Legal defense, educational fund offers help for miniority businesses

One on one

August 26, 1991

One on One is a weekly feature offering excerpts of interviews conducted by The Evening Sunwith newsworthy business leaders. Parren J. Mitchell is a former U.S. congressman and founder of the Washington-based Minority Business Enterprise Legal Defense and Education Fund.

Q. In creating the Minority Business Enterprise Legal Defense and Education Fund, what had you hoped to accomplish with it and where is it going?

A.We've accomplished exactly or are accomplishing exactly what we wanted. I conceived of this in 1980 when I knew the Justice Department had sold us out. We became operational in 1984, been operational since. We handle class action

suits for minority businesses; we worked with cities and states in their disparity studies to help them come up with a program that will meet the muster of the Supreme Court. We're advocating all the time on legislation. Like every other group, we're limited in resources, but I think we're doing pretty well.

Q. What's your budget?

A. Our budget is less than $600,000 a year. And that's to serve the whole country. But we're managing to do it.

Q. What is the most pressing economic problem facing black America and particularly black businesses?

A. Well, access to capital and an

anti-black attitude that now exists in this country. Poll after poll has confirmed that there is this idiotic feeling that if blacks do well, it's at the expense of whites, and that's a very pervasive and endemic attitude. That attitude coupled with a lack of access to capital makes it very difficult for us.

Q. You quote 1987 census data that reports black businesses generate a scant 1 percent of all business receipts and those businesses constitute only about 3 percent of all businesses in America. Does any of the fault lie with the black business owners?

A. No. It lies in those barriers that are still very, very strong in the business community and it lies in the obstacles that I talked about... The obstacles that are placed in the way of black businesses. Laws not being enforced. That's a very serious obstacle. The matter of diluting the strength of black businesses by adding on other groups that really should not be included, where not originally intended to be included. So those obstacles really are the major problems, not the fault of black businesses themselves.

Q. Well, some people say that black businesses don't have enough experience as managers; they come in with not enough money, so that some of the problems have to rest at their feet.

A. No, I think that's ridiculous. I think that's smoke screen stuff. I've worked with black businessmen over the last 22 years, and many of them, the majority of them, come in with the ability to perform and grow. The major obstacle is that the banks and other lending institutions often simply do not let them have a line of credit that's made available to whites.

Q. Now you have repeatedly said black businesses will not make a jump into economic mainstream without access to capital and bonding. In this market climate, isn't that going to be practically impossible?

A. No. Already you see the resurgence, you see the economy beginning to come out of the recession. If the federal government wanted to, it could provide a huge pool of capital. Talk about the deficit and the national debt and all of that, why in foreign aide, which I support and always will, there's over $9 billion sitting there that the countries it was allocated to can't use. That's $9 billion. In research and development, you've got lTC billions of dollars that can't be spent. So it's not a question of "Is the money there?" It's there. The question is the priority.

Q. What is your opinion of the financial aid programs in Maryland? How's Maryland doing compared to the rest of the country?

A. Well, I think Maryland is probably a little bit ahead of most other states in helping to get some access to capital through its small business development programs. It is helping some companies but even I think those who run those operations would be forced to admit that it is a woefully insufficient amount of capital to really give assistance to minority businesses.

Q. Some people feel that if you provide more capital to black businesses, it's going to take the business away from other businesses that are doing well. What do you say to counter that argument?

A. You know, it's so ridiculous to argue that.

Q. You are arguing in effect that the American economy is never strong enough, never capable enough, to include black businesses, and I don't want to believe that. We include all kinds of new opportunities, daily and yearly. So I just refuse to believe the fact that the American economy cannot accept the entrance, the significant participation of black businesses.

A. Do you think that the Small Business Administration has progressed since you left Congress?

Q. Well, it has not progressed very well. Here again I find an example of an agency really not carrying out the law or throwing obstacles in the way of people so that they can't benefit from an 8A program.

Q. Obstacles such as?

A. Well, the length of time that it takes to process an application. Under the law, they're supposed to do that within 90 days. In some instances that I've dealt with, it's been two years. That kind of bureaucratic tom foolery.

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