Nation & World

America's first black billionaire says Trump economy has been good for African-Americans

'You have to say something is going right'

U.S. President Donald Trump speaks about tax reform during a visit to White Sulphur Springs, in West Virginia, U.S., April 5, 2018. REUTERS/Kevin Lamarque
U.S. President Donald Trump speaks about tax reform during a visit to White Sulphur Springs, in West Virginia, U.S., April 5, 2018. REUTERS/Kevin Lamarque

BET founder Robert L. Johnson, America’s first black billionaire, said during a CNBC appearance Friday that black Americans should be encouraged by the growing economy under President Donald Trump.

“Something is going right,” said Johnson, owner and chairman of Bethesda, Maryland-based asset management firm RLJ Companies.

He cited the December jobs report showing that unemployment among black workers was at its lowest since the Labor Department began tracking the data in 1972.

Black unemployment did fall to 6.8 percent in December, before rising and dipping again to 6.9 percent in March, according to the latest jobs numbers released Friday. But black unemployment remains nearly double the white unemployment rate of 3.6 percent, even though the gap has narrowed somewhat.

Johnson, during his appearance on “Squawk Box” on Friday morning before the March jobs report was released, was optimistic about how black Americans will continue to fare economically.

“You have to take encouragement from what’s happening in the labor force and the job market,” Johnson said. “When you look at African-American unemployment, in over 50 years since the Bureau of Labor Statistics has been keeping the numbers, you’ve never had two things: African-American unemployment this low and the spread between unemployment among whites and African-Americans narrowing.

“That absolutely means the jobs market is soliciting employees who have been out of the labor force, some of it just based on discrimination, some of it based on changes in education, access and technology changes,” he continued. “And so when you look at that, you have to say something is going right.”

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Johnson praised the current U.S. business environment, “if you take into account the Trump tax cut,” he said. “I believe the economy is on a strong growth path.”

The December tax cuts were the largest one-time reduction in the corporate tax rate in U.S. history. The GOP bill, sold on the promise that it would drive up wages and increase job growth, also lowered taxes for the vast majority of Americans, as well as small-business owners.

While Trump often claims credit for the lower black unemployment rate — touting it in his State of the Union address in January and even tweeting a CNBC story about Johnson’s comments Friday — the brightening economic outlook preceded his presidency. The black unemployment rate had steadily declined during Barack Obama’s two terms, from nearly 17 percent in 2010, after the recession, down to 7.8 percent by the time Trump entered office in January 2017.

“Most of the programmatic work was set into motion before the last administration was leaving,” said Hilary Shelton, director of the NAACP’s Washington bureau.

Some economists criticized Johnson’s rosy assessment of the economic picture for black Americans.

“A 6.9 percent unemployment is perhaps in a historical sense something to be happy about, but if the white unemployment rate were at 6.9 percent, we would consider this catastrophic and be very alarmed,” said Darrick Hamilton, an economics and urban policy professor at The New School.

Hamilton noted that the structural nature of work has changed drastically since the government began tracking employment statistics, with very different implications today in regard to job security, wages and retirement benefits.

“Work is more precarious today than it was in the past, and in particular, black individuals are more likely to be in precarious employment scenarios with jobs that face greater wage and work-hour volatility,” Hamilton said. “Bob Johnson’s in the billionaire’s club with Donald Trump, so it’s not surprising that they align in their vision on labor.”

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Johnson, who’s said he’s been friendly with Trump through the years, had met with the president at his golf club in New Jersey shortly after his election when Trump offered him a cabinet position.

“I thought I would meet to see if there’s common ground with someone most in the black community might call an enemy,” Johnson told NBC at the time. “It was clearly based on the respect two businessmen would give each other.”

Johnson reiterated Friday that he turned down the cabinet position because he didn’t want to work for the government but said he continues to have regular access to top administration officials who he speaks with regularly about improving the economic lives of African-Americans. Among the issues he said he’s engaged them on, including Trump himself during a meeting last week in Florida, are encouraging black workers to save for retirement and keeping black-owned banks from going out of business by ensuring they have enough capital to lend and promote community development.

Johnson, a Democrat and supporter of Hillary Clinton, had previously penned an essay on how African-American voters should respond to the “tectonic political rift” resulting in Trump’s election.

“Why shouldn’t we, as Black voters, reject the notion that we are locked into one party which undoubtedly limits and dilutes our voting power? We should, instead, use the power of our vote to support and elect whichever party that best serves our interests,” Johnson wrote.

He went on to quote former representative William Lacy Clay Sr., D-Mo., who formed the Congressional Black Caucus in 1971: “Black people have no permanent friends, no permanent enemies, just permanent interests.”

“That was the CBC motto then and Black Americans should embrace it as our rallying cry today,” Johnson wrote.

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