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Excerpted From: Robert J. Miller, Sovereign Resilience: Reviving Private-sector Economic Institutions in Indian Country, 2018 Brigham Young University Law Review 1331 (2018) (290 Footnotes) (Full Document)


RobertJMillerAmerican Indians and Indian country are desperately poor. Across the United States, more American Indian families per capita live below the poverty line than any other racial or ethnic group. Economic conditions are even worse on the more than 300 Indian reservations where unemployment reaches 80-90%, inadequate housing and the absence of housing are at the highest rates anywhere in the United States, and health conditions and life expectancy rates are the worst in America. In fact, many commentators, including President Bill Clinton in 1999, have compared reservations to "third-world countries."

In contrast, before contact with Europeans, most Indian nations and peoples were fairly prosperous and healthy, and had thriving societies that existed for hundreds and thousands of years with well-established governmental and economic systems. Most Indian peoples supported themselves primarily through agriculture and lived in permanent or semipermanent towns and settlements. Other tribal peoples were somewhat nomadic, engaging in buffalo hunting or fishing for example, but even these nations and peoples lived what are called "seasonal rounds" and traveled annually to identical locations to live, harvest fish runs and animal migrations, and take ripening roots, nuts, and berries. These peoples were not nomads in the sense of being lost and wandering aimlessly about. All Indians pursued economic activities and created the foods and resources they needed to survive in a systematic and intelligent manner.

Indian nations and societies also developed governmental institutions that controlled their economic activities and rights. Tribal peoples had well-established legal rules that recognized private property rights in, for example, the ownership of homes, tools, art, crops, horses, captured animals, fish, and land. Individual American Indians also conducted extensive trade across the continent and at regularly scheduled trade fairs that were held annually at various locations and tribal towns. For example, in 1804-06, Lewis and Clark were impressed by the Indian trade they observed during their expedition--especially the trade and objects for sale at the Mandan and Hidatsa villages in modern-day North Dakota and The Dalles in modern-day Oregon. William Clark recorded in 1806 that The Dalles "is the Great Mart of all this Country." This trade was carried on by individual Indians through their own private initiative, manufacturing, and economic efforts to earn "profits" to support themselves and their families by producing, selling, and enjoying necessary and luxury products.

In light of the current poverty and negative economic and social conditions prevalent on most reservations, tribal governments are heavily focused on economic development today. But one tribal institution that I fear has been overlooked by almost all Indian nations, the federal government, and reservation communities is the historic institution of the tribal/reservation private-sector economy. It is long overdue for Indian peoples and governments to revive their traditional institutions that promoted and protected private economic activities, and to look to their historical roots and traditions of individual Indian and Indian family economic development efforts. Thus, this Article is not arguing for some new or radical idea to address the negative economic conditions in Indian country. Instead, this Article is calling for Indian nations and Native Americans to revive their historical and traditional customs, laws, values, behaviors, structures, and mechanisms for engaging in economic activities and to restore their institutions and legal regimes that promoted, supported, and protected Indian individual and family economic activities.

This endeavor will not be easy because Indian country is proceeding from such a low economic baseline and such dire poverty and deficits. Creating private-sector economies on reservations will take the intelligent and coordinated efforts of tribal governments, Indian individuals, reservation communities, the United States, and nonprofit organizations. Indian nations and Indians will have to revive their private business skills, their legal regimes for promoting and protecting private economic activities, and their historic support for reservation-based entrepreneurs and businesses. The upside to such efforts is limitless, and success in this field will create untold benefits for reservation communities and economies, individual Indians, families, and their nations. Creating functioning reservation-based, private-sector economies will go a long way toward diversifying economic activities on reservations and will benefit everyone as the "multiplier effect" of keeping money circulating and re-circulating in Indian country creates more businesses, more jobs, more income, and better conditions for everyone. There can be no higher goal than to improve the living conditions on reservations, guarantee the future livability of reservations as Indian homelands, and, ultimately, ensure the continued existence of Indian nations and peoples. These improvements will only occur if tribal governments and Indian peoples can revive their traditional institutions that support private-sector economic activities. Needless to say, without some minimal level of economic activities, jobs, and money in Indian country, reservations will not be sustainable homelands for Indian nations, Indian peoples, and Indian cultures into the future.

Part II briefly lays out the current depressed state of economic conditions in Indian country and demonstrates the crying need for tribal governments and individual Indians to take dramatic steps to alleviate them.

Part III then details the historical and traditional institutions of Indian private economic activities that supported native nations and Indian peoples for hundreds and thousands of years.

Part IV examines how Indian nations, individuals, and organizations can revive their institutions to promote private-sector, reservation-based economies.

Part V takes on the currently popular private property rights cure for economic conditions in Indian country.

Lastly, Part VI concludes with my opinions on the absolute imperative that tribal nations and American Indians improve their economic conditions in any way possible. Redeveloping and reviving traditional private-sector economies and the tribal institutions that promoted, supported, and sustained Indians for centuries are efficient and effective methods to pursue the laudable goal of ensuring reservations as Indian and Indian-nation homelands for the centuries and generations yet to come.

[. . .]

There is a crying need to revive the traditional American Indian institutions that supported private-sector economic activities in Indian country. Economic conditions are desperate on reservations. It is crucial for the continued existence of Indian country as the homelands of tribal governments, Indian peoples, and their cultures that Indian nations and reservation communities improve their living conditions.

A failure to address these issues will continue to create problems that work to defeat Indian country. The leakage of money from reservations to border towns and beyond, and the "brain drain" issue that tribes and rural America face of young families moving away, is a death knell for communities. If young people and families cannot find living wage jobs, adequate housing, good schools, and the necessities and luxuries of life on reservations, they will be forced to live elsewhere. This loss of human capital is a disaster for the future of tribal nations and reservations. In addition, continued abject poverty and the social pathologies caused by poverty will continue to work against Indian country as the continued homelands of Indian nations and peoples.

The goal of this Article is to stimulate analysis and action on improving economic conditions to help make Indian country and reservations sustainable homelands where Indian nations, governments, cultures, communities, and peoples can survive and thrive. American Indian nations, peoples, and cultures have existed on their homelands for thousands of years. Will they be able to preserve their existence? Many tribal citizens and families are ready to move home to their reservations if they can only find decent housing and employment. Surely, diversifying reservation economies and improving economic conditions will go a long way toward strengthening reservation communities and making reservations viable places to live and to "sustain[] and develop[] Native American cultural identities."

One of the best ways to diversify reservation economies is to revive the native institutions that supported private-sector business activities. Re-developing traditional private-sector economies and institutions is an efficient and potent method to increase economic activity and economic diversity in Indian country. The private sector is so important because it allows a community to benefit from the "multiplier effect" where the same dollar circulates within an area creating new economic activities, new businesses, and new jobs. The longer a dollar stays in a local area the greater the benefit. Rural America and Indian reservations understand the opposite of the multiplier effect; these areas suffer from "leakage" where money leaves their communities sooner than is optimal. The only way to create the multiplier effect is to have multiple locations in a community where money can be spent on goods and services. This requires the creation of private-sector economies on reservations. No matter how much economic activity tribal governments engage in, they can never replicate or operate the enormous level of diverse businesses, goods, and services that a functioning private sector can create.

Furthermore, the importance of developing privately owned businesses in Indian country is emphasized by the fact that small businesses are the primary ingredient of the U.S. economy. As of 2001, small businesses were creating 93% of the new jobs in the United States. In Oregon, for example, as of 2008 small and family-owned businesses made up 90% of the state's economy, created 78% of new jobs, and paid more than 65% of all wages. When we compare these facts to the almost complete absence of small businesses and private-sector economies in Indian country, it is no surprise that poverty exists on reservations.

Indian peoples can only rely on themselves and their institutions to improve conditions in Indian country. No one else cares as much or will work as hard as themselves to correct these deficiencies. I agree with a statement of Sam Deloria when he was discussing Indian educational issues: "[T]he federal government can't give our young people hope and pride: we have to do that .... High-level people in Washington can help ... but we can't look to them to do our jobs."

In addition, Indian nations and peoples must address the issue of culture. In every discussion of economic development in Indian country the question of culture arises. Many people fear that American capitalism or increased attention to economic activities will injure Indian cultures. I hope that Part III of this Article helps dispel the myth that being involved in private economic activities is somehow anti-Indian or anti-native culture. In fact, the exact opposite is true. American Indians have always supported themselves through individual and family-operated economies activities and hard work. That defines Indian cultures, histories, and institutions. One Navajo Nation chairman affirmed this point: "Traditional Navajo values do not include poverty." And frankly, it is clear that allowing Indian country and Indian families to suffer from poverty is injuring our cultures and imperiling the continued existence of our reservations as our homelands. Our cultures demand we work to support ourselves. Creating private-sector economies on our reservations is a tool to ensure our continued existence.

Moreover, one point bears emphasizing and re-emphasizing: improving economic conditions on reservations will greatly help tribal cultures, reservation health and welfare, and the continued existence of Indian nations. Improved conditions in Indian country will encourage families to move home, increase salaries, and produce both private profits and public tax dollars that can be spent on studying and practicing native cultures, creating and supporting language preservation programs, sustaining and improving governmental services, and improving social welfare issues on reservations. We must emphasize the important fact that better economic conditions make families healthier. The same is true in Indian country.

In fact, there are concrete examples of this statement. An ongoing twenty-year study by Duke University School of Medicine demonstrates clearly that this statement is true. Since 1996, Duke has studied the mental health of children from the Eastern Band of Cherokee Indians in North Carolina. As the Band began operating a successful casino and distributing some of its profits annually to Cherokee families, the mental health of the children improved dramatically. These improvements are still evident today even as these Cherokee children are entering their thirties. Moreover, the Mississippi Choctaw Tribe has demonstrated the fantastic beneficial health and cultural results that arise from improving economic conditions on reservations. In the 1950s and 60s, the Tribe suffered from the lowest life expectancy rates and the highest infant mortality rate in the United States, and almost every family lived in poverty and on less than $2000 in annual income. Up to 90% of their houses had no plumbing, only 7% of the people had attained high school degrees, and educated Choctaws were leaving the reservation seeking better economic opportunities. After several decades of the tribal government and community working to create sustained and diverse economic activities, Choctaw families were moving home to the reservation for employment and improved incomes. Chief Phillip Martin stated in 1998: "It used to be that everyone moved away. Now they're all coming back." The Tribe also significantly improved its housing, increased educational attainment levels, and is now one of the top ten employers in the state. Choctaw people are now enjoying improving life spans and as of 1998 had the lowest infant mortality rate in the United States. It is hard to imagine more concrete and beneficial results for an Indian nation and Indian families.

In conclusion, Indian nations and Indian peoples need improved economic conditions. Reservations need living-wage jobs, adequate housing and schools, and adequate health care. These kinds of services require public and private economic activities and money. Indian nations and reservation communities need to revive their traditional governmental and cultural institutions that support and promote private-sector economies and use them as one more tool to address and solve the economic issues they face. 

Professor, Sandra Day O'Connor College of Law, Arizona State University; Faculty Director, Rosette LLP American Indian Economic Development Program; Navajo Nation Council of Economic Advisors; Interim Chief Justice, Pascua Yaqui Tribe Court of Appeals; Justice, Grand Ronde Tribe Court of Appeals and Northwest Inter-Tribal Court System; Citizen, Eastern Shawnee Tribe.