing of Trump’s plan. He said that during the last four years, Trump’s administration has talked about a boost in African-American employment but hasn’t made any targeted efforts toward assisting Black-owned businesses.
Scott said he is concerned about the administration’s efforts to weaken the Community Reinvestment Act, a federal law that encourages depository institutions to meet the credit needs of low- and moderate-income neighborhoods.
“You’ve had four years and now you’ve come up with this plan and [at the] same time why is your administration trying to weaken the Community Reinvestment Act that is already in place that forces banks to provide capital,” Scott said.
He noted that he thinks Biden’s plan is headed in the right direction.