The Democratic Party’s establishment is in denial about the ways in which concentrated riches are warping society and contributing to the disunity it seeks to heal.
” . . . Just as the 2008 recession ushered in the election of the first black president, a subsequent white backlash, and a rebirth of left-wing populism led by figures such as Warren and Sanders, the economic hardships of the late 1870s inspired both worker activism and racist retrenchment. In times of economic hardship, it was not a difficult matter to discredit Reconstruction as an attempt to raise ignorant black laborers above white men who were entrepreneurial, responsible, and refined. Nor was it difficult to justify government intervention on behalf of Big Business while condemning such intervention on behalf of workers. The rich, after all, had earned it, or they wouldn’t be rich.
Foner documents how former antislavery figures such as Horace White of the Chicago Tribune “condemned agrarian and labor organizations for initiating ‘a communistic war upon vested rights and property,’ and insisted that universal suffrage had ‘cheapened the ballot’ by throwing political power into the hands of those influenced by the ‘harangues of demagogues.’” Antislavery publications such as The Nation “linked the Northern poor and Southern freedmen as members of a dangerous new ‘proletariat’ as different ‘from the population by which the Republic was founded, as if they belonged to a foreign nation.’” With Reconstruction ended, capital took advantage of the stability of its aftermath to expand convict leasing, a new regime of forced labor that white southerners would impose to replace slavery and keep the region’s black labor force captive and subordinate. Big industries—lumber, railroads, mining, and others—would take eager advantage of this system of neo-slavery to boost their profit margins.
The end of Reconstruction coincided with the Republican retreat from civil rights. But that retreat was precipitated by deep-seated fears over workers in the North and South seeking labor reform, income redistribution, and regulation of industry. “The South sensed the willingness of Big Business, threatened by liberal revolt, labor upheaval and state interference, to make new alliance with organized Southern capital if assured that the tariff, banks and national debt, and above all, the new freedom of corporations, would not be subjected to mass attack,” wrote W. E. B. Du Bois in Black Reconstruction in America. “Such a double bargain was more than agreeable to Southern leaders.” Racism not only threatens democracy and prosperity; it accrues tremendous benefits for those already leading lives of plenty.
America’s political parties are now as polarized as they were at the end of Reconstruction. And just as at the end of Reconstruction, a multiracial party whose ranks include both frustrated workers and wealthy capitalists finds itself at a crossroads, with no certain options for healing the nation’s divides or its own. As ever, America’s gilded class regards the possibility of higher taxes and redistribution as a greater threat than a resurgent racist authoritarianism that imperils America’s still-young experiment in multiracial democracy. The latter, after all, does not jeopardize its profits.Into this divide steps Patrick, a man who went from poverty on Chicago’s South Side to the heights of both business and politics, practically an avatar of the old free-labor ideal that animated the 19th-century Republican Party, an ideal whose blindness to how concentrations of wealth warp politics and society leaves it ill-equipped to deal with the threats to democracy and prosperity America currently faces. The paradox for Democrats is that the candidates who understand this appear less likely to prevail in the general election, and those who have yet to grasp it may be better positioned to unseat the president.
In Polarized America, Nolan McCarty, Keith Poole, and Howard Rosenthal argue that economic inequality and polarization reinforce each other. Economic suffering and ideology foment anger toward minorities, who are blamed for that economic suffering. The very wealthy exploit those divisions to sustain their streams of income, which in turn makes it less likely that redistributive legislation addressing that economic suffering can be passed . . .”
Recommended Reading: Keeanga-Yamahtta Taylor
(Justice, Power, and Politics reading)
By the late 1960s and early 1970s, reeling from a wave of urban uprisings, politicians finally worked to end the practice of redlining. Reasoning that the turbulence could be calmed by turning Black city-dwellers into homeowners, they passed the Housing and Urban Development Act of 1968, and set about establishing policies to induce mortgage lenders and the real estate industry to treat Black homebuyers equally. The disaster that ensued revealed that racist exclusion had not been eradicated, but rather transmuted into a new phenomenon of predatory inclusion.
Race for Profit uncovers how exploitative real estate practices continued well after housing discrimination was banned. The same racist structures and individuals remained intact after redlining’s end, and close relationships between regulators and the industry created incentives to ignore improprieties. Meanwhile, new policies meant to encourage low-income homeownership created new methods to exploit Black homeowners. The federal government guaranteed urban mortgages in an attempt to overcome resistance to lending to Black buyers – as if unprofitability, rather than racism, was the cause of housing segregation. Bankers, investors, and real estate agents took advantage of the perverse incentives, targeting the Black women most likely to fail to keep up their home payments and slip into foreclosure, multiplying their profits. As a result, by the end of the 1970s, the nation’s first programs to encourage Black homeownership ended with tens of thousands of foreclosures in Black communities across the country. The push to uplift Black homeownership had descended into a goldmine for realtors and mortgage lenders, and a ready-made cudgel for the champions of deregulation to wield against government intervention of any kind.
Narrating the story of a sea-change in housing policy and its dire impact on African Americans, Race for Profit reveals how the urban core was transformed into a new frontier of cynical extraction.
ABOUT Keeanga-Yamahtta Taylor @KeeangaYamahtta
Keeanga-Yamahtta Taylor is Assistant Professor of African American Studies at Princeton University. Taylor’s writing and scholarship engage issues of contemporary Black politics, the history of Black social movements and Black radicalism, and issues concerning public policy, race and racial inequality. Taylor’s writing has been published in New York Times, The Guardian, Los Angeles Times, Boston Review, The Paris Review, The New Republic, Al Jazeera America, Jacobin, In These Times, New Politics, Souls: A Critical Journal of Black Politics, Culture and Society, and beyond. Taylor is also author of the award-winning From #BlackLivesMatter to Black Liberation published by Haymarket Books in 2016. She is also author of How We Get Free: Black Feminism and the Combahee River Collective which won the 2018 Lambda Literary Award for LGBTQ Nonfiction. Taylor’s forthcoming book with the University of North Carolina Press, titled Race For Profit: How Banks and the Real Estate Industry Undermined Black Homeownership will be published in October of 2019.
Taylor received her PhD in African American Studies at Northwestern University in 2013.
She soon learned that the rumors held some truth. Medicaid, the government program that provides health care to more than 75 million low-income and disabled Americans, isn’t necessarily free. It’s the only major welfare program that can function like a loan. Medicaid recipients over the age of 55 are expected to repay the government for many medical expenses—and states will seize houses and other assets after those recipients die in order to satisfy the debt.
“The folded american flag from her father’s military funeral is displayed on the mantel in Tawanda Rhodes’s living room. Joseph Victorian, a descendant of Creole slaves, had enlisted in the Army 10 days after learning that the United States was going to war with Korea.To hear more feature stories, see our full list or get the Audm iPhone app.After he was wounded in combat, Joseph was stationed at a military base in Massachusetts. There he met and fell in love with Edna Smith-Rhodes, a young woman who had recently moved to Boston from North Carolina. The couple started a family and eventually settled in the brick towers of the Columbia Point housing project. Joseph took a welding job at a shipyard and pressed laundry on the side; later, Edna would put her southern cooking skills to use in a school cafeteria.
In 1979, Joseph and Edna bought a house in Boston’s Dorchester neighborhood for $24,000. Just a few years after they moved in, Joseph died of blood-circulation problems. But by leaving that house to his wife and children, its mortgage satisfied by his life-insurance payout, he died believing that he had secured a legacy for his family, which, in just a few generations, had lifted itself out of slavery, segregation, and poverty to own a piece of the American dream.
Guest Contributor, Barbara R. Arnwine, President and Executive Director, Lawyers’ Committee for Civil Rights Under Law
The Fiscal Cliff Fallout: This Is Not What MLK Would Have Wanted
As we reflect on Martin Luther King Day, many of us reflect on his famous and stirring “I Have A Dream Speech.” This speech is memorialized as the centerpiece of the “March on Washington for Jobs and Freedom,” which spoke of the twin evils of racial discrimination and economic deprivation that prevailed because of the defaulted promissory note that stipulated equality for all. In an earlier speech in Detroit (1963), Dr. King linked the “twin evils” stating that “I have a dream this afternoon that one day right here in Detroit, Negroes will be able to buy a house or rent a house anywhere their money will carry them and they will be able to get a job.” Then and now the civil rights movement is about much more than ending racial discrimination, it’s also advocating for economic justice and opportunities for all people.
Until there is equal access to economic opportunities, America cannot call itself a post racial society. The modern form of racial discrimination is realized through an economic proxy. We find evidence of this in the fiscal cliff compromise, which was hard fought and difficult to reach. The fruition of the compromise allowed racial minorities to avoid a compound of injustice and discrimination that could have manifested without a decision.
According to the August, 2012 report from the Congressional Budget Office in “An Update to the Budget and Economic Outlook: Fiscal Years 2012 to 2022 Report” the cuts could have sent the entire country into another recession. As we have learned from the Great Recession, racial minorities are disproportionately impacted by downturns in the economy. In 2001, nearly 65 percent of White adults and just over 60 percent of Black adults were employed. The Great Recession caused the share of Black working adults to slide down to 52 percent, nearly seven points behind Whites.
Throughout the recession, the unemployment rate for African Americans continued to rise in the double digits, with the December 2012 unemployment rate at 14 percent for African Americans, while it was only 6.9 percent for Whites. Even though racial minorities can count this fiscal cliff compromise as a win, the political showdowns surrounding the compromise have fostered a breeding ground of animosity that may preview continual struggles ahead.
Debates in coming months concerning spending cuts and raising the nation’s limit on borrowing are raising legitimate concerns in minority communities. Those who opposed the compromise and were against raising taxes on the wealthy, have vowed that in any future debates they would stalwartly include significant cuts in government benefit programs like Medicare and Medicaid, which could potentially have a disparate impact on minorities and low income families. This debate illustrates the twin evils of racial discrimination and economic deprivation that Dr. King spoke of so eloquently.
Many of Dr. King’s remarks are almost prescient of today’s economic issues. His remark that “God never intended for one group of people to live in superfluous wealth while others live in abject deadening poverty” resonates soundly with the fiscal cliff compromise to tax wealthy Americans at a higher rate in order to supplant the harrowing growth of the minority poverty rate, which had previously been narrowed prior to the recession. In a similar fashion, his observation that “Injustice anywhere is a threat to justice everywhere” speaks to how politicians should approach future economic debates.
Decisions in any upcoming fiscal debates should ensure that all Americans are treated fairly and should not create an undue burden on those in our country who are already struggling. That type of injustice only impedes the growth our nation in becoming a post-racial society. Dr. King’s speeches push beyond issues of economic inequality, calling for parity in all facets of life. However, it is hard to envision the dream of equality manifesting without an equal economic playing field.
Barbara R. Arnwine is president and executive director of the Lawyers’ Committee for Civil Rights Under Law. The Lawyers’ Committee is a nonpartisan, nonprofit organization, formed in 1963 at the request of President John F. Kennedy to enlist the private bar’s leadership and resources in combating racial discrimination and the resulting inequality of opportunity – work that continues to be vital today. Tahirah Marston, a Business Major at George Washington University and intern for the Lawyers’ Committee, contributed to this editorial. For more information on the Lawyers’ Committee, please visithttp://www.lawyerscommittee.org
Barbara Arnwine is an OUR COMMON GROUND Voice
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“So, here’s the million dollar question: If prices are already at “normal”, and sales are already above trend, and President Obama isn’t going to approve another round of fiscal stimulus, (He won’t) and the Fed’s $85 billion per month QE4 program continues to have no impact on sales (it doesn’t), then what magical force is going to push the market higher?
The only way that prices can continue to rise is if the banks start issuing loans to unqualified mortgage applicants en masse like they did back in 2005-2006. Otherwise, the market’s going to stay right where it is today, in the dumps.”
DECEMBER 31, 2012
In the Dumps
All You Wanted to Know About Housing in Three Minutes
by MIKE WHITNEY
There’s a terrific video at Bloomberg News that will tell you everything you want to know about housing in just under 3 minutes. Unfortunately, the video hasn’t gotten much attention, probably because it veers from the MSMs fairytale about a housing recovery. Even so, I have transcribed the interview below so that readers can judge for themselves whether housing is really bouncing back or it’s just a bunch of baloney.
Keep in mind that Robert Shiller, who predicted both the dot.com and housing bubbles, is widely regarded as the nation’s top housing market expert. Also, the S&P Case-Shiller Home Price Index, which he co-founded, is the benchmark index for home price trends in the country’s 20 largest cities. Here’s the interview (with some commentary):
“According to the latest Case-Shiller Home Price Index, which we got yesterday, home values are up over 4 percent on the year. Can this positive housing news weather the fiscal cliff and all the uncertainty into 2013?
For a closer look at what the housing recovery means for the economy, we turn to Robert Shiller of Yale University, the co-founder of the Case-Shiller Home Price Index.
Good morning Bob. You’ve been very, very hesitant to call a bottom for home prices and an all-out housing recovery, but don’t the data pretty broadly speak to the fact that housing is on the mend?
MIKE WHITNEY lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition. He can be reached at email@example.com.