redlining

Redlining (fl. 1933-68) is where banks, insurance companies and others mark certain neighbourhoods in red on their maps as places not to do business – or to offer the most unfavourable terms. This is not done for hard-headed business reasons, but mainly because of the race of people who live there. Even Sugar Hill in Harlem, where Duke Ellington lived, was redlined.

Common side effects: check-cashing places, predatory lending, run-down neighbourhoods, bad schools, food deserts, continuing wealth gap.

Most neighbourhoods that were redlined in the 1930s were Black and Brown and poor in the 2010s. And no wonder since redlining starved them of credit! The main exceptions are neighbourhoods that have been gentrified – by Whites. Redlining was outlawed in 1968, but as of 2015 banks were still using redlined maps!

In the 1930s the US government drew up secret, colour-coded maps of over 200 cities:

• Green: best (= well-to-do, lily-White neighbourhoods)
• Blue: still desirable (= working-class Whites)
• Yellow: definitely declining (= poor White, immigrant or racially integrated)
• Red: hazardous (Negroes, Jewish, Italians, Orientals, Mexicans)

The public did not know about these maps till the 1960s. The government used them to determine its insurance rates for home loans, which in turn affected the decisions of banks and mortgage companies.

Homer Hoyt, who became the government’s top economist on housing in 1934, said that long-term property values were determined by who lived in a neighbourhood. From most “desirable” to least:

1. English, Germans, Scots, Irish, Scandinavians;
2. North Italians;
3. Bohemians or Czechoslovakian;
4. Poles;
5. Lithuanians;
6. Greeks:
7. Russian Jews of the lower class;
8. South Italians;
9. Negroes;
10. Mexicans.

Which is not far from what eugenicists of the time were saying.

Hoyt said Whites could move up if they assimilate (“conform to the American standard of living”) – which is just what Third Wave Whites (#2 to #8) would do. Thus Jews are no longer redlined. But Blacks and Mexicans had no hope of overcoming “the opinion or prejudice” of the housing market.

The government could have evened the playing field. Instead it used redlining to turn prejudice into policy.

Bootstraps: Owning a home is the main stepping stone to a stable, middle-class life in the US. And property taxes paid by home owners in turn determine how good the nearby schools are. So redlining in effect shut many Blacks and Latinos out of the middle class. The government was secretly cutting their bootstraps behind their backs!

In 1968 the Fair Housing Act outlawed redlining and the Community Reinvestment Act (1977) was meant to reverse its effects. But like most civil rights laws, they have been poorly enforced, even under President Obama.

In 2018 a study of 31 million mortgage applications from 2015 and 2016 found that, despite an applicant’s income or a neighbourhood’s median income:

“black applicants were turned away at significantly higher rates than whites in 48 cities, Latinos in 25, Asians in nine and Native Americans in three.”

Banks deny they redline. They say they go by credit scores – and yet refuse to tell the government what those credit scores are! Which makes it all but impossible to nail them on redlining.

– Abagond, 2020.

Sources: mainly The Root (excellent YouTube video, 8.5 minutes, 2019); Curbed Seattle (map); Reveal News (study, 2018); “Not in My Neighborhood” (2010) by Antero Pietila.

See also:

• housing phenomena:
  • racial steering
  • blockbusting
  • gentrification
  • White flight
  • Black ghetto
• wealth gap, causes of:
  • slavery
  • Homestead Act
  • The Third Enlargement of American Whiteness – for Third Wave Whites
• The Bootstrap Myth
• Ta-Nehisi Coates: The Case for Reparations
• eugenics
• English Americans – and their racial model
• other nefarious uses of US Census data:
  • The Japanese American internment

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