Difference Makers

Before the Banks

• Hosts: Pete Upton, Brian Edwards, Elyse Wild | Producers: Native CDFI Network, Tribal Business News • Season 2 • Episode 1

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Episode 1 explores how Native CDFIs emerged from a long history of tribal economic systems, legal sovereignty, and policy reform — and why they are tools of nation-building, not diversity programs.


Difference Makers highlights how Native community development financial institutions (CDFIs) work alongside their small business clients to accelerate change and create economic opportunities in Native communities. Join the Native CDFI Network and Tribal Business News as they shine a spotlight on the people accelerating economic change in Indian Country.

brian edwards:

To understand the future of native CDFIs and why they matter so much, you have to start with a truth that's often forgotten. Native people have always had economies, trade routes, systems of value, self determined ways of building, exchanging and sustaining before there were banks, there were indigenous economies. They were complex, resilient and sovereign. Then came colonization, land loss, policy after policy aimed at breaking those systems apart, from allotment determination to relocation. But over the past few decades, something extraordinary has happened. Native communities didn't just rebuild. They started reshaping the rules of finance itself, and at the heart of that transformation, native CDFIs, these are indigenous led, community rooted and designed to serve native people on native terms. Hi and welcome to difference makers. 3.0 I'm Brian Edwards from tribal business news, co hosting this season alongside Pete Upton, CEO of the native CDFI network, this podcast is about how Native communities are reclaiming their economic futures. Sometimes that story runs through capital, sometimes it runs through law, sometimes it runs through history that was never taught in school. In this first episode, we're going to set the foundation. Because if you want to understand why native CDFIs matter today, you have to understand tribal economies before colonization, and how sovereignty was recognized and how sovereignty is still misunderstood today. There really was no better person to start with than attorney author and Law Professor Robert J Miller.

Bob Miller:

Hey, Brian and Pete, thank you for having me on the show.

brian edwards:

Well, let's get going. So first question, how would you describe tribal economies before colonization? There is this notion that, you know, tribes are wandering around like a bunch of socialists.

Bob Miller:

Yes, that is totally false. The word Nomad, that sort of pictures somebody that's just lost, and that is not true. I think 99.9% of Americans do not know the true history of indigenous peoples in what's now the United States. I think there's a specific reason that's not taught, but we don't have time to get into that today. That's another podcast. Indigenous people supported themselves for millennia before Europeans arrived on the scene. And I always joke, we did not wander around the woods waiting for apples to fall out of trees. Most indigenous peoples archeological research, sociological anthropological research has proven that most native peoples lived in permanent or semi permanent villages, and certainly when the Europeans started arriving in this continent. But I want to focus on two cultures that I, again, I think Americans don't know about, and I I'm going to make a joke now. Well, one of them is so remote. Yeah, it's eight miles west of St Louis. When the Lewis and Clark expedition got underway, William Clark wrote in the journals he was standing on a mound in the what is the St Louis area? And this whole area was called Mound City. There's something like 10,000 mounds built by Indian cultures in the Mississippi Valley. There's a mound state park in Minnesota. And what were these mounds? Often they were burials of elites. Sometimes they were for temples on top, perhaps, or, who knows, maybe, a king and queen lived on top. I don't know, but in August of 1804, William Clark writes in the journal, this is evidence of a great population. So there were great population centers and very active economies, not just nomads lost looking for food. So the town of Cahokia is, what is eight miles west of St Louis. It's in Illinois, the largest man made structure in the world, maybe not height, but the Great Pyramid at Cahokia Mounds, Monks mound, it's called, covers 14 acres. This is dirt that was moved. This is a larger site than is the Great Pyramid of Cheops in Giza, in Egypt, Cahokia. It was a culture from about 700 ad to about 1400 ad, and in 1200 to 1300 ad, it had a larger population that the City of London had at the same time, it was a center of trade. It was a palisaded city with a wooden fence around it, and on the outside, it had something called a stone wood hinge, which is very parallel to the stone hinge in England. It was a. Calendar. It was astronomically correct, and these cultures understood astronomy and used calendars, etc. The trade that went on in Cahokia was enormous, the farming, the production of textiles, and the trade that went on and the objects they find in these burial mounds, even to this day, sometimes were traded over 1000 miles or 1500 miles away. And this was, of course, before we even had the horse. But shells from Baja California are found in burials in the Midwest. Pipestone from, I think, Minnesota, it was quarried and traded across the United States. You find the tribal pipes that were used by medicine men, etc, from stones in Minnesota. I want to talk about Chaco Canyon here in New Mexico. It's in the northwest area of New Mexico, quite close to me. Actually. This was the ceremonial center for the Ancestral Puebloan peoples. There's a building there called Pueblo Bonito that's mostly in ruin. I don't know if it's still standing, but this was an 800 room building this area had, I've read, 300 miles of paved roads, nine feet wide, leading to this ceremonial Pueblo Bonito. Now, anthropologists today and archeologists think that people didn't really live there. They went there for ceremony. There were underground Kivas where ceremonies would take place, but the majority of the Pueblo people lived in the outskirts. So farming, pottery trade from across the continent, and even turquoise was used as a currency there. It's very interesting to think that native peoples used various objects as currency. Hudson Bay blankets were used as currency. A slave cost five Hudson Bay back blankets, wampum shells from the Pacific or the east coast were used as cash. And in fact, tuition at Harvard was paid with wampum belt and wampum seeds at different times. So these were business people. And this is stuff Americans know nothing about. And again, I'm afraid it's a purposeful we sort of don't want to know what was here before Europeans showed up. We want to believe America was empty,

brian edwards:

to what end, so

Bob Miller:

that the country would be deemed empty of humans. And, you know, Euro Americans would have some kind of God given right to take it over. It's called Terra Nullius Brian. Empty land is available to be claimed by whoever discovers it. Discovers it first. But there's just two examples of economies that went on. We intelligently worked hard. We supported ourselves and our families. We did it in our own cultural and legal, if you want to use that word way, the lands were deemed to be communally owned by the whole tribal community. But if you or your family used a location in some tribes, there was literally a chief to hand out farming plots, and as long as you and your family farmed that area, it was yours in perpetuity, until your whole family died out or you moved away. So those are private property rights.

brian edwards:

I mean, that directly contradicts the idea that tribes were purely

Unknown:

communal with no private ownership.

Bob Miller:

Absolutely, I, in all 30 years of studying this subject, the only thing that was held communally was the idea of land, and the tribal community owned that land in common. But as I just said, you could acquire private property rights to a particular spot. Again, I'm from the Pacific Northwest, salmon dipping. You're by a Roaring River A well placed rock that juts out. A man would be deemed to own that rock and would lease it out if someone else, if he wanted someone else, to be allowed to use it and would leave it to his son in through rules, cultural rules of inheritance in the in the Northwest Indian women would be deemed to own berry patches or pinion nut trees, stuff like that, if they scared the deer away and if they watered it and weeded it, and they would leave those assets to their daughters when they died through well recognized rules of inheritance. So we had law, we had custom. We had cultural responsibilities, of course, feed the elders, feed the needy, etc, but everything except land was private property.

brian edwards:

Let's talk about how this history becomes law. So how did tribes become recognized as sovereign nations? What does the Constitution say about

Bob Miller:

that tribal governments were a political force with warriors who were going to defend their territories, and the Europeans knew that, so they had to sign treaties and negotiate peace and trade and locations for Europeans to locate their settlements, England and its. 13 Colonies signed about 108 treaties, official treaty documents with tribal nations. Benjamin Franklin and other founding fathers represented their colonies and engaged in treaty making with Indian nations. Our founding fathers well understood that tribes were governments. What's a government that's a controlling body over a political group, a group of people who pledge their allegiance or they continue to live there under that government. So the Founding Fathers, when they sit down in May of 1787 to draft the Constitution, they write what is called the Interstate Commerce Clause, Article One, Section Eight, clause three, I encourage people to look it up. It's called the Interstate Commerce Clause, very important provision of the Constitution, but when the Supreme Court decides a case about tribes, it also calls this provision the Indian commerce clause, because article one sets out the powers of Congress. Section Eight does and in clause three, one of the powers of Congress is to regulate commerce with the foreign nations, among the several States and with the Indian tribes. Now that's the only express reference to tribes in the Constitution, but it is enormously important and powerful. The Supreme Court has referred to it 3040, 5060, times, maybe more. But the way I characterize it is our founding fathers thought Indian tribes were governments, and they were somewhat on the par with foreign nations and the original 13 states and who was supposed to deal with Indian tribes, politically and commercially only, the US Congress, Indian peoples are mentioned twice in the Constitution. Article One, Section two, I believe, is clause three, recognizes Indian peoples are not federal citizens and they're not state citizens. This is the provision of the Constitution that sets out how we do the census every 10 years, and Indians were not to be counted in the census when the 14th Amendment was drafted in 1868 and giving civil rights to the recently freed people Indians were again defined as being outside the United States political body and the state bodies. So the founding fathers of the article one of the Constitution in 1787 and the founding fathers, if you want to use that phrase of the 14th Amendment, in 1868 they knew Indians were citizens of their own governments.

brian edwards:

Pete, you've been way too quiet here. I know you've been wanting to ask Bob a few questions about tribe status as sovereign governments, and how that impacts programs like the Native American CDFI Fund, the NACA fund, you know, in the

Pete Upton:

political world that we're operating now within it's different. Be the first to admit it's different. And what we always run into Bob is trying to educate Washington, DC lawmakers, staffers, congressional leaders on why are sovereign governments different than all the different buckets they want to throw us in, whether it be a dei bucket or a woke bucket. How would you educate some of these staff, congressional staff and government officials,

Bob Miller:

I would say the most important United States Supreme Court case is Morton V man Carey from 1974 and footnote 24 The case was about the BIA had a hiring preference for Indian peoples and non Indians sued, claiming that's racial discrimination. You're discriminating against us white or black people because we're not Indian. And the United States Supreme Court said, No, that's not a racial preference at all. And footnote 24 just drives the point home. Pete, I'm going by memory now, but it says this hiring preference in the Bureau of Indian Affairs, which Congress has allowed as long ago as 1834 is based on being a citizen of a federally recognized tribe, and so footnote 24 says something like this isn't even a racial definition, it's a political definition. So for the United States to call someone an Indian, that's a person that has been enrolled in a federally recognized tribe.

brian edwards:

So this, this is the difference between heritage and citizenship. I mean, I'm of Irish heritage, but I'm not an Irish citizen. I wish I were,

Bob Miller:

yeah, we could go have a Guinness. I. Yeah.

brian edwards:

But is that, I mean? Is that? Get to the heart of it, that this is the difference between your your Native Heritage, maybe, versus being an enrolled citizen of a tribe.

Bob Miller:

That's a perfect analogy, Brian, and I hope you'll let me use that in the future. Yes, every American, you know, unless they're indigenous, every American came from some European or Asian or African country, and so they have this blood, if you want to talk about blood quantum or DNA, if that's more accurate, but you're an American citizen. Now that's a political act. The US has accepted you birthright citizenship. You were probably born here. So tribes decide who their members are, and some tribes use adoption yet to this day. Now I don't think that's very widespread, but a few tribes will bring someone in as a citizen who maybe has no Indian blood at all. So there's hope for me. Yes, you can always move back to Ireland.

brian edwards:

I meant maybe Pete would adopt me or something, you know, as a member of the Ponca Tribe, you know,

Pete Upton:

I'm not that high up in the government rankings. Here to do that, the question that I would have for you, Robert would be, what are the like, the treaty foundations, or the treaties that still matter today for understanding tribal economic rights. You know, you go into these meetings, sometimes you talk about treaties, and sometimes you get the deer in the headlight. Looks like, do they really matter? Look how long ago that was?

Bob Miller:

Well, thank you for that question that even reinforces the tribes are governments and still governments today. So the United States from 1778 to 1871 signed 375 treaties with Indian nations. Congress stopped treaty making in 1871 because of an internal battle inside Congress, the House and Senate were jealous of each other, and so they passed a law saying there'll be no more treaties with Indian nations. That's probably unconstitutional, to tell you the truth, but no one's ever challenged it. But that was not the end of treaty making with tribes. The Federal Government negotiates with tribes all the time, and Congress passes now, instead of a treaty that only the executive branch and the Senate engage in, it's now the executive branch and both houses of Congress pass laws that set out policies and programs for Indian tribes or restricting Indian tribes, etc, etc. Anyone can see that that's politics. And so in essence, treaty making still continues to this day, and sometimes courts make mistakes. Even sand justice, Sandra Day O'Connor made a mistake in a 1994 Supreme Court case, and she wrote about a negotiation between with tribes and the feds, like in the night 1780s 1790s way after treaty making had ended, and she still called the agreement a treaty. So not quite legally correct, but a true representative of what goes on every day as the United States deals with tribes about Indian Health Service issues governmental services through the BIA, etc, etc. There are tribes who have treaties today that still have a provision that applies in the modern day. But I want to give you an example the Pacific Northwest, the treaties that the tribe signed in the 1850s this federal courts have decided it gives them 50% of the salmon, the harvestable amount of salmon, which is worth billions every year. The tribes in the Pacific Northwest have treaty rights to catch those salmon. The Supreme Court has decided seven cases about the treaties out of the Pacific Northwest. So there's a right that is extremely valuable, economic, cultural, religious that the tribes protected when they negotiated their treaty, and the federal courts have honorably enforced those treaties. Tribes in the Great Lakes region, they fish in the Great Lakes. They take wild rice out of ponds and lakes. That's from their treaty. So there are economic factors. So I don't know all 375, treaties, but I'm pretty certain there are other economic rights, mining, timber, set out in other treaties. And of course, when your boundaries are defined in a reservation, you have all those economic assets in that area, treaty, timber, trees, water, whatever. So there's economic impacts from all the treaties that are still have application today.

Pete Upton:

I've got one I can never say on script Brian, so I'm gonna go off script here. How could the self determination act and. And the CDFI Fund worked together to embolden, I guess, the the self determination act of the 1970s Is there a link? There some way, somehow, on a strong, strong argument to Treasury that, hey, this is perfect. The CDFI Fund aligns perfectly with self determination.

Bob Miller:

As a lawyer that gets paid by the word. It might take me a few minutes to say this, but Richard Nixon created a revolution in Indian law. We have lived in seven eras of federal Indian policy. Most historians say, this is not me. This isn't my opinion. There are seven eras of federal Indian policy, and Nixon ended what's called the termination era number six, when the United States was literally trying to get rid of the federal recognition of tribes and get rid of tribes as recognized governments. But in 1970 Richard Nixon gives a speech to Congress, and he writes a law review article. Most people don't know that he was a lawyer. He graduated in the top three of his class from Duke, and he gets up and really kind of hit a bomb. He said, It's time for the federal government to stop telling tribes what to do, and it's time for the tribes to tell us what they want and how we can help them. So the program you mentioned, I'm no expert on these programs. You're the expert, Pete, but these are policies that tribal nations now, and you told me, this is not an act of Congress, this, NACA, it's a policy. Is that correct?

Pete Upton:

It's an initiative under the CDFI Fund. It's a it's an initiative, and it's not in statute, but

Bob Miller:

Congress authorized the CDFI Fund. Is this correct spend this X amount of money in this way and left it up to a federal agency to work out with the tribes how it would be done. Is that correct?

Pete Upton:

Congress left it to the CDFI Fund to come up with 11 different initiatives, and the Native American CDFI Assistance Program was one of those initiatives.

Bob Miller:

Well, thank you. Now I hope everyone, I hope the audience, can see that that looks like treaty making. To me, Congress told a federal bureaucracy work with tribes, help tribes develop their economies, set up some policies and programs, and that's exactly what that looks like. So when I use the word treaty substitutes earlier, my gosh, this looks like a treaty, or at least that kind of arrangement. United States agreed to support X. Federal officials have been told to work with tribes and and create x, and that's what you guys have been doing. So that's a government to government relationship. It's not based on the race of Indian peoples. It's working with tribal governments that our founding fathers recognize. So this is as far away from dei as it can possibly be. It's not based on race. It's based on the existence of tribal governments. And so that's the work you and your organization are doing,

Pete Upton:

and it would be more Congress gave Treasury the ability to disperse these funds, and Treasury took it upon themselves to come up with the 11 initiatives, and one of them being to create the Native American CDFI Assistance Program, which serves native people.

Bob Miller:

That's exactly what Congress did for 100 years with 150 years with the Bureau of Indian Affairs. That's what they do with the Indian Health Service. I don't know exactly when the Indian Health Service started, but Congress appropriates a lump sum of money and tells an agency spend this money for these purposes. That's exactly what you just described. So this is federal Indian law, government to government relationship, the feds to the tribes this, this is not dei

brian edwards:

can you? Can you connect the dot though? Bob, so native CDFIs are not sovereign, right there? There are many native, certain native led native serving organizations. How does the sovereign status of tribes, though, shape how we should understand native CDFIs and other native led and native serving institutions.

Bob Miller:

Congress creates all sorts of programs and invites all sorts of people to apply and carry out that federal policy, that federal program. Now, Pete, you tell me, do tribes authorize their CDFIs, or are you guys like NGOs, like a nonprofit

Pete Upton:

NGOs, and they can be controlled by a tribe as well, but I would say the majority of them are NGOs, and there's probably 30% that are tribally formed.

Bob Miller:

Okay, so, but Brian, to your question, this is no different. When the Feds create a program for health and some nonprofit group here gets formed in Phoenix, and they apply for that federal dollars to spend it doing X, they're doing something that's a federal goal. They're carrying out federal policies. Of course, that nonprofit in downtown. Phoenix is not tribal, but the groups that Pete works with, he just told me, US is 65% NGOs to use that word, but they are pursuing a federal policy that's for native peoples, for reservation economies and native peoples. And so now, if a third of these CDFIs are tribally government authorized? Well, that even brings it more home to a political situation. So it's a political goal of Congress, and then when the tribes get involved, it's political on the other side. So this is still carrying out a federal policy, still spending federal dollars for a federal political goal.

Pete Upton:

And I do think the majority of the NGOs, well, it's not a majority, it's just the way the certification requirements are written. You have to have 50% Native Americans that serve on the board. And so they do have a requirement that it can't it has to have an element of native led

Bob Miller:

well, and that, see, that's even borrowed from the old buy Indian Act and for other programs, where to get federal assistance and funding through the buy Indian Act, a company has to be 51% owned by an Indian person, if it's a corporation. So that's interesting, that that's kind of the same idea that it's long been around through the buy Indian Act that was enacted in 1910

brian edwards:

So Bob, you've kind of addressed this already, but I'm going to ask the question, why is it wrong to lump tribes in with the DEI initiatives?

Bob Miller:

One reason people might do that is they want to fight a program, and if it's racial discrimination, what the Supreme Court calls invidious racial discrimination, then it's far easier for that to be struck down in a court because if something is race based, the federal court system has to look at that under what's called a microscope. I call it that strict scrutiny is the legal term, and any law that discriminates based on race gets strict scrutiny, and a federal law almost never can pass that level of judicial scrutiny. But with since these interactions with tribes are based on politics, now, the Supreme Court told us in the 1970s that a federal court engages in what's called rational basis review. And I tell my constitutional law class that's like standing across the room and instead of using a microscope to look at the law, the court stands across the room and looks at it and asks a question, is there any reasonable connection? There rational basis for Congress's duty to have passed a law like this. So I hope I explained that clearly enough that instead of super close judicial review, if it's based on race, when it's based on the tribal political status and the constitution of tribes as governments, federal courts take a hands off approach, and they use what's called rational basis review. If Congress was rationally pursuing a goal that is legal and allowed by the Constitution, etc, federal courts won't mess with it, and they don't look at it too closely. So on the if you're talking nuts and bolts, it makes a big difference on an opponent to the program and what kind of court review they can get of what Congress has authorized and then what the federal agencies have done.

brian edwards:

So it's a legal strategy.

Bob Miller:

Well, you know, I'm no dei expert, but I, you know, there's political reasons I think those arguments are being made also clearly and and there's a legal way to attack it, if it's based on race. So what Pete and other organizations that are working in Indian country? We got to convince these donors, and we got to convince the federal government that carrying out congressional policies for Indian country. It's not a racial discrimination. It's not going to receive Supreme Court, you know, strict scrutiny, under the microscope. The courts are going to pretty much approve governments almost always win a case and what they're doing, if it's rational basis review, because the courts really take a hands off approach. So that's both a little legal, but there's political reasons behind it. I think anyone that's calling Indian law Dei, there's a political position there that someone's trying to push for.

Pete Upton:

What I'm trying to do is figure out how we can tie the CDFI fund appropriations to a fulfillment of the self determination act, and then also having it align the CD the CDFI is serving Native citizens having an alignment with current administration's policy of native communities becoming. And self sufficient and also meeting that self determination act,

Bob Miller:

you're successfully tying the CDFI Fund and why Congress appropriated this money for Treasury to work on and programs to the self determination act. But let me tell you one other big argument that you could be making. The United States owes a trust responsibility to Indian nations and to individual Indian peoples as citizens of their nations. So in the United States, native peoples are the poorest people in the country, poorest group. We're the least educated. We are shortest lifespan, worst health problems of any identifiable group in the United States. Well, how can that be if the United States is supposed to be taking care of us? So that's one thing, Nixon, and what the self determination era is about, the United States carrying out its trust responsibility. So Pete, I would strongly encourage your organization to be talking not just self determination, but the trust responsibility there are, you know, there are some very successful tribes. Now, I saw a report recently the tribes in Oklahoma contribute like $15 billion to the Oklahoma economy. I'm from Oregon. The tribes there have long done reports showing how many people they hire, people who used to be on welfare getting child support now they're tax paying citizens and so how their economic activity has helped the state and the United States at large. So you brought up economics? Absolutely, you bring a whole group of people out of poverty. What does that do? It raises the income. It raises the health of that entire area. I want to give you guys just two quotes. The Mississippi Choctaw tribe used to have the worst rate of infant mortality in the United States in the 50s and 60s. And now that they have a very successful economy. They have the highest How do you word this? Non infant mortality rate the Eastern Band Cherokee, have been studied by Duke Medical School for about the last 30 or 40 years, the mental health of their children and the men. You can get this report online in two seconds, the mental health of Eastern Cherokee, Eastern Band, Cherokee Indians has improved as financial situation has improved in their families. Those two tribes I cite in my latest book, their population on reservation has increased enormously because there are actual jobs, actual middle class homes, health care, maybe schools you want to send your kids to. What a wonderful benefit that is for the economy of the tribal people, the health, their education, etc. My God, it's wonderful. And then those dollars also help. You know, what do we say a rising tide floats all boats. So it helps the surrounding economies, counties, states and etc. So it's a win, win situation, and people who oppose it are taking a short term narrow view, cutting off their nose despite their face is the old saying,

brian edwards:

Yeah, this the spillover effects of of tribal businesses, from casinos to federal contracting to energy projects, everything else. I mean, the spillover effect is on those surrounding communities, right? Many, many tribes with their healthcare are offering it to other. You know, community members that are not native, that are not members of their tribe, the Puyallup Tribe in Tacoma, Washington, opened a rehab hospital, effectively, that's available to all members of the Puyallup Tribe, but also available to other people in Tacoma, to their neighbors, because they're an urban tribe. Bob, thanks so much for joining us and really setting the stage for this whole series that we're going to do. Really appreciate the context and history that you've given us.

Bob Miller:

Thank you. I'm delighted to chat with you two guys, and we'd like to be of any assistance in the future too.

Pete Upton:

I'd love to take you to DC with me sometime, Bob, and have you in the audience as a ringer for me.

Bob Miller:

I'll give you a standing ovation. Pete,

brian edwards:

that was Robert J Miller breaking down for us why tribal economies didn't start with the federal government, and why sovereignty isn't just a buzz word, it's actually the Legal Foundation. He made it pretty clear, right? Native CDFIs are not dei programs. They're native built institutions. They're designed to meet native communities where they are and then move them forward. Next time on difference makers 3.0 we'll talk with researcher and economist Miriam Jorgensen about how native CDFIs came to be, how they've grown. Own and what they're up against. Now that's Episode Two from policy to practice. Difference makers. 3.0 is a co production of the native CDFI network and tribal Business News. Thanks again to Bob Miller for joining us this week. Be sure to check out the new edition of his landmark book. It's called reservation capitalism, economic development in Indian country, and you can find it on Apple books, Kindle, Barnes and Noble and I'm sure many other fine institutions. Special thanks to Kristin Lia, our project manager, wrangler in chief, and the on the ground recording expert, and to Elise wild, who's working behind the mic this season as our sound editor and podcast Maven. Check out the show notes for links and more. Thanks for listening. See you next time you.