In January of 2008 Black Enterprise (BE) showcased a cover with Barack Obama on it blaring the caption “Why Barack Obama should be President.” At the time I found it a bit odd that a business magazine, even one for African-Americans, would endorse Senator Obama. For any number of practical and objective reasons Senator Obama was not a good choice from a business perspective; reasons I outline in a blog entry I wrote on the matter. Now for the second time in a year, BE has placed Barack Obama on the cover this time with a cover title blaring, “Yes, We Must!”

As a reader and occasional freelance writer for BE, I find myself again frustrated and bewildered not only by the endorsement of Barack Obama, but the reasons given for the endorsement. After reading the article, written by Editor in Chief Derek T. Dingle, and Editor-at-Large George Alexander, I had no doubt that business principles were not at the root of the endorsement. While on the surface one could expect a magazine geared toward African-Americans would want Senator Obama to win. But from an objective nonracial view I expect the magazine, both its owner and writers, to look beyond race. The name of the magazine is Black Enterprise Magazine, emphasis on “enterprise.” It is not titled Black Social Magazine or Black Empowerment Magazine. In other words, it’s a magazine about black businesses, geared toward black business and for African-Americans who want to become business owners. Therefore, any support, or evaluation of any Presidential candidate is supposed to be objectively viewed from the view of what is good for business and what is good for black businesses in particular.

In a repeat of the first article written in January, this obvious mandate has been ignored. For example, one assertion made in the article is, “Unlike like McCain Barack Obama will insure that Americans are not alone in dealing with their economic woes. His initiatives are fresh and comprehensive while McCain’s resemble a stale rehash of the trickle down agenda first introduced by Ronald Reagan some 25 years ago.” The statement as written sounds like a perfect campaign sound bite from an Obama staffer.

Senator Obama wants to tax the rich. That’s the centerpiece of his economic plan and stump speech. Now, of course, he does not say it like that. He couches it in terms of “not helping the top 1%” or “no tax breaks for the greedy oil companies.” But, that’s all code for taxing the rich and everyone knows it. Question: have we not heard this before? Is this not what Kerry said? Is this not what President Carter did? This is not new, or fresh. It may be comprehensive, although comprehensively stupid.

Every President since Kennedy that has raised taxes has had slow or no economic growth during their term. Johnson, Carter, Bush the first, all raised taxes and the country paid the price economically. These are well established facts that are not in dispute, so why is it ignored in the article written by Dingle and Alexander?

There is a reason why major business publications like the Wall Street Journal, and Investor’s Business Daily seldom, if ever, support Democrats. It’s because the policies they (Democrats) espouse are not good for the economy or business.  The primary agenda for Democrats and liberals are social items, not fiscal ones. Now whether that focus is a good one or not is not the point. The point I’m driving at is when I read BE, I expect to see any political based story, especially a feature, to be written in some part through the lens of how black businesses are affected. I do not care that Senator Obama is black. What I care about is how his call for a windfall tax on oil companies will affect Kase Lawal [Oil Baron cover story, June 2006] a black man that owns a “greedy” oil company.

Obama’s playbook, whether you agree with it or not, is straight out of a traditional Democratic view. During the primary campaign, Senator Hilary Clinton, said this about Obama’s fresh ideas, “This isn't change that you can believe in, its change that you can xerox.” She took much flack for that, but do you know what? She was right. A careful view of his proposals shows a direct correlation to the policies of President Jimmy Carter. Do we need to relive that nightmare? I hear many blacks complain about the Reagan years. How did blacks fare during the high interest rates, double-digit unemployment, and long gas lines of the Carter administration?

If you’re a BE writer and you’re writing about politics, it should be from the view of what's good for black businesses. A major question to be examined is how does taking more money out of the BE100 help them? How can you support something like that?

When it comes to Senator Obama there are only two ways from a black person’s point of view that you can look at him. Either you look at him as our chance to get a black man in the White House or you look at him and his policies objectively. The every day person usually cannot do that. Journalists are supposed to do that. Objectivity is the coin we trade in, and while I know and respect Mr. Dingle, I did not see any of that in this article.

If you are the editor of a magazine your mandate as both a journalist and as a journalist writing for a magazine about business is to evaluate all the candidates based on how is it going to help or hurt your constituency? With BE that is black business owners. Higher taxes do not help them. Even if you just go by what Senator Obama says, he is going to raises taxes on everyone with incomes above $250,000. I feel confident in saying that includes every business owner on the BE100. When you look at what his plan does in reality, his tax proposal will hit anyone with incomes above $100,000. That includes the owners, most of the senior executives in the BE100, and most of the readers of BE. How exactly does this help black business owners?

There is an answer to that last question within the article. Dingle and Alexander write, “To spur innovation and create new jobs Barack Obama promises however, to do away with capital gains taxes for startups and other small businesses.” This statement has to come right out of the Obama campaign. There is no way I’m going to believe that professional writers, writing for a business magazine, who presumably know a thing or two about business, would not know that businesses do not pay capital gains taxes. They pay corporate income taxes. Sylvia’s in Harlem does not pay capital gains taxes neither does your local building contractor, or the local McDonalds franchisee. They ALL pay corporate income taxes. The only businesses that pay capital gains would be companies involved in securities trading or sold their business. So the proposal by Senator Obama sounds good, but is filled with the same thing that makes cotton candy—hot air. I can’t believe that either of the writers did not know this, so I have to assume they ignored it in their evaluation.

When reading and evaluating this article it becomes clear the writers only scratched the surface of Senator Obama’s initiatives. Where is the evaluation of saying that taxes for seniors making incomes under $50,000 will be null and void, when many seniors income’s are made up of dividends and capital gains? An area that Senator Obama wants to double. Where is the information showing that under Senator Obama’s plan the cumulative tax rate for anyone making over $104,000 will be 62 percent? Why is every other business magazine and publication discussing and writing about these things, but the one major black publication about business is not?

 

Most African-Americans want to vote for Senator Obama because he’s black, and he is a Democrat, and because they hate President Bush. Most have no idea or clue about what the good Senator’s economic policies mean or their long-term consequences. But it is the job of BE to explain all of these things. This article does not do this. Instead it attacks Senator McCain’s ideas in much the same fashion as the Obama campaign. Take for instance this phrase, “McCain poses permanently extending the Bush tax cuts which has greater benefits to those in high income brackets.” This assertion is further strengthened with a chart that shows percentage wise the lower income levels getting a better tax break under Obama versus McCain.

On the surface it appears that Senator McCain is targeting his tax cut proposals toward the rich, but nothing is further from the truth. A deeper analysis shows McCain’s primary way of getting the economy started again is to cut corporate income taxes and capital gains taxes. Most high income earners, say members of the BE100, are business owners, so naturally they would be helped the most. They would be helped the most for the same reason they make more than most people, because they own a successful business. Again, like all the members of the BE100.

The second thing an objective analysis of the two plans shows is that McCain is offering a real tax cut. Obama is offering a refundable tax credit to everyone who makes less than $50,000 a year. He’s going to send them a check, even though the people who make less than $28,000 a year do not even pay taxes. In fact, 40% of working age adults do not pay taxes, but Obama wants to send them a check for $1500 dollars. That’s not a refund, that’s welfare. Here’s the critical part, however. The top three categories in the chart, those that make $250,000 and above, account for 65-70% of all new and current jobs. Individuals in those categories are business owners that is where their money comes from, and they pretty much hire and employ most people. The bottom categories that Obama wants to help by taking the money from the top, and giving it to the ones at the bottom account for less then 10% of new or current jobs. Here’s the bottom line, individuals who make less than $50,000 are working for someone, not hiring people. You cannot have a growing economy unless jobs are increasing, and businesses are expanding. Raising taxes prevents that from happening.

This is not empty rhetoric. Rather than compare Obama to McCain, let’s compare him to another charismatic Democrat that blacks love, Bill Clinton. Everyone knows the economy during his tenure as President was great. How did it come to be so? The first two years of his presidency were a disaster from an economic stand point. But then he cut the capital gains tax, he cut corporate taxes, and he decided to not tax the internet, which was the area the economy fed off. The economy then grew at a pace never seen before, until the end of his term. If it was great for Bill, and blacks and Democrats loved those times so much, then why is a business magazine promoting someone who is going to do the exact opposite?

The only time the economy expands is when we have lower taxes. So when Obama says he is going to create businesses and economic growth and do it by raising taxes it’s the job of a business writer to point out historically how that is false. BE did not do that, and has not done that. I expect for the average African-American busy with work, family, and just living life to not know this information. BE and its writers do not have this excuse. Their job, everyday is to get up and write about business. That means, therefore, they should understand business. If you’re telling me the writers and editors do not understand that cutting taxes helps the economy, increases tax revenues, then I don’t know why they are writing for a business magazine.

I know Mr. Dingle personally, and respect him. I have interviewed him, and as freelance writer for the magazine worked for him, but it is plain to me that either racial solidarity or political ideology has trumped what should be the mandate of this publication. If a policy does not help businesses and black businesses, then BE should not be supporting the politician promoting the policy. While it may not be obvious to people not used to working in business or with business owners, BE has done a disservice to African-American’s across this country. This is because they have no idea of the economic mess that is about to come down the pike. And it is BE’s job to objectively tell them. Businesses do not grow in high tax environments. If you believe that it’s harder for black businesses, then you have to believe that a shrinking economy will be worse for us than for white business owners. Either way, the only suitable cover story title for this election should have been, “Obama, Yes We Want Too, but We Must Not.”