There is a piece in the New York Times today is reporting on their investigation into the explicitly racist practices of Wells Fargo in their subprime mortgage business (Creative Commons License photo credit: TheTruthAbout… , h/t Schiffon Wong). According to the NYTimes,  Wells Fargo created a unit in the mid-Atlantic region to push expensive refinancing loans on black customers, particularly those living in Baltimore, southeast Washington and Prince George’s County, Md.

wells fargoAccording to a former employee of the banking giant quoted in the article, the company viewed the black community as fertile ground for subprime mortgages, as working-class blacks were hungry to be a part of the nation’s home-owning mania. Loan officers, she said, pushed customers who could have qualified for prime loans into subprime mortgages. Another loan officer stated in an affidavit filed last week that employees had referred to blacks as “mud people” and to subprime lending as “ghetto loans.”  The employee, a Ms. Jacobson, who is white and said she was once the bank’s top-producing subprime loan officer nationally, goes on to reveal:

“We just went right after them. Wells Fargo mortgage had an emerging-markets unit that specifically targeted black churches, because it figured church leaders had a lot of influence and could convince congregants to take out subprime loans.”

The NYTimes backs this anecdotal evidence with their own more systematic investigation:

The New York Times, in a recent analysis of mortgage lending in New York City, found that black households making more than $68,000 a year were nearly five times as likely to hold high-interest subprime mortgages as whites of similar or even lower incomes. (The disparity was greater for Wells Fargo borrowers, as 2 percent of whites in that income group hold subprime loans and 16.1 percent of blacks.)

To understand the Wells Fargo case, it’s important to understand the broader context of this banking institutions’ policies as part of a larger pattern.

Sociologists Doug Massey and Nancy Denton in their ASA-award-winning book, American Apartheid, document the systematic pattern of housing discrimination in the U.S., as well as the dire consequences of such enforced segregation.   Part of Massey and Denton’s argument is that segregation in housing leads to “social dislocations” (William J. Wilson’s term) in other areas like high school drop-out rates, increased rates of drug use, delinquency and crime, in other words, “the making of an underclass” (the subtitle of their book).

Massey and Denton’s work was path-breaking for the way that it clearly and painstakingly documents the “construction of the ghetto,” but their findings were not exactly new.  The Kerner Commission Report from 1968 famously concluded:

“What white Americans have never fully understood— but what the Negro can never forget— is that white society is deeply implicated in the ghetto. White institutions created it, white institutions maintain it, and white society condones it.”

The report from today’s NYTimes and the evidence of explicitly racist practices of Wells Fargo do not mean that everyone that worked there agreed with these policies or harbored explicitly racist views.   Indeed, as Eduardo Bonilla-Silva as recounted in his Racism Without Racists, the continued operation of white supremacist system does not require the presence of extreme racists in that system.  In fact, I’m sure that many of the people that worked at Wells Fargo would never consider themselves racists but rather well-meaning and liberal in their views on race.

So, then it becomes necessary to understand Wells Fargo’s banking discrimination — and the housing segregation such discrimination creates — within an even broader context.  For that, it’s important to understand the white racial frame that sustains systemic racism, as Joe has described here and in his important book by the same name.  Note the loan officer mentioned in the NYTimes piece that referred to blacks as “mud people” and to the subprime lending as “ghetto loans.” These statements reflect thinking within the white racial frame and the result is the maintenance of systemic racial segregation in housing and further economic devastation of black families that might otherwise be homeowners.

That’s the real tragedy of this story, to my thinking.  Families that worked hard, tried to buy a home and provide a better life for their kids, are now facing foreclosure – and maybe worse – because of the systematic racism in Wells Fargo’s banking practices.    The question really becomes then if we, as a nation, are so “tragically bound to that starless midnight of racism,” as Dr. King said, that we can never move beyond it.    It’s time, I think, to begin holding institutions accountable for racist practices like these.

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The National Urban League’s 2009 State of Black America report is just out and shows, yet again, the longterm consequences of systemic racism as it impacts African Americans. The Urban League has developed what they term an Equality Index, a statistical measure of white-black inequalities in the economy, education, health, community engagement, and the “justice” system.

According to their press release, the 2009 summary index shows a little decline in the overall position of African Americans relative to whites, in their terms from 71.5 percent in the 2008 report to 71.1 percent in that 2009 report. The trend line over the five years between 2003 and 2007 shows greater inequality:

Even as both groups made progress in educational attainment, the progress was slower for blacks. During the same period while white children saw increases in “preprimary” enrollment of about 3 percent, black children saw a decline of about 1 percent, causing the education gap to grow, not shrink.

The executive summary of the report adds the inequality measures for subareas:

Economics remains the area with the greatest degree of inequality (from 57.6% in 2008 to 57.4% in 2009), followed by social justice (from 62.1% to 60.4%), health (from 73.3% to 74.4%), education (from 78.6% to 78.5%) and civic engagement (from 100.3% to 96.3%).

The State of Black America report ends with important suggestions for job/economic policy such as these:

1. Increase funding for proven and successful models of workforce training and job placement for under-skilled workers between the ages of 16 and 30 such as the Department of Labor’s “Responsible Reintegration of Youthful Offenders.”
2. Direct a percentage of all infrastructure monies to job training, job placement and job preparation for disadvantaged workers;
3. Target workforce investment dollars to the construction industry jobs that an infrastructure program will create and, where reigniting the construction industry is a goal, pre-apprenticeship programs must be funded in that sector;
4. Fund infrastructure development for public building construction and renovations of schools, community centers, libraries, recreation centers, parks, etc., that will rebuild and revitalize urban communities;
5. Re-establish a temporary Public Service Employment (PSE) program aimed at creating 150,000 – 200,000 jobs in urban areas to forestall a reduction in public services and an increase in job losses.

The report has not yet gotten much attention, but Leonard Pitts Jr., the black Pulitzer-Prize-winning columnist and author of Becoming Dad: Black Men and the Journey to Fatherhood, wrote a recent article arguing that these data will not be welcome to

Americans who convinced themselves in November the country had entered a “post-racial” era. Those Americans will be overwhelmingly white and will resist with mighty determination the report’s implicit argument: that we have not yet overcome, not yet reached the Promised Land, not yet come to a point where race is irrelevant, Barack Obama notwithstanding.

He then chides African Americans for not dealing with their own problems:

African-Americans do not, after all, need its policy suggestions to fix many of their most intractable problems. We do not need a government program to turn off the TV, realizing it’s hardly coincidental that people who watch more television per capita have poorer academic performance.

But then adds these savvy words:

Once you’ve turned off the television and encouraged black children toward academic excellence, you still must contend with the fact that their schools are too often crumbling, underfunded and staffed with inexperienced teachers. Once you’ve gotten black women and men to raise their children in the context of families, you still have to deal with the fact that those families need places to live, jobs to support them and doctors to keep them healthy….

Overall, Pitts accents some findings of psychological researcher, Richard Eibach, that

in judging racial progress, white people and black ones tend to use different yardsticks. Whites use the yardstick of how far we have come from the nation we used to be. Blacks use the yardstick of how far we have yet to go to be the nation we ought to be. . . . There is value in the yardstick white Americans use. . . . But there is value in the yardstick black Americans use, too, the measure the National Urban League provides in its annual studies. . . . We have not yet reached the Promised Land and we all have a moral responsibility toward that goal. But before we can fulfill that responsibility, we must learn to speak the same language where race is concerned, and to mean the same things when we do.

Even good critical analysts like Pitts seem to feel a great obligation to “balance” the views (yardstick) of most black Americans about their oppression and its redress—people who have been the targets of racial oppression at the hands of whites for four centuries and whose current unjust impoverishment is the cumulative result of that extensive oppression—with the typical blame-the-victim, moralistic views (yardstick) of many white Americans. Indeed, there seems to be an unwritten rule in the mainstream media, and in too much academic scholarship, that one should not name and critique whites for systemic and institutional racism too openly and honestly–and another unwritten rule that if one does critique white Americans for some racism, one must then “balance” that critique by clearly mentioning something negative about people of color or something else positive that whites have done in the racial arena. The frequent obsession with “Balance” here signals once again how whites really run this country and even control how we can publicly think and write about matters of systemic racism.

One can certainly counsel African Americans to do this or that to improve communities and conditions, but the greater moral responsibility obviously lies on those who created the 400-years of racial oppression, not those who have had to endure it now for four hundred years.

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In her “The Last Word” column at Newsweek this week Anna Quindlen gave us a new and useful concept to describe what many whites do—the “Caucasian card” (H/T Jose Cobas). When African Americans object to racist framing, antiblack commentary, or antiblack practices, whites accuse them of “playing the race card.” This is a white-framed, whitewashed phrase designed to deflect objections to everyday racism. It was doubtless invented by whites for that purpose. (Can anyone tell me its first use?) (photo: kevinthoule)

Quindlen cites the way that African Americans carry a heavy load of racial hostility and discrimination on their shoulders:

When one of the white guys blows an account, the office line is that he’s a loser. But when a black guy does it, it means that they—that’s the all-purpose “they,” sometimes used interchangeably with “those people”—don’t seem to be able to close the deal.

This burden of everyday racism makes a black person’s life quite different from that of a white person. Somehow most whites assume their lives are the same. They assert that blacks have equal opportunities compared to whites–in education, employment, housing or health care.

She later notes that Senator McCain justifiably likes to cite his long trials in a Viet Cong prison with it torture of a physical and psychological kind for five years. That, he and his supporters plausibly assert, “builds character.” But they forget or intentionally ignore the huge burden of contending with white hostility and discrimination that black men and women face (as well as other Americans of color). They face it for lifetimes, for far more than five years. This heavy burden often involves physical and psychological torture of its own kind. This should be fully recognized by the white media and voters, but is not.

Quindlen then comments on the McCain campaign’s reaction to Senator Obama’s recent and reasonable commentary on being viewed by many (whites) as not looking like other presidents on U.S. money and as being portrayed by McCain supporters and others as somehow foreign and “other.”

The man is black. His candidacy is indivisible from that fact, given the history and pathology of this country.… The suggestion of [his doing] something untoward was pandering to stereotypes and fear. Senator McCain was playing the Caucasian card.

She nails it this time. Whites invented the racist system of this country and have maintained that system, with great white privileges, since the 1600s. They have “played the white card” in every era. They played it in the abolitionist era of the 1850s-1860s, and they played it in the civil rights era of the 1950s-1960s. With no sense of irony, privileged whites (coming from what one blogger bobbosphere calls the “deal”) still play that white card today when they regularly accuse African Americans who critique the racist system and try to bring it down as “playing the race card” and being unfair to our “really democratic” system.

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