Universities including Yale and other institutions with significant financial assets should patronize more minority-owned financial firms, the Rev. Jesse Jackson said in a speech at the 7th Annual Rainbow/Push Coalition Wall Street Project Conference Jan. 14.
Jackson, who said he believes increasing minority control would create economic development in underserved communities, said the goal was for these firms to control 5 percent of all institutional assets. Both Jackson’s speech and a working paper prepared during the conference explicitly mentioned Yale as a focus of the campaign.
“We call on the GMs and IBMs, the Pfizers, the Yales and the Stanford universities, the Verizons, the United Methodist and Episcopal Churches and other major institutions to help lead the way,” said Jackson, the president and founder of Rainbow/Push — a group that according to its Web site works for social, racial and economic justice. “For these institutions that enjoy such fine reputations, the destiny of America’s promise is in their hands and well within their reach.”
Lonnie Soury, a spokesman for the project, said Jackson would work in collaboration with the senior financial officers of the institutions. He said he did not know why Jackson specifically mentioned Yale.
The project began as an effort to create job opportunities, Soury said, but he said increasing usage of minority financial managers will be “a real focus of the Wall Street Project over the next year.”
Jackson said in his speech that minorities manage only $5.5 billion out of $7 trillion in mutual funds. According to the working paper prepared for the conference, no Ivy League university uses a minority firm to manage its endowment.
Yale Chief Investment Officer David Swensen was unavailable for comment. Officials from Yale’s Office of Public Affairs could not be reached Monday night.
The working paper argues that minorities should be given increased control over the assets because much of these assets consists of their wages, taxes and retirement funds. Increased participation would have a domino effect, the paper argues, with minority investment managers hiring other minority firms.
Besides Yale, the Wall Street Project will also initially work with IBM, General Motors, Pfizer and Boeing. The five institutions combined have over $240 billion in assets, of which about $928 million is controlled by black managers, the paper said. Yale ties with Pfizer for the smallest group in the fund — both have about $10 billion in assets. Of the five, Yale and IBM are the only groups that have no black managers, the paper said.
Jackson said in his speech that increasing access to capital is the fourth stage of the civil rights movement, with the first three stages as slavery, segregation and gaining voting rights. He said capital “is to the economic system what blood is to the human body — that which carries the oxygen.”
“We must end apartheid structures at home by investing pension funds and equity capital in our communities,” Jackson said. “And by helping to manage these funds so as to direct their flow.”
Some groups have accused Jackson of threatening corporations with claims of discrimination to gain contributions to his campaigns. In April 2003, Robert Huberty, the executive vice president of the Capital Research Center — a group that according to its Web site analyzes “organizations that promote the growth of the welfare state,” accused Jackson of using “the art of the shakedown” against Viacom and Coca Cola, among other companies.
“Companies would rather accommodate Jesse Jackson than resist his demands,” Huberty wrote in the center’s Organization Trends.
This is not the first time in recent months that Jackson has been linked with Yale. He was arrested on Sept. 1 for blocking a street during a protest by University workers who participated in a three-week strike at the beginning of the year.
Soury said Jackson plans to move forward on the assets project immediately.