The term “black dollar” refers to money that circulates within the African American community. It encompasses both spending by African American consumers and revenues of African American-owned businesses. The concept of the black dollar gained prominence during the Civil Rights Movement as a way to encourage Black economic empowerment. Leaders urged African Americans to support Black-owned businesses and redirect their spending power within their own communities. This was seen as a path towards economic independence and a means of building wealth and resources within Black neighborhoods. The term continues to hold significance today as a reflection of African American economic influence and as a call to action for community-centered commerce.
Origins of the Term
The specific phrase “black dollar” emerged in the 1960s during the Civil Rights Movement, though the concept of Black consumer power dates back much earlier. Booker T. Washington, founder of the National Negro Business League, spoke of the need for Black economic solidarity as early as the late 1800s. Marcus Garvey, W.E.B. DuBois, and other Black leaders also championed Black entrepreneurship and consumer activism in the early 20th century.
The term grew in usage during the 1960s as African American buying power increased and activists made concerted efforts to direct that spending within Black communities. Organizations like the Nation of Islam, the National Urban League and CORE (Congress of Racial Equality) advanced “Don’t Buy Where You Can’t Work” campaigns and “Negro Dollar Day” initiatives to boost Black businesses.
Leaders like Malcolm X expressly used the phrase “black dollar” when urging the African American community to support itself economically. The term gained further exposure through publications like Black Enterprise magazine, founded in 1970 to focus on Black business and economic issues.
Meaning and Significance
The concept of the “black dollar” has multiple layers of meaning:
Racial Pride and Empowerment
On its most basic level, the phrase is about taking pride in the economic influence of the African American community. It is a testament to the billions in spending power held by Black consumers. The concept asserts this buying power as something that is distinctly “Black” in nature and that it can be leveraged for the advancement of the Black community.
Community Loyalty
The “black dollar” also carries a notion of loyalty to Black-owned businesses and services. Similar to “buying Black,” it reflects a commitment to supporting enterprises within one’s own community. The implication is that African Americans should choose to pay the “black dollar” into Black hands whenever possible.
Wealth Building
Keeping dollars within the Black community is presented as a way of building collectively held wealth. The money circulates amongst Black businesses and consumers, funding jobs and growth rather than being siphoned out of the neighborhood economy. The vision is one of economic empowerment fueling greater prosperity and financial security.
Self-Determination
At its core, the term embodies the spirit of self-determination. It suggests the African American community has the power to fuel its own progress through strategic use of its consumer strength and resources. The emphasis is on Blacks determining their own economic fate by controlling the flow of money within their communities.
Black Buying Power Statistics
African American consumer spending has been steadily rising over the past several decades. Here are some key statistics about the current economic influence of the Black community:
U.S. Black Buying Power
| Year | Black Buying Power |
|---|---|
| 1990 | $318 billion |
| 2000 | $533 billion |
| 2010 | $896 billion |
| 2020 | $1.4 trillion |
Source: NielsenIQ
Comparison to Other Groups
| Racial/Ethnic Group | Buying Power in 2020 |
|---|---|
| African American | $1.4 trillion |
| Hispanic American | $1.7 trillion |
| Asian American | $1 trillion |
| Native American | $115 billion |
Source: Selig Center for Economic Growth
Portion of U.S. Black Buying Power by State
| State | % of National Total |
|---|---|
| New York | 9.6% |
| Texas | 9.3% |
| California | 8.2% |
| Florida | 7.6% |
| Georgia | 5.8% |
Source: NielsenIQ
These figures demonstrate the huge spending capacity held by African American consumers today. Blacks have over $1 trillion in buying power, on par with the spending of other major racial/ethnic groups. The black dollar undoubtedly represents an extremely influential market segment.
Black Dollar Circulation
A key aspect of the black dollar concept is how money circulates amongst African American individuals and businesses. Unfortunately, the actual rate at which dollars exchange hands within the Black community is difficult to track empirically.
Some economic studies have analyzed flows of capital in Black neighborhoods relative to other areas. Research indicates that even predominantly Black communities tend to have money leak outside frequently due to factors like fewer Black-owned businesses. However, certain categories show greater potential for capturing local black dollar circulation.
Categories for Black Dollar Circulation
| Category | Black Dollar Capture Potential |
|---|---|
| Grocery and convenience stores | Medium-High |
| Eating and drinking establishments | Medium-High |
| Health and beauty stores | Medium-High |
| Other retail stores | Medium |
| Automobiles | Low-Medium |
| Home improvement/furnishings | Low |
| Electronics/appliances | Low |
For categories like food, personal care and restaurants, there is greater potential to harness black dollar spending within the community. Categories dominated by large chains tend to see more leakage of dollars.
Strategies for Increasing Circulation
Some strategies that could help improve local circulation of black dollars include:
– Supporting more Black-owned grocery stores, restaurants, salons, clothing boutiques, etc. in Black neighborhoods
– Expanding options for Black-owned financial institutions like banks and credit unions
– Creating community investment funds that let residents pool money for investing in local Black businesses
– Promoting circulation through campaigns, directories, and events spotlighting local Black businesses
– Helping Black entrepreneurs scale up their businesses to meet more community demand
With the right infrastructure and initiative, communities have tools to help maximize black dollar circulation from one local outlet to the next. This builds wealth that stays within the community.
Black Dollar Day Initiatives
“Black Dollar Days” represent a form of consumer activism tied to the black dollar concept. On these designated days, African Americans are encouraged to spend their money intentionally with Black-owned businesses. The initiatives send a concerted message about the power of the black dollar while also providing an economic boost to participating businesses who see increased sales.
Key Examples
Some major recent Black Dollar Day events include:
| Event | Date | Details |
|---|---|---|
| OneUnited Bank’s #BankBlack Challenge | July 7, 2016 | Hundreds of thousands nationwide shifted funds to Black-owned banks |
| National Black Economic Liberation Day | July 7, 2017 | Initiative of NCOBRA supported by celebs, companies, activists |
| Blackout Day 2020 | July 7, 2020 | Black Dollar Day promoted heavily on social media |
These events have leveraged social media to gain greater participation across the country. The initiatives tie the black dollar directly to larger economic justice efforts.
Impact
Outcomes reported from these events include:
– Over $50 million deposited in Black-owned banks for #BankBlack initiative
– Blackout Tuesday yielded estimated $4.1 million in increased sales for Black-owned businesses
– 76% of African Americans said Black Dollar Days make them more likely to shop at Black-owned stores overall
The viral, collective nature of these days can create short-term sales spikes. Ongoing grassroots support for Black businesses is still essential for lasting impact.
The Black Dollar During Recessions
African American buying power, like that of other groups, can take a hit during economic downturns. However, research indicates that loyalty to the “black dollar” often remains resilient.
Spending During Recessions
| Indicator | 2001 Recession | 2008 Recession |
|---|---|---|
| Drop in Black buying power | 14% | 7.4% |
| White buying power change | -4% | -11% |
While recessions negatively impact Black buying power, the drop tends to be less steep than for White consumers. This indicates greater loyalty amongst African American consumers.
Sustained Solidarity
In spending surveys across economic environments, African Americans consistently exhibit greater commitment to Black businesses compared to other groups. For example:
– 50% of Blacks “strongly agree” they’re more likely to shop at Black-owned stores, versus just 19% of Whites who say they actively seek to buy from White-owned businesses.
– 71% of African Americans try to utilize Black-owned companies whenever possible vs. about 50% of Hispanic-Americans who prioritize Hispanic-owned businesses.
This data reiterates that supporting the black dollar has deeper cultural and economic significance, beyond just individual financial circumstances.
Conclusion
The black dollar remains an influential force today, representing over $1 trillion in buying power. More importantly, the concept reflects the African American community’s ongoing push for economic security, self-reliance and racial pride. Boosting circulation of the “black dollar” requires collective commitment from Black consumers and business owners alike. With strong infrastructure and ingenuity, communities can leverage their resources strategically for lasting progress and generational wealth. The journey to full economic equality is long, but the power lies within reach.