12/17/2020
Session 2 Home Ownership=Wealth Accumulation
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JCC Arts and Culture Program
Lev Rothenberg Director of Arts and Education
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Welcome and More….
Rules of the Road: • So glad you are here! • 2 parts: Presentation + Conversation. • Everyone’s voice is important. • Jot down your questions/comments. • Mute during presentation. • Raise your HAND to be recognized. • Do NOT use Chat. It is disruptive. Thank You!
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From Last Week
Any “Aha” moments to share from last week’s discussion, “History of Racism”?
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What is Racism?
• Racism is commonly defined as “Prejudice + Power. • Prejudice is used against someone based on his/her race. • Racism is a belief that certain racial groups are superior to others and have rights and power over others.
Racism can be manifested through beliefs, policies, attitudes and actions by governments, organizations and individuals.
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What Is Systemic Racism?
• It is Prejudice expressed through the Power of governments, institutions, organizations, policies and laws.
• Systemic, Structural and Institutional Racism are often used interchangeably.
For our purposes. . .We will use the term Systemic Racism.
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The “Other Story”
Much of our country’s history is from a White perspective, but . . .
There is Another Story about Free Blacks and their relationship with govt. institutions
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Wealth Accumulation
Reviewing sources of wealth. . . • Household items Crops • Slaves Livestock • Land Precious metals • Buildings/homes Currency – (later) • Stocks/securities (First in1790’s in Philadelphia)
Enslaved Africans in America had NO wealth. They were considered a Source of wealth.
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Early Colonists
We all know . . . White Europeans arrived as early settlers We also know . . . African Americans arrived enslaved
BUT .. there were also People of Color (POC) who were NOT enslaved and were early settlers
A Free Negro or Free Black man was a Legal Status
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New Wealth Opportunities
1796 - Land Act encouraged Westward Expansion Pioneers could buy land for only $2 per acre. 1860 - Census estimated 488,070 Free Blacks 1862 –Homestead Act - gave settlers 160 acres of free land
By 1867 there were nationally defined civil rights, regulated banking systems, standard currency and land out West.
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The “Other Story”
• Free Black Men settled out west, owned land and built homes • Free Black Men were legally able to accumulate wealth . . . with Home Ownership
Until the early 1900’s
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1929 Stock Market Crash
• Massive amounts of LOST accumulated wealth • Great Economic Depression Many Home Foreclosures • Massive job losses Bread lines for food
The Political Climate . . . Jim Crow laws heavily enforced, KKK expands, segregation is legal
Violence is a fact of life for many African Americans
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1933 Homeowners Loan Act
• Homeowners Loan Corporation (HOLC) created as a federal agency. • It was an emergency program. • HOLC Made over 1 Million loans to those who needed help.
HOLC Did Its Job
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Residential Security Maps
• HOLC reported to *FHLBB • FHLBB was the federal govt. agency that provided guidance, regulations and oversight for all banks • FHLBB concerned about banks being able to protect residential loan investments. • FHLBB asked HOLC to create “Risk Security Maps” to protect all banks from “adverse influences” when making loans. • HOLC mapped 239 cities. • These “Residential Security Maps” had 4 risk levels that were color coded. These are the RED LINE MAPS.
* Federal Home Loan Bank Board
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Legend on HOLC Maps
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What Legend Really Meant
• Type A most desirable area for mortgage lending
• Type B still desirable
• Type C declining and risky
• Type D most risky for mortgage support
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Redlining
HOLC “Residential Security Maps" coded areas.
RED neighborhoods were the highest risk. RED neighborhoods had primarily Black residents. RED neighborhoods meant homes were considered a low value. RED neighborhoods created “White Flight”. RED neighborhood residents were unable to obtain loans to fix up or move.
People of Color were “stuck”
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Redlining Widely Used
• FHLBB Bank publication instructed banks how to use or create “Residential Security Maps” for their localities. This publication instructed banks how to use these maps for home appraisals. • FHA 1935 Manual instructed banks to use these maps to apply for federal mortgage insurance. • National Real Estate Journal endorsed maps for national use.
Federal Govt. designed and endorsed Systemic Racism
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The Impact of Redlining
• Redlining was embedded in banking procedures • Redlining was embedded in appraisal standards • Redlining was embedded in real estate practices
Because an area was Redlined, there was little capital investment And few opportunities for Wealth Accumulation
Redlining IS Systemic Racism
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Redlining paralyzed the housing market, lowered property values and encouraged abandonment
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CleCleveland
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Dayton
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Louisville
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Milwaukee
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Philadelphia
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Indianapolis
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Indianapolis
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Thinking About Indianapolis And Redlining. . .
• What neighborhoods are in the red/yellow areas of Indianapolis in 1937?
• Which neighborhoods are in the blue/green areas of Indianapolis in 1937?
• What did these neighborhoods look like then?
• What do these neighborhoods look like now?
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The Effect of Redlining Today
Besides Housing, what other challenges might these neighborhoods face today?
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Laws to Address Redlining
• 1968 –The Fair Housing Act prohibited discrimination with sale, rental and financing of housing based on race, religion, national origin or sex.
• 1977 – Community Reinvestment Act (CRA) banks were to locate in areas where they take deposits Were to extend credit to low- and moderate-income residents
Do These Laws Work?
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Indianapolis
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Systemic Racism
Exists Today in Homeownership & Wealth Accumulation
Nedra’s stories Paula’s stories
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Sources
• If you would like to find other redlining maps: www.dsl.richmond.edu (Digital Statistical Lab of Richmond University)
• To read recent paper on HOLC: https://repository.upenn.edu/cgi/viewcontent.cgi?article=1004&context=cplan_papers (University of Pennsylvania, Scholarly Commons)
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Other Comments/Questions?
Racism is a white problem. It was constructed and created by white people and the ultimate responsibility lies with white people. For too long we’ve looked at it as if it were someone else’s problem, as if it was created in a vacuum.
“White Fragility” by Robin DiAngelo
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Contact Information
For further questions, comments contact:
Paula Means at [email protected]
Nedra Feeley at [email protected]
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