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Philly’s new commerce director seeks a better path for Philly employers

"We have to do a better job making it easier to do businesses in Philadelphia.... So we are forming the Business Response Team" to fix problems that come up.

Michael A. Rashid
Michael A. RashidRead moreIndependence Blue Cross

Michael Rashid, Philadelphia’s new Commerce Director, like his predecessor Harold Epps, grew up in the segregated South, and made his mark running a large business, before his public service. Rashid’s story, from our interview, has been edited for clarity:

I was raised in Birmingham, Ala. It was apartheid: I never talked to a white person socially until I went to college.

My parents each worked two jobs as long as I could remember. I didn’t see them a lot. Their whole thing was to get us into a good college, outside Alabama, away from the segregated schools.

My mom was a schoolteacher. My father had wanted to be a doctor. He became a health-care worker. He ran an X-ray van out to the coal-patch villages. Looking for tuberculosis, and for black lung.

On Sunday nights my dad would let me go out with him. I’ll never forget how he related to those people. They didn’t have a lot of education. He would convince them to get an X-ray. It was totally inspiration.

In those days, the doctor had the money, he was at the top of the pyramid. Not like now, when it’s the CEO of the insurance company. I wanted to be a doctor.

I got into USC. I still harbor some resentment at the lady they sent me to the first week, who planned your schedule. She looked at my transcript — C’s in chemistry and biology. She didn’t say, ‘Take a couple of remedial courses.’ She said, ‘You weren’t that good in the sciences. Look at something else.’ I let her talk me out of it.

But I was blessed at Harvard Business School. I was told that 1968 was the first year they had more than five African Americans. Like now, there were a lot of demonstrations going on, and they figured they better have more of us. They had 30 African Americans in that class.

My first job out of there was in finance, in an insurance company. I went to live in Baltimore. I became friends with Clarence Burns, who later became the first Black mayor of Baltimore. He was chairman of the East Baltimore Medical Plan, getting more African Americans to visit doctors, and he encouraged me to get involved.

I was familiar with racism and desegregation. I was not familiar with the health disparities in cities all over the country at the time. Baltimore in the 1970s and 1980s was quite the place to learn.

The plan was supported by Johns Hopkins. Great institution, people there would tell you. But people in East Baltimore didn’t want to go to Hopkins. Hopkins had a reputation as a place that experimented on Black people. So we built a community organization to support a federally qualified primary-care center, outside Hopkins.

Then Mercy Health Plan, owned by the Sisters of Mercy, recruited me to come to Philadelphia, to run a new medical plan, in partnership with Blue Cross. I started in New Jersey, then they made me chief operating officer, based in Philly. We grew it from 400 employees at those three plans in 1994, to 16 states and 4,000 employees. In 2010, [Independence Blue Cross CEO] Dan Hilferty appointed me CEO for what by then was Amerihealth.

In mid-2014 I tried retirement, but failed. I kept being offered these consulting opportunities. About 2017 Centene Corp. asked me to turn around one of their failing operations, in Chicago.

After that, I heard this job was open. I love our Mayor [Jim] Kenney. I put my hat in the ring. Now I’m here trying to do a turnaround in Philadelphia.

My orders are, take a bad situation and provide a key element: leadership. Business problems aren’t isolated from other problems. People on all sides tell me we can’t turn the economy around until we work together to address the pandemic. People aren’t going to come back to the city until the restaurant community and the hospitality community in general are working again.

We met with 250 restaurants last week. They made a point that all restaurants are not the same. Some can feed people outdoors. Some spent a lot of money on air filtration systems indoors. They were very articulate: ‘Please let us sit at the table and come up with reasonable accommodations and restrictions that make sense.’ The health commissioner, Dr. [Thomas] Farley, was there, the managing director was there. We met again this morning.

They need help to accommodate people safely, but the city’s coffers are basically empty. We are asking for federal assistance. I don’t know why it has taken so long, with people suffering, and businesses closing.

It’s my experience that the mayor, the president of city council, they understand, but their hands are tied. The mayor was at a restaurant a couple weeks ago. The people there asked him, what are you going to do about the homicide rate? And he said, the police are taking guns off the street, but more guns are getting right back on the street because of the lax [Pennsylvania] gun laws, which we can’t change from Philadelphia.

We have to address that connection between poverty and crime. I know guys from my youth who stood on the corner and sold stolen goods and drugs. Not because it’s their life aspiration to stand in the rain and risk jail. Because in their minds they have no other way to make money. We are still trying to show people there’s another way to get out.

We have to increase the minimum wage. The law in Pennsylvania is, the city can’t do that, it has to be dealt with in Harrisburg.

But there are things the city can do. The city requires a higher wage from its contractors. As you point out in your articles, we have to do a better job making it easier to do businesses in Philadelphia. So we are forming the Business Response Team. If they are taking too long at Licenses and Inspections, if you are forced to make too many trips to City Hall, if you have individual problems with agencies or departments, we will work with you to fix the problem.

And we will, more importantly, work on process improvement. In big organizations, even when everyone is trying to do a good job, sometimes there are unintended consequences of a new process.

Some of the young people joining the city are incredibly smart, they have incredible ingenuity, but let’s not overlook people with experience and relationships. We are putting together the team with both people who have worked at L&I for many years and some of the new hotshots we’ve hired from Drexel.

Now you know we lost a lot of airport jobs when the airlines stopped flying. But at the same time cargo traffic increased, people are shipping things all over the place. My friend sells jewelry — she used to go to fairs, she got a storefront, it shut down for the pandemic — she had to go online, and now her business is up five times. That is the kind of opportunity we need more people to realize.

But that’s just the start. We have to help show new business people how to handle their money, once they start making any. We need lower barriers to entry, so more people can be in business. I want to be the guy who does that.