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Economic Development in the Latino Community: Our

Path To the 21st Century

By Tomás Alberto Avila


ovember 8, 1997
Providence, RI

Building a community requires a strong foundation upon which to develop neighborhoods into thriving
productive areas. Frequently community leaders tend to dwell on the problems and deficiencies of their
community as their basis for producing a strategic plan to guide neighborhoods and individuals in
building their community. Communities are study for these problems and subsequently become
consumers of human and social services.

Often before embarking on a new project, a need assessment is undertaken to identify and determine the
specific needs of a target group or community so that a program can properly be structured to meet those
needs. Organizations are accustomed to focusing on the gaps in the community in addressing those related
needs. Most of the funding directed to lower income communities is based on the problem-oriented data
collected in need assessment. Targeting resources based on deficiencies directs funding not to residents
but to service providers.

This mentality can also have a negative effect on the nature of local leadership. If for example one
measure of effective leadership is the ability to attract resources, then local leaders are in effect being
force to belittle their neighbors and their community by highlighting their problems and deficiencies, and
by ignoring their capacities and strengths. This direction should be regarded as one of the root causes of
the sense of hopelessness that pervades discussions about the future of local communities. Typically, this
has been the most common strategy however; a foundation based on deficits makes it difficult to realize
the goals of a strong community

As the youngest, fastest growing minority group in the country, Hispanics have immense electoral and
consumer-market potential. Hispanic consumers already spend over $350 billion a year, and their
influence will inevitably grow in national and economic affairs. We need to demand the support of
business and Corporate America to help our Hispanic citizens realize their great potential, instead of
highlighting the problems and deficiencies in our communities. Investing in Hispanic America makes
good business sense.

In today's global economy, Latin America has emerged as a key region for trade and investment
opportunities for the United States. Opportunities exist in almost every sector of the Latin American
economy, including: communications, software, construction, transportation, agriculture, health and
energy. Hispanic Business in the U.S. continues to expand at a higher rate than ever before, with over 1.3
million Hispanic business owners in the U.S. today, generating nearly 200 billion dollars in annual gross
receipts. Through this growth, Hispanic entrepreneurs have become a strategic partner for Latin American
businesses.

Our community leaders and organizations should proclaimed themselves ready to dive deeply into the
issue of economic development, with a multifaceted plan to help our people increase their economic self
sufficiency. This agenda should signal a clear economic direction for the Latino community in the 21st
century.
This agenda should focus specifically on the way to shape the economic future of Latinos, and should
provide how-to strategies on becoming entrepreneurs, accessing capital, getting involved in urban
revitalization and partnering with large companies to engendered self sufficiency and wealth building in
the Latino community of RI.

The organizations will endeavored to build individual and collective wealth, increase business and home
ownership, prepare people for gainful employment, and promote academic excellence. The next 30
months should be a time of serious soul searching for Latino organizations. We should be asking
ourselves how we could best serve our constituencies in the next century. In most cases, this soul
searching should lead to a more sharply defined and targeted approach to achieving our community’s
economic objectives. Just like Afro American civil right organizations are shifting their civil right
agendas to an economic agenda, Latino organizations need to start focusing on the economic
empowerment of our communities.

Why should economic development be the agenda of choice for the Latino community and other minority
groups?

Despite some improvement in the last decade, more economic development is crucial if Hispanics are
ever to attain a full and equal place in American society. Latino leaders need to furnish Hispanic
businesses with training services and management expertise. Leaders also need to assist entrepreneurs in
starting new businesses and helps small businesses expand. Because the current environment has shifted
from the government to corporate America and the community entities, the politicians in Washington are
a lot more inhospitable now than in the past and it’s tougher getting equal rights laws pass. Since this time
is not conducive for government activism, self-sufficiency has become the watchword.

With the advent of major corporations right sizing, the white working class is suffering from the same
anxiety as other ethnic groups, and to just make a statistical statement about needing to hire more Latinos
won’t necessarily work. White workers are starting to view this tactics as a power grab, which has
lessened the public relations benefit and the moral authority. Economic Development for the Latino
community should not only mean accumulation of capital, but more importantly the development of an
infrastructure within our communities, economic development, business development, job creation all
have to do with developing a community. Economic development is the active participation in the
creation of individual and collective wealth in the community where one lives, participating in the
economic revitalization of our own neighborhoods as producers’ manufacturers and sellers. A community
will remain powerless when it only consumes.

Economic development provides the fuel to exercise political clout. For mobilizing our ballots power so
that politicians who covet our vote don’t take us for granted. For influencing national elections outcome,
which as we have learned the hard way of late, shape the composition of the federal courts that ultimately
rule on issues close to home. The Latino leaders should work on developing role models within the
business community and invest the capital into educational opportunities. This will empower the
participants and the community to create it’s own jobs, hire Latinos, contribute to candidates of it’s choice
and will exhort Latinos to demonstrate the same entrepreneurial zest that has existed in every community
through the following strategies. It should urge Latinos to lessen their dependence in a weekly paycheck
by saving and pooling their individual and collective resources and investing them wisely.

It should encourage our organizations to build up local business districts in Latino neighborhoods across
the state, instead of standing around waiting for the government to do it, while other cash in the financial
benefits. With our small businesses and entrepreneurs, we have the right stuff to take advantage of any
huge opportunity that’s unfolding under our noses. There are new opportunities downtown, in many
urban neighborhoods and nearby suburbs. Increase home ownership in our neighborhoods, and produce
more executives in income-producing divisions of corporate America

Educate young people that academic excellence is the key to competing at a world-class level, and
encourage Latinos to become players of our own destiny, and not just bystanders. We should become
involved in the merger proceedings if local banks plan to merge, so they won’t fail to make provisions to
establish credit pools for the Latino community and secure that retail and business loans flow to the
Latino community. Financial institutions have to go beyond window dressing when it comes to
community reinvestment. They have to stop just making donations, and instead make low interest money
available to the community. They should start making the process easier. The real spirit of community
reinvestment is to do those kinds of things,

Institute pilot economic development programs and then make successful models available to other
community organizations. In order to secure the success of this agenda, the organization needs to make
sure that the adequate amount of resources is in place to support it. Utilizing the community reinvestment
Act to its fullest extent to bring capital into Latino businesses and neighborhoods. Mainstream companies
are eagerly tapping into the new energy and immense purchasing power in cities. The key question is: Are
we going to be players? Shame on us if we let the opportunity slip by, only to moan years from now that
we’re still on the outside looking in.

Offering the understanding of neighborhood conditions and the long-term focus that the community
requires. For example teaching residents about their options and rights concerning housing. Training
young Latinos in the various careers involved in the development of the needed infrastructure. Past
experiences indicate that significant community development takes place when local community
individuals are committed to investing themselves and their resources in a joint effort. Another reason for
accentuating the development of the internal economic development of local urban neighborhoods is the
dismal prospect for outside help from forces outside the community.

The passive action of sitting around and waiting has been exhausted and proven unworthy to the minority
communities. Economic development must start from within the community. One of the biggest obstacles
facing local leaders today is revitalizing and expanding the economic life of a community. As a result of
various cutbacks and downsizing, smaller neighborhoods and communities have been virtually unplugged
from the mainstream economy. In order to reenter the economy, communities need a major commitment
to economic development. A creative approach works best in situations where traditional methods of
economic development haven’t work.

Question to consider, while establishing a strategic economic development plan.

How may community builders recognize and capture the full economic development potential of all local
institutions and organizations?

How can community builders capture local savings and expand the availability of vital capital and credit
for community economic development purposes?

How can local development leaders maximize the creative uses of all the physical assets of the
community?

Even in most devastated neighborhoods there exist materials needed to construct a path toward economic
development. It is necessary to harness the underutilized economic power of local institutions. Non-
economic institutions have the potential to be key players in building stronger, healthier economies
depending on how they use their resources. Local institutions, which invest in neighborhood, demonstrate
commitment to the economic health and well being of the neighborhood.

In general there are eight basic methods for local institutions to invest in building their community:

1. Local purchasing
2. Freeing potential productive economic space
3. Local investment strategies
4. Mobilizing external resources
5. Creating alternative credit institutions
6. Hiring locally
7. Developing new business
8. Developing human resources

Another method that can be utilized to rebuild community economies is to begin looking at physical
liabilities and devise alternatives for how they can be transformed into assets. Communities can begin by
reclaiming vacant lots and abandoned spaces. This process involves four basic steps:

Make an inventory of vacant and abandoned spaces

Acquire the space, using variety approaches, often with the help of partners.

Initiate and develop an appropriate project.

Maintain a viable ongoing project.

Whole Community Mobilization

Concentrating on maximizing local assets and generating new relationship is not enough. The real
challenge presents itself in developing comprehensive assets base strategy, one, which might involve
virtually the entire community in the complex process of regeneration. Whole community mobilization
may be envisioned and may begin being implemented by a five step process:

1. Mapping completely the capacities and assets of individuals, citizens associations and local
institutions.
2. Building relationships among local assets for mutually beneficial problem solving within the
community.
3. Mobilizing the community’s assets fully for economic development and information sharing
purposes.
4. Convening as broadly representative groups as possible for the purpose of building a community
vision and plan.
5. Leveraging activities, investments and resources from outside the community to support asset
based, locally defined development.
6. All together these steps comprise the process of achieving an asset based, internally focused and
relationship driven community economic development.
Reference
Altshuler, Alan A. and Jose A. Gomez-Ibanez. 1993. Regulating for Revenue: The Political Economy of
Land Use Exactions. Washington, DC: The Brookings Institution.

Avila, Alberto, Tomás Community Leadership Development Initiative Structure & Vision, Providence,
RI January 1, 1997

Blakely, Edward J. and David Ames. 1992. "Changing Places: American Planning Policy for the 1990s."
Journal of Urban Affairs 14:423-446.

Bogart, William T. 1993. "'What Big Teeth You Have!': Identifying Motivations for Exclusionary
Zoning." Urban Studies 30:1669-1682.

Clingermayer, James C. and Richard C. Feiock. 1993. "Constituencies, Campaign Support, and Council
Member Intervention in City Development Policy. Social Science Quarterly 199-215

Dear, Michael and Allen Scott, eds. 1986. Urbanization and Urban Planning in Capitalist Society. New
York: Methuen.

Fleet Bank, 20/20 Vision CRA Symposium, Washington DC November 4-6, 1997

Rodriguez, Ralph, Governor's Advisory Commission on Hispanic Affairs Action Forum Report,
Providence RI, November, 1997