Written by Maia Lisiecki. For more, check out Code Green.
(UNITED STATES) - Although laws are a crucial step to bringing change in society and improving the lives of its citizens, it often does not eliminate the effects of unjust legislation or change the thoughts of minds stuck in the past. In the post-civil war era, several Jim Crow laws were passed to continue subjugating African Americans after slavery had been abolished. African Americans were deprived of rights that white men possessed and did not have equal social, political, and economic opportunities.
One economic setback faced by African Americans and other minority groups was redlining, which was introduced in the 1930s. Redlining policies segregated minorities and contributed to a cycle of poverty that can still be witnessed in the modern day. When viewing the economic issues of minority groups, ties can be made to the unjust redlining policies. And with economic disparity, social and political disparity can be equally observed.
Britannica defines redlining as an “illegal discriminatory practice in which a mortgage lender denies loans or an insurance provider restricts services to certain areas of a community, often because of the racial characteristics of the applicant’s neighborhood.” In an article titled “Redlining Was Banned 50 Years Ago. It’s Still Hurting Minorities Today” by the Washington Post, Tracy Jan outlined the history of redlining active between 1930 and 1968. When building new housing and neighborhoods, government surveyors would color-code neighborhoods ranging from most to least desirable, with minority areas marked as “red” or “hazardous,” hence the name “redlining.”
According to the government surveyors, what made these neighborhoods “hazardous” was that the population consisted of minority groups, such as African Americans, Catholics, Jews, Asians, and southern Europeans. This drove Americans of northern European descent away from these neighborhoods, adding to the segregation seen in housing. White Americans not in poverty or minority groups were encouraged by the government to want to continue life in their homogenous communities and to make it nearly impossible for minorities to live amongst them.
Separating minority and non-minority groups was an intentional social move as well as an economic one. John Taylor, president and chief executive of the NCRC, told the Washington Post that “homeownership is the number-one method of accumulating wealth, but the effect of these policies that create more hurdles for the poor is a permanent underclass that’s disproportionately minority.” Redlining was a way to keep minorities segregated because it promoted socio-economic immobility. Residents had limited opportunities to break the cycle of poverty and to be able to afford the more expensive housing outside of the redlined zones.
Redlining laws made it difficult for minorities to move into other neighborhoods because loans could be denied on the basis of race. Loans in white “desirable” neighborhoods were too expensive for many minorities to pay for. These obstacles led to what is known as the “wealth gap” between the rich and poor, which is a growing issue in modern times. The American Dream of being able to “make it” in America by working hard is not a reality when the government put laws in place that make it difficult for those in poverty to reach a place of financial security.
he 1930s were already times of economic hardship due to the Great Depression. The stock market had crashed, and millions of Americans had become unemployed. In response, Franklin D. Roosevelt enacted the “New Deal,” which was a set of projects and reforms to help America recover from the depression. The Homeowners’ Loan Corporation (HOLC) was one of many “New Deal” programs “leading the way in establishing the modern government-based mortgage system,” where “stabilization of the nation’s mortgage lending system was the primary goal,” as reported by the National Community Reinvestment Coalition (NCRC). Though, given the premise of Jim Crow segregation laws, similar attitudes were reflected in this program.
"Other people of color were left out of the new suburban communities — and pushed instead into urban housing projects."
According to NPR’s article “A ‘Forgotten History’ Of How the U.S. Government Segregated America,” author of The Color of Law Richard Rothstein explains that the government’s efforts in the HOLC were “primarily designed to provide housing to white, middle-class, lower-middle class families. Other people of color were left out of the new suburban communities — and pushed instead into urban housing projects.” Alongside redlining, the Federal Housing Administration (FHA) “[subsidized] builders who were mass-producing entire subdivisions for whites” that were not allowed to be sold to African Americans. The FHA deemed in their Underwriting Manual that “incompatible racial groups should not be permitted to live in the same communities,” which meant that loans to African Americans could not be insured. The FHA used “incompatible,” as a means to continue to discriminate and keep rich white neighborhoods separate, to uphold their own interests and the interests of white residents who did not want to live amongst people of color.
Alongside other changes in laws made during the Civil Rights Movement, in 1968, redlining was made illegal under the Fair Housing Act. Although this was a step in the right direction, this did not automatically allow minorities to live alongside white residents. With the still increasing wealth gap between the previously desirable and the redlined districts, houses in white neighborhoods were far too expensive for most African Americans. And, white residents were still typically hostile towards African Americans and did not welcome them as neighbors. Some argue that today, redlining exists in different forms despite banks denying that they still take part in the practice.
The article “Redlining’s Legacy: Maps Are Gone, But the Problem Hasn’t Disappeared” published by CBS News, explains the term “reverse redlining,” in which “banks may engage in predatory lending in the same neighborhoods that were once marked as off limits for borrowers.” The Chicago Tribune reports a similar finding, calling it “modern-day redlining,” where African Americans and Latinos continue to be routinely denied conventional mortgage loans at rates far higher than their white counterparts. This pattern of denials for people of color across the country was noted in sixty-one metro areas such as Atlanta and Detroit, where loan applicants explained that loan officers seemed to be “fishing for a reason to say no.”
Although this may not technically be redlining, these comments point in the direction of loan officers still possessing the same negative attitudes towards minorities “ruining” white neighborhoods and making the assumption that they are too poor to make their payments, even if their financial history proves otherwise.
A study done by the NCRC reports that “most of the neighborhoods (74%) that the HOLC graded as high-risk or “hazardous” eight decades ago are low-to-moderate income (LMI) today,” “most of the HOLC graded “hazardous” areas (nearly 64%) are minority neighborhoods now,” and that “more of the HOLC low-risk or “desirable” areas have remained white.” This indicates that maps the HOLC created when redlining was legal are more or less the same today when comparing their demographics. Because of the efforts put into housing segregation in years prior, undoing those effects is difficult and not a possibility for many families. Low-income areas remain impoverished and disadvantaged compared to the rich neighborhoods in town that used to be labeled as “desirable.”
The effects of redlining are also seen in the difference in income, well-being, and opportunities between the two ends of the spectrum. U.S. Census data shows that “people living in formerly redlined neighborhoods earn far less, are less likely to have college degrees, and are far less likely to own homes, whose value is a large part of a family’s financial worth.”
“people living in formerly redlined neighborhoods earn far less, are less likely to have college degrees, and are far less likely to own homes, whose value is a large part of a family’s financial worth.”
The News Tribune, a local newspaper of Tacoma, Washington, reports on the local effects of redlining. Amongst the redlined cities in the 1930s, Tacoma was one them, with the North End deemed “desirable” and the Hilltop deemed “hazardous.” Most of anyone living in Tacoma can verify that the associations the North End has are rich, white, neighborhoods while Hilltop is low-income and dangerous to drive through. Stadium High School, for instance, is associated with high performing students, excellent sports teams, and good funding while Foss is associated with being poor and gang affiliated. Although these assumptions are true to an extent, they are a direct result of a past of redlining.
When looking at the financial disparities between the two areas, the median household annual income is nearly $91,000 in the North End versus $17,000 on the Hilltop. Further, eighty percent of homes in the North End are owned, while 5 percent on the Hilltop are. Next, the number of residents over the age of twenty-five who’ve completed college degrees are fifty percent in the North End and ten in the Hilltop. The Tacoma-Pierce County Health Department claims that “those who live in areas once deemed ‘hazardous’ can have life expectancies decades lower than those in what were considered the ‘best’ neighborhoods.” The red lines drawn nearly one hundred years ago continue to divide Tacoma and contribute to the wealth gap that segregates its residents.
Studying the history and effects of redlining demonstrates how closely economic, political, and social issues are tied. The racist social reasons behind Jim Crow led to depriving African Americans of economic power, which in turn kept them socially subjugated. Breaking the cycle of poverty is difficult for every American, and much of it can be contributed to the discriminatory housing policies under Jim Crow that are arguably happening in a sense today. America continues to heal from the unjust laws of the past, as well as the discriminatory economic decisions. It is important to understand that simply working hard will not guarantee to pull a family out of poverty when the institution benefits those who are already on top the most. Laws must be changed to make progress, but will not work unless the attitudes of citizens are reformed as well.