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Making Lending Discrimination Great Again

Barely a week after the celebration of Dr. Martin Luther King’s birthday, the Trump Administration announced it intends to reverse the Obama administration’s rules that target racial discrimination in home lending.

The administration also is targeting a federal law that supports the desegregation of American neighborhoods, according to published reports. These moves could undo decades of progress for people of color in home ownership and undercut a 50-year-old law, the Fair Housing Act.

While the Trump administration frequently touts developments that have benefitted minorities, such as criminal justice reform and job creation, this inextricable move toward discriminatory housing lending and practices is overtly racist and bizarre. It should not go unnoticed that Housing and Urban Development (HUD) Secretary Ben Carson, Trump’s sole African American cabinet member, had no comment on the proposals, which have been excoriated by civil rights and housing experts as “reckless and wrong.”

Reversing Decades of Progress

HUD Secretary Ben Carson has been a vocal critic of federal desegregation of neighborhoods, referring to it as a “failed socialist experiment.” He has also stated that requirements that banks collect data to better track patterns of neighborhood development and segregation to obtain federal housing funds have “suffocated investment in some of the poorest, most distressed neighborhoods that needed the investment the most.”

His argument is that data collection, something that banks routinely do anyway, is hampering investment in minority neighborhoods.

Carson’s cognitive dissonance is profoundly bewildering on these issues. As a black man, advocating for policies that will reverse decades of progress for African Americans in housing is deeply disturbing and beyond spiteful.

Homeownership is the key to building wealth in America. Since the passage of the Fair Housing Act to fight lending discrimination some 50 years ago, policies like redlining have declined significantly, helping to boost the African-American Homeownership rate to 44 percent as of the fourth quarter of 2019 – the highest level on record since 2012, according to the U.S. Census Bureau’s Housing and Vacancy Report.

Yet despite the progress in African American home ownership, racial disparity in mortgage lending persists, according to a studyby Northwestern University, which found that black homebuyers are more often denied mortgage applications and pay high loan costs than white buyers, even with similar incomes and credit.

Perhaps Prevention of Wealth is the Goal

It’s hard to view the administration’s intent to roll back regulations that prohibit discrimination as anything but a carefully calculated move to prevent black wealth accumulation. With documented evidence that black homebuyers continue to be rejected for mortgage loans more frequently than white buyers, why would any measure that would ultimately give license to banks to increase discriminatory practices make sense otherwise?

For an administration that constantly claims progress that supposedly benefit black Americans, like criminal justice reform and job creation, an open attempt to increase lending discrimination is in direct opposition to progress the administration claims to seek for African Americans. It’s regression on a large scale. It’s spiteful, racist and wrong.

It’s upsetting the administration’s only African American cabinet member, Ben Carson, is a proponent of policies that would damage all Blacks, including ostensibly, members of his family.

These are indeed strange, unsettling and dark days for all Americans, but especially for people of color.

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