How the Promised Land of Black Business has disappeared

CHICAGO — Every now and again, Alvin Boutte Jr.’s travels take him past 79th Street and Cottage Grove Avenue on Chicago’s South Side. And the memories come flooding back.

The retail corner in the city’s Chatham community, with its handsome 1920s brick-and-terracotta buildings, boasted a host of Black-owned businesses from the 1970s through the 1990s. It had stores, a pharmacy, dentists, a nightclub, a funeral home and the jewel of them all: Independence Bank of Chicago, with more than $100 million in assets, right there in a big new modern building at 7936 S. Cottage Grove Ave.

Boutte remembers that one particularly well. His father was Alvin Boutte, Sr., Independence Bank’s chair and CEO.

“Colgate Palmolive [executives] used to fly in and go sit up there in my dad's corner office,” the younger Boutte, 50, says now. “It was always cool to see and hear him tell me about all the people that would come to Independence — to 79th street — from New York, from California or wherever their corporate headquarters were.”

But after more than 30 years in the game, Independence ended its run in 1996 when it merged with the Chicago community development bank, ShoreBank, which failed in 2010. The swanky bank building Boutte’s father built in the early 1980s — the place that employed and made loans to Black people who were ignored by white-owned banks and was an emblem of Black financial and political capital — is still there, but is now the Providence Bank and Trust.

Since the 1920s, Chicago — with one of the nation’s largest concentrations of Black residents — has been a capital city for Black millionaires and businesses. Their footprint wasn’t just local, but national: Chicago was headquarters to global brands such as Ebony and Jet magazines, and Afro Sheen hair care products.

No longer. Johnson Products, the parent company for Afro Sheen, shuttered its South Side factory. Oprah Winfrey moved Harpo Studios from the West Side to West Hollywood. Gladys’ Luncheonette, which served up smothered chicken and peach cobbler to the likes of Martin Luther King Jr., comedian Redd Foxx and a host of politicians and other luminaries, is now gone. Significant regional businesses like Independence Bank disappeared.

And, as the Chatham streetscape shows, others are vanishing, too, thanks to a variety of factors, including disinvestment, globalization and the nationalization of local businesses.

Though their absence is visible and tangible, numbers tallying how many businesses have shuttered are hard to come by. But there are clues. In 1990, three Chicago companies—Johnson Publishing, Johnson Products and Soft Sheen Products—placed within the top 20 of Black Enterprise magazine’s list of the country’s largest Black-owned businesses.

Today, only one Black Chicago area business even cracked the magazine’s top 50, Baldwin Richardson Foods, based in the suburb of Oakbrook Terrace, Ill. And according to the magazine, five of the nation’s 25 largest Black banks were located on Chicago’s South Side in 1990, including Independence Bank, which was ranked fifth. All of the five banks in the 1990 tally either went out of business or are no longer Black-owned. Only GN Bank, located in Chicago’s Bronzeville neighborhood, made the list in 2020.

Meanwhile, as Black residents leave Chicago in droves, the city is grappling with shifts in political power as its electorate morphs.

Back in the day, Black business represented a certain kind of power in Chicago, from access to City Hall to funding political campaigns to financing civic projects like a local performance center. Perhaps more important, those businesses represented possibility, creating a world where everything was “for us, by us”: movie theaters, cab companies, clothing stores, banks, real estate companies, restaurants, nightclubs, bars—and even vice. And as that evaporates, it is having a similarly important, if hard to measure, effect on the city.

During the 20th century, Chicago—even with its serious racial flaws and inequities—was still a city bristling with opportunity, earning it the sobriquet "the Promised Land" by Black people escaping the oppressive South during the Great Migration. Today, it has become almost an article of faith that this kind of opportunity has dried up.

“You tell me where you can drive in the city of Chicago right now and find [any substantial Black business ownership]?’ said Maze Jackson, a talk radio host and political consultant. “Not the stores, not the chicken [restaurants], not the fish [restaurants], not anything.”

‘Lost to history’

It hasn't all evaporated, of course. Boutte notes there are fewer Black businesses in the city, but some are doing “much, much better,” pointing out successful and lucrative Black-owned investment houses and bond-selling firms, such as Ariel Capital Management and Loop Capital, that give Black owners and investors some local clout.

Ariel manages a staggering $15 billion in investments—a figure the old school Black companies could only dream about.

But the overall shrinkage has been dramatic.

The South Side’s 87th Street, for instance, was a stronghold of Black businesses, particularly during the 1980s.

During its heyday, there was Soft Sheen Products, a $100 million-a-year manufacturer of Black hair care products near 87th and Dobson. The company’s Care Free Curl product line turned Soft Sheen into a $55 million a year business by 1982. And its owners, Ed and Bettiann Gardner, proved to be political powerhouses, funding campaigns and voter registration drives. Meanwhile, at 87th and Cottage Grove, there was Black-owned Seaway National Bank, which, at its height, boasted more than $400 million in assets. Among its first depositors when it opened in 1965 was the Southern Christian Leadership Conference, headed by Martin Luther King Jr.

Then there was Johnson Products, which made Afro Sheen and Ultra Sheen hair care products from its factory at 87th and Lafayette. Owned by George E. Johnson, Sr., the company was a main sponsor for “Soul Train,” helping the program rapidly grow from a local TV show here to a nationally syndicated cultural icon in the ‘70s. Filling in the gaps between these businesses were Black-owned clothing stores, insurance companies, restaurants, gas stations and more.

Most are gone now. Soft Sheen’s plant is now a self-storage facility. And while the company is still in businesses, it’s no longer based on 87th Street, or even Chicago. It’s now owned by French cosmetics giant L’Oreal.

This network of Black-owned businesses was responsible for the rise of Black political power in Chicago, laying out the cash that funded political campaigns, most notably Harold Washington’s successful 1983 bid to become Chicago’s first Black mayor.

Washington’s fundraising chief was Al Johnson, whose Al Johnson Cadillac was the country’s first Black-owned Cadillac dealership when it opened in 1971. A media campaign encouraging Black voter registration—“Come Alive October 5”—helped sweep Washington into office.

Having capital changed the expectations of what Black Chicagoans could ask for politically. “For a lot of Black people, if you were a middle-class school teacher or a member of the city’s corporation counsel’s office, or a social worker, chances are your check was being cut by the same government folks [in City Hall] that you were pushing to get out of there,” said attorney Quintin King, a lobbyist and political science professor at DePaul University.

But the folks who organized and put together the push to unseat the political machine and to back Harold Washinton, most of them were independent businesspeople like the Bouttes and Al Johnsons, King said.

“And a slew of other people whose names have been lost to history.”.

Lucrative contracts

That ascension, it turned out, was brief. Shortly into his second term as mayor, Washington died in office, felled by a heart attack. The ensuing scramble for power ultimately led to the election of another white mayor, Richard M. Daley—son of legendary Chicago political boss Mayor Richard J. Daley—in 1989.

The younger Daley embraced the Black business community, just as other economic factors caused its numbers to dip.

But some Chicago political observers saw his strategy as fueling the decline: in order to remain in power and prevent the rise of another Harold Washington, they say, the mayor used the vast City Hall purse to help reward loyal Black businesses with lucrative contracts and political access. (Full disclosure: I spent three years as Daley’s deputy chief of staff for urban planning from 2001 to 2004.)

“Their bread was being buttered downtown [by City Hall],” said Jackson, the political consultant.

The result, he said: “As black business owners started to climb and get into the wealth circle, they were no longer interested in Black empowerment.”

‘Dressed fly as can be’

The power marriage of Black business and politics in Chicago during the 1970s and 1980s garnered national attention, especially on the pages of Ebony, Jet, and Black Enterprise magazine. The stories were enough to bring Quintin King to Chicago from Cleveland when he was a young attorney in the 1980s.

“I said, ‘I gotta get there.’ There was something about seeing all these beautiful Black people walking down the street on Michigan Avenue, owning businesses and dressed fly as can be,” said King, who is now a partner at the Black-owned Chicago law firm Dillard & King.

And for those of us of a certain age who grew up on the South Side where these Black-owned businesses and many others were located, the loss in the years since then is felt personally.

If you were a kid growing up in the 1970s, when your mother sent you to the store to buy ice cream, she didn’t have to tell you what to get: It was Baldwin Ice Cream, Black-owned and local. And until it went out of business in 1977 or so, Joe Louis Milk was a staple in many a refrigerator. The Brown Bomber had a milk bottling company at 62nd Street and Prairie Avenue, right there in the South Side.

But now, with the massive population loss from the city’s predominantly Black South and West Sides, it's becoming a very different Chicago.

“I have become resigned to the fact that we are living through the Great Exodus,” Jackson said. “And we are going to be like the Native American: at a place where [people will say], ‘Remember when the Black people used to be here?’”

Black people built their own

Many historic Black businesses were born of a time when white-owned businesses would refuse to serve — or even recognize — Black customers.

So Black people built their own, in their own neighborhoods.

But John H. Johnson’s Johnson Publishing Co. was an outlier. In 1972, the media giant that published Ebony and Jet—and also created Fashion Fair makeup and the legendary Ebony Fashion Fair traveling fashion show—moved from the near South Side to a stylish 11-story headquarters it built in the South Loop at 820 S. Michigan Ave.

Overlooking historic Grant Park, the building was an event when it opened. Designed by architect and Chatham resident John Moutoussamy (his daughter Jeanne would later marry tennis great Arthur Ashe), the building’s opening drew more than a 1,000 people and a stream of visitors that went on for weeks, including Lena Horne, Gwendolyn Brooks, Ruby Dee, Shirley Chisholm, John Lennon and Yoko Ono, Amiri Baraka and even Henry Fonda.

The building featured a heated outdoor sidewalk and a private driveway with a curb cut that was approved by the powerful Mayor Richard J. Daley himself.

But today, the historic tower is a rental apartment building. Johnson Publishing went out of business in 2012 after years of decline. And its trademark Ebony and Jet magazines are published digitally only, and by a different, much smaller Black owned company based in Louisville, Ky.

Trying to stay afloat

Truth is, things are tough all over for legacy companies—an important thing to keep in mind as we consider the loss of these Black-owned stalwarts.

Recently, Sears closed its last Illinois store. In the 1970s, Sears was a retail and mail order colossus, based in downtown Chicago in a brand new skyscraper, the Sears Tower, that was the tallest building in the world.

But look at Sears now, trying to stay afloat in a retail world dominated by Amazon. The Sears Tower was renamed Willis Tower in 2009 and is now just the 23rd-tallest building in the world.

Scores of historic white-owned Chicago businesses that once seemed as permanent as our skyline have vanished since the 1990s. Arthur Andersen. First National Bank of Chicago. Dominick’s Food Stores. Kroch’s & Brentano’s bookstore chain. Marshall Field’s department stores. Talman Federal Savings. The list goes on.

But while these businesses move on, merge or die, others rise up to fill the need. A bit of that is happening among Black Chicago businesses, and often not with a lot of fanfare. It may not be like the old days, but it’s something.

King said he represents a “partially black owned” hair care company that fits that bill.

“They’re selling a hair product that they never touch themselves,” he said. “It goes through a distributor in India and lands on shelves everywhere. How many employees do they have? Maybe six or seven and they all work from home. But they probably make more money in a year than [the now-defunct Chicago hair care companies did]. This is the world we live in now.”

King’s got a point. Among this emerging new class of businesses is Crockett Cookies. The company, which specializes in butter cookies—delicious, and more than a little addictive—that used to be found in Chicago public school lunchrooms between the 1970s and 1990s.

Founder and owner Cheryl Crockett bakes and supplies the popular cookies to 200 Walgreen’s stores across the city and suburbs with a staff of fewer than 12 people. Six people make the cookies on the production floor, operating out of an industrial kitchen just northwest of downtown.

Crockett said she is seeking to buy her own larger facility within the next year. She said she might either purchase a spot in the city’s hot Fulton Market area west of the Loop, or build a space in Bronzeville.

But with that growth must come increased business from the companies that sell her cookies, she said. And when she gets to this part, Crockett sounds like the Black Chicago business people of old. People like the late Baldwin Ice Cream Co., Chair Jolyn Robichaux, who successfully pushed to get the tasty treat in retail stores. Or the senior Boutte’s friend George E. Johnson, Sr., who got his start selling his Johnson Products hair care supplies and cosmetics out his car trunk in the 1950s.

Perhaps there’s still hope for Black Chicago business.

“I’m in over 200 Walgreens stores and I am definitely grateful for them, but Walgreens has close to 9,000 stores,” Crockett said. “And that’s what we’re preparing for.”

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By: Lee Bey
Title: How the ‘Promised Land’ of Black Business Disappeared
Sourced From: www.politico.com/news/magazine/2021/12/07/chicago-black-owned-businesses-history-523622
Published Date: Tue, 07 Dec 2021 11:00:54 EST

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