The 12th annual Rainbow PUSH Wall Street Project Economic Summit is underway. I have attended the summit off and on since 1999, when the event was held at Windows on the World atop the World Trade Center. President Bill Clinton was the luncheon speaker.
While attendance is way down from its heyday, the conference theme, “Fallout from the Bailout: A New Day in Washington,” is ripped from the headlines.
It is deeply troubling that minority-owned professional services firms, including legal, accounting and asset managers, have been excluded from the Treasury Department’s Troubled Asset Relief Program (TARP).
During the opening plenary session, speakers expressed concern about TARP’s lack of transparency and accountability, and the notion that a business is “too big to fail.” Executive managers can make bad bets and get bailed out.
While Bank of America and Citigroup are back for a second helping of taxpayers’ money, minority-owned firms are sent to the back of the line. Indeed, the recipients of the first $350 billion have historically excluded minorities. Odysseus Lanier observed:
The professional services market is the last frontier. It is where the relationships and profit margins are…The folks who are getting the money have not demonstrated a willingness to work with minority-owned firms.
The Congressional Oversight Panel for Economic Stabilization reports there’s been no accounting of how the money was spent:
What have the companies who received money from Treasury done with the money? Have the companies used the funds in the way Treasury intended when it disbursed them? How have institutions supported under the Capital Purchase Program used their funds, and have they leveraged the capital support to increase lending activity? Is this different from the way funds were utilized for institutions who received funds pursuant to the Systemically Significant Failing Institutions plan?
BTW, a “systemically significant failing institution” is bureaucratese for a business “too big to fail.”
Emery Harlan cut to the chase:
It seems to me we kind of got played…They hooked up their boys on the way out the door. It’s not clear how they ended up with the contracts. They just ended up with them.
If we want to participate, we can’t just sit back and hope it’s going to happen…We have to be vigilant in making sure our interests are known and what we want is known.
My regular readers know I don’t just sit back. In the coming weeks, I will launch Tracking Change, a wiki that will track—and measure—change in the new Washington. We will track the White House and the People’s House.
I must admit, I don’t see the value at this point. All I see are institutions sitting on this “free” capital, not lending and not putting those resources in play to help fix our economy. This is unacceptable. If banks are unwilling to lend the money to small business owners trying to make payroll, that young person dreaming of going to college or that couple trying stay in their home—we shouldn’t give them another dime!