Fred McKinney (opinion): A golden opportunity to transform CT’s Black and brown businesses

Back • Publication Date: November 13, 2021 • Fiscal & Economics

Fred McKinney (opinion): A golden opportunity to transform CT’s Black and brown businesses

“I don’t want nobody to give me nothing, open up the door and I’ll get it myself.” ~ James Brown, The Godfather of Soul

Last week’s passage of the $1.2 trillion “hard” infrastructure bill is a golden opportunity to create sustainable jobs, businesses and communities that have been underserved for decades. Connecticut is scheduled to receive about $6 billion, or less than one-half of 1 percent of the total bill. Connecticut’s “fair” share based on our population and our tax contribution to the bill is closer to $10 billion.

Public investments in Connecticut’s roads, bridges, airports, broadband internet, trains, schools and other public buildings will improve the productivity of all Connecticut residents. The bill also represents at least $6 billion in income to the region’s businesses. The question that must be asked and answered is: Which businesses will get the contracts to revamp Connecticut’s infrastructure?

Too often minority-owned businesses are an afterthought when it comes to major public investments this once-in-a-lifetime bill represents. Five years from now, I hope we can look back and be proud of the work we have done instead of looking back and wondering how we failed to take advantage of this opportunity to build minority businesses. Connecticut lawmakers and communities should not let that happen this time.

I spent 15 years as CEO of the largest supplier diversity organization in the region. After my years at the GNEMSDC I spent three years at Dartmouth’s Tuck School of Business, where I developed an executive education training program for corporate supplier diversity professionals. Over the last two decades, I have worked with hundreds of corporations helping them improve the utilization of minority businesses in their supply chains.

With some corporations I was more successful than others. But I always believed that government at the local, state and federal levels has a greater responsibility to build and develop minority businesses than the private sector because minority business development directly impacts the lives of citizens, taxpayers and communities. And unlike corporations, whose primary goal is to increase the wealth of its shareholders, government’s “shareholders” include all citizens. Part of that responsibility is to set the stage for the continued growth of the whole economy, not just the economy of private shareholders.

In Connecticut, we need this focus on inclusion more than ever. A recent report by the advocacy group Connecticut Voices for Children shows that despite our image as a progressive and prosperous economic state, Connecticut has the second-highest income inequality of any state in the country and the second-lowest rate of economic growth of any state since 2007. Our job growth is anemic, and the productivity of our workforce is also one of the worst in the nation. This is a recipe for long-term stagnation even for the wealthy in the state. These facts dispel the myth that addressing inequality harms economic growth. Right now, we have great inequality and no growth; maybe we should try something else.

The Infrastructure and Jobs Act of 2021 creates an opportunity to turn the fortunes of Connecticut around by utilizing this investment as a mechanism of building sustainable minority businesses and communities. But we must be intentional if we want this opportunity to not just slip away. We can make a new and better future, but we must take concrete steps to transform minority communities in the state and the nation.

There are several steps we should be considering right now so that the money and income in this bill finds its way into the minority business community.

1. Gov. Lamont and the congressional delegation should convene a conference of minority business, nonminority business leaders, local officials and other stakeholders to develop a “compact” that will set the goals for how these new federal resources will be spent in the state and how the state and localities will commit to utilize minority businesses.

2. Minority businesses need to develop an inventory of their current capabilities and their needs to accomplish the goals set by the compact. This needs to be done at a granular level. For example, we need to know what minority businesses exist in road construction, trucking, carpentry, electrical, cellular technology, etc. We need to know where the gaps are and then commit to filling those gaps.

3. We must develop the processes to connect the opportunities to the businesses, and we must expand our perspective to include the possibility that minority businesses can be both subcontractors and the construction managers on projects.

4. Communities, particularly minority communities across the state, need to be educated on the changes that are coming to their community and have a voice in those decisions, unlike what has happened in the past. In previous major public investments, minority communities were either not involved, or their interests ignored. The best example of this was with the construction of interstate highways that brought great improvements in transportation, but often at the expense of minority communities that were carved up and economically destroyed in the process.

Many infrastructure businesses are about to benefit from this once in a generation investment. This is an opportunity to develop the businesses of the future. We cannot afford to settle for business as usual. I hope we are up to the challenge.

Fred McKinney is the co-founder of BJM Solutions, an economic consulting firm that conducts public and private research since 1999, and is the emeritus director of the Peoples Center for Innovation and Entrepreneurship at Quinnipiac University.

Authors: Fred McKinney, Ph.D. •  Source: CT Post • View