TSD Memphis

Fri04182014

Opinion

Could a tax credit fix the black jobs crisis?

Tax Credit Blacks-400

The May jobs report didn't bring worse news than the April jobs report. But it was still bad news for African Americans, for whom unemployment remains in the double digits.

Although unemployment among whites is 6.7 percent, 13.5 percent of African Americans are unemployed. As America slowly recovers from the recession, Black America appears to be getting left behind. A 2005 study found that race plays a role in hiring decisions, noting that white applicants with criminal records were still statistically more likely to get callbacks for jobs than black applicants without one.

After a Senate roundtable on Thursday about the issue, The Root interviewed three senators about the effects of racial discrimination in the black unemployment crisis and whether or not drastic measures, such as tax incentives for diverse hiring, are needed to address the issue.

When asked if discrimination continues to play a role in the high rate of black unemployment, Sen. Mark Pryor, a Democrat from Arkansas, replied, "Well, I think there is some discrimination. I'm not familiar with all the numbers and all the studies, but my instinct is to say there is some and that is a factor."

When asked how to remedy the role that such discrimination plays in hiring decisions, Pryor proposed that other industries could take a cue from football: "I think the Rooney Rule is a good model for us to look at and follow because before they did the Rooney Rule in the NFL, they'd had a very small number – maybe one African-American head coach."

Pryor was referring to a rule named after Pittsburgh Steelers Chairman Dan Rooney and implemented in 2003 that required professional football teams to interview at least one minority-group member when hiring head coaches.

"If you think about the talent pool of all these former NFL players, they had a zillion people that could have (risen) through the ranks and been head coaches. To the NFL's credit, they recognized that, and again, they don't require any kind of quota. They just require that you consider diversity and have a diverse hiring pool." (The NFL recently revisited the Rooney Rule and added career-development opportunities for potential coaches to further improve upon the the policy.)

Asked whether a tax credit aimed at incentivizing more businesses to consider instituting their own versions of the Rooney Rule would work, Pryor paused before saying, "It's a good question. I'd have to think about how to do something like that and how the mechanisms would work." He went on to say that while he is a supporter of affirmative action, often such measures are remedial, and once the remedy has run its course, at a certain point the free market has to kick in.

Sen. Mo Cowan (D-Mass.), one of two black senators currently serving (the other is Republican Sen. Tim Scott of South Carolina), when asked about the role that tax credits could play in spurring more businesses to hire African Americans, said, "In my opinion, everything should be on the table."

Of tax credits that are already being used to incentivize businesses to hire veterans, Cowan said, "I like that tax credit – certainly for veterans." He continued, "I'm not ruling it out. Anything and everything should be on the table."

But, he cautioned, "I imagine if you have a tax credit that is for the benefit of hiring someone for their race or ethnicity, you're going to have a legal challenge of significance. I'm not saying that that debate shouldn't happen. I'm saying that everything should be on the table. If we are sincere about addressing our unemployment, that means we have to look at unemployment wherever it exists and then develop strategies and tactics specifically tailored to address those issues. I'm all for that, and I think this Congress could get a lot more serious about addressing those issues."

Sen. Mary Landrieu, the Louisiana Democrat who is chair of the Small Business and Entrepreneurship Committee, said, "I think, unfortunately, discrimination still exists in our country in many places and while it has improved, it's still real and it still hurts."

When asked how to tackle the impact of racial discrimination on economic inequality, Landrieu replied, "What we've been trying to focus on in the small-business committee is getting access to capital to more Americans, to more small businesses – particularly to minority, African-American, Hispanic businesses in the communities in which they live."

She stressed, though, that holding institutions accountable is key. For instance, she noted that the committee has worked to require "banks to report where they are lending to by ZIP code."

Pryor also acknowledged that the first black president could be complicating efforts to address the issue of black unemployment head on, particularly in terms of creative or risky policy solutions. When asked directly if there are policy solutions that a white president like Bill Clinton could have proposed that might be received less enthusiastically from Barack Obama as a black president, Pryor said candidly, "I think there is that concern. That type of thing does happen sometimes in politics where it takes the right person under the right circumstances to make the changes because sometimes you have the wrong messenger in there."

He was quick to note that this is not a race-specific phenomenon. For instance, Democrats tolerated welfare reform because it was spearheaded by a Democratic president, Clinton, in a way that they might not have had he been a Republican, Pryor theorized.

Cowan had these final thoughts on the role of the president's race in addressing policy issues that disproportionately affect the black community: "Electing and re-electing a black president obviously didn't solve all of the problems of black America. It's not a cure-all. I, for one, did not assume this president would have a solely black agenda, whatever that may mean."

(Keli Goff is The Root's special correspondent. Follow her on Twitter.)

Add comment


Security code
Refresh