By Lisa Swanson of the NUBIANO Exchange 
Over the past decade, the United States has seen many instances of housing injustice which have disproportionately affected blacks, women and low-income families. From the escalating subprime mortgage crisis to dwindling units of affordable housing, from increasing gentrification to decreasing funding for public housing, from the swelling homeless population of New Orleans to the progressing permanency of the Gulf Coast Diaspora, the most direct and devastating consequences of housing injustice, including the loss of homes, communities, and even lives, have consistently and overwhelmingly been borne by blacks.
This pattern is not coincidental. If we choose to view each of these problems and its race dynamics as separate issues, then we are guilty of ignoring the points of origin which connect them all together. According to Max Rameau, an organizer with the Center for Pan-African Development in Miami, Florida, the root problems of gentrification in the 2000s are the same as the root problems of segregation in the 1960s: people of colors’ lack of power and control over land, and white supremacy.
Typically, the phrase “white supremacy” is associated with hate groups such as the Ku Klux Klan and the National Alliance. This extreme mental association hinders our recognition of white supremacy, also referred to as white privilege, in our everyday lives. Many white people would be very upset by the suggestion that white supremacy is a part of their everyday lives, and I think that most white people would say very firmly that they do not believe that white people are superior to black people. I agree that white people are not superior to black people, and that people of all shades and appearances are inherently equal. The first calling of my faith as a Unitarian Universalist is to “affirm and promote the inherent worth and dignity of every person.” I believe in every corner of my heart that we are all human beings with worth and dignity, and that the color of our skin does not matter.
I also believe that, in this society, the color of our skin matters; I believe that our society functions in a way which favors people with white skin and makes things harder for people with skin that is brown or black. This favoritism reinforces the superiority of white people, and white privilege becomes a self-sustaining cycle. There is nothing inherent in skin color with makes a group with one shade superior to a group with another shade of skin. But the racism that all of us in the United States experience every day is no less real for being manufactured.
Article comments
— go to most recent comments1 - Dan Miller
According to the article,
This is most likely accurate; it is also true in places with non-White majorities.I have spent quite a lot of time in Asia (mainly Korea, but also Taiwan and Japan), in the Virgin Islands, the Windward and Leeward Islands, South America, and Central America. Consistently, I have noticed that lighter skin color is favored by the local, non-white inhabitants. Perhaps this is simply because many dark complected people work outside in the sun and dark skin is therefore associated with low status workers. I don't know; perhaps there is another reason. A now deceased friend, as a young man many years ago, became a successful photographer by taking pictures of people in Jamaica and doctoring the photos to make the subjects appear lighter in the resulting portraits.
I have no idea why this preference exists even in societies not dominated by Whites, but thought it worth mentioning.
Dan
2 - Clavos
In Haiti, an all Black country, most of what little wealth there is rests in the hands of the lighter-skinned people. The same is true of most of the political power.
I have visited Haiti numerous times since 1958, and this situation has not changed appreciably since then.
3 - Baronius
There's not much in this article worth commenting upon. The author takes six pages to state an argument without providing proof or substantiating her claims. There are two things that made me laugh, though:
"Subprime loans account for 55 percent of foreclosuresâ€"a disproportionate percentage, given that subprime loans make up only 13 percent of all existing home loans, according to the Mortgage Bankers Association."
Disproportionate? Why? These are loans at a higher rate of interest, so it's natural that there would be more defaults. Furthermore, the fact that people are defaulting on these loans more frequently indicates that they were higher risks, so they shouldn't have gotten prime rates.
For the last dozen or so years, the government has been pushing creditors to give loans to minorities and inner city residents. More loans went out than should have. This was government action at its finest (as was the HOPE program), and now the author wants the government to get more involved?
I know something about the housing market. I don't have the financial standing to get a decent loan. If I bought a house, the terms would have been terrible. So I didn't buy a house. There would have been a lot fewer defaults if people hadn't overextended themselves.
The other amusing thing was the author's assumption that Katrina was so obviously racist that it didn't need to be discussed.
4 - Dan Miller
Baronius,
DanIt all depends on how one defines "racist."
5 - Condor
No one should live beyond thier means. In other words, no matter how good the snake oil sales seem to be, you BETTER be able to afford it.
That said, there are large number of gullible idiots out there, and plenty of corrupt sales people willing to take full advantage of those who are a sucker for a "good deal" -- didn't P.T. Barnum state that "there's a sucker born every minute" -- believe it.
6 - Dan Miller
Here is another newly discovered and substantial problem, mention of which is sadly omitted in the article. It seems that in New York State, of all places, lottery games which residents of poorer areas tend to play have somewhat lower payouts than other lottery games equally available there.
One must wonder why nobody told them; the Government needs to do something, right now.For shame, I say.
Dan
7 - Robert Firth
Baronius is right. For years, banks lent money only to people who could afford to repay. Then a bunch of liberals screamed that this was a racist policy - and browbeat the banks into lending to minorities who couldn't afford to repay.
So now the banks are racist for doing exactly what the liberals told them to do. Don't you love the sound of chickens coming home to roost?
8 - Clayton Perry
I think the logic behind many of Lisa Swanson's critics is interesting. Their comments are focused on individual "stupidity" and "gullibility," so much so that Robert Firth asserts that the chickens are coming home to roost. Perhaps. But more often than not, when "chickens come home to roost," they tend to pile their excrement (read: the consequence or "lesson learned") on top of one group or individual. That is not the case, however.
Banks are crumbling.
Communities are dying.
And Americans of all stripes are suffering.
P.T. Barnum may have said that a "sucker is born every minute," but it is wrong to paint the issue as creditors being "pushed" into doing something that they did not want to do by liberals screaming "racism," "sexism," "classism" and the like.
Malicious corporate practices took advantage of PEOPLE, especially minorities, women and the poor. Period.
Human nature might make it "easy" to place the blame on others, but if we continue to focus on individual "short-sightedness," instead of institutional malfunctions, then America will be the loser in the long run.
Martin Luther King said it best: "Injustice anywhere is a threat to justice everywhere."
9 - Condor
Back in the 80's when loans were 12 to 14 percent... I didn't buy a house. In the 90's I bought my first house, I was hitting 40. But the note was low enough that I was comfortable with the payment. Sold it, moved up. But I waited until the timing was right.
I have a niece who is on her 4th house and she's 34. New norm? Perhaps, but keeping up with the Jones' should not put you on the skids when the first economic burp happens. That's called living life on the serrated edge.
10 - Lumpy
this article comes off as vaguely racist, outdated and confused. there is no 'housing crisis' most of the houses foreclosed on will become rental units and rental prices will go down. the so called mortgage crisis has made home ownership possible for responsible minorities and low income buyers for the first time. yes some people made mistakes and face a very temporay inconvenience but the overall impact of this adjustment period should be positive.
11 - Doug Hunter
A lame bit of leftist race agitation.
I'd be interested to know how successful minority and ethnic groups fit into your white supremacist/oppressor model. If whites are so into rigging the system in their favor then why have they allowed certain minorities to surpass them in a variety of success indicators?
12 - Lumpy
among those minorities doing well are poor african americans who are substabtially more upwardly mobile than poor whites, though hispanics outdo both.
13 - Lumpy
among those minorities doing well are poor african americans who are substabtially more upwardly mobile than poor whites, though hispanics outdo both.
14 - ow
key phrase - probably eligible for A paper...but discrimnation subordinates people to lousy loans that carry higher risk of defaulting....a nice fixed loan at a reasonable rate carries less risk. I had 680 an still driven to subprime...but know counterparts that have same or less and got better offers...me first time home buyer...maybe that's the reason not complection????
15 - Baritone
The contention that all this mortgage mess is owing to liberal pressure is bullshit. Countrywide, Wells Fargo and many other lenders did what they thought would make them a bundle of money. These companies did not go out and make loans they did not believe would make money.
Whenever something turns to shit in the corporate world, there is inevitably someone who finds a way to blame it on liberals. It just couldn't be individual and/or corporate greed at fault. Heavens no!
The tenor of most of the comments here border on true racism - the borrowers are "gullible and stupid" - good ole Step-n-Fetchit buyin' a house.
The lenders are, in the eyes of most commenting here, without fault. They just either responded - presumably kicking and screeming - to leftist pressure, and in contravention of their share holders' interests, or were just taking advantage of circumstances feeling justified banking on the concept of caveat emptor.
It is also true that a large number of the most culpible borrowers were not individual home buyers, but rather investors buying several homes in the full knowledge that they would never be repaying those loans. Most took the money and ran. The "gullible" who wound up on the shit heap were mainly guilty of actually trusting someone (ie: the mortgage broker, loan originator, realtor, builder, etc.; something that obviously no one should ever do. The corporate community in general is not to be trusted. It's the American way.
So the lesson to be learned here by those who lost their ass is NEVER trust any of those people. Assume that they are all crooks - all bankers, all brokers, all builders, all realtors.
Maybe, if the gun laws get looser over time as appears likely, a borrower could just carry heat to a closing, and if they feel like they might be getting screwed, just blow some motherfucking banker to hell. That'll teach those thieving cocksuckers!
B-tone
16 - Clavos
"Assume that they are all crooks - all bankers, all brokers, all builders, all realtors."
The phrase "caveat emptor" (let the buyer beware) dates all the way back to Roman times.
Not all bankers, etc. are crooks, but the buyer should approach ALL business dealings as if they were.
One doesn't have to be rude or obnoxious about it; merely ensure all the Ts are crossed and all the Is are dotted.
I've bought nearly a dozen houses in my lifetime (my wife and I were forced to move a lot). I hired a lawyer to protect me for the first couple of transactions, until I learned how to protect myself. I still hire independent appraisers when I buy real estate. I've never been burned in a real estate deal.
It's just prudent and common sense to trust, but verify.
17 - Doug Hunter
"The contention that all this mortgage mess is owing to liberal pressure is bullshit. Countrywide, Wells Fargo and many other lenders did what they thought would make them a bundle of money." - Baritone
Do you live under a rock in fairytale land? You're sadly misinformed on how much money and power there are in the race business. Search 'CRA minority mortage' or something similiar on google and find out how this mess started with pressure on banks to loan to low income and minority customers. If they didn't make the loans (or preferably pay off the right racist agitation group who were essentially allowed to enforce the program through fed filings) they opened themselves up to bad ratings, lawsuit hell, and inability to expand or merger.
18 - Baritone
No rocks here. I have been in the real estate business in one capacity or other for nearly 30 years. Yes, certainly pressure may have been applied, but as with the individual borrowers, the lenders ultimately made the decision to provide such loans and it was done in a way to insure that in one way or another, they would make money in the process, which in and of itself is to be expected. But these loans were set up in such a manner as to be very complex, the terms of which were at best confusing, leaving many buyers, especially first timers totally without a clue. No one counciled these people to "trust but verify." They were encouraged, prodded even, to simply trust, to hell with verification. "Oh, well, you can have an attorney check it over if you want, but this deal is only good for another 7 minutes and 12 seconds. Then rate goes up. But, hey, you do what you think's best. Anyway, would I lie to you? Tell me true now, do you think I'm a liar? You cut me to the quick."
Should they have done as Clav suggests? Yes. But does it absolve the lenders and their high pressure tactics because they failed to do so? Clav is an intelligent, educated guy. Many of the sub-prime home buyers may or may not have been intelligent, but many were not educated - formerly or informerly - about the process of buying a home and obtaining financing.
Rather, a mortgage broker or loan originator, or perhaps a realtor took many of these wide eyed people in hand and dazzled them with the site of 3000 square foot homes with 4 bedrooms and 2.5 baths, big family rooms and a lot of other bells and whistles - the fucking American dream - and led them with that enticing carrot to the closing table. And before they knew what hit them, they were supposed home owners, but more to the point, they were mortgagors who didn't quite understand why 6 months or a year, maybe two, down the road their mortgage payment suddenly went up in leaps and bounds while their income stayed much the same or even dwindled. As wifey scrambles to find that manila folder with those 176 pages of finely printed closing documents, hubby is on the phone being shuttled around by the mortgage company's automated answering system, not sure which fucking button to push.
"And oh, by the way, didn't you notice? Your original mortgage company sold your loan 6 months ago. Cut Throat Mortgage no longer carries your loan. It is now owned by Fast Talking Savings and Loan. Have a nice day." And on it goes.
Of course, I don't contend that ALL banks and mortgage companies, or ALL mortgage brokers (most, but not all) or ALL Realtors are crooks. Hell, I pretended to be a real estate broker for about 7 or 8 years. (I couldn't sell water on the Sahara.) I have been and continue to be a certified residential appraiser for over 20 years. I've seen a lot of bullshit in that time. I've seen a lot of bamboozlers and a lot of the bamboozled. It ain't pretty.
I'd also say that if the lenders succumbed to pressure from whatever source to make bad loans, then they are no less gullible and stupid than the individuals who got stung with a big mortgage and a white elephant house that they can't sell.
B-tone
19 - STM
I don't know what you guys are complaining about.
My mortgage interest rate has gone up 15 times in the past two years - largely thanks to the sub-prime idiocy in the US that has led to the cost of borrowing/lending going up in first-world countries world wide. I am paying roughly $600 ($US580) more a month since it started going up.
It now sits at a whopping 9.29 per cent, and I get no tax break on it unlike in the US. The banks have even started putting it up independent of what the Reserve Bank of Australia decides on official interest rates. It's a joke, fair dinkum.
We have the opposite problem to the US, in that the economy is hot and riding the back of a mining boom (and a wages blowout). Low unemployment and household spending off the scale has led to underlying inflation now heading towards 5 per cent.
To say I'm p.ssed off would be an understatement, because when you throw the sub-prime crisis into the mix it's a disaster. I'd like to wring the necks of the sub-prime lenders too, as I don't even live in your bloody country and I'm suffering as a result of their greed and the greed of the corporates who jumped in on the act.
I'm already working my tits off doing a six-day week, petrol prices have gone up at least 50 cents a litre in the past six months, and I'm now getting stung every time I go to the supermarket because the economy of this vast country is entirely dependent on the road transport industry.
I blame Bush (and the previous Aussie PM John Howard, Bush's best mate) for that whole stinking mess, plus the idiots who are speculating on oil as a result - they're responsible for about one third of the increase in fuel prices.
They should stick to OJ, pineapple juice and pork bellies. You know, we're talking about something that is breaking the budgets of ordinary people. In thwe space of a few months, my monthly household budget has come to resemble the GDP of a small African nation (not Zimbabwe, although if the pressure gets any worse we might be heading there).
Speculating on oil and driving up the price will bring everyone undone at some point.
Right now, the price of oil is vastly over-valued, and us fools who aren't making a quid out of it in Wall St or London are paying for it at the pump, the supermarket, and ultimately, it impacts on our struggle to meet rising mortgage costs.
Bush and his administration couldn't organise a piss-up in a brewery, and it's beyond me how he got control of a place like the US in the first place. Maybe they were planted there by aliens as part of a plan to destroy the global economy of planet Earth (Pablo, where are you when we need ya??) They fu..ing well near succeeded, too ...
Let's hope the next comer has some better ideas, because the way it works at the moment, you fart, we suffer.
20 - Andy Marsh
The one thing I've found with the three different homes I've owned is that the lenders always tell you that you qualify for more than you should be qualified for. I bought the home I live in now about 5 years ago. I remember when I got my loan approval they told me I qualified for some ridiculous amount. Something like $400,000. I figured that a $400,000 home loan would require somewhere in the neghborhood of $4000 a month house payment. Well, I knew damned well I couldn't afford a payment like that and told my realtor that I only wanted to look at houses in what I considered to be my price range which was less than half that amount.
The other problem I see is that banks and other lenders could take care of this problem if they really wanted to. All they'd have to do is restructure the loans and then...poof! No default. So, the way I see it, the banks and other lenders have done this to themselves.
21 - Doug Hunter
"I figured that a $400,000 home loan would require somewhere in the neghborhood of $4000 a month house payment. "
That's the same rule of thumb of cost I used. As a small business owner I am forced to live below my apparent means as well because my income is highly variable. I think it's better that way. The problem with a regular paycheck is people find a way to spend every last dime of it between their bills. If one unexpected thing occurs (which invariably it will) they're pushed onto credit cards and late/overlimit fees or even worse.
22 - Clavos
B-tone,
i never meant to imply the lenders, RE brokers, etc. were blameless. What I was pointing out was that they were not the only participants who should shoulder some of the responsibility.
Were some (maybe many) of the buyers lacking in education and/or experience? Undoubtedly. All the more reason why their common sense should have been screaming at them "get some advice!"
The bottom line is, however, that the most damaged in this debacle is the housing industry (and therefore the economy as a whole), and especially the bankers.
The buyers are losing their houses, sure. Houses which, in most cases were bought for little or no money down; what monthly payments they may have made while living in the properties amount to rent. Many were able to simply walk away from the properties, and all continue to be able to rent elsewhere, just not own. Ironically, those who got out without credit damage may actually benefit from the consequent plunge in property values and may be able to buy something they can actually afford soon.
As for the speculators, fuck 'em. They were NOT naive and uneducated; they knew what they were doing, and if they got caught with their pants down, tough shit, that's part of the game.
I speculate all the time in the stock market, and sometimes I lose; nobody's to blame but me.
23 - bliffle
I find it difficult to blame the buyers for the simple reason that the lenders are basically operating a monopoly or oligopoly. The buyers are simply confronted with terms that they have NO say in (like pre-payment penalties, rate controls, etc.) and only narrow choices as to 'points' and interest rates. There is NO free market because federal bank controls are weak so state controls (even weaker) apply.
The lenders themselves have found ways to reduce their risk by bundling the loans as AAA bonds and selling them off before the crisis. Nowadays the banks and S&Ls are basically just sales offices: they have no longterm connection to the loans they make.
And that brings up the REAL problem: the influence of the load peddlers. They only have responsibility for selling the loans, then they collect their fees (exorbitant, but negotiated with the lender only) and move on before the spit hits the fan. They have enormous influence over lenders because they show high revenue figures, so they get the rates and terms they need to sell mortgage paper to buyers. They inherit the immunity to anti-trust laws. When housing goes best they move on to selling whatever is hot, like LCDs and HDTV.
The poor buyers are confronted with a situation where they must act and their choices are controlled by an oligopoly.
24 - bliffle
All home buyers are forced into the role of speculator by the circumstances of the market. The reason a guy buys a $400k house he can't afford this year (but maybe next year when his salary increases and he has some equity in the house) instead of the $150k house he can afford is because there is no $150k house.
RE sales people openly tout this line. They have to, or they'd never sell a house.
Part of the problem is that the sales fees taken by RE companies and RE sales people have increased disproportionally over the past several years because they are based on gross price. And the fees are non-negotiable. Another de facto monopoly.
25 - Baritone
Clav,
I agree with you regarding speculators/investors. But many of them knew they were going to walk away from the beginning. It was all a part of the plan.
I also agree that prospective home buyers should attempt to get independent advice or counceling about the process and the various pitfalls. But most, I'd say, the vast majority don't. Most prospective buyers depend on their realtors, their loan originators, etc. to be honest and straight with them. Frankly, I'd say most are, although there is another factor - that being the ineptitude of some of those same people. A huge number of people go through the process of becoming a realtor - taking classes, gettng licensed, signing on with a real estate sales company and wind up selling at most 2 or 3 houses (one to themselves, one to Uncle Roy and maybe one to Bob and Betty Firsttimers) before quitting in frustration. It is often these people who don't really know what the hell they are doing, who don't really understand the process much better than the Firsttimers. It's not that they are being deceptive, they are just not experienced enough, and don't always ask questions of others more experienced when they should. Instead, not wanting to look stupid, they plunge on guessing and keeping their fingers crossed that they didn't fuck up.
There are even more seasoned brokers, mortgage brokers, loan originators and appraisers who again aren't necessarily trying to pull a fast one, but who are just lazy, not willing to take the time and effort to do their jobs properly. What was it called? - "The Peter Principle" or some such wherein after a time people settle into a job having learned what minimum effort is needed to keep the job without expending anymore time and effort than absolutely necessary. There are a lot of ways we victimize each other without even knowing or intending to.
Also, for some, the notion of seeking advice from an attorney is off-putting at best in that attorneys don't have the highest level of consumer confidence either, and their advice doesn't come cheap in most cases. But, there are in most communities, and perhaps on-line, consumer groups that will provide information and counseling to one degree or another, usually for a reasonable fee, some for free.
B-tone