On Dec. 17, Congress passed legislation that will greatly reduce the tax burden on estates. The new law exempts the first $5 million of value that a person leaves to his/her loved ones. After that, the tax rate of 35 percent will be applied to the remainder. This is the lowest rate in 80 years and it is certainly a blessing for Black families. We are now evolving into ownership and business entrepreneurship which allows more and more Blacks to accumulate some wealth to pass on to their children and grandchildren. Wealth is built through inheritance and the work of generations. We Blacks have been hurt financially because our past has been plagued with poverty and slavery. The time has now come for us to begin to get out of that misery and enjoy life the way God intends for us to.
It has not been easy. There were 400 years of slavery followed by 100 years of apartheid and Jim Crow obstacles. We are at the point of learning this thing called Capitalism as Booker T. Washington preached it. Security is a financial future; not a Cadillac or expensive clothes. As we build our "nest egg" we prepare to pass it on to our loved ones so that they can have a running chance at life. Yes, Black America it is our turn to live the American Dream. Enjoy it and pass it on so that our loved ones will enjoy it even more.
We have been fighting for this reduction in estate taxes for more than 15 years. Our biggest foe has been Black politicians who have been acting like "crabs" in a barrel. For some reason the majority of Black congress persons have fought against this reduction bitterly. Why? I guess it is plain ignorance. If you look at the financial statements of members of Congress you will see that the vast majority of Whites are wealthy, very wealthy, while Blacks are basically common, if not poor. They don't think rich and will never become rich. They certainly can't feel the need to help other Blacks become rich. This has been our plight and is why our unemployment rates soar above all other ethnicities. It is why our neighborhoods lack economic vitality. We need leadership that understands our needs.
The reduction has finally happened but no collective thanks to our Congressional Black Caucus. Of the 41 members only three voted for the reduction. Special thanks to Congressmen Artur Davis (Alabama), Lacy Clay (Missouri) and Sanford Bishop (Georgia). They joined the majority of Congress and voted for this reduction in estate taxes. They didn't take orders from the "plantation". They voted for their constituents not Nancy Pelosi. Also, a very special thanks to President Barack Obama, who signed this legislation despite the protests of Speaker Nancy Pelosi and Senate Majority Leader Harry Reid.
Before this the most common thing that would happen when a wealthy matriarch or patriarch would pass away was the appearance of the tax man. The family or heirs would have to sell the business just to pay what they would owe to the IRS. Now most families can keep the business and maintain their livelihoods. Progress can continue and the fruits of hard work can be passed on to loved ones not the federal government.
The timing is very important. Blacks own businesses like never before and we are growing at a rate of 40%, which is the greatest growth compared to all other ethnicities. Also, the land we own in certain areas is increasing in value daily. Folks in Texas, Louisiana, Arkansas, Mississippi, and other places that are well populated with Blacks are realizing that there is oil, natural gas, and other minerals that can yield millions of dollars. As we benefit from these findings and the royalty payments start coming in, we must ensure that this new wealth can stay in the family. People in the Haynesville Shale on the Texas/Louisiana border are realizing new wealth and now they can invest this wealth and keep it in the family for generations to come. I know people who are getting five digit royalty checks monthly and it is just beginning.
My people, life is getting better despite the obstacles and setbacks we endure. It is getting better and we must ensure that good laws and policies are implemented. Bad laws and oppressive taxation must end and we must elect people who understand that. African American families have a lot of reasons to be thankful and this tax reduction is a good one. We did it despite the "crabs" and that is a very good thing. The next time you plan to vote please consider the person who is looking out for you; not the one who obeys orders that come from someone else. Don't let them take you for granted. Power to the people!
Mr. Alford is the co-founder, President/CEO of the National Black Chamber of Commerce, Inc.