Pipelines of opportunity should be available to all Americans. But for Black Americans, discrimination and historical injustice have created significant barriers to critical opportunity on-ramps like capital to start a business or access to the training and education needed to enter a lucrative field.
It’s harder for Black entrepreneurs to get the startup capital they need. They are more likely to rely on personal credit cards carrying balances than traditional bank loans, and when Black entrepreneurs do get a loan, they are more likely to be offered a smaller amount and pay higher interest rates. Additionally, Black Americans are saddled with much higher student debt burdens, which makes it harder to get financing to start a business. Nearly 40% of African American adults between the ages of 25 and 55 hold student debt, compared to 30% of whites and Latinos.
We must also speak the truth about how Black Americans remain at a disadvantage in participating in our STEM (science, technology, engineering, and math) workforce. The Penn Center for Minority Serving Institutions (MSIs) reports, for example, that Black students studying engineering earned only 4.2% of bachelor’s degrees in 2012 across the United States. Of these, Historically Black Colleges and Universities (HBCUs) graduate nearly 1 in 4 Black Americans who earn science and engineering bachelor degrees. Yet, HBCUs remain historically under-resourced and some are even being forced to close. Of the U.S. institutions of higher education that have endowments of $1 billion or greater in 2018, none are HBCUs. A 2018 GAO report found that the size of the median HBCU endowment was about half the size of a similar institution that wasn’t an HBCU.
We have to reverse this trend. With access to proper resources, HBCUs and other MSIs can be hubs of activity for STEM research and learning which will create a virtuous circle, attracting other leading faculty, students, and research funding opportunities. And with proper resources, we can ensure that Black entrepreneurs have a real shot at starting small businesses and other ventures.
HERE’S HOW SHE’LL DO IT:
She’ll provide the resources we need to create hubs of STEM research and education at HBCUs and other MSIs
- Kamala Harris will invest $60 billion in STEM education at HBCUs and other MSIs.
- First, she’ll make sure we build out the infrastructure needed to facilitate STEM research and education by creating a $10 billion infrastructure grant program for HBCUs and other MSIs. Institutions will be able to use the funds to build classrooms, labs, and other facilities.
- Then, she’ll create a $50 billion fund at the Department of Education to help HBCUs and other MSIs build up STEM education. These dollars can be used to fund undergraduate and graduate scholarships, fellowships and internships for students, as well as the institutional and curricular support STEM students need on their pathway to success. Funds can also be used for cutting-edge research equipment as well as training and supporting faculty, lab technicians, and post-doctoral fellows.
- She will also direct the Pentagon to work with HBCUs and other MSIs to engage these institutions in DoD-funded basic and applied research opportunities. This will also include partnership opportunities with DoD and our top research universities as well as research and internship opportunities for HBCU and other MSI students.
- Additionally, she will direct federal research and grantmaking agencies to drive more opportunities to HBCUs. She’ll ask the National Institutes of Health, the National Aeronautics and Space Administration, the Environmental Protection Agency, and the National Science Foundation to facilitate HBCU and broader MSI participation in federal research grants.
- Kamala will also invest in other critical infrastructure at HBCUs and other MSIs. She’ll rebuild campus infrastructure, permanently increase funding for these institutions, and provide $2.5 billion to support HBCU programs that will generate Black teachers, an expansion of her previous plan to increase teacher pay.
She’ll make investments that create opportunities for Black entrepreneurs to bring great ideas into the marketplace and grow the small business engine of our economy
- She’ll work with Congress to create a $12 billion capital grant and technical support program, which will go directly to helping minority small business owners start businesses. She’ll direct the U.S. Department of Commerce Minority Business Development Agency to distribute these funds, leveraging its nationwide network of business development centers.
- She’ll tackle the enormous student debt burdens with which so many Black Americans are saddled.
- She’ll establish a student loan debt forgiveness program for Pell grant recipients who start a business that operates for three years in disadvantaged communities.
- Participants can have up to $20,000 of debt forgiven and can defer all of their student loans, interest-free, during a business-formation period that can last for as many as three years.
- She’ll make sure that Black entrepreneurs have a real shot at getting a federal contract awarded to their business.
- She’ll streamline the application process for the 8(a) Small Business Development Program, which helps minority-owned small businesses in the federal contracting process. She’ll also expand Rep. Clyburn’s plan that 10% of the federal funds in the program go to communities with persistent poverty and require federal agencies to better track their minority contracting spend. She’ll set as a goal that 25% of the 10% going to those communities gets spent directly on contracts with minority entities or minority-serving institutions. And to address cash flow issues frequently experienced by minority-owned small businesses, she’ll reinstate the Quickpay initiative to bring down from 30 to 15 days the time the federal government pays contractors after receiving a valid invoice.
- She’ll partner with states to expand access to capital through state-led programs.
- She’ll bring back the State Small Business Credit Initiative that supported state programs to strengthen small businesses. She’ll invest an additional $10 billion in the fund and add incentives to encourage the funding to be used to support minority small businesses operating in high-poverty communities.
- She’ll reform Opportunity Zones and set new goals to make sure funds go to minority-owned small businesses, prioritize lowest-income neighborhoods, prioritize hiring in those neighborhoods, and have safeguards to ensure that housing projects that are built actually contain affordable units. Additionally, she will ensure that information on this program is collected and made public to ensure the reformed Opportunity Zones program achieves the program’s goal of improving the opportunity for people and communities most in need.
- She’ll expand support for Black entrepreneurs navigating the permitting process and other regulatory barriers to starting small businesses.
- She’ll reinstate tools at the CFPB designed to identify and prosecute acts of private discrimination against Black and other minority entrepreneurs.
- And, she’ll expand small business development centers at HBCUs and leverage other entrepreneurial apprenticeship programs in the private sector to provide strategic advice and mentorship to Black entrepreneurs through the process of starting a venture.