Biden to Direct $100 Billion in Federal Contracts to ‘Disadvantaged’ Businesses to Shrink Racial Wealth Gap
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President Joe Biden intends to present a range of plans to shrink the Black-White wealth gap during his speech in Tulsa, Okla. Tuesday, including funneling $100 billion in federal contracts to ‘disadvantaged businesses,’ according to an administrative official familiar with the proposal.
Biden is scheduled to introduce the plan Tuesday at an event memorializing the 100th anniversary of the massacre perpetrated against the African-American section of the town, the Washington Post first reported.
It is unclear how the Biden administration intends to identify so-called “disadvantaged businesses” without explicitly establishing a racial litmus test, which would almost certainly be challenged in court as unconstitutional.
Under Biden’s plan, billions of dollars will also be directed to a variety of other underprivileged community needs, such as civic infrastructure, transportation and public transit, parks and recreation, and housing inequality. For example, the plan will allocate about $15 billion toward improving transportation in historically under-served areas and another $10 billion toward reclaiming vacant storefronts and subsidizing office space for community services.
Last summer, many black businesses were vandalized or entirely destroyed during the violent riots that broke out across American cities, namely Portland and Minneapolis, following Black Lives Matter protests. Many companies, such as Uber, as well as Hollywood influencers urged Americans to spend their paychecks and support black-owned businesses that suffered disproportionately during both the social unrest and pandemic.
Biden’s new initiative to reduce wealth inequality among Black Americans comes after the latest April Jobs report fell about 800,000 short of economist expectations, leading many Republicans to attack the administration’s stimulus payments as a counter-productive disincentive for minorities to re-enter the labor market. With an extra $600 a week from the CARES Act on top of state unemployment checks, the majority of unemployed workers were earning more from Biden’s enhanced unemployment benefits than from a job.
A key feature of Biden’s American Families Plan, proposed earlier in the year, is that it expands welfare and childcare benefits without work requirements. Critics of this kind of government spending assert that it will keep impoverished Americans, people of color or not, trapped in poverty and dependent on federal assistance.
