The evolution of Black-owned businesses

Last Sunday, in celebration of Black Business month, I wrote about how at the end of the Civil War almost 120,000 enslaved Arkansans were suddenly expected to make their own way in an unfriendly economic world.

A few of the urban enslaved had been able to save enough money to purchase their freedom. Some even opened businesses. However, the great bulk of the new Black citizens soon fell into the clutches of sharecropping and tenant farming, the handmaidens of the crop-lien system.

With cotton prices declining during much of the 1880s and 1890s, huge numbers of both white and Black farmers fell into deep poverty. Historian Carl Moneyhon summarized the situation: “The lifestyle of the majority of African Americans was not appreciably different from that of lower-class whites. Both lived in a world of grinding poverty that virtually denied them a chance to get ahead, relegating them to an almost permanent place at the bottom of society.”

Nevertheless, surprising numbers of freedmen—especially in urban areas—never gave up hope of having their own businesses.

The situation was made much worse for Blacks during the 1890s when they were essentially disfranchised, racial segregation grew much more rigid, and violence against Blacks rose to the point that no Black man could be considered truly safe.

By the turn of the new century Black Americans, including Arkansans, began to turn inward as they sought economic advancement through self-help—through coordinated business initiatives, through taking advantage of the “race market” made possible by the separate economy which accompanied segregation.

Perhaps the best evidence of this new emphasis on business was the founding of the National Negro Business League in 1900. Atlanta University scholar W.E.B. DuBois conceived the need for a national business group and set about organizing Black business leagues in 1899, but Booker T. Washington—DuBois’ polar opposite and-soon-to-be rival—appropriated the idea and called an organizing meeting in Boston for the summer of 1900. Seven delegates, including a woman from Hot Springs, represented Arkansas at the Boston meeting.

The Arkansas affiliate, originally known as the Arkansas Colored Men’s Business League, was established in late 1902. Rev. J.M. Conner, bishop of the AME Church, was elected president, and John E. Bush, a businessman and political leader, became treasurer.

Bishop Conner was cut from the same cloth as conservative Booker T. Washington, and it is likely no accident that Conner was elected to head the Arkansas league. Washington used the leagues as a cog in his “Tuskegee Machine” by which he maintained rigid control over many aspects of Black life. In 1910, Washington attended the annual meeting of the Arkansas league, where he received a huge welcome.

The major emphasis of both the state and national league was the creation of new businesses. During the first decade of the 20th century, hundreds of new Black businesses ranging from banks to drug stores opened in Arkansas.

The state’s first Black bank opened its doors in Pine Bluff in 1902. The Southwestern Investment, Trust & Banking Association was founded by former legislator Jacob N. Donohoo and located in the local Black Masonic Temple. The Capital City Savings Bank was established in Little Rock by elderly wealthy M.W. Gibbs in 1903.

Both banks were successful at first, with deposits reaching $100,000 in Gibbs’ bank within two years. However, the turbulence and dislocation caused by the Panic of 1907 helped bring down both banks in 1908.

Several Black insurance companies were established in Arkansas during the 20th century. Since white insurance companies would not insure Blacks, fraternal organizations filled much of the breach.

The Mosaic Templars of America, founded in Little Rock in 1888, was established by John E. Bush and Chester Keatts to provide burial insurance, though it would diversify with time, even adding a hospital wing to its headquarters in downtown Little Rock. It has been estimated that

Black Arkansans spent

$8 million for fraternally based insurance during the period 18701920.

With time, regular life insurance companies were established by state Black investors. Perhaps the best known was Century Life Insurance Co., founded in Little Rock in 1926. One of the prominent organizers was A.E. Bush, son of the late founder of the Mosaic Templars. Woodmen Union Life of Hot Springs was another prominent Black insurance company.

While the banks and insurance companies ultimately failed, thousands of small Black-owned businesses flourished in Arkansas cities and towns. Little Rock was home to dozens of Black confectioners, going back to the slave era. As late as 1920, Blacks made up 24 percent of the 55 confectioners working in the city.

Most Arkansas towns with significant Black populations had Black undertakers. The Josenberger family of Fort Smith was diversified in its holdings, but the family funeral home was a mainstay. Perhaps the oldest surviving Black funeral home in Arkansas is Dubisson of Little Rock, founded in 1915—just in time to bury venerable M.W. Gibbs, providing 14 Black carriages for his funeral procession.

Skills learned while enslaved often evolved into jobs. In 1871, shoemaker Ed Campbell of Little Rock, for example, was successful enough to have a shop on Main Street. The 1908 Pine Bluff city directory listed 13 cobblers, five of whom were Black.

Solomon Winfrey—the progenitor of a dynasty of masons and plasterers—found that brick masonry skills he learned as a slave served him well in 1871 Little Rock. That same year, Little Rock was home to a Black saddle maker, Ben Wood, while formerly enslaved Harmon Scruggs had a blacksmith shop on Main Street.

New business ventures evolved. In 1920, Little Rock was home to three Black-owned drugstores. One of those druggists was W.O. Foster, who sold his own patent medicine: Creo-Tolu Compound, a “well-known cough and cold remedy.”

Black-owned barber shops were ubiquitous in larger towns. Argenta, now North Little Rock, was home to six barbershops in 1890, four owned by Blacks. Beauty shops are not as old as barber shops, but they caught on quickly as one of the few business opportunities for Black women. By 1920, Little Rock was home to 16 Black hairdressers, representing 70 percent of the total.

While this column, and the previous one, barely touches on the topic, I hope they remind us that generations of Black Arkansans have persevered in efforts to join the economic mainstream of the state.