Honoring Nations: Anthony Pico: Building On the Success of Nation-Owned Enterprises

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Harvard Project on American Indian Economic Development
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Anthony Pico, the longtime chairman of the Viejas Band of Kumeyaay Indians, discusses the larger purposes of economic development for Native nations, why it is important for nations leverage their gaming successes via the cultivation of other nation-owned enterprises and citizen-owned businesses, and why nations need to grow their governance institutions to keep pace with their economic growth.

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Pico, Anthony. "Building On the Success of Nation-Owned Enterprises." Honoring Nations symposium. Harvard Project on American Indian Economic Development, John F. Kennedy School of Government, Harvard University. Cambridge, Massachusetts. September 10, 2004. Presentation.

Amy Besaw:

"Next up we will have Chairman Anthony Pico give some words and remarks on his experience as a tribal leader in Indian Country and also from their highly successful Viejas bank, the Borrego Springs Bank."

Anthony Pico:

"Good afternoon. [Can you hear me back there?] If you're a tribal leader, you've got to wear those arrow shirts because your own people want to clothe you [Laughter], unclothe you, and flock you. I'd like to thank the Harvard Project on American Indian Economic Development and the Honoring Nations advisory [board] for hosting this impressive symposium and it's a humbling experience to be invited to share my thoughts with so many whose contributions are the foundation of the American Indian and Alaskan Native renaissance.

For me, whether we're talking about great government programs or successful business ventures, the key political issue is, and keeps going back to, exercising our sovereignty. As the Viejas Band of Kumeyaay Indians moved forward on the path of creating economic viability, I have learned two important political lessons. The first is that sovereignty is the most important attribute that we have and the purpose of tribal government programs and enterprise is to enhance our sovereign right to self-government. The meaning and practice of sovereignty is learning. Learning how to get it, learning how to use it, learning how to keep it. Sovereignty is a shared sacred journey with my brothers and sisters and I'm honored to be sharing this journey with you this afternoon. It's a great pleasure to follow Mary Jo Bane.

I'm a great fan of the Harvard Project on American Indian Economic Development and I've read all the reports and had opportunities to integrate some of those within our governance and economic systems. I've often incorporated the outstanding Harvard research on successful business practices in speaking engagements, governmental policies and my own leadership goals. I'm also pleased to have a future leader, or a leader, a young leader, Myron Brown. I'm very impressed with him participating in this discussion. The key to building great programs in a political setting is to have strong and consistent leadership and we are fortunate to have youth willing to step up and begin the sacred journey along with the rest of us. I really appreciate that.

Generating jobs for our people and revenue for our government through gaming has given the tribes, many tribes -- like the Viejas Band of Kumeyaay -- the ability to exercise sovereignty. It has also tested and expanded our respect for the politics of exercising sovereignty. In the process of developing our entrepreneurial ventures, we have had to acquire new political skills both on and off the reservation. To me, sovereignty is the right to govern ourselves, control our resources, follow our respective traditions and customs, and create our own visions for our own communities and our children's future. It's the foundation on which our economic goals and achievements must be built if we are to create a life and not just make a living. Without exercising sovereignty, we are just one more special interest group hacking its way through the competition, fighting for jobs and income, but with sovereignty we create jobs and we create income.

Another surprise, that there was no taking our economic success or failures and hiding out on the rez, at least if we want to be equal to the task of acting as our own strong governments in today's world and in the future. The Viejas has had some advantages including strong tribal government that has been mentored by our elders. Sometimes you've got to be careful because it seems like they're going to spank us [Laughter]. Tribal leadership willing to break new ground and courageous enough to face the risk of failure, owning up to our responsibility, and wise enough to know that commerce will bring change and non-Indians into our lives, and willing to take the heat of forging new relationships in the outside world and the difficult task of balancing our culture and tradition with the new demands of owning non-traditional businesses.

Our councils constantly deal with the issue of which master our businesses serve. Is it the financial bottom line or tribal community? At the same time we have to placate political factions, as you know. They aren't the Democrats versus the Republicans and their divergent ideologies that we saw recently in the political conventions. Our political debates are between traditionalists who worry about the impact of changes and the price of economic success and the self-interest of family factions who elect our councils. The scales aren't always easy to balance.

I would like to share with you what we've learned at Viejas. To do business with our people one must understand our history and to respect how we make our decisions and our priorities one must be acquainted with our experience. To work with us, one must be sensitive to our culture and traditions and it's our responsibility to do the educating. We must offer an economic environment that inspires and motivates loyalty towards tribal prosperity financially, culturally and spiritually. We seek loyalty to a higher cause from our economic gains. Strong tribal governments and healthy Indian communities is that cause, and we must educate everyone who works for tribal businesses or partners with tribal businesses that they are working for a sovereign government. They are invited to benefit from achievements that go beyond making a salary.

Our patrons and tribal members alike know that they are investing in something that will change the world and live beyond our time. Our government must be able to relate to the world of business -- our own and others -- and other governments, and we must be able to do so in a way that is consistent, fair, stable, respected and acknowledged.

We invest time and resources in educating the public, our neighbors, politicians and the media about who we are and what we are. Creating stakeholders -- political, community and business alliances -- is a necessity for our survival. Shaping our futures will require not simply the assertion of our sovereignty -- a claim to rights and powers -- it will require effective exercise of that sovereignty. A challenging task we face today is to use the power we have to build viable governments and government programs. It's filling the void of dependence created by federal policy, the Bureau of Indian Affairs, and others who have controlled our lives and resources. Moving from independence to governmental independence takes economic development but it takes more than money. It takes developing the capacity to govern our people and offer them a place and environment that is stable, supportive, nurturing, strengthening, safe and yes, even sometimes disciplining. It's a political, social and spiritual quest.

The challenge is to make sovereignty a political reality both on and off the reservation, to turn an abstract promise embedded in the federal policy of self-determination into genuine decision-making power. Then we have to back up assertions of sovereignty with the ability to govern effectively. It's one thing to have the power to govern, but it's another to govern effectively. The shift in governance from outsiders to self-governance puts the spotlight directly on the tribes and we can't blame our problems or failures on others, and by the same token we can claim and bask in our own achievements. Decisions tribes make now and the ability we bring to the task of self-governance is crucial to our children's futures claim to sovereignty. The success of our businesses depends on our sovereignty and not only our right to exercise sovereignty but how well we exercise that. And finally, sovereignty education is important because the mainline defense of American Indian freedom is in the court of public opinion and make no mistake, when push comes to shove the voting public may eventually decide the fate of Native America.

In 1960, when the federal policy shifted for the fourth time in 100 years to self-governance and economic self-determination, tribes have been able to work and plan more than just simply survive. The result has been the development of economic opportunities for some tribes. Today, an increasing number of American Indian governments have the best chance that we have ever had in over 300 years to participate in and influence our destiny.

At Viejas, our gaming business quickly surpassed our wildest dreams. The business growth outpaced our marketing management and our facilities. We had to make decisions by the seat of our pants. What did we know about gaming? All we knew was that we needed it. Just as we learned to play the game, the rules always seemed to change. It takes time to acquire the confidence and the experience necessary to manage a multi-million business and enterprises. It takes an attitude adjustment to deal with the thousands of employees and hundreds of thousands of guests milling around our reservation. Nobody was interested before; now everyone seems to be interested in us. Too much attention too soon creates other types of problems. We wasted a great deal of energy reacting rather than being proactive. Now we know the difference and now the task is to translate these experiences into future planning and policy that is effective. Gaming, for example, may raise the quality of life and may reduce dependence on the federal government, but it won't necessarily create a culture renaissance or strong government. Gaming success may in fact discourage or blind us to the need to rebuild and revisit our values. We may get so complacent making money, or so busy, that we fail to invest in building strong Indian governments.

Our current work is creating policy that allows new changes in leadership to build on our successes and avoid our mistakes. Diversification is an economic must; however, each new venture brings new issues and decisions, especially when we engage in off-reservation ventures. We have learned we need policies and programs to settle disputes and they must be fairly discharged and adjudicated. This applies to tribal members, employees and guests, business partners and tribal governments themselves. People must believe that the system is fair and this requires institutionalization and objective policies that are rigorously upheld rather than [subject to] random actions. People can't be fired at pleasure and personal politics needs to be kept out of the government relations.

Separating tribal politics from business -- this is an issue that each tribe must solve in its own way. Learning what is appropriate matters for political debate and tribal leadership versus what matters best needs to be left to those hired to run the business. This really depends on the issue and how the business and the tribes have organized the relationship. However, we have learned experience brings wisdom.

The first rule is that businesses cannot compete successfully when the decisions are made according to tribal politics instead of business criteria. This doesn't mean that the tribe must abandon control; it means the tribe must develop strategies and policies and execute oversight that guide the actions and decisions. The strategic question the Viejas council engages should not be who runs the mailroom, but what kind of society are we trying to build? What are our priorities as a community? What uses should we make of our resources? What relationships with outsiders are appropriate and necessary? Who can we trust? What do we need to protect and what are we willing to give up?

The most difficult decisions for me have been when and how to compromise issues of sovereignty and when to draw the line in the sand. When dealing with the federal, state and local governments there's the recognition of the need for compromise but always the haunting fear that an inch given leads to a mile stolen. Indian gaming and related hospitality and entertainment businesses have boosted tribes to new levels of purchasing power and economic growth and we haven't even begun to scratch the surface. Economic success has also given us an appetite for self-reliance. It also has given us a taste of what it means to once again sit at the Thanksgiving table as participants in America's prosperity and wealth. Two questions for Viejas [are] -- and I hope for you -- how to protect our seat at the feast, and how do we get more Indian people to the table? How can tribes with gaming operations help American Indian governments still trapped in third-world conditions access the resources to rebuild communities and economies? And how can we encourage individual Indian entrepreneurship? One answer is, buy Indian.

There's a spinoff economy of cottage industries and services that serve tribally owned casinos and related businesses. They are waiting to be explored and exploited by tribal entrepreneurs and tribal governments. Indian-owned businesses are not supplying to tribal governments, casinos and other businesses -- then we need to develop that capacity. Just as gaming tribes have created new markets, Indians can create Indian-owned businesses to fill casino and hospitality generated market demands for goods and services. By using the purchasing power, gaming tribes can engage, encourage large international vendors to invest in developing tribal franchises, partnerships, or setting purchasing contracts to reciprocate by buying products from Indian companies. Prosperity and stronger tribal governments create an increased demand for professionals, tribal educators, attorneys, architects, and marketing and management expertise. Each time Indian people fill the markets and supply the demand for goods and services our businesses are creating, we are taking the next logical step to developing a stronger national American Indian economy. Gaming tribes have the markets -- we also have the capital, the other necessity -- to invest in startup operations.

There are new opportunities for joint ventures and financial partnerships and we have help from new unexpected sources, our own banks. Tribally owned banks are a source of capital and growing expertise in accessing money for economic development. Bankers make solid financial partners and experienced advisors in accessing funds targeting and nurturing successful business deals. Banks are not in the business of providing loans; we are in the business of managing loans. The mission of Viejas-owned Borrego Springs Bank is to explore Indian ways of enhancing a self-sufficient and mutually reinforcing national Indian trade economy and profit-sharing network. There's money, markets, buyers as well as expertise in Indian Country to spawn a new generation of business development. In the words I heard yesterday from Chief Oren Lyons, he said, ‘We need only broaden our vision.'

The Viejas band has modeled partnerships among other tribes to increase investing potential and reduce risk. One partnership, the first of its kind in the nation, is a limited liability corporation (LLC) named Four Fires. Comprised of four tribal nations the first venture of Four Fires is a $45 million Marriott Residence Inn hotel opening this January in the nation's capital. Another tribal partnership we've created is closing a similar deal on a hotel adjacent to the Capitol Mall in Sacramento. Both deals mix tribal government investments with non-Indian investors and corporations.

Pairing with someone else also has its advantages in that tribes may not have the expertise to manufacture a specific product. We can hire the expertise. Hiring expertise is hardly new. Indian owned casinos have become expert in contracting with others. If a tribe chooses the right ventures and the right partners and exercises the right management, it can generate discretionary income for the reservation that eventually translates into increased entrepreneurial expertise and activity. Many tribes are also providing the money and expertise as investment and management partners of struggling tribes trying to break into gaming. Again, it's Indians investing in and building a synergistic economy.

Economic recovery at the individual level is a bigger challenge. Many Native Americans don't have the tools -- such as access to capital -- that would allow them to elbow into entrepreneurship and many who do and want to do business with tribal enterprises find themselves rebuffed. We must change this. One way is to create polices within our businesses that give preference to Indian-owned businesses and products. Let me reiterate that what we have here is governmental authority to create the type of work, places, and business enterprises that respect our culture and help our people. That's part of the sovereignty package.

There are obligations as well, such as balancing commerce with our culture, ensuring that the businesses and short-term desire for income and jobs doesn't control the government and blind us to creating a long-term vision for our community. To this end, we must exercise the right and the obligation to plan for our communities. It's hard with all the decisions and time that we must put into building and protecting our businesses, but we must not lose sight of the ultimate purpose of economic development, which is building strong governments and nations.

So how do we do this? We take time to involve our tribal community in envisioning the future, we talk to our children, we talk to our elders, we listen to our hearts and the land, and we sit again in circles to discuss what we want our nations to be like ten years from now, 100 years from now. We identify priorities for our gaming revenues that support the most immediate needs of our people and enable us to create whole and healthy families. We plan for the life of our community just as we research and study our business ventures. So how do we begin creating healthy governments and programs? We learn from each other, we mentor each other, we counsel each other; we have plenty of models right in this room and the Harvard Project has profiled a number of these.

As Indian nations increasingly take over management of social and economic programs and natural resources on our reservations, as we undertake ambitious development programs, our governments tasks become more financially and administratively complex, our government infrastructure becomes more essential to overall success. By infrastructure, I mean those bodies and directives that help keep the fire lit while the hunters are on the trail. It's the glue that keeps things going when the leadership changes or there's a political crisis. It means attracting and keeping loyal employees and developing and retaining skilled personnel. It requires establishing effective civil service systems that protect employees from politics. It means putting into place solid personnel grievance systems and that decisions are implemented and recorded effectively and reliably. It ensures that businesses and future government officials do not have to reinvent the wheel or lose momentum, but rather are able to build on the success and avoid the failures.

At the heart of the quest of self-governance is how should authority be organized and exercised? The task of governing institutions is to back up sovereignty and developing the ability to exercise it effectively. Where do these institutions come from? Should they be simply imported from somewhere else? As the Harvard Project of Economic Development has found through research and with successful tribal governments, the task of governing institutions is to back up sovereignty and developing the ability to exercise it effectively. Our unique societies, languages, worldviews and culture contain the heart and the identity of our people. They offer us a guidance and direction and a new way of solving old problems. They also remain one of the foundations upon which our constitutional, legal and political jurisdictions and governmental authority rests.

Tradition is the root of the tree, yet we must remember the tree is constantly sprouting new branches and uniquely accommodating itself to the environment and times. People are always creating tradition. There was a time when what is now accepted as tradition was bold and new and it was probably fearful and certainly criticized in its infancy. Indian culture is the living branches of the traditional tree. Like our vision of sovereignty, our culture must evolve, find its place in the sun, and continue to create, innovate and reproduce new versions of its self. Then we need to continue to take concrete steps creating not just an environment but programs that allow us individually and collectively to turn our visions into reality.

Cultural match is particularly difficult when interfacing with the outside world. We don't always match. We don't need to. But it's important that when the outside world looks in it can understand and respect what it sees. The idea that money alone is the answer to all of our problems is a fantasy and without sovereignty and healthy attitudes about the value of money it won't last very long. I know now that money is much easier to make than to keep. Building an economic base is important to self-reliance, but self-reliance requires more than finding financial investors. It means building a community in which people want to invest -- not just the capital, but their hearts and their lives. Economics that are not driven by a broader vision and values will eventually fail us.

When I speak of investors, I'm talking about more than just cash-rich joint venture partners, I'm also talking a tribal member considering a job with the tribal government or its tribal enterprise. These investors are people worthy of our utmost respect. They offer time, energy, ideas, skill, good will -- or dollars. They are the reason for economic development, but they will only bet these assets on the tribal future because they see a benefit for themselves and are invited to share in the vision.

It also means taking a critical look at how reservation politics may be hampering rather than contributing to the vision of self-achievement and satisfaction for the future of the community. The age of psychology, of scarcity, are over for some tribes. We must rid the bad habits of fighting over scraps created. We must get back to a vision of plenty, a vision of community, a vision of sharing and mutual support. And yes, we must unify behind a vision bigger than the next per capita checks. We need to see, feel and imagine and reinvent what Indian sovereignty is and we need to do this [within] each tribe and within all Indian Country.

There are different paths and future emphases for tribes. Some will strengthen sovereignty through spiritual and religious beliefs and practices, some will provide new models for strong 21st-century tribal governments and others will focus on economic development. I hope all will focus on healing the pain of the past and the psychological damage of poverty and social disintegration that haunts each generation. It's critical we become aware of our misplaced shame and find ways to free ourselves of the patterns of self-destruction, unrecognized anger, abuse, racism that drives so many to alcohol, drugs and suicide. We have to learn to live life again, not deaden ourselves to it. If not for ourselves, then we must seek to be life-affirming for the sake of our children and the next seven generations.

Asserting sovereignty is taxing. There are always new uncharted territories, whether it's employees, local government or neighbors, the federal government, or the resistance of our own people. California tribes had to overcome powerful political and financial obstacles and a steep learning curve in our political battle for economic parity. Our political victory would have never been possible had we not leaned on and trusted one another. There is no greater service than sharing the road of success with others. There is only one greater honor than to be of service and that is to pass it on.

Thanks to Harvard University, Honoring Nations, and all the great leaders who have chosen by words or example to bring our people from the depths of extinction to the cutting edge of prosperity. We all need a nudge, support from someone or something, to take that leap of faith into the future and this is a long journey that we are taking together.

Sometimes it's absolutely thrilling and sometimes it's terribly discouraging. But when I get discouraged, I think of the blood that runs through my veins came at a high cost of unspeakable atrocities suffered by my ancestors and yours. That same blood has blessed this country's soil, I will not let their suffering go unanswered, and I know that they are with me and they are with you when we make the sacred journey to create a place for that next seventh generation. Thank you."

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Borrego Springs Bank of the Viejas Band

The first American Indian-owned bank in California, the Borrego Springs Bank (BSB) offers a full range of services to tribal governments and Native-owned businesses in order to facilitate the entrepreneurial growth of American Indian tribes. With more than $74 million in assets and two full service…

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Patricia Ninham-Hoeft, Sophie Pierre, and Anthony Pico address questions about how to create and maintain a foundation for effective, sustainable leadership within Native nations.

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Viejas Band of Kumeyaay Indians Chairman Anthony Pico reflects on his experiences as leader of his nation, and stresses the importance of Native nations strengthening their systems of governance in order to protect and strengthen their cultures and ways of life.