Couple of weekends ago took a walk down memory lane in Los Angeles, through El Pueblo Monument, the site of the original settlement of Los Angeles.
It is not as big an attraction as Hollywood or the Staples Center or tonight’s BET Awards.
There is one building in particular at El Pueblo, that in its hey day, no one could hold a candle to. It is the Pico House Hotel, the first three-story building in Los Angeles and the first with a steel frame, considered at its construction, the “finest hotel in the Southwest.” As we describe in Our Roots Run Deep: the Black Experience in California, Vol. 1, 1500-1900, Pio de Jesus Pico, the hotel’s owner, owned 532,000 acres in the Los Angeles basin through most of the 19th century along with his brother Andres. The two of them were the last two Mexican governors of Alta California before the U.S. takeover. Built in 1868 and staffed with blacks imported from the South by the Picos, the building has endured numerous earthquakes and every inclination to tear it down.
However, Pico himself died near penniless, having signed over his properties on what he thought was a mortgage, but what a sly business opportunist crafted instead as a deed. It is hard to envision that the richest men in 19th century southern California were African-Americans, descended from black conquistadors who had sailed with Cortes, because all we’re left with are Pico Boulevard and Pio Pico State Historic Park in Whittier. At one time, their holdings included the entire San Fernando Valley, the current Camp Pendleton and most of Whittier.
At the time when the Picos were the Schwarzneggers of their day, their wealthy counterpart in Northern California was another African-American, William Alexander Leidesdorff, owner of 41 lots in downtown Yerba Buena, the predecessor to San Francisco; Rancho Rio de Americano (now the City of Folsom) and business partner of John Sutter in the gold business. Leidesdorff died at 38, just after having issued the proclamation declaring California part of the United States in his role as subconsul to Alta California (the first black American diplomat). He was not able to pass on his wealth to his family because he’d taken out loans to buy provisions for the U.S. Army during the Mexican War. The quartermaster at the Presidio, Capt. John Sutter, used his inside information to buy the Leidesdorff estate, valued at $1.4 million in 1854, for a mere $50,000 from Leidesdorff’s mother in the Virgin Islands. There’s a Leidesdorff Street in San Francisco’s financial district to remind us that he was here.
Fast forward to this weekend and the fog of the late Micheal Jackson’s holdings, which have drawn as much attention in business sections as the front pages. There are myriad scenarios which can make the valuable music catalogs, unreleased songs and properties like Neverland Ranch pass into probate oblivion, as we wistfully write about what Michael Jackson used to own or control.
If you’re scrambling to find the last MJ CD or DVD on the record store shelf, devote some time to think about your own estate planning, which even the wealthiest African-Americans, time after time, fail to do. Remember the spectacle of James Brown and the months it took for his heirs to even agree on a funeral. Although both he and Jackson will live on in song and in memory, financially it is conceivable that all the creativity and energy invested in building their careers will inure to the benefit of some faceless noteholders.
In Blackmoney: Advanced Strategies for Maximizing the $1 Trillion Blacks Receive Worldwide Yearly, we lay out a risk management approach for black families to operate financially that takes into account the costs of racial discrimination. Despite Jackson’s song, he found out in the 1990s, that it did matter whether he was “black or white,” as his cash flow was savaged by litigation and the attendant loss of business opportunities. We calculate what a normal African-American male can expect to spend contending with “driving, flying, walking, swimming, sitting while black.” In an earlier blog, we mentioned that much of the black music industry adopted the free-spending celebrity ways that Jackson exhibited.
During the new millennium, much of the African-American community took the same “bling-bling” approach to their personal finances, investing in showy items fueled by easy access to sub-prime credit.
The continuing saga of talented African-Americans failing to pass on their wealth does not have to continue. If Michael Vick and Kobe and James Brown and Michael Jackson don’t bring us back to the mother wit of the grandmothers who used to squirrel away funds for the inevitable rainy days, it is hard to imagine what will.
In that vein, perhaps the Michael Jackson song we should all be singing is “You’d Better Get it Together or Leave it Alone.” Even if he didn’t heed his own advice to “get up off your high horse” and “think what you’re doing, doing,” we still can. At our site, blackmoney.com, we feature several pages which show a way to begin the hard work of planning ahead financially such as mybiz and retiringwhileblack.
As we look ahead to National Black Business Month in August, it is a good time to remember that all the energy involved in building an enterprise as vast as Jackson’s empire or as meager as a home-based business should best be honored by having a sound financial foundation which can be easily tracked and potentially preserved for future generations.