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Minority Small Businesses Key to Economy

Eastern Group Publications, News Report, Edgar Rascon Posted: Apr 21, 2009

Small businesses have long been called the life-blood of the U.S. economy; the same can be said for the Los Angeles economy, said U.S. Bancorp CEO Richard Davis at the launch of a new business organization last week in Downtown Los Angeles.

Davis was joined by several hundred business owners and members of the media who crowded into the Los Angeles Theater Company for the April 2 official launch of the Latino Business Chamber of Greater Los Angeles (LBC-GLA).

The LBC-GLA is the vision of a group of Latino small business owners who feeling there is a void in services and organizational support available to help their businesses prosper set upon a path to create an entity that would provide a national presence to minority owned businesses in Los Angeles.
Mayor Antonio Villaraigosa and FDIC Senior Advisor Robert Mooney were two of several high profile guests who attended the chambers inaugural event.

In a city where 70 percent of the population is people of color, we need an organization that supports Latino small businesses, said Villaraigosa who was introduced by LBC-GLA Board Member and Promerica Bank founder and board chair, Maria Contreras Sweet.

Villaraigosa introduced U.S. Bancorps Davis, whose company has pledged hundreds of thousands of dollars to the chamber. Davis said last weeks G-20 Summit in London is evidence that the United States is still the heart of the worldwide economy, and that California was the heartbeat of the U.S economy.

And since Los Angeles is the heartbeat of the California economy, the Latino Business Chamber of Greater Los Angeles will essentially be the heartbeat of the world, said Davis.

Jorge Corralejo, CEO and Chairman of the LBC-GLA said the new chamber will allow minority-owned small businesses to engage corporate America and the public sector in a serious way.

While much attention has been paid to what is going on with the countrys corporate giants during the economic downturn, more attention should be given to the fact that more than 50 percent of U.S. workers are employed by small businesses, said Corralejo.

In early March, the chamber traveled to Washington D.C., to meet with senior financial officials, including Federal Reserve Chairman Ben Bernake and U.S. Treasury Secretary Timothy Geithner. They were there to remind them that small businesses must play an important role in any long-term recovery plan, said Corralejo. These officials are the gatekeepers who decide where and when stimulus funds will be appropriated, and the Chamber wants to make sure small, Latino owned businesses are given access to those funds and contracts, said Corralejo.

Feedback from those and future meetings, and the Chambers technical expertise to assist local businesses prepare proposals to secure funding for their projects.

One of those serious steps taken to strengthen the Chambers clout was getting the Federal Deposit Insurance Corporation involved with the launch. Robert Mooney, senior advisor to FDIC Chairwoman Sheila Blair described changes by the FDIC that will assist the chamber in reaching their ultimate goal of greater access and security in lending.

Minority small businesses help create a stable local economy, said Mooney. The Latino Business Chamber will go a long way to create jobs which will produce homes, and produce happy families.

New strategies from the Obama Administration to shore up and stabilize banks could result in more available capital to put together loan packages tailored to small businesses. Specifically, Mooney said a temporary liquidity guarantee, the increase of deposit insurance to $250,000 and the Legacy Loan program, which will remove bad assets off banks balance sheets, will preserve consumer confidence and increase a banks ability to lend.

Corralejo said the chamber is lobbying the Treasury to allocate unused or returned funds from the Troubled Asset Relief Program (TARP) to bolster investment in Latino and other minority owned businesses.

We must increase lending in the minority community and we can put pressure on officials by using our demographics as leverage, Corralejo said.

He says the idea is the first of its kind and that the chamber is already working with a major financial institution on finalizing the proposal.

And with small businesses accounting for 60 to 80 percent of the new jobs created since the mid-nineties, its innovative ideas such as these that supporters feel will help get the economy out of the current recession.

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