Native America Socioeconomics

Shake Aboitiz Tuason

March 4, 2014

The Current Native American Socio-Economic Conditions

Introduction:

This paper is an analysis of the current socio-economic conditions of the Native

Americans. This investigation and research focuses on the issues of: education, healthcare,

housing, labor and income, and the development of casinos, in order to illustrate the social and

economic factors affecting the Native American population.

As said by W.E.B. Du Bois in his book The Souls of the Black Folk, “To be a poor man is

hard, but to be a poor race in a land of dollars is the very bottom of hardships”. Throughout their

history, the Native American population is a group that has undergone immense alienation.

However, the Native Americans are also very different from other minority groups, as they have

a special legal status. Special federal government agencies such as the Bureau of Indian Affairs

(BIA) formed in 1824 was tasked with enhancing the quality of life for native tribes. The BIA

now oversees roughly 4.5 million of the current Native American Population (US Census Bureau

2011). However, despite government efforts to improve the livelihoods of Native Americans, a

Gallup Independent Poll cites the economic and social conditions in reservations as being “third-

world” (Grand:12). Even with the recent efforts to improve livelihoods through the construction

of casinos and gaming licenses in native lands, the economic opportunities and income

distribution in reservations has remained very unequal.

Education:

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Native American education started in 1611 when the Jesuits set up schools in an attempt

to “Christianize” the indigenous people (Grande:11). Tribal education first started out with a

missionary-dominated relationship, and then eventually entered federal government control.

Universities situated in the East Coast such as Harvard University (1636) were founded in

another attempt to further civilize the Native Americans. This form of Anglo-conformity robbed

the Native American’s very right to remain indigenous, and instead forced American Values

upon them (Grande:13). More recently, the federal government has largely left individual states

to handle Indian education. Native American educational attainment is still significantly lower

compared to the national average. A report from the Education Trust says that in 2011, only 18%

of Native American 4th graders were proficient or advanced in reading on the National

Assessment of Education Progress (NAEP), this is a stark contrast compared to nearly 45% of

white children who reached those levels. Not only is there an evident lack of educational

opportunities in the elementary level, less than 70% of Native Americans graduate high school in

4 years as compared to over 80% for whites (Grande: 23). After high school, statistics show that

only 52% of Native Americans apply for college.

This lack of proper education in the elementary, high school, and college levels means

that Native Americans do not have as many job opportunities as other demographics do. Little or

no improvement has been made in educational attainment for Native Americans from 2005-

2011, despite an increase for other minorities (Thinkprogress.org). According to data collected

by the Harvard Project on American Indian and Economic Development, the severely

marginalized status of Native Americans in society suggests that the students are more prone to

risky behavior such as increased rates of drug abuse and school dropouts. There is also the fact

that America exercises an educational system that predominantly stresses mainstream American

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cultural dominance and Anglo-conformity. Schools have also discouraged the formal use of

native languages (Grande:20).

These factors have contributed to poor academic performances for the Native American

students. There needs to be a reformed educational system that focuses on a multicultural

education. This sense of cultural pluralism, where there is a strong cultural presence of Native

Americans will promote nationalism among students. This will in turn promote and enhance

academic environment of the students. Professor Manley Begay of the Harvard Project affirms

this formula; he cites in his study that successful schools are the ones that have a nation building

approach. The Cacedeaver Elementary School in Alabama, with nearly 80% of its students being

Native American, has promoted cultural pluralism and has successfully improved its academic

performance. Nearly 61% of 6th graders scored advanced level in Math compared to the 35%

statewide average (Cacedeaver.com). By affirming pluralism, students feel a greater sense of

community and engagement in academic activities.

Healthcare:

The Dawes act of 1887 authorized the government to divide native lands and allot them

to individual Native Americans. One of the main objectives was to further reinforce Anglo

Conformity: by stimulating the assimilation of Indians to mainstream society (Holm 34). The

pressure to shift from a traditional way of life, towards a more Western lifestyle has dramatically

impacted the health and welfare of the Native Americans. Instead of a communal distribution of

land, Native Americans were then forced to abandon their tribal landholding, and were given

individual parcels of land to farm. This led to Native lands being open to non-Indians. Native

American landowners were often exploited by white landowners through the use of drugs and

alcoholism (Holm: 37). This contributed to the prevalence of drug and alcohol abuse in present-

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day Native American society. Illicit drug use among Native Indians is 22%, double the national

average of 9.7% of the whole US population and binge alcohol use among Indians is also higher,

at 13% compared to the national average of 10% (US Department of Health and Human Services

2001). This represents a growing social problem, which may only get worse if the nothing is

being done to improve the impoverished social environment of reservations across the United

States.

The Indian Healthcare Improvement Act (IHIA) was enacted in 1976, to address the poor

health conditions in Indian Country. The act seeks to provide “Federal health services to

maintain and improve the health of the Indians, which are consonant with and required by the

Federal government’s historical and unique legal relationship with, and resulting responsibility

to, the American Indian People” (nihb.org 2009). The authorization for appropriations for the

bill was expired in 2000; it took roughly ten years for the government to re-sign the act.

President Obama extended the act on March 23, 2010 and made it permanent with no expiration

date. Instead of increasing health care standards of Native American to bring it up to par with

the rest of America, the Indian Healthcare Act only meets 60% of their healthcare needs

(Commission on Civil Rights Census 2003).

The healthcare act only covers 55% of the total Native Indian population, and is severely

underfunded (Rodgers 2013). There is also a current backlog of $900 million in unmet needs for

American Indian health facilities (walkingshield.org). The government needs to dramatically

increase the level of funding provided for Native Americans living on reservations. 30% more

dollars per capita are spent on healthcare in prisons that on Native American Reservations

(Rodgers 2013). This finding represents the poor state of the healthcare provided to reservations.

There is clearly a discrepancy between Native American quality of life, and that of the rest of

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America. Native Indians are 82% more likely to commit suicide compared to the rest of America

(Indian Health Disparities Report 2011). Infant death rates are also 60% higher for Indians than

for Caucasians (nrcprograms.org). While the extension of the IHIA brought about recent

improvements, there is still a lot more that needs to be done in order to improve the poor quality

of health of Native Americans. This is clearly emphasized by the fact that Native American life

expectancy is 5 years under any other ethnic group in the United States (walkingshield.org).

Housing:

There is a severe housing crisis currently being experienced in Indian Reservations.

There is a need to provide adequate housing, as 90,000 Indians are considered homeless

(nrcprograms.org). Current infrastructure is also lacking, one in five homes on reservations lack

plumbing facilities, and less than 50% of homes are connected to a public sewer system

(walkingshiled.org). The sub-standard living conditions have also contributed to an impoverished

environment that is more prone to violence and drug abuse. The undersupply of housing has also

applied significant pressure on Native American families. Eighteen percent of total reservation

housing is overcrowded, with 25-30 individuals sharing one home. Over 30% of families live in

overcrowded housing. The housing situation for Native Americans is significantly inadequate

compared to American standards.

There are also factors hindering tribes from improving their own housing conditions.

Indians have the highest rate of home loan denial of any other ethnicity in the United States,

nearly 25% (walkingshield.org). This fact highlights the dismal state of the Native American

social conditions. It is extremely difficult for families to borrow money in order to purchase a

house. Overall, the poor housing situation of Native Americans can mainly be attributed to a lack

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of funding. It is estimated that $1.1 billion is needed to adequately address housing inadequacies

on reservations (walkingshield.org)

Labor and Income:

Native American reservations across the United States experience a severe lack of

economic opportunities. The poverty rate for American Indians living on reservations is 31.2%,

nearly three times the national rate. On some reservations, unemployment levels have reached as

high as 85% (walkingshield.org). The Pine Ridge reservation in South Dakota is home to nearly

40,000 residents. Currently, it has an unemployment rate of 85% with a per capita of less than

$8,000, making the reservation one of the poorest across the country (nytimes.com 2013). As the

federal government is one of the largest employers of Native Americans on reservations, the

recent federal budget cuts have severely affected Pine Ridge’s economic environment.

Figure 1: Native American Unemployment from 2007-2013

Source: Economic Policy Institute 2013

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Figure 1 above represents a bleak picture of Native American unemployment. Over the last five

years, they have consistently maintained high levels of double-digit unemployment significantly

higher than whites. This lack of job opportunities has contributed to a median income of $35,000

for Native Indian households, compared to the $50,000 median income for the nation as a whole

(United States Census Bureau 2011). This has also left Native American reservations as being

one of the most consistently poor areas across the US. In areas such as the Blackfoot Reservation

in Montana, the annual unemployment rate is nearly 70% (Rodgers 2013). Extremely high

unemployment rates have contributed to the foundering of the economic environment in some

reservations, such as the one in the Blackfoot.

The average poverty rate for Native Americans as a whole is 28.2% (nrcprograms.org

2008). However, the disparity for Native Indian families living on reservations increases to 36%.

Some of the worst poverty rates in the country are located in North Dakota, South Dakota, and

Wisconsin, with poverty rates reaching higher than 60% (Champagne 2013). High rates of

poverty can be related to social distress. Impoverished Native Indians are more inclined to

participate in the underground economy, use drugs and alcohol, which in turn lead to higher

crime rates and increased domestic violence. Violent crime in reservations increased during 2000

to 2010, by nearly 29%. Murder rates in reservations have also increased by 41% during the

same period (Champagne 2013).

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Figure 2: Poverty Rates for the American Indian population in the 20 cities most populated by

this group

Source: United States Census Bureau 2013

Figure 2 ranks poverty levels of Native Americans in urban areas. Large cities such as

Minneapolis, which has an average poverty rate of 4.2% for whites, has nearly 50% of Native

Americans living below the poverty line. This indicates that even Native Americans who leave

reservations in order to seek job opportunities across the United States are still living in severely

poor socio-economic conditions compared to other ethnic groups. In some instances, the heads of

the households are forced to find work in off-reservation areas, leaving grandparents or even

non-family members to take care of the children (nrcprograms.org). In some instances, this has

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led to the breakdown of the Native Indian family unit, as some children are raised without their

parents present.

There is definitely a need for the economic opportunities in most Indian reservations. The

current Obama administration has recognized this: in 2010, the Department of Labor launched

the Native Indian Training program and training services, geared towards lowering

unemployment. The budget of $53 million provides 178 Native Indian grantees with technical

skill training for jobs (inthesetimes.org). The program’s limited funding will barely make a dent

in the overall level of Native Indian employment. However, if enacted on a larger scale, it is

these types of training programs that will help enhance economic livelihoods of the Native

Americans.

Development of Casinos:

One of the first successful gaming operations conducted by a tribe was the Seminoles

Reservation in Florida. The tribe opened a high-stakes bingo operation that generated $100 after

a couple of years (Evans:23). In 1988, Congress passed the Indian Gaming Regulatory Act

(IGRA), which allowed more tribes to take control over their economic development by allowing

the operation of casinos in reservations. The goal of IGRA was to promote economic

development and self-sufficiency on reservations. However, this study reveals that the

establishment of casinos in reservations has been met with positive and negative externalities.

By 2000, Indian owned casinos generated nearly $10 billion in revenues, 1/6th of all

gaming revenues in the country (Evans:27). Native American Casinos in New York and

California alone have reported close to $4 billion, and have reported a dramatic decrease in

unemployment. The introduction of Casinos has introduced new economic opportunities for

Native Americans. Tribes receive $4 of every $10 that Americans wager on casinos located in

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reservations. Because of this, tribes now have additional income to use to improve the socio-

economic livelihoods of its members (Israel 2010). This is evident as reservations that have

casinos after four years have experienced a 2% drop in mortality rates (Evans:45). On average,

employment has increased by 26%, and tribal populations have increased by 12% on reservations

four years after the opening of a casino (Evans:9). This positive economic impact indicates that

there are much more employment opportunities available in reservations after opening casinos. It

also suggests that more Native Americans are coming back to reservations as a result of more

economic opportunities. Tribes with gaming operations enjoyed 13% lower unemployment than

their non-gaming counterparts by 1995 (Indiangaming.org)

One of the most successful gaming operations, the Foxwood Casino in Connecticut, has

nearly 315,000 sq. ft of area reserved for gaming and is considered one of the largest casinos in

the world. This has resulted in increased economic and social benefits to the surrounding area.

However, these economic benefits are unevenly distributed if all Indian reservations are taken

into account. There are a total of 310 gaming operations run by 200 out of the 556 federally

recognized tribes. The other 356 tribes are left out of this economic development. A major factor

hindering greater development and integration of casinos in Native American reservations is a

lack of infrastructure. Only 33% of roads in Indian Country are paved, and 72% of all roads are

considered poorly built (walkingshield.org). The tribes of the Greater Sioux Nation in North and

South Dakota that have opened a dozen gambling facilities garner very little revenue. This is

because most of the casinos were built in rural and un-populated areas that do not have the

necessary infrastructure.

Because of the undeveloped infrastructure, successful casinos can only operate near areas

with larger populations. As a result, out of 106 tribes surveyed, 82% of the tribes generated less

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than $20 million in revenue from gaming operations. Half of all gaming revenue comes from just

20 casinos (National Gambling Impact Study Commission Report 1999). Despite the positive

economic impact of casinos, the income generated is unevenly distributed among reservations, as

only successful casinos garner the lion’s share of revenue. This means that on a nationwide level,

only a small number of casinos have been able to successfully provide revenue and income to

reservations.

Casino operations have also brought about negative effects on reservations. Bankruptcy

rates, violent crimes, and auto thefts have increased by an average of 10% in counties that have

opened a casino within four years.

Figure 3: Impact of Native American Casinos on Crime

Source: National Bureau of Economic Research 2002 Figure 3 shows that there is a clear impact of Casinos on crime after four years of opening. In

counties with Native American casinos, property crime per 100,000 people significantly

increases from 79.4 at the third year to over 174 property crime incidents per 100,000 people in

the fourth year. Violent crimes and auto thefts also have a significant increase after a four-year

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mark. One theory suggests that the increase of influx of Casino visitors mean the influx of people

with a greater propensity to commit a crime (Evans:18). However, it is clear that Casinos

increase the rate of violence and crime four years after a reservation starts gambling operations.

This means that there is inherent trade-off with casino operations in reservations; tribes may

decide to allow gaming facilities that will in turn generate higher revenues, but may be faced

with higher crime rates that could possibly worsen the already impoverished living standards.

Conclusion:

The current Native Indian socio-economic condition can be described as bleak and

impoverished. It is the government’s responsibility to improve and enhance the livelihoods of the

Native American people. According to its website, the Bureau of Indian Affairs (BIA) mission is

to “…enhance the quality of life, promote economic opportunity, and improve the trust assets of

American Indians and Indian tribes…” Improvements have been made to improve the economic

livelihoods in reservations through introduction of casinos on native land. However, studies

reveal that gambling facilities bring about high crime rates to the area. Casinos also bring about

uneven economic development and are only proven to be successful in certain areas. This means

that casinos are not a dependable means of creating economic livelihood for the greater majority

Indian reservations.

High unemployment and high poverty rates still persist in most Indian reservations.

When accompanied with low government funding for education, healthcare, and housing, these

factors have contributed to very impoverished living conditions. In an environment where Native

Americans are 2.5 times more likely to commit suicide than any other demographic, more

Federal action and attention is needed to ensure a brighter future for Native Americans.

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Bibliography:

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