How redlining prevented Black and Brown families from becoming home owners

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In every way imaginable, the consequences of redlining to many black and brown communities across America meant that those communities had the least and the last of everything. So I want to talk about redlining, because this is a term you may have heard, but most people don't actually know the history. In 1933, in the midst of America's Great Depression, when unemployment rates were 25% and millions of people were not only out of work, but many of them were houseless, the federal government under President Franklin Delano Roosevelt established an agency called the Home Owners Loan Corporation. Basically, it tried to make home buying much more affordable by subsidizing the cost of building and lending such that people would be able to afford to buy for the first time. Millions of Americans participated, except that when the Home Owners Loan Corporation began to issue mortgages, it came up with a scheme to decide which communities were deserving of loans and which ones weren't. They made maps and used a color coded scheme. Green meant this was a community that you could lend to and red you could not. The basic decision they made was to determine that any community with the presence of black people or brown people or people who, perhaps, spoke Italian, in certain parts of the country could not receive support from the Home Owners Loan Corporation. This created a system that came to be known as redlining because communities that were deemed risky by the mere presence of people of color, most especially black people, were disqualified from getting direct support from the federal government to purchase homes. This policy lasted until 1968, when the federal government passed the Fair Housing Act, which made all forms of discrimination in the buying and selling or renting of homes illegal. But the truth is that the legacies of redlining from that moment to the present meant that black people were subjected to other forms of exploitative lending. A system called contract buying grew up as a way to sell black people homes on a layaway plan. You made set payments over an extended period of time, but you never owned the home until the very last payment. It was very common for unscrupulous sellers to withhold that final payment in an effort to take back the home from a person who had worked incredibly hard to buy it. Home ownership has been the most important asset that a typical white family has in order to do simple things like borrow money to send a child to college. But most importantly, they have financial freedom. But for communities that have been subjected to redlining, they didn't have those advantages. Not only that, the very communities that they lived in suffered from divestment, including the lack of grocery stores, the lack of businesses, the imposition of federal highways that often bisected their communities. In every way imaginable, the consequences of redlining to many black and brown communities across America meant that those communities had the least and the last of everything. And to this day, the median wages and income of those communities, and the financial insecurity that people who live in redlined communities face, has long term health consequences for families, has educational consequences for young people whose schools often don't have the tax basis to give them the same resources that communities that were never redlined actually have.
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Channel: Harvard Kennedy School
Views: 8,246
Rating: undefined out of 5
Keywords: public policy, government, public service, harvard kennedy school, changing the world, kennedy, kennedy school of government, khalil gibran muhammad, redlining
Id: cUl3l4w5CYw
Channel Id: undefined
Length: 4min 29sec (269 seconds)
Published: Tue Sep 19 2023
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