American Indians own businesses on average at lower rates than any other ethnic group in the United States and the businesses they do own make less profits on average than those owned by other ethnic groups.
The long term and entrenched poverty on reservations, the lack of functioning economies on most reservations, and the low amounts of accumulated family wealth for Indians contribute to these problems.
One major factor that could assist the development and expansion of Indian owned businesses would be if tribal governments directed as much of their spending as possible to Indian owned businesses.
It is well recognized and admitted by various tribal economic leaders that this is not happening and that this oversight should be corrected.
A recent article in Indian Country Today newspaper highlighted this issue:
“This year we “celebrate” the 100th anniversary of the Buy Indian Act. Under that federal law, the Department of Interior and its agencies “shall” employ Indian labor and purchase “the products of Indian industry.” Over the last 100 years, however, the United States’ record of buying Indian has been less than stellar.
It took the BIA until 1976 to adopt the procurement policy that “all [BIA] purchases or contracts be made or entered into with qualified Indian contractors to the maximum practicable extent.” . . . Still, by the early 1990s, it was reported to the Senate Indian Affairs Committee that Interior agencies were overwhelmingly awarding construction contracts to non-Indian businesses. . . .
This year we ‘celebrate’ the 100th anniversary of the Buy Indian Act.
Today, while there is mixed opinion as to whether Interior employs Indian labor whenever practicable, tribal entrepreneurs report that the United States’ record of purchasing the products of Indian industry remains abysmal. After 100 years of Buy Indian nonfeasance within every federal government branch, we must acknowledge that the act is ineffectual. The act will never be fully honored federally. Buy Indian must be realized tribally.
In the spirit of Indian self-determination, it is time for Indian country to buy Indian. In fact, as self-determination remains our watchword, do we really need the U.S. to finally buy Indian? Certainly we want federal purchasing power devoted to tribal businesses but we wield $26 billion of our own purchasing power thanks to Indian gaming. We can now do it – Buy Indian – ourselves. . . .
Sadly, Indian country’s record of buying tribal products is also woeful. We must buy Indian products and services in order to create a vibrant reservation private sector. According to “Rebuilding Native Nations,” “Small business activity has a tremendous psychological and emotional impact on reservation people, particularly reservation youth. When they see businesses sprouting up, they see hope for the future.” Yet without an Indian business sector, not only does our communities’ hope for economic prosperity languish, but money representing that chance of prosperity perennially flows off of the reservation, and into non-tribal communities.