Harry C. Alford, Louisiana Weekly (New Orleans), April 7, 2008
One of the biggest indicators that racism is still alive and well in America is the experience of the sub-prime mortgage fiasco. President Bush proclaimed with all sincerity that he would like to see a major increase in home ownership amongst minorities in this nation.
That was a noble goal. However, the racist minds listening to that announcement began to construct a very sinister plot. With the logic of the Ku Klux Klan, many mortgage houses began to set up a process targeted for Black perspective homeowners. Not just those looking for home ownership but those who were already comfortable with it. They came up with the plan of “Reverse Redlining”.
The conventional “Redlining” has long been used against Black neighborhoods victimizing homeowners, renters and businesses. Insurance companies, banks, investors, etc. would take a red pen and encircle a geographical territory. Nothing within that red circle would receive investment, coverage or business interaction. It was cold hard racism usually intended for Blacks and based solely on the color of their skin. It made no business sense as it is based solely on racial animus.
“Reverse Redlining” is somewhat different. You encircle that same geographical territory but instead of starving the community from business interaction you flood it with activity—detrimental, fleecing activity. This activity will certainly not be economically enhancing. It actually will be predatory and designed to cheat the residents of those communities from fair financial practices. The activity is designed to economically destroy the people and the very land they live on. It is based solely on the color of the victims’ skin and the goal of quick, fast money.
The subprime mortgage hustle is indeed Reverse Redlining and the economic impact it is having on African-Americans is historical and extremely devastating. It is the biggest negative shift in assets and wealth ever put on a group of people in this nation. It is setting back the wealth of Black America by two generations. Is it racist? Certainly! Is it evil? Yes indeed.
The big question is: Is it illegal? Former Federal Reserve Chairman Alan Greenspan thinks so. He says, “It was an accident waiting to happen. Irrational robust exuberance over a scheme that was, in fact, serious criminal fraud.”
Serious criminal fraud is a crime. What we have here is a crime directed to a certain group of people based on their race. That meets the parameters of a racial hate crime which attaches harsher punishment at the end of the prosecution of such. So, when is the U.S. Attorney General going to start prosecuting the culprits for this historical hate crime?
What has happened so far is that the perpetrators of this very larger conspiracy have gotten away with it. CEO’s have all received “golden parachutes” in retirement packages that will set them for life. $40 million, $50 million packages and more is what they are receiving for destroying the futures of hardworking Black families. You can go down to the individual mortgage brokers who pursued people in these redlined zones and started them down to the road to ruin. Most of them are getting off the hook. Why even the CEO of Ameriquest, one of the biggest perpetrators, subsequently served as US Ambassador to the Netherlands for two years. It’s as if he received meritorious distinction for his sinister work against Black neighborhoods.