Why are the New York Times and the Wall Street Journal attacking an African American member of Congress who has devoted herself to issues of stabilizing the economy of the African American community throughout her political career, instead of more closely scrutinizing the activities of former Citigroup Vice Chairman Robert Rubin?
In case you have forgotten, while serving as Secretary of the United States Treasury, Robert Rubin engineered a multibillion dollar, admittedly-illegal transaction that allowed Citigroup to acquire Travelers Insurance. Mr. Rubin, immediately after facilitating this transaction, took a $15 million a year job at Citigroup, where he admitted he had no managerial or administrative responsibility. Many contend the $150 million Mr. Rubin secured over the last ten years was equivalent to a payoff for this illegal transaction, which has now cost taxpayers at least $45 billion and created a bank “too big to fail”.
In this context, what exactly is the “crime” that Congresswoman Maxine Waters has committed?
First, she has helped a small black-owned bank, OneUnited, that cannot afford the multi-million dollar lobbyists that the Bank of America, Citigroup and other majority corporations have.
Second, in order to preserve black-ownership, which is rigidly defined by federal regulators, her husband invested $250,000 in a bank that was unlikely to be profitable. For clarification, over the last decade, banks on the average have lost more than 81% of their value, and black-owned banks have suffered even more.
Third, Maxine Waters has been an advocate for African American and minority-owned banks from the time when Robert Rubin was Treasury Secretary, and when neither he nor no other federal regulatory agency would help minority owned banks.
Fourth, unlike for example AIG, Congresswoman Waters has always been open and transparent about her husband’s modest and nonprofitable investments.
As Congressman Charles Rangel well knows, when the New York Times and Wall Street Journal gang up on you, there’s no petty violation that will go unnoticed. Therefore, what we suggest is that Congresswoman Waters take advantage of these attacks to push forward the generally unsupported agenda of African Americans and other underserved communities.
Congresswoman Waters should request an investigation as to why the number of African American-owned banks has declined over the last twenty years, and why Citigroup’s $2 trillion in assets are 700 times greater than every African American bank in the nation combined. The investigation could also include why there are only three Mexican-American owned banks in the western United States and why Citigroup is using Troubled Asset Relief Program (TARP) funds to put the newest Mexican-American owned bank, Promérica, out of business.
The Congressional hearings should also explore the implementation of efforts to increase TARP funding to minority-owned banks, so that they can almost instantly triple their responsible small business and home lending to African American and other minority communities.
Last year government awarded $650 billion in contracts to large businesses served by Citigroup, Bank of America and other major financial institutions. Recent data shows that less than one percent (.8%) was awarded to African American businesses and just 1.1% to Latino-owned. Why shouldn’t Congress and the President, under the leadership of Congresswoman Maxine Waters, develop legislation and Executive Orders to compel federal agencies to provide up to 15% of their contracts to minority-owned businesses, and why shouldn’t every large federal contractor be required to do the same?
Every one of these issues has been raised in the past by Congresswoman Maxine Waters. Now is the time for our communities to support her in bringing these issues to the forefront. One piece of advice, however: no good deed will necessarily be rewarded.
Earl “Skip” Cooper, II has been an African American and minority business advocate in Southern California for more than thirty-five years. He serves as the President and Chief Executive Officer of the Black Business Association.