All Money Is Power

Audio Description

African Americans are 48 million strong in the United States. But what does the data reveal about Black consumer impact on U.S. economics and culture? Crisis manager Drew McCaskill gets us up to speed, empowering African Americans to understand just how powerful and influential they are. 

Transcript

00:00 - 00:20

If African Americans alone were a country, just Black folks, we would be the 15th largest GDP in the world between Spain and Australia, is black America, right? The wonderful world of Wakanda. Right. This is Changing the Trajectory.

00:20 - 00:46

I'm your host, James Seth Thompson, Bernstein's Head of Diverse Market Strategy. My guest today is Drew McCaskill, a dynamic marketing executive and culture analyst. Drew will help us contextualize and quantify the African American influence so that we can move beyond the headwinds straight towards empowerment. Drew, I'm excited that you can join me today. And I know you have a very impressive resume.

00:47 - 01:22

You worked for many years at Nielsen. While you were there, you co-authored the diverse intelligence series on the economic and cultural impact of multicultural consumers. I'd like to know eventually what discoveries you revealed in that report, but why don't you start off by giving us a little bit about who you are and what you're about. Sir, hey, I want to say thanks for having me. I'm really excited to be here to talk about this, because economic empowerment for diverse communities is sort of my passion. I am a crisis manager by trade, so I've managed crises for large corporations all over the world for about 20 years.

01:22 - 01:39

But in my time at Nielsen, one of the things that I was really, really interested in was the impact of multicultural consumers on the US economy, on how they impact culture, as well as what that means for brands. Right.

01:39 - 02:10

So Nielsen is a data company and my clients then were manufacturers, retailers, the entire media industry. And I wanted to put some real data around the impact that multicultural consumers  particularly Black consumers, had on just culture and US economics. Yes. So what was the message that you were trying to get out to the leaders in the industry? Multicultural consumers are really important to the US economy.

02:10 - 02:25

The reality of America right now is that 92 percent of the population growth that has happened in the last 15 years has come from communities of color, African Americans, Hispanics and Asian-Americans. That is real impact, right?

02:26 - 02:45

That means that if you're a manufacturer, a retailer, a service provider, a financial institution, if you don't have a multicultural strategy today, you don't have a growth strategy. That is surprising for a lot of journalists. It's surprising for a lot of marketers.

02:45 - 03:19

It's surprising for even folks inside of those communities that just how much power and just how much impact we have. I look at African American impact on the US economy and US culture, and I'm shocked that sometimes we don't know and we don't recognize just how much power we actually have. African Americans in the United States, if you just think about the sheer numbers, let's just look off top the numbers. African Americans are 48 million strong in the United States.

03:19 - 03:37

Oftentimes when we look at population numbers and we look at data, we hear that number that we make up 14 percent of the US population. But when you start to look at the actual number of 48 million Americans, that is impact, right? That is a big deal.

03:37 - 04:00

And African Americans, median age is 32 years old. So we are young. We are just entering into our high earning years. And across the board, when we start to look at educational attainment increases and we start to look at income increases in the African American community, it's significant.

04:01 - 04:14

I've heard you refer to this concept of the three epicenters of power that African Americans have. What do you actually mean by that? When people understand their power, they move through the world differently.

04:14 - 04:45

And so my goal is to relay to African Americans just how powerful they are. And I look at that power in the light of some of the media myths that are out there, the media myths that all African Americans are in poverty, media myths that African-Americans spend indiscriminately, media myths that we don't vote, all sorts of things. But I look at it as African Americans have three really core epicenters of power, right.

04:45 - 05:17

The power that we exercise at the ballot box; we're 14 percent of the US population. 48 million strong. Black voter turnout was within one percentage point of white American turnout in 2008. In 2016, voter turnout for African Americans was just slightly lower than that, but it was actually higher than white voter turnout in 2012. African Americans consistently have a higher voter turnout than our Asian and Hispanic counterparts.

05:17 - 05:30

When Black people go to the polls, we change the results of elections. All you have to do is look at how African Americans put the defibrillator on Joe Biden's campaign in this election year alone.

05:30 - 06:04

Right. If African Americans hadn't turned out for Joe Biden in South Carolina and in the primaries, that campaign would have died on the vine. Right. And so when we move collectively, there's a lot of power there. Tom Perez, the DNC chairman, has talked about how African American women are the backbone of the DNC and have been the backbone of the DNC for decades. Because Black women vote, you know what I mean? And so I look at the ballot box, right? That's one epicenter of power.

06:04 - 06:36

The second epicenter of power is at the cash register. African Americans contribute 1.4 trillion dollars to the US economy. If you think about that in terms of just global money, if African Americans alone were a country, just Black folks, we would be the 15th largest GDP in the world between Spain and Australia. Is Black America, right? The wonderful world of Wakanda. Right. We are an economic force in this country.

06:36 - 06:53

One of the things that I studied at Nielsen was their entire product categories that, if African Americans just did not buy a product, those entire product categories would collapse. They would literally collapse. And there are tons of those categories.

06:53 - 07:11

Right. So we have a lot of power. We do have a lot of power. That's true. But many people also say that 1.4 trillion dollars of African American contributions to the US economy is not wealth. I'm wondering how you actually respond to that. True. Yeah, that is a fact.

07:12 - 07:42

But all money is power. And so when we decide to spend or not to spend, we have a disproportionate impact on the economics of companies and of brands and of entire communities. Black Americans decide for 30 days they're not going to buy a particular product or particular product category. It will get the attention of some of the largest corporations in the world. Right. And so we have a lot of economic power.

07:42 - 07:56

The third epicenter of power is our impact on culture, and that impact is not just impact on American culture, but as goes American culture, so goes the rest of the world.

07:57 - 08:29

African Americans have an incredible amount of what I call social currency, and we have the ability to change the narrative in digital spaces. African Americans make up 14 percent of the US population, but 28 percent of the people on Twitter. So there's a reason why there are journalists at major metropolitan newspapers that study and follow Black Twitter so that they can understand what's coming around the corner, culturally. The most recognized singers and performers are African Americans.

08:29 - 08:44

Athletes are African Americans, artists are African Americans. There's a halo effect around the things that Black people like, that Black people are interested in. Right. There's a cool factor for that. And we saw that over and over

08:44 - 09:10

when African Americans use their power in digital spaces and their influence in digital spaces, we get it done. People oftentimes forget that the reason why the Academy Awards completely changed the way that they recruit Academy Awards voters came from a Black Twitter hashtag, #OscarsSoWhite. We forget that the Me Too movement was started by African American women.

09:10 - 09:29

We will sometimes forget that so much of the social justice movement that we see right now is about Black citizen journalists posting and talking about the things that are happening in our community, that were not making national news, that were not making local news. Right.

09:29 - 09:50

And so when we move collectively at the ballot box, when we move collectively at the cash register and when we move collectively using our social and digital capital, African Americans are an incredible economic and cultural force, not only in the United States, but in the world writ large.

09:51 - 10:12

You know, I appreciate the statistics that you use to really illustrate how vital the Black contribution is to the economy and society. It's what we feel. It's what we believe. But the statistics prove it is what it is. And I want to turn a little bit to a different conversation.

10:12 - 10:31

We've had discussions of this nature on my podcast episodes before, but we can't talk about this idea of power without acknowledging our hurdles. Can you speak to some of the myths surrounding socioeconomic issues that impede economic progress for us?

10:31 - 10:56

Because I know the well-known narrative is that Black people have no one to blame but ourselves for not attaining what other minority groups have. But we also know that other minority groups have not had to go through what we went through and continue to go through today. Yeah, so here's the thing is that African Americans are making huge gains in

10:56 - 11:30

income, we're making huge gains in educational attainment, and we are working extremely hard, sort of as a community to attain the American dream, but the reality is that America has systemic racism that is just embedded in every, almost every function of progress in this country, political progress, economic progress, educational progress, and particularly financial progress. Let's just talk about corporate America.

11:30 - 11:59

You and I are both corporate guys, right? And there are two million African Americans with advanced degrees in this country. Yet less than 4 percent of the S&P 500 executives are Black. Right. We're talking about less than 5 percent of the executives in the private sector on the whole are Black. We look at that and we're trying to figure out what is that. A lot of that comes from just that, it's very difficult to outrun racism. Right.

11:59 - 12:18

And these are organizations that have D&I programs. These are organizations that have human resources programs. These are organizations that have people out actively recruiting people to come into their organizations. And I mean, it's a reality, right? So think about, think about these numbers.

12:19 - 12:24

That level of racism is also embedded in things like housing.

12:24 - 12:59

We all know that homeownership is so closely connected to wealth creation in this country. It's why when soldiers got back from service, they were given access to get homeownership loans, because we know that once you get a house, you can start to begin to build wealth and build generational wealth, the largest contributor to wealth. It is the largest contributor to wealth, yet we have the headwind of redlining. We've had the headwind of the mortgage industry and the loan industry.

12:59 - 13:00

Icing us out.

13:00 - 13:23

One of the largest financial settlements in cases in history was about Black farmers not being given the same loans that their White counterparts were given. Right. And so even if you say, well, I'm going to farm, I'm going to farm the land that I have, but the system that every other farmer uses, I don't have access to it. I don't have access to capital. Right.

13:23 - 13:38

Or predatory lending in the African American community is one of the things that some of the largest banks in the country all have a horrible history with. This statistic is one that has always shocked me.

13:38 - 13:59

Fewer than 1 percent of the mortgage loans at banks that are not run by minorities go to Black borrowers. And so that's the reason why we have some of the headwinds to Black homeownership that we have in this country. White homeownership is at seventy three percent in the United States, Black homeownership is at 44 percent.

14:00 - 14:24

Right. And so if you look at that gap, that's not about African Americans not wanting to own homes. That's about, you know, we only get 1 percent of the actual loans from banks that are not Black-owned banks. Right. And so there's a reason why that redlining is also a big deal for us. Right. So think about this.

14:24 - 14:54

If you're an African American and you buy a home in a Black community, statistically speaking, the rate that your home value increases is exponentially lower. It could be a great neighborhood, a safe neighborhood, a beautiful neighborhood, a well-manicured neighborhood. But because it's a home in a Black neighborhood or in a neighborhood where people of color are, your home, values do not go up as much.

14:55 - 15:14

And so even if you are an African American and you get that 1 percent of those home loans and you buy a great house in a great neighborhood, the delta between what your home is worth in 10 years and what your White counterparts' home is worth in 10 years is significant.

15:15 - 15:37

It is very difficult to outrun racism and systemic racism. So, you know, people will say, oh, well, you know, Black people need to pull themselves up by their bootstraps. You can do everything right and still have the hurdle and the headwind of systemic racism in this country.

15:37 - 15:59

I can't tell you how many conversations I've had and really talked about the historical context where we find ourselves today from Jim Crow to redlining. And look, at the end of the day, to your point, the historical things that have happened still show up today in policy. And yes, everyone should pull themselves up by the bootstraps.

15:59 - 16:27

But it's hard when your straps are shorter. Right? Absolutely. It's very hard when your straps are shorter. It is very hard. At the very least, if African Americans know what some of those headwinds are, they can make a decision for themselves. Hey, I may need to, for my own financial benefit, as much as I want to live in a Black neighborhood, I might have to buy a house in a White neighborhood.

16:27 - 16:35

Right. And that's a hard pill to swallow. But the more information that we have, the better we can make decisions for ourselves. Right.

16:35 - 17:09

So I'll give you another statistic that really sort of burned in my brain as America started to cope with COVID-19. And it's this: 40 percent of the revenues of Black-owned businesses are located in the five most vulnerable sectors. Right. So you could be a business owner and an entrepreneur. But for African Americans, about 40 percent of the revenues from our Black-owned businesses are in leisure, hospitality and retail type businesses. Right.

17:09 - 17:37

And so they're incredibly vulnerable. And that's compared with 25 percent of the revenues of all US businesses. It means that, I hate that statistic, but I give that statistic to Black entrepreneurs so that they can think, I might want to do something in hospitality, but I might want to diversify what that looks like so I can have a business where there's a moat built around it. Right.

17:38 - 17:59

I just want us to have information because I don't believe that you can outrun and outwork racism. But I do think that we have to be just as strategic and innovative about shielding ourselves from racism as racists have been with keeping racist systems in place.

17:59 - 18:34

I've heard you talk about this idea of conscious consumption and this idea that companies should be deliberate in how they show up for us in a very significant way. Can you elaborate on this idea of conscious consumption? Absolutely. Listen, that 1.4 trillion dollars that we contribute to the US economy, it's slated to be 1.8 trillion by 2024. That's in just four years. We're talking about almost 2 trillion dollars that African Americans contribute to the economy. And so I believe all money is power.

18:34 - 19:00

And the decision on where to spend our money, how to spend our money, when not to spend our money is really powerful. There's an expectation now that we've not seen before for companies and corporations to have some moral agency. Right. It's not enough for companies to just do no harm. Now we're expecting companies to be on the right side of history on a lot of things.

19:00 - 19:23

And that demand has come from conscious consumers. We have to think a little bit differently about what we spend our money on and who we spend our money with. So how do we actually make conscious consumption a habit? How do we weave it into the spending habits of African Americans? Before we buy a product, I say, ask yourself five questions.

19:23 - 19:46

Right. Can I get this product or service in my neighborhood, right, do I have to drive across town to a White neighborhood or to a different neighborhood to get this product? And why do I have to do that? Right. Why am I going to get your product as opposed to you bringing your product to me?

19:46 - 20:04

Because that's not the experience for our White counterparts. Right. Two. Does the company that I'm about to do business with or spend time with hire people who look like me? Is there anybody who looks like me in your leadership and if not, why? Right.

20:05 - 20:39

And that's not just about having a single Black executive that's looking at diversity and inclusion. Right. Because here's a factoid, as somebody who's lived and breathed corporate America and lived and breathed diversity and inclusion in human resources and crisis management, if the senior-most person of color in your organization is the diversity person, your company has a diversity problem. Right? Right. The third question, do I see positive images of myself in the content or in the advertising of these companies?

20:40 - 20:54

Important. Important. I personally can go the rest of my life and never see another Black choir singing about chicken and burgers. Right. That's me personally. Right.

20:54 - 21:25

Does the company actually support causes that are important to my community? How much are you taking from my community and not giving anything back? And if any of those four questions is a no, your fifth question is, do they deserve my money? Do they deserve my money? You know, I commend PepsiCo for retiring Aunt Jemima. I do. But it probably shouldn't have taken 100 years to do it.

21:26 - 21:43

My answer to that is, you know, that is conscious consumption, right? That's woke money versus broke money. There is also a spending component to that. You know, when I think of inclusive procurement, I talk about this all the time. Right. Drew and James, we can spend every dime we have

21:43 - 22:09

to make sure we are empowering Black businesses and black entrepreneurs. But companies and organizations can do that at an exponential clip, whether it's the services that keeps you light on, whether it's the person that supplies your paper products. How intentional are these companies also in supporting minority and Black vendor relationships?

22:09 - 22:34

I could not agree with you more, man. That's, that's a big part. We talk a lot about extending ourselves to be contributors to the economic ecosystem of African Americans. But we, the people, the Black people can't do enough ourselves. We have to get these organizations to put money where their mouth is as well.

22:34 - 23:02

Right. And look, I love those questions you posed because I asked a question about money is power, and you gave me five questions back. But those are five questions are actually answers to the question about money and power. Drew, I've heard you reference ourdipper.com as a great resource for African Americans and a great example of a way in which we can be deliberate about helping one another. What is ourdipper.com about and why are you a big fan of it?

23:03 - 23:20

The reason why I like ourdipper.com so much is because at the core, it's about information sharing amongst African Americans. It's a website where African Americans talk about their experiences at work. How many times has an African American interviewed for a job?

23:20 - 23:47

If you're a superstar where you already are or you're being recruited by an organization and you go in and you've got your shiny Black folks clothes on for the interview and you're ready to rock and roll and to wow them, and you wonder to yourself, I wonder what the Black people headcount is, right? Or I wonder if they're any Black executives, or I wonder if this is the best that they will treat me in this moment right now. Right.

23:47 - 24:06

OurDipper, it's a professional network where people can talk about their experiences, information sharing, helping people not make the same mistakes that you've made, but also helping people get some of the winds and low-hanging fruit that you have seen and identified.

24:07 - 24:23

Let's start to wrap up the conversation by just nailing down what you think the key to African American empowerment is. My biggest plea around African American empowerment is number one, move collectively.

24:23 - 24:43

African Americans have to demand more, demand more at work, demand more in our communities, demand more in our faith centers, demand more where we show up, right. And where we are the economic or the cultural engine. We have skin in the game.

24:43 - 25:18

We need to have all of those entities that we impact to do more. Ask more of our government. Right. Even in faith life. If my Black church does not have its money in a Black bank, I need to know why. If my company is not doing business with Black businesses, I want to know why. We have to start asking the questions. And I think that that empowerment and demanding more is that we have to recognize our own power in that we deserve more.

25:18 - 25:29

We literally built most of this country, right. And most of what we built, we built in free labor, stolen labor. That's just a reality of our history.

25:29 - 25:46

And we have to stop demurring from that and understand that we really do deserve more. So move collectively, ask for more. Right. Those are the two things that I think really change it. And consume consciously and thinking about it.

25:46 - 26:19

Unconscious consumption of media, unconscious consumption of products and services is a detriment to our community. And I think we have to think about it from a consciousness standpoint. The other part of moving collectively is information sharing. We have to share information with each other. We have to give each other a heads up when we have a heads up, whether that's financial information or whether that's information around how we move better and more effectively toward success. Share your wins and your losses with other people.

26:20 - 26:21

All facts, all facts.

26:21 - 26:43

And I appreciate your approach to what empowerment looks and feels like. Intentional actions are necessary, deliberate actions are required, and influence leads to impact. And, you know, especially now, the last couple of months, so much talk about people like you and I, African Americans, have been so oppressive.

26:43 - 27:12

So I really appreciate you joining me today to have a more uplifting discussion. I do want our community, African Americans, to realize the influence that they have in their community and in the economy, but to also know that we can do more, and I think knowing the facts, knowing the numbers is actually encouraging, you know, so I really appreciate your time, Drew.

27:12 - 27:47

This idea of conscious consumption has just left some to-dos for me. I've personally been looking at what my sphere of professional looks like and where we spend money and where I try to be as intentional as possible to really impact our people. So I want to thank you again for joining us. And then you took me to church. I really appreciate it. Hey, thanks for having me, man. I love that there is an African American man doing what you're doing because so much of what we don't do is about what we don't know.

27:47 - 28:13

And information sharing is so important. I feel like more of us would participate in the financial process in a different way, if we saw people who looked like us in those spaces, people that we felt more comfortable with having tough conversations about money or saying, I don't know, it's sometimes hard for us to say, I don't know, to someone who doesn't look like us.

28:13 - 28:38

Right. And there's a level of cultural competency that goes along with knowing what some of those things are. And so I'm just grateful that a you exists out there and a place like AB, and I'm encouraged by that. I really appreciate that. 22 years in the industry. And I always say I've accepted the challenge. Right. I'm not stopping by any means necessary, but just know I really appreciate that perspective. Thank you.

28:39 - 29:06

I hope you enjoyed today's episode. We love to hear from you. So please e-mail your thoughts, questions, and any feedback you may have to diversemarkets@Bernstein.com. Be sure to share, subscribe and rate us on Apple podcast or anywhere you listen to podcasts, and check us out on Twitter at BernsteinPWM. Bernstein: Making money meaningful for individuals, families, and foundations for over 50 years. Visit us at Bernstein.com.

Hosts
James Thompson
SVP—Head of Diverse Markets Strategy

The information presented and opinions expressed are solely the views of the podcast host commentator and their guest speaker(s). AllianceBernstein L.P. or its affiliates makes no representations or warranties concerning the accuracy of any data. There is no guarantee that any projection, forecast or opinion in this material will be realized. Past performance does not guarantee future results. The views expressed here may change at any time after the date of this podcast. This podcast is for informational purposes only and does not constitute investment advice. AllianceBernstein L.P. does not provide tax, legal or accounting advice. It does not take an investor’s personal investment objectives or financial situation into account; investors should discuss their individual circumstances with appropriate professionals before making any decisions. This information should not be construed as sales or marketing material or an offer or solicitation for the purchase or sale of any financial instrument, product or service sponsored by AllianceBernstein or its affiliates.

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