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DNC's Family Feud Over Minority Contracting

Dnc Minority Contracting

First Posted: 04/21/2011 5:34 pm Updated: 06/21/2011 6:12 am

Party insiders say the Democratic National Committee awards few contracts to companies controlled by racial minority groups, despite repeated pledges to increase business to such firms.

Instead, Democratic leaders claim progress by leaning on a broader definition of “minority contractors” that includes white women, the disabled and the gay community, according to internal memos and emails obtained by The Huffington Post and corroborated by those insiders.

The apparent dearth of contracts has fueled frustration and criticism, mostly from African American Democratic loyalists who accuse the party of failing to use its institutional finances to advance the cause of fair racial representation in the lucrative business of politics.

"There is no more loyal group of voters to the DNC than black people, and yet they have done nothing to ensure that that constituency is able to participate fully in the economic benefits of party business," said a DNC member who spoke on the condition of anonymity.

DNC leaders say while they take such concerns seriously, having launched a broad review of the committee’s hiring practices, they have been and remain committed to diversity, as does the broader party.

"I appreciate that some folks may think the party has some serious challenges in this regard,” said Patrick Gaspard, who was recently appointed the executive director of the DNC, “and one can, in all these kinds of instances, work hard to be more inclusive to make absolute certain and to make sure that the Democratic Party has as big a tent as possible.

"At the same time," he continued, "I say clearly, loudly and vociferously that there's a commitment that is ongoing. That commitment did not just begin today."

Democratic Party committees, including the DNC, spent about $759 million on national politics during the last election cycle. Consultants, including pollsters, fundraisers, strategists and those who send mailers and produce media advertisements, received a portion of the cash.

It’s difficult to say how much of that money went to minority-run businesses, since the party committees have repeatedly declined to release detailed breakdowns of their expenditures. But an analysis done for The Huffington Post by the Center for Responsive Politics shows that Democratic campaign spending on firms with at least one African American senior principal was about 1.5 percent of their total spending in 2010.

CRP’s analysis included a list of 15 of the top black-owned consulting firms identified by a number of black political consultants. Only five of the firms were awarded contracts, two of which collected the lion's share of that spending. By contrast, the Democratic Party hired hundreds of companies during the same period, according to CRP records, though the breakdown of contracts is more difficult to quantify, the center’s analysts say.

Gaspard said that of the $64 million in discretionary contracts the DNC awarded during the 2009-’10 election cycle, $19 million went to minority-run companies, though he and other committee officials declined to provide a further breakdown of the contracts by race or gender.

The executive director did say, however, that over the past few months, under the leadership of former chairman Tim Kaine and former executive director Jennifer O'Malley Dillon, the DNC has undertaken an "exhaustive forensic" look at its minority hiring and procurement, the most extensive in the organization's history.

"When I look at where we are today, when I compare it to what the Democratic Party has been in the past, I have to take issue that some say our performance on this issue is shameful," Gaspard said.

To Gaspard’s point, this controversy has been boiling for decades. The minority contracting issue has come up during almost every election cycle and every Democratic National Convention since the 1980s, when the Rev. Jesse Jackson was running for president and challenged the DNC to be more inclusive. But after the hue and cry from the usual band of minority leaders, the fuss generally dies down, with little resulting action.

Several months ago, however, members of the DNC's Black Caucus discovered a little-known loophole in the DNC's contracting process they claim exacerbated their concerns. And after being, they say, "ignored" and "disrespected" by DNC leadership regarding requests for specific information on staffing and contracting, the black, Hispanic and Asian caucuses took the unusual step of using the committee process to force the organization to officially acknowledge their grievances.

A KEY LOOPHOLE

According to Democratic insiders and internal DNC memos obtained by The Huffington Post, the DNC applies a loose definition of what a minority and minority business is.

Some call it the "one person rule," in which a company needs only a single minority owner to be recognized as a minority vendor, allowing the favor accorded historically disadvantaged groups.

The federal government and the U.S. Small Business Administration use a different definition to identify minority businesses than the DNC. Those institutions define such companies as those with a majority, or 51 percent, minority ownership.

The DNC also lumps together women, blacks, Hispanics, Asians, the disabled and members of the LGBT community as “minorities” generally, with little disambiguation. As a result of the umbrella grouping, the share of contracts awarded to racial minorities has further diminished, while those going to white women and gay men have bolstered, according to people close to the process.

The broad designation of “minority” clouds interpretation of the data, making it difficult to gauge the true economic inclusion of the individual groups but allowing the appearance of equity.

"At its most innocent, the people putting these numbers together just aren't clear of the real definition," said a former DNC member who now works as a party operative. "But all the way over to the most nefarious, maybe they are trying to pull the wool over our eyes to hide what they don't want people to see, that there are not sufficient contracts. So, maybe they came up with this alternate definition."

DNC leaders questioned the wisdom of "pitting" women, gays and people of color against one another by comparing contracting data.

"We have taken these steps to redress issues confronting groups that had historically faced institutional obstacles in furthering opportunity. I don't think any Democrat would argue that doesn't include women," said DNC interim chair Donna Brazile, who was also the first African American to lead a major presidential campaign: Al Gore’s in 2000.

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