It’s racist to respond to the fact that the macroeconomy is racist

Apparently. I just came upon this over at Bloomberg (I love that site. So uncluttered):

Minority borrowers received higher- cost mortgages than whites more frequently when they refinanced their homes last year, continuing a trend of racial disparities in home-loan rates, the Federal Reserve said.

Blacks received high-cost loans 52.8 percent of the time when they refinanced home loans last year, versus 49.3 percent in 2005, the Fed said in a report released today. Hispanic borrowers received high-cost refinancings 37.7 percent of the time, up from 33.8 percent in 2005. The rate for white borrowers was 25.7 percent last year, compared with 21 percent in 2005.

“The incidence of higher-priced lending for blacks and Hispanic white borrowers is notably greater than for non-Hispanic whites,” the Fed said in the report. “Similar patterns are shown in racial and ethnic differences in denial rates.”

“Differences by race and ethnicity remain stubborn, persistent, and significant,” said Josh Silver, a vice president of research and policy at the National Community Reinvestment Coalition in Washington. “The differences are not narrowing. With all increased attention, why isn’t it?”

I think he’s serious, too. At least the Federal Reserve is circumspect enough (just barely):

The Fed economists writing the study cautioned that credit histories, loan-to-value and debt-to-income ratios may also explain the racial disparities. Their analysis of high-cost loans doesn’t include this information.

“As in past years, the Federal Reserve’s report is of limited utility in determining whether there are true disparities because it doesn’t have information about credit scores, which are the most significant explanatory variable in loan pricing,” said Andrew Sandler, a partner at Skadden, Arps, Slate, Meagher & Flom in Washington who leads the firm’s consumer financial services enforcement and litigation practice.

Which leads one to wonder why they’re bothering in the first place. How about, instead, a story about how much more vulnerable minorities are in a recession? Something that hasn’t changed in 20 goddamn years in this (or, probably, any other) country. Or, say, unequal access to health insurance.

This is known as economic discrimination: when two (or more) individuals do not differ along any relevant characteristics, but are treated differently anyway (equally-qualified black and white candidates, but the white guys routinely get the jobs). Here’s where it works, here: equally skilled, equally senior, equally reliable (hypoethetically) workers, but the minorities are out the door when the recession comes. And there’s one, apparently, right around the corner.

Yet we’re being sold some story about how it’s the fault of Banks for not giving the people more likely to lose their jobs (thanks to economic discrimination) the same risk-assessment as the people less likely.

I’m not saying Banks are the victims. Minorities are, and they have been all along. Banks (and non-bank lenders) should be written about in the finest tradition of Nixonian eulogies for their willingness to suspend even ordinary civic responsibility in giving unaffordable mortgages to poor (read: more likely to be a minority) people earlier this decade. But, we certainly didn’t object then, either. Did we?


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