Establish savings on Indian reserves
Promoting business development and economic independence on reserves is critical to supporting tribal communities.
In April 2020, the national unemployment rate skyrockets due to the COVID-19 pandemic. Data shows that the pandemic affected Indigenous workers especially harshly, with more than 26 percent of the Native American workforce unemployed last April against 14.5% of the national population.
The disparity between Aboriginal and non-Aboriginal unemployment rates existed before the pandemic. In some Indian reservations in the United States, the unemployment rate for residents has from a distance from 20 percent to 80 percent, demonstrating the continued need for government efforts to promote functional economies among Indigenous communities.
Few of the 300 Indian reservations in the United States have functional economies in which on-reserve residents can be employed, spend their money and find suitable housing. As a result, almost all on-reserve residents must to travel to distant cities to find banks, businesses, higher education and jobs. This helps state economies but serves to impoverish reserves, where indigenous people disproportionately live in poverty.
In light of these conditions, governments and tribal communities should to augment the number of small private and tribal businesses on reserves to help create functioning economies in the Indian country.
Governments to play a crucial role in the development of a private and free economic system by protecting the public interest, ensuring fair competition and managing legal systems that help enforce contracts and property rights. Governments can also regulate, creating and enforcing rules that ensure a fair and stable economic system which, in turn, can attract investors.
By enacting trade laws and creation With stable and fair justice systems and bureaucracies, tribal governments can encourage the development of private businesses on reserves. Tribes can also use Taxation and regulatory strategies attract private investment and new businesses in reservations. Tribal governments must play this important role for reserve economies.
In addition to encouraging the development of private enterprises, supporting Indian industry and labor is a common sense idea that favors tribal self-preservation, as it keeps “Indian money” in the Indian community and contributes to the growth of tribal economies.
Tribes can support existing Aboriginal businesses by enacting and enforcing “Buy From Indians” laws. The US Congress, for example, passed the 1910 Buy Indian Act who sought to promote Indian industry whenever possible. The law provides that the secretary of the US Department of the Interior with considerable discretion when it comes to spending federal funds on Indian labor and products made in India.
But tribal policymakers might consider lobbying Congress for stronger federal legislation on Indian purchases. For example, Congress could require the Home Secretary to spend a certain amount Indian Affairs Office ‘ budget on Indian labor and products. This would create a huge incentive for tribal businesses to provide these goods and services, which would help create many more Indian owned and reservation based businesses.
Tribal governments should also enact their own Indian purchasing laws and should purchase as many goods and services as possible from tribal, reserve-based, and Indian-owned businesses. In 1985, the Navajo Nation enacted such a law, called the Navajo Nation Business Opportunities Act. The law provides that the Navajo Nation will give Indian owned businesses the first opportunity to contract with the Nation. The tribal government enacted this legislation in part because 76 percent of contracts awarded by the Navajo Nation went to non-Navajo people and businesses.
In addition to giving preference to Indian companies when distributing government contracts, tribal governments could also impose the spending of a certain percentage of annual tribal revenues on private companies owned by tribal citizens or other Indians. . These types of mandates and statutory actions could go a long way in encouraging and supporting the creation, operation and expansion of more private businesses on reserve.
Tribal governments can also support the development of Indian-owned businesses by creation an environment that helps residents of the reserve who wish to start a business. Although many private businesses in the United States are beginning to use family savings and bank loans, most American Indians lack access to these resources due to historical poverty and high unemployment rates. Therefore, the seed money that tribal, private, state and federal loans to bring is crucial to alleviating this funding problem.
Additionally, reservations rarely have successful business owner role models that others can learn from. They often lack businesses on reserves where young people can get their first jobs and learn about business management. Tribal economic development departments can help remedy this situation through mentoring and training programs for young entrepreneurs.
A few organizations already offer this type of training. For example, in 1992, four tribes created the Oregon Native American Business and Entrepreneur Network to train individual Indians on how to write business plans, obtain financing and operate their own businesses. Likewise, in 2000, individuals from the Cheyenne River Sioux Indian Reserve created the Four Band Community Fund, an Indigenous community development financial institution focused on entrepreneurship and financial literacy.
Another example is Lakota Fund, the first Indigenous community development financial institution that community leaders of the Pine Ridge Reservation created in 1986. Lakota Funds contributed to the economic development of this reserve, disbursement more than $ 10 million in loans since its inception. These loans aid create more than 1,600 jobs and establish and develop nearly 600 businesses on or near the reserve.
Despite the importance of these initiatives, tribal governments must also to bring laws, regulations and independent judicial systems that will help and protect commercial and property rights. Indian countries must reserve fair and reasonable locations for businesses if they hope to attract private investment and build their economies.
Prioritizing economic development, including the creation of their own businesses and other efforts to to attract private development to provide a wide variety of goods and services on reserve – tribal governments can dramatically improve economic conditions on reserve and better support tribal communities.
Native American governments must do everything in their power to develop entrepreneurship among the residents of the reserves and ensure that more businesses are established in the Indian country. Economies that work allow Indian families to gain gainful jobs, adequate housing and the infrastructure necessary to live their lives on their own reserves.
This essay is part of a series called Indigenous peoples, tribal sovereignty and regulation.