The group named itself after the lake and state park in northern Minnesota—Itasca—where Minnesota’s progressive elites used to vacation together in the summer back in the old days: the Pillsburys, the Daytons, the Cargills, and the McKnights, to name the key families. They were an unusual group of civic-minded patricians, who also set their own example by mandating generous corporate donations to improve community life. I was only vaguely aware of Itasca until, out of the blue, the group was profiled by Nelson Schwartz in The New York Times on December 29, 2015, under the headline “They’re in the Room When It Happens.” Here is how the story began:
A nondescript conference room on the 38th floor of Minneapolis’s tallest skyscraper bears little resemblance to the brick clubhouse a few blocks away where members of the local elite have gathered for more than a century.
But swap out the Oriental rugs and dark wood for a granite table and Aeron-style chairs, and it serves much the same function as the Minneapolis Club once did.
Every Friday morning, 14 men and women who oversee some of the biggest companies, philanthropies and other institutions in Minneapolis, St. Paul and the surrounding area gather here over breakfast to quietly shape the region’s economic agenda.
They form the so-called Working Team of the Itasca Project, a private civic initiative by 60 or so local leaders to further growth and development in the Twin Cities. Even more challenging, they also take on thorny issues that executives elsewhere tend to avoid, like economic disparities and racial discrimination.
Think of it as The Establishment 2.0: more diverse than the nearly all-white and male establishment of old, to be sure, but every bit as powerful, and just as invisible when need be …
Itasca’s impact is very real, however. And its consensus-oriented approach offers an alternative path at a time when politics nationally—and in many state capitols—seems hopelessly divided along partisan lines …
The guest list for the weekly breakfasts downtown includes the mayors of Minneapolis and St. Paul, as well as local legislators, school superintendents and university officials.
So when a proposal to raise the gasoline tax in 2008 to help rebuild roads and transit systems was vetoed by the Republican governor at the time, Tim Pawlenty, phone calls from Itasca’s business leaders helped persuade enough Republican legislators to cross the aisle and override the veto.
More recently, pressure from Itasca helped secure increased funding for the state’s college and university system. Itasca also spearheaded the creation of a new regional agency to attract companies looking to move or expand, as well as an effort to encourage procurement chiefs at local giants like Target and Xcel Energy to buy more goods and services locally.
The story noted that “Itasca’s work is among the reasons that the Twin Cities region has emerged as an economic powerhouse. At 2.9 percent, the metropolitan area’s unemployment rate is well below the national level of 5 percent. At the same time, Minnesota has excelled in creating the kinds of higher-paid, knowledge- and skills-based jobs that provide entree into the middle class today.” The story also pointed out that most big cities and towns have chambers of commerce and economic development offices, but
what makes Itasca unique, participants say, is a commitment to hard data and McKinsey-style analysis, as well as a willingness to depart from the script that drives many private sector lobbies.
“We’re not just asking for lower taxes and less regulation,” said David Mortenson, the current chairman of the Itasca Project. “If we’re taking on education or income disparity as a group of business leaders, we want to be able to break some eggs.”
That’s different from what happens in most other cities, said Mr. Mortenson, who earlier this year took over M. A. Mortenson, a nationwide construction firm founded by his grandfather.
In Seattle, where Mr. Mortenson lived for nine years before moving back to Minneapolis in 2012, “most of the big tech companies viewed the city as a convenient location to house some of its workers,” he said. “They didn’t engage unless it affected their business …
“Tech leaders are very philanthropic,” he added, “but they disconnect it from their business.”
The story concluded by quoting James R. Campbell, a local banker who served in top positions at Norwest banks and Wells Fargo before retiring in 2002, as asking and answering: Could Itasca be repeated elsewhere? “My answer is maybe,” Campbell told the Times. But “there’s a unique willingness to trust each other here.”
Wanting to understand how this group worked, I tracked down one of the founders, Tim Welsh, a senior partner in the McKinsey & Co. team in Minneapolis. He recalled for me the first meeting of the Itasca group on September 12, 2003:
We had twenty-five or thirty senior people in town. Governor Pawlenty came and we spent well over an hour doing introductions—everyone was so passionate about this community and that there was the ethos that we wanted to preserve. We all knew it, but could not put our fingers on it, but it was a sense that we are all in this together and shared a commitment to the common good … To get started on our efforts, we launched the first task force to focus on how to get the University of Minnesota to be more connected to the business community.
In recent years Itasca has put much of its focus on local inequality. There is a lot of work to do. A 2012 task force on socioeconomic disparities found that in Minnesota, African Americans with a BA had a 9 percent unemployment rate, while whites with a BA had a 3 percent unemployment rate. Minneapolis ranked just above Detroit—not a good place—in the “color gap”—the gap between the percentage of whites and blacks of working age (sixteen to sixty-four) who were employed. A 2015 study by the Center on Reinventing Public Education found the four-year graduation rate for blacks and Hispanics from Minneapolis high schools was among the worst in the country. Studies are projecting a hundred-thousand-person labor shortfall in Minnesota by 2018, and most of the jobs will require some postsecondary education, so the business community can’t ignore these disparities any longer.
One of the ways Itasca members sought to fix this problem was to get behind Sondra Samuels, who heads the Northside Achievement Zone (NAZ)—a collaborative of forty-three organizations and schools aimed at closing the achievement gap. NAZ was founded in 2008 in Minneapolis, and is modeled on Geoffrey Canada’s Harlem Children’s Zone. It uses a holistic web of family coaches and tutors, combined with academic and wraparound support, for 1,100 families, to keep 2,300 children in an education pipeline from early childhood to college. North Minneapolis has been designated a racially concentrated area of poverty where more than 50 percent of the residents are people of color and 40 percent live below the poverty line, and where schools have long been low-performing. A 2016 headline in the Star Tribune called it the “Battle Zone.” You cannot build a healthy community, Samuels argued, when African American students in Minneapolis have a 52 percent four-year high school graduation rate.
“From the beginning, we recognized the importance of a two-generation approach,” Samuels explained in an essay published in the Star Tribune on June 21, 2016.
We work with both parents and their children to make lasting progress. Supporting the entire family to succeed is critically important, because when parents provide stable homes, their children are able to focus on learning.
We also recognized that schools can’t do it alone, so we surround students with a team that provides everything from extra academic opportunities, parent education, and early childhood services to behavioral health counseling, housing and career support. In partner schools where the supports are most layered for NAZ students, they are doing significantly better than their peers in reading.
Samuels was not born or raised in Minnesota—she moved to Minneapolis in 1989 to work for Ford Motor Co. in the sales division and lived in St. Louis Park for a few years before creating NAZ. Maybe because she was born and raised in New Jersey, she is not afraid to bluntly denounce the quiet racism that existed in Minnesota for too man
y years while, in the next breath, praising her Minnesota supporters in groups such as Itasca for being sincerely focused now on fixing the problem.
“I grew up in New Jersey and became totally consumed with racial justice in my late teens,” Samuels told me over coffee one morning in downtown Minneapolis. “My father and mother came from the Jim Crow South and were the descendants of slaves and sharecroppers, and they came north for the same reason immigrants come to America—to find a better life and opportunity that the South could not provide.” Her father joined the longshoreman’s union and went from low income to middle class and then later moved the family from the equivalent of North Minneapolis to St. Louis Park, or from Newark to Scotch Plains, thanks to fair housing legislation passed in 1968. When she would give vent to her passion to struggle against racial injustice growing up, Samuels recalled, “my father used to say to me, ‘Sandy, when you find that country that’s better than this one, you tell me and we’ll go live there together…’ I always got stumped by that.”
Speaking of Minneapolis, she said: “We have some great disparities in this community—‘Minnesota nice’ tried to cover up a lot of racism.” But, “while I can tell you a story of real disparities and how there was structural racism in Minneapolis—historical and present-day—that has gotten us to where we are, I can also tell you that today we have a business community like no other business community.” Today, “people are stepping up and saying, ‘This cannot happen on our watch…’ It is game on.” Working with Itasca members and other business leaders, said Samuels, “we are trying to be there for each other. That is what we lost in our country or never really had. We all share a vision that we are not going out like this and we are not going to let our kids go out like this.”
NAZ has benefited from both private and public support. It received a five-year, $28 million Promise Neighborhood Implementation grant from the Obama administration; and Target and General Mills each committed $3 million a year for three subsequent years, to make sure NAZ continues to have all the resources it needs to have a chance to be successful.
While Samuels is buoyed by the financial support and the partnerships with groups such as Itasca, she knows that the Northside of Minneapolis cannot be transformed without attention to systemic racism that still needs fixing. She also knows that that fixing will not be transformative unless the area’s largely African American families take their future into their own hands as well. The good news, lost in the headlines, is that there are many signs that is happening with the families in the NAZ, she argued:
What makes me most hopeful is the ownership that African Americans in this community are taking—[their realization] that nobody is coming to save us. Partners are critical but we have to save ourselves—we have to change our community ourselves. I see families creating achievement plans and they are working their plans and they are showing up differently at their child’s school and they are enrolling in parenting education classes like crazy. I have fathers saying to me, “I didn’t know I was supposed to read to my child.” I am seeing a real commitment to change on a personal level, and people asking, “How can I use who I am in this change to help my neighbor on my block?” Everyone has to do their part, but I see families in North Minneapolis saying, “It is up to us” … With the right support we can create a culture where people believe they are expected to succeed.
For its part, Itasca has understood that its members needed to go well beyond check writing and make a personal commitment to own the change as well. To do that, Itasca set up a yearlong leadership seminar that focused on increasing workforce diversity. Local CEOs were asked to explore their own prejudices (the group is predominantly white, but includes a few members of other races) and move their organizations to contribute to regional efforts to reduce employment disparities. The project was cochaired by MayKao Y. Hang and Brad Hewitt, CEO of Thrivent Financial. If you talk to Hang, forty-three, for just ten minutes, you understand how far Minnesota has come in the diversity realm since I grew up there—and how far it still has to go.
A Hmong refugee from Laos, she came to the United States in 1976 with her family. She was a first-grader at the time and moved to St. Paul in 1978. She went through the St. Paul public school system, which is now 31 percent Asian American (predominantly Southeast Asian), earned a BA from Brown, a master’s degree in social policy and distributive justice from the Humphrey School of Public Affairs, and a doctorate in public administration from Hamline University. Today she is chair of the board of directors of the Minneapolis Federal Reserve Bank in her spare time. Most of her day is spent as president of the Amherst H. Wilder Foundation, a nonprofit organization dedicated to improving lives in greater St. Paul and beyond.
“I was asked three years ago to partner with Itasca to reduce socioeconomic disparities,” Hang told me one afternoon in her St. Paul office. The data Itasca had assembled was not Minnesota nice: Minnesota had a tight labor market, and yet students of color with bachelor’s degrees “were three times as unlikely to be hired as a white person,” said Hang. “We had bias around hiring and that should not happen in a tight market like this. There were barriers to employment.”
So Itasca and Hang set up a CEO forum that would help corporate leaders take a deep and honest look at themselves and their hiring practices. So many CEOs signed up that they were oversubscribed. “They would say to me: ‘I care about diversity but I don’t know how to do it.’” This is the second year and each CEO was challenged, said Hang, to ask him- or herself: “Am I self-aware about diversity?” “What is my personal transformation going to be?” “And what business plan am I going to put in place to change the practices of my organization?” Added Hang: “We help them hold up a mirror.”
When the CEOs in the group start to share their life stories, said Hang, she also shares hers:
I look like other CEOs, but I come from a very different culture and I go home after work to a clan-based community that has experienced displacement, trauma, and war. And as a Hmong woman I don’t have a lot of power [in that setting]. I feel the social powerlessness and loss of status when I go home. So when someone who has never experienced that sees the world through my eyes, that allows us to create trust, to see what is similar and very different: “You are like me in this way and different in that way.” It is a lot harder for me to judge someone if I have a relationship with them—and that is part of the trust building.
Mary Brainerd said Itasca’s diversity training program had a profound impact on her health care company’s hiring and its readiness to ask some basic questions: “Are black women getting mammograms as often as white women and are African American men getting colon screenings as often as white males? Now we measure that across the state.”
Brad Hewitt, CEO of Thrivent Financial, a Fortune 500 insurance firm based in Minneapolis, and currently vice chair of Itasca, went through the training and concluded: “It changed me profoundly. We uncovered the unconscious biases we all had and now we’re trying to get a hundred other CEOs into the same kind of process.”
Thrivent grew out of the Aid Association for Lutherans and Lutheran Brotherhood insurance co-ops, founded in 1899 to serve German and Norwegian immigrants after a mill explosion killed many breadwinners and left their families destitute. “We were happily going along doing really well in our co-op serving Lutherans, meaning Swedish, Norwegian, German, and Finish immigrants,” said Hewitt. These communities were a long way from Somalia. The Itasca diversity initiative “forces you to recognize that you are blind to unconscious bias and privilege and if you want to actually be more welcoming to others you have to work on those things systematically. Our [company] culture was very strong. Every year we had a big Christmas party with ludefisk [a dried whitefish and Scandinavian/Minnesota favorite]. It was just natural. We have about three thousand employees and had about one percent or less of color. Well, we just doubled that in eighteen months.”
If you’ve been raised on ludefisk and it was a staple at your C
hristmas party, introducing halal food or other ethnic delights is an adjustment. “It’s like learning another language,” said Hewitt. “You don’t always get it right the first time, but you don’t let that stop you … The number-one thing when you’re learning languages is that you have to be ready to be laughed at—we are learning a new language,” he said. “I have gotten comfortable being laughed at when trying to promote diversity.”
But embracing diversity in Minnesota today, as in parts of the rest of the country, is not simply a matter of overcoming hidden prejudices toward African Americans. It also involves integrating very different cultures such as Somalis and Hmong. I didn’t encounter anyone in my research who wanted Somalis or Hmong to give up their cultural identities, any more than Norwegians or Jews had to, to become “Minnesotans.” But there is a strong aversion in Minnesota, which I share, to the kind of globalist multiculturalism that took hold in Europe, where everyone is just left to go their own way and one day you wake up and discover the melting pot is busted and there is no real community. The Minnesota way is that everyone should maintain their customs, but there are certain bedrock values—regarding how you treat women, the rule of law, other faiths, public institutions, and community spaces—that are nonnegotiable.
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