In 1980, the economy of North Carolina looked much like the Rust Belt, where we had more industrial shutdowns in North Carolina than any other state in the country. So the state was going through a massive economic transformation from manufacturing to a service economy, which it’s still doing, but really was accented in the early 1980s. So when a zipper factory or a casket factory or a textile factory or a furniture factory was about to shut down, the employees or the owners would call us and say, “Can you help us figure out a way to transition this business that would otherwise shut down and terminate all of the jobs, convert it into a employee-owned, worker-owned enterprise?”
So we did all this and we had lots of success, but what we found was that particularly poor families in poor neighborhoods, they didn’t have the cash to start a business. So in 1983 we had this wild idea that we would start our own bank because there weren’t any banks that really were willing to take a risk on low-income, black women in Halifax, North Carolina. I tell people, my early view was that all bankers were racists, that they were turning down loans because they were evil. And the very first three loans that Self Help did once we became a lender all went bad. So I looked in the mirror and concluded that either the bankers are not as stupid as I thought they were, and clearly I was not as smart as I thought I was. But we were half right. Half of the businesses that we were trying to assist should have been able to access credit and get started but they couldn’t simply because they were located on the wrong side of the tracks.
When Self Help first started, our goal was to put women and men, black and white on the same side. And our strategy for doing that was to create worker co-operatives where businesses would be owned by the people who are employed there. In rural and eastern North Carolina, in particular, black and white folks really had not worked together in a way that was on the same side. So by owning a common venture, a business, that everyone’s livelihood depended on, we felt like this was a way of having workers be able to interact with each other. And it worked very well for a while – for a long while. It’s just that about four years into Self Help’s work, we uncovered what became this dramatic fact. People who were smarter or better researchers than us would have already known this, but we didn’t. We discovered that black and Latino families had one-tenth the family wealth that white families had. And that single fact in my view is perhaps the most unacceptable fact in modern U.S. economy and it has implications all across the map. And just to add one more key fact: 60 percent of black households and Latino households have zero or negative net cash resources in the family. So if your goal is to create middle-class opportunities by owning a home, and you can’t have a down payment if you have no cash for a down payment, it becomes self-fulfilling. So for Self Help our goal was to figure out, how can we have, sort of, tipping points where economic advancement would occur, and what would be the places that you could intervene to make that happen? Homeownership, owning small businesses were two of the primary targets for us when we started – and still are, actually.
The issue of economic inequality has actually gotten worse in the 30 years that we’ve been working. We’d like to think that we’ve made a difference, but in the big scheme of things – I read this statistic which is powerful that said, if we still had the level of economic inequality of incomes that we had in 1979, which was nothing to get excited and jump up and down about, the median family in North Carolina would now have $15,000 more in annual income. So we have, in the last 20 years, so skewed the incomes of the very wealthy compared to the very – not even the poor. Eighty percent of all families in North Carolina have less real income from their jobs today than they did 20 years ago. So if that trend continues, nothing else will matter. I can’t really solve housing problem. We can’t really solve health issues if families on the bottom 40 percent or 50 percent simply do not have enough income, even if they’re working 50- and 60-hour jobs, to be able to survive. So the biggest challenge that I see is there’s this battle of ideology that has polarized and paralyzed the state and the country where we can’t really come to a consensus that a certain amount of economic inequality is so corrosive that it actually destroys the foundation of the society, which is exactly what we’re seeing.
I think that organizations like Self Help and others that are working to create economic opportunities for the bottom 50 percent, are actually working to save the country’s democracy – that if that is not, if we don’t make progress there, the social fabric will tear apart.