June 23, 2021

The Power of 9

On this day in 1972, President Nixon was taped plotting with his Chief of Staff to have the CIA obstruct the FBI investigation into his administration – an egregious use of the nation’s institutional powers for corrupt political purposes. A unanimous Supreme Court decision led to the release of the tapes and once revealed, this smoking gun evidence of the President’s commands would seal his fate. Revelations of such extraordinary abuses were once considered shocking and would trigger broad bipartisan redress to defend America’s democratic ideals.

On the very same day, President Nixon also signed into law, the Higher Education Amendments of 1972, also known as Title IX. Title IX was enacted as a follow-up to the passage of the Civil Rights Act of 1964 and states that:

No person in the United States shall, based on sex, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving federal financial assistance.

This statute sounds rather mundane, but just as the sexual revolution was propelled on this day in 1960 when the FDA approved the pill for contraception, Title IX triggered a tidal wave of far-reaching impacts across education. Without a single mention of sports, Title IX forced schools to create athletic opportunities for females in order to meet requirements of proportionate participation by gender.

In 1972 fewer than 300,000 high school and 30,000 college females participated in sports. Today, those numbers have increased more than 10-fold to over 3.2 million in high school and 500,000 in the NCAA. Women’s 2% share of athletic budgets in 1972 increased to 40% by 2010, and nonexistent female athletic scholarships reached 48% of the available $ billion’s. In fact, by 2010, women made up a majority of the national student body, and an even greater majority of associate’s, bachelor’s, masters, and Ph.D. awards.  During the decades following the passage of Title IX, sports and higher education ceased to remain the exclusive domain of men.

On this day in 1894, the International Olympic Committee was founded to organize the first modern Olympics in 1896 in Athens. One month from tonight will be the opening ceremonies of the Tokyo Olympics, and we can surely expect some iconic female sports moments like the Title IX coming of age when San Jose’s Brandi Chastain scored the winning goal over China at the Rose Bowl in 1999’s World Cup final.

Last Wednesday, I watched Elk Grove’s Megan Rapinoe and Cal Bear’s Alex Morgan lead the USWNT over Nigeria in another of their string of victories leading into the Olympics. But this weekend, I was on the edge of my seat watching Stanford’s Simone Manuel recover from hardship to make the Olympic team in the 50 freestyle and cheering on USC’s Allyson Felix in her incredible come from behind finish in the 400 to make her 5th Olympics, with her little girl cheering at the finish line.

When I watch Simone Biles defy time and gravity on her way to dominating another world competition, I can’t help but think the same Title IX statute which enabled the dreams of all of these athletes, was also the tool used to initiate investigations that eventually led to the conviction of Simone’s sexual assaulter, Larry Nassar, although years too late.

Because another area where Title IX has been extremely impactful is in the arena of sexual misconduct. Title IX was ruled by the courts to establish that sexual harassment is considered illegal sex discrimination. It later placed the responsibility upon schools to take immediate and effective steps to end sexual harassment and sexual violence, deeming that such acts interfere with a student’s right to receive an education free from discrimination.  The Department of Education’s leverage was considerable, holding the right to deny access to federal funds.

Colleges across the nation have created Title IX offices with specialized staff and Title IX has become a primary means of addressing sexual misconduct claims on campus. Furthermore, women were no longer expelled for being pregnant, and transgender students were included for protection during the Obama Administration. As a board member of Callisto, a sexual assault reporting platform for college campuses, we were proud to respond last week to the Biden Administration’s request for input on potential Title IX policy modifications. And next week, our first female Vice President will give a speech at the UN on the issue of gender equity.

The Equal Rights Amendment may have had even more profound effects across all of society rather than just higher ed, but it remains stalled from passage since its introduction one hundred years ago, one state short of the 38 required for a constitutional amendment. Meanwhile, the same year that the ERA was passed by both houses of Congress and submitted to state legislatures for ratification, the lesser-known Title IX from the same year has evolved and grown in its reach and impact to help address discrimination across education. We believe it can continue to do so but it would be tragic if such laws or constitutional amendments remain necessary a half-century from now.

As women graduate in greater numbers, we can not stop there. Women still face large pay and opportunity gaps throughout society, and perhaps none more than in the financial sector. According to a Stanford SPARQ study in 2019, of the $69 trillion of global financial assets under management across mutual funds, hedge funds, real estate, and private equity, fewer than 1.3% are managed by women and people of color. In the venture industry, more than 90% of decision-makers are male. Likely, as a result, gender-diverse founding teams receive only 14% of all venture dollars despite strong evidence of superior results. To make matters worse, the pandemic has hit women especially hard and the disproportionate job losses and business failures have resulted in what has been referred to as America’s first female recession.

IBank has been seeking to help address this enormous gender inequity. We partner with our FDCs, who are comprised of 58% female employees to provide small business loan guarantees, 43% to female business owners to date. Similarly, nearly 40% of loans from the CA Rebuilding Fund are to female owners. We’re also currently contemplating a state venture capital program targeted to underrepresented populations, such as female fund managers and start-up entrepreneurs.

Yes, I watched a lot of sports last weekend, but I also commemorated the end of slavery on the first Juneteenth to be recognized as a national holiday. Curiously, on June 23rd of 1865, the last Confederate General surrendered, ushering the end of the Civil War. That Confederate Brigadier General was Stand Waite, also the Principal Chief of the Cherokee Nation and the only Native American to attain the rank of General during the Civil War.

General Waite’s fight was not to preserve the institution of slavery, but fear of the federal government’s encroachment of Indian Territory in its westward expansion to create the state of Oklahoma. Native Americans faced with difficult options fought bravely on both sides of the Civil War to preserve their lands, often against others of the same Tribe. It’s clear that regardless of Union or Confederate status, all Native Americans continued to suffer from perpetual loss of land, rights, and broken treaties.

This week the US Treasury is expected to allocate $500 million of small business funds to Tribal governments from the SSBCI.  Separately at IBank, the authority to fund Tribal projects was explicitly included in the formation of our Climate Catalyst Fund, and we’re also able to support businesses on Tribal lands via our Small Business Finance Center. We have a very long way to go to rectify past damage to Native American communities, but the time is always right to do what’s right.

June 23rd was a very busy day in world history, as we also acknowledge today’s 5-year anniversary of Brexit. I was in London on the day of the Brexit referendum, and I can still remember the shocked faces who were attempting to make sense of the stunning results and the ramifications of growing nationalistic movements. Last week as President Biden held meetings with G7 leaders, his message was indisputable – America is back, back to lead the free world to join forces in a spirit of global cooperation to address our common problems and common adversaries.

And if anyone had a doubt, CA is also back.  Last year witnessed an endless parade of headlines on our mass exodus, the hostile business environment, and the state’s certain demise.  A Bloomberg headline from last week reads “California Defies Doom . . . The Golden State has no peers when it comes to expanding GDP, raising household income, investing in innovation, and a host of other key metrics.”

The narrative that taxes are too high, regulation too stifling, natural disasters too catastrophic, making CA unlivable rings hollow when one examines the facts. Recent Bloomberg and Forbes articles now tout CA’s dominant leadership across key sectors relative to the rest of the nation as well as globally, from venture capital and start-up success to energy, agriculture, CleanTech, construction, and manufacturing in terms of investments, jobs, and output.

However, just as folks were too quick to declare failure, we should not rush to declare victory, either as a state or country. COVID is still with us and we should not underestimate the risks posed by waning vaccinations and increasing variants.

US retail sales were surprisingly down last month, although up 28% from last spring. An outlier was the 200% increase in clothing sales – which can only be explained by Fritz’s recent shopping spree.

Demand is returning but supply chains struggle to fully recover and a labor market transition may portend permanent structural changes to the economy. In a significant shift following news of a 4.9% CPI increase, the Fed announced that it now expects at least two interest rate hikes in 2023.

In other words, we’re far from out of the woods, but the CA sunshine is visible on the horizon once again. So when you watch the upcoming Olympics – keep in mind that at the last summer Olympics, athletes born in CA won 27 gold medals. The US won 46 event golds, ahead of 2nd place Great Britain with 27. While it’s difficult to break down team medals if CA competed as its own country and included those that were educated here or consider the state to be their home, CA would most likely have surpassed Great Britain and perhaps even the remainder of the US for the top spot on the standings . . . of course, powered by our women.

Scott Wu

S. Wu Signature