Institutional Discrimination Against African Americans

Reading the article, “The Racial Discrimination System” by Barbara Reskin, helped me see that diversity is more than just race; it varies between skin color, wealth, education level, religious beliefs, and gender identity. But even though multiple laws since the 1960s have been passed to ban racial discrimination, the effects are still around today. One of the concepts from the article that really intrigued me was when it talked about some of the racial disparities I wasn’t even aware of. For example, prior to reading the article, I didn’t know that black businesses on average would pay higher interest rates than white businesses. And while I was aware about the employment gap between blacks and whites, I didn’t realize that blacks were twice as likely to be unemployed as whites. And while I always believed

The intent was to open up the ability for the average American to purchase homes for the first time (Adelman, 2003). What was also introduced by the government underwriters was a national appraisal system. The national appraisal system unfairly tied race, loan eligibility, and property values together, which resulted in minorities and mixed neighborhoods receiving low ratings and being denied loans, while all white neighborhoods received the benefits of a higher rating and the low cost loans backed by the government (Adelman, 2003). As a result of this system of appraisal, less than two percent of the one hundred and twenty billion in loans went to nonwhites (Adelman, 2003). This resulted in an unfair advantage in

In “The Complexities and Processes of Racial Housing discrimination” by Vincent J. Roscigno, Diana L. Karafin, and Griff tester, the main concept of racial disparity and inequality among neighborhoods is discussed, and how those inequalities became to be. They first highlight the wide range of potentially exclusionary practices, through qualitative and quantitative data comprised of over 750 verified housing discrimination cases (Roscigno, p. 162). Citing the U.S. Census, it is found that Blacks, compared to Hispanics and Asians, continue to experience high levels of residential segregation. This is done through discriminatory practices, whether they be by exclusionary or non-exclusionary methods. Even after the passing of the Fair Housing Act in 1988, discrimination against Blacks and Hispanics decreased somewhat, though African Americans still appeared to take part in racial steering, and Hispanics continued to have limitations in regards to opportunities and access to rental units (Roscigno, p. 163).

Instead of receiving reasonable interest rates or regular loans, they were redirected to apply for subprime loans. Why would the brokers do this? Ironically, there are no laws against a mortgage broker asking a borrower’s race, or a borrower refusing to select race identity on a loan application. As a matter of fact, if a borrower refuses to select their ethnicity on an application; brokers are inclined to guess the borrower’s race to be in compliance with the Home Mortgage Disclosure Act. This is a requirement to ensure mortgage lenders are not discriminating based on race. Hence, mortgage lenders have the right to guess a borrower’s race based on the physical color of skin.

One legacy of discriminatory policies is that African American families today are more vulnerable to foreclosures, which destroys a large amount of their wealth. According to a study by Shapiro et al. of Brandeis University in February 2013, “Homes are the largest investment that most American families make and by far the biggest item in their wealth portfolio. Homeownership is an even greater part of wealth composition for black families, amounting to 53 percent of wealth for blacks and 39 percent for whites. Yet, for many years, redlining, discriminatory mortgage-lending practices, lack of access to credit, and lower incomes have blocked the homeownership path for African- Americans while creating and reinforcing communities segregated by race. African-Americans, therefore, are more recent homeowners and

The NAACP filed lawsuits against 14 lenders including the two largest -- HSBC and Wells Fargo -- after a review that showed "systematic, institutionalized racism" in their subprime lending. As a result the NAACP settled with Wells Fargo (and some other banks) and the banks also agreed to work with the NAACP to develop programs to improve access to the best loans possible in minority neighborhoods and to ensure that borrowers don't get mortgages destined for

Even though black people have descendants who suffered much more inequality issues than they have faced nowadays, they still have to deal with this historical problem in different ways. The wealth gap between whites and blacks is huge, “every extra dollar of income earned by whites generates $5.19 in new wealth over 25 years while another dollar of income for a black family adds a mere 69 cents to its bottom line (Starkman)”. These numbers show us that we still live in a segregated

It was a way to constraint African Americans to areas that were far away from those with status, class, and power. Segregation led to discrimination in economic opportunities, housing, and education. The black culture has suffered from the barriers that were placed through segregation. However, the Civil Rights Act of 1964 and the Fair Housing Act of 1968 tried to limit some of the discrimination associated with segregation. It was discovered that even a “rising economic status had little or no effect on the level of segregation that blacks experience” (Massey and Denton 87). The authors imply that “black segregation would remain a universal high” (Massey and Denton 88). The problem with the continuing causes in Segregation is that even though the Fair Housing act was placed, many realtors still discriminate against blacks “through a series of ruses, lies, and deceptions, makes it hard for them to learn about, inspect, rent, or purchase homes in white neighborhoods” (Massey and Denton 97). Segregation and discrimination have a cumulative effect over time. Massey and Denton argued that the “act of discrimination may be small and subtle, together they have a powerful cumulative effect in lowering the probability of black entry into white neighborhood” (98). William Julius Wilson had

White people, due to white privilege, are up to ten times more likely to be able to get a loan for a house than someone who is non-white.

Therefore, I’m going to justify this information I have acquainted you with.First thing, you need to know is that I’m not against anyone I’m neither racist or bias.I was born in a city of diversity which is called New York City. However, the things I’m about to tell you may be uncomfortable or maybe even interesting.Digging deep into America’s seventeen trillion dollar economy and you’ll find fractures beneath the surface.The spoils are split unevenly between men and women, old and young. But, one of the most massive disparities is only skin deep.Everything you own houses, stocks, and cars are your wealth. According to “Blacks still far behind whites in wealth and income” by Tanzina Vega, In 2011 the wealth of the median white household was over $110,000. African American on average was 17 times less just over $6,314.” Housing has a lot to do with this massive separation.For the average American, their home is the most valuable

There is still an unusual amount of two million cases of housing discrimination each year (Wikipedia). The National Fair Housing Alliance estimates that number to be closer to 4 million per year. Inappropriately, only seventeen of the cases went to court nationwide between the years 1989 and 1992 (Wikipedia). Studies show that minorities who apply for mortgages still have troubles are there rejected 3 times as much as Caucasians (Wikipedia). For instance, according to one Federal Reserve Board study, among higher income applicants, the denial rates were as high as 21% for African- Americans, 16% for Latinos, 11% for Asians and 8 and Caucasians (Wikipedia). In conclusion, the Fair Housing Act tried it’s best to eliminate housing discrimination and to provide structural equality. However, housing discrimination still exists but it is not as prevalent as it was before the

In terms of persistence of discrimination, African Americans were reported to have been discriminated against in terms of access to information, inspection of houses, steering, unfavorable terms of finance, and lack of encouragement and assistance in housing search. As a direct result of increased enforcement and attitudinal changes of real estate agents and awareness programs, African American renters and homebuyers have seen substantial decline in discrimination. Although favoritism in favor of whites appear to be similar for both metropolitan and national levels, the reverse is the case for African Americans. African American renters and homebuyers are heavily discriminated against in metropolitan areas than any other sub-grouping. Steering,

Chinatown, Olvera Street, and Compton all contributed to culturally diversity and the expansion of Los Angeles. Although Los Angeles has become rich in cultures, its evolution did not go without racial tensions and segregation. With the arrival of blacks from the south, white-Los Angeles did always recognize the minority community. Angelenos did not always embrace diversity with pride, but perhaps the sad part is not the fact that racial segregation took place, but the fact that it was not created by just the individual, but also by the organization. Federal programs like the Federal Housing Administration (FHA) and the Homeowner’s Loan Corporation (HOLC) divided up Los Angeles into a complex socio-economic racial-class system. The influences of the local level influenced the federal level and revolutionized the finance industry. (Avila, lecture 2/5/02) These federal organizations blatantly labeled minorities as derogatory, uneducated, second-class citizens that brought down property value in “white” neighborhoods. Latinos and Black were often labeled as a “minority problem” and even as a “disease” on official HOLC documents. The HOLC implemented strict government guidelines and kept maps of white neighborhoods confidential. It also devised a formal and uniform style of appraising homes by breaking neighborhoods into race classifications by letter. As Waldie states, “The Montana Land Company made it clear that lots were

In the study done by Rugh and Massey, they determined that “high levels of segregation create a natural market for subprime lending and cause riskier mortgages, and thus foreclosures” (Rugh and Massey 2010:610). By preying on people on the basis of their race, subprime loan lenders set up people of color for disproportionately high foreclosure rates. This goes to show that even if minorities overcome all the forces working against them to secure a house and a mortgage loan, their risk of foreclosure, like eviction, is much higher. This fact is in direct contrast to the perception of social mobility in the United States, which according to Noah is the highest in a survey of 27 nations (28). It is because of ideals of meritocracy, that no matter your circumstances you can make your own wealth that people discredit the notion of institutionalized racism. This foundational idea of America has led to the subordination of entire populations of people for the economic benefit of a few white individuals in power, and the segregation of entire neighborhoods by both class and race, which still permeate American society

When it comes to buying a home there are a few things you need first. Of course you need money , but what if you don 't have the money but you want to get a home? Well you would apply for a loan, but there are two loans you could qualify for and those two are known as prime loans and subprime loans. There are far too many cases where there are well qualified people with the credentials to get a prime loan but were denied, forcing them to settle for worse forms of credit such as subprime loan. The problem is that it is unethical to even offer these subprime loans because of the debt that it puts subprime borrowers in. Through my research I have gathered I have determined that well-qualifying minorities, in particular blacks and Hispanics, have been denied prime mortgages based on race and prejudices, making them easier prey for less convenient loans such as subprime mortgages, which results in higher default and foreclosure rates amongst minority residences.