Economy, Native businesses succeed together
Julie Kitka
October 16, 2008 at 9:23AM AKST
An editorial in the Anchorage Daily News on Oct. 7 (“No-Bid Preferences”) irresponsibly indicts Alaska Natives for the alleged impropriety of two companies associated with a recent and isolated Food & Drug administration government contract. It also illustrates a fundamental misunderstanding of our history, the work of our business leaders and employees, our contribution to our country and the greater Alaska economy.
The U.S. Congress settled the land claims of Alaska Natives on Dec.18, 1971. The settlement was the largest, most complex Indian land settlement in the history of the United States. In addition to retaining 44 million acres of our original homeland, the Congress authorized Alaska Natives to organize and set up corporations to hold our land and resources. Our Native people were each issued 100 shares of stock in the newly formed Native corporations. We became shareholders and had to learn quickly what that meant and what the corporate structure was all about.
It is 37 years since the initial settlement and we have gained an incredible amount of experience with the corporate structure, with economic decision-making and competing in our rapidly changing capitalistic society. Over the years, we have made mistakes and we have learned. Now, many of our Native corporations are very successful. We have Alaska Native people at the helms of these economic engines. We are proud to contribute to both the Alaska and U.S. economy in significant ways.
The Anchorage Daily News editorial on government contracting was a huge disappointment to us. First of all, it tarred and feathered us all. It did not distinguish between our companies who are working hard and delivering real value and savings to the U.S. government — following the rules and exceeding government standards and expectations — and those few who may have made a mistake and must be accountable for their actions.
Congress authorized and required us to use corporations to implement our settlement. And Congress authorized Alaska Natives to participate in the Small Business Administration’s 8(a) Businesses Development Program. The purpose of the U.S. national Indian policy in the 8(a) program was to allow our businesses to participate in the work the government was contracting out to the private sector. It was to allow our Native shareholders to benefit from our successful completion of government work, which met strict standards. If we were not successful in delivering quality work on time, within budget and within appropriate standards to the government, we would not be successful in competing for other work. This 8(a) government contracting is not a handout.
In many ways, Alaska Native corporations cannot be compared to any other business in America. The U.S. Congress created a vast experiment in 1971 and its success and failures have never been fully documented. When I talk to respected individuals around the world, they are amazed by what has happened with our land claims. For example, Hernando de Soto, a world renowned Peruvian economist told us this: “Alaska Natives are living proof that life is not a roll of the dice, harsh and brutal. Government can set in place policies and structures to allow people to help themselves”. When de Soto told us this I was amazed — someone saw what was happening in Alaska. He saw how hard the Alaska Native community was working to make our land settlement a success; he saw how we have shaped the corporate structure with our own values and culture; and saw that we are a contributing member of society.
The 8(a) program is allowing Native Americans, including Alaska Natives, to help ourselves and contribute here in Alaska and across the country. Unlike other 8(a) businesses that are individually owned, Alaska Native corporations are charged with the monumental task of lifting entire communities — representing hundreds, and often thousands of disadvantaged individuals. Therefore, placing caps on awards Alaska Native corporations receive through the 8(a) program or eliminating our corporations’ ability to create subsidiaries with the 8(a) program would suffocate the ability of our corporations to build capacity and expertise which is needed to compete in the global economy and greatly reduce the dividends, scholarships and our efforts to lift our people out of poverty. It would turn the clock back on the very people our government reached out to help.
As with industry, Alaska Native corporations that do not follow the rules and regulations of the 8(a) program must be disciplined individually — not collectively. The Anchorage Daily News’ advocacy for collective punishment of all our corporations would condemn the entire Alaska Native population to further reliance on the American taxpayer, rather than furthering the cause of self-determination and economic independence.
Alaska Native businesses support 20 percent of Alaska’s population. In 2006, they generated a combined payroll of $695.25 million to over 15,000 Alaska employees, over $1.11 billion in payroll to almost 40,000 employees worldwide, and paid over $60 million in federal taxes. Progress has been made, but much more must be done. Dramatic economic disparity between Alaska Natives and other Americans still exists and must be overcome. Disparities continue in education, in health and life expectancy, even infant mortality. The Alaska Native leadership is committed to doing everything we can to eliminate the disparity in life opportunities and create a chance for every child to have a healthy and productive future.
It is unfair and irresponsible for your paper to call for sweeping changes to a government initiative which is working. On behalf of the Alaska Native leadership, we ask the Anchorage Daily News to retract their editorial and provide us an opportunity to meet to discuss your concerns.
Julie Kitka is president of the Alaska Federation of Natives