Redlining
Encyclopedia
Redlining is the practice of denying, or increasing the cost of services such as banking, insurance
, access to jobs
, access to health care, or even supermarkets to residents in certain, often racially determined, areas. The term "redlining" was coined in the late 1960s by John McKnight, a Northwestern University
sociologist and community activist. It describes the practice of marking a red line on a map to delineate the area where banks would not invest; later the term was applied to discrimination
against a particular group of people (usually by race
or sex
) no matter the geography. During the heyday of redlining, the areas most frequently discriminated against were black inner city
neighborhoods. For example, in Atlanta, through at least the 1980s, this practice meant that banks would often lend to lower-income whites but not to middle- or upper-income blacks.
Reverse redlining occurs when a lender or insurer particularly targets minority consumers, not to deny them loans or insurance, but rather to charge them more than would be charged to a similarly situated majority consumer.
informal discrimination and segregation have always existed, the practice called "redlining" began with the National Housing Act of 1934
, which established the Federal Housing Administration
(FHA). The federal government contributed to the early decay of inner city neighborhoods by withholding mortgage capital and making it difficult for these neighborhoods to attract and retain families able to purchase homes. In 1935, the Federal Home Loan Bank Board
(FHLBB) asked Home Owners' Loan Corporation
(HOLC) to look at 239 cities and create "residential security maps" to indicate the level of security for real-estate investments in each surveyed city. Such maps defined many minority neighborhoods in cities as ineligible to receive financing. The maps were based on assumptions about the community, not accurate assessments of an individual's or household's ability to satisfy standard lending criteria. Since African-Americans were unwelcome in white neighborhoods, which frequently instituted racial restrictive covenant
s to keep them out, the policy effectively meant that blacks could not secure mortgage loan
s at all. At various times the practice also affected other ethnic groups, including Latinos, Asians, and Jews. The assumptions in redlining resulted in a large increase in residential racial segregation
and urban decay
in the United States. Urban planning historians theorize that the maps were used by private and public entities for years afterwards to deny loans to people in black communities. However, recent research has indicated that the HOLC did not redline in its own lending activities, and that the racist language reflected the bias of the private sector and experts hired to conduct the appraisals.
On the maps, the newest areas — those considered desirable for lending purposes — were outlined in blue and known as "Type A". These were typically affluent suburbs on the outskirts of cities. "Type B" neighborhoods were considered "Still Desirable", whereas older "Type C" were labeled "Declining" and outlined in yellow.
"Type D" neighborhoods were outlined in red and were considered the most risky for mortgage support. These neighborhoods tended to be the older districts in the center of cities; often they were also black neighborhoods.
Some redlined maps were also created by private organizations, such as J.M. Brewer's 1934 map of Philadelphia. Private organizations created maps designed to meet the requirements of the Federal Housing Administration
's underwriting manual. The lenders had to consider FHA standards if they wanted to receive FHA insurance for their loans. FHA appraisal manuals instructed banks to steer clear of areas with "inharmonious racial groups" and recommended that municipalities enact racially restrictive zoning ordinances, as well as covenants
prohibiting black owners.
The film Revolution '67
examines the practice of redlining that occurred in Newark, NJ in the 1960s.
, the Fair Housing Act of 1968 was passed to fight the practice. It prohibited redlining when the criteria for redlining are based on race, religion, gender, familial status, disability, or ethnic origin. The Community Reinvestment Act
of 1977 further required banks to apply the same lending criteria in all communities. Although open redlining was made illegal in the 70s through community reinvestment legislation, the practice may have continued in less overt ways. AIDS activists allege redlining of health insurance against the LGBT community in response to the AIDS crisis, though no evidence exists to support this claim.
ShoreBank
, a community-development bank in Chicago
's South Shore
neighborhood, was a part of the private-sector fight against redlining. Founded in 1973, ShoreBank sought to combat racist lending practices in Chicago's African-American communities by providing financial services, especially mortgage loans, to local residents. Many sources characterize ShoreBank's efforts as overwhelmingly inspirational and successful. In a 1992 speech, then-Presidential candidate Bill Clinton
called ShoreBank "the most important bank in America."On August 20, 2010, the bank was declared insolvent, closed by regulators and most its assets were acquired by Urban Partnership Bank.
is often contingent on the racial composition of neighborhoods where the loan is sought and the race of the applicant. Lending institutions such as Wells Fargo
have been shown to treat black mortgage applicants differently when they are buying homes in white neighborhoods than when buying homes in black neighborhoods.
just a couple decades earlier. However these same financial institutions in the 2000s saw black communities as fertile ground for subprime mortgages. Wells Fargo
for instance partnered with churches in black communities, where the pastor would deliver "wealth buildling" seminars in their sermons, and the bank would make a donation to the church in return for every new mortgage application. There was pressure on both sides, as working-class blacks wanted a part of the nation’s home-owning trend.
A survey of two districts of similar incomes, one being largely white and the other largely black, found that branches in the black community offered largely subprime loans and almost no prime loans. Studies found out that high-income blacks were almost twice as likely to end up with subprime home-purchase mortgages as low-income whites. Loan officers were also apparently aware that what they were doing was exploitative, as they referred to blacks as “mud people” and to subprime lending as “ghetto loans.”
A lower savings rate and a distrust of banks stemming from a legacy of redlining may help explain why there are fewer branches in minority neighborhoods. In recent years while subprime loans were not sought out by borrowers, brokers and telemarketers actively pushed them. A majority of the loans were refinance transactions allowing homeowners to take cash out of their appreciating property or pay off credit card and other debt.
Several state attorney generals have begun investigating these practices, which may violate fair lending laws, and the NAACP
have filed a class-action lawsuit charging systematic racial discrimination by more than a dozen banks.
Redlining Property Type. Other forms of redlining include the nullification of mortgage loans based on internal bank policies and procedures that fail to recognize complex property types. Co-Op and Condo Conversions in New York City are one such example. These building types are often made up of legacy rent controlled and rent stabilized units or may contain another protected class of tennant. Lenders who practice redlining often cite sponsor concentration or high rental concentration as an excuse to redline the property type. Such internal policies run counter to state and municipal laws and statutes, and are an illegal form of silent judgment on the economic and racial makeup of a building.
redlining is a spatially discriminatory practice among retailers, of not serving certain areas, based on their ethnic-minority composition, rather than on economic criteria, such as the potential profitability of operating in those areas. Consequently, consumers in these areas often find themselves vulnerable because no other retailers will serve them. They may be exploited by other, often smaller, retailers who charge them higher prices and/or offer them inferior goods.
redlining is a spatially discriminatory practice among credit card issuers, of providing different amounts of credit to different areas, based on their ethnic-minority composition, rather than on economic criteria, such as the potential profitability of operating in those areas. Many believe policies of credit card companies such as American Express
that reduce credit lines of individuals that make purchases at retailers frequented by so-called "high-risk" customers to be akin to redlining.
or redlining has a long history in the property-insurance
industry in the United States. From a review of industry underwriting and marketing materials, court documents, and research by government agencies, industry and community groups, and academics, it is clear that race has long affected and continues to affect the policies and practices of the insurance industry. Home-insurance agents are generally able to detect the race of someone who contacts them by telephone. This information affects the services provided to those who inquire about purchasing a home-insurance policy. This type of discrimination is called linguistic profiling
. There have also been concerns raised about redlining in the automotive insurance industry. Credit-based insurance score
s have been shown to produce unequal results by ethnic group.
lawsuit
was brought against student loan lending giant Sallie Mae in the United States District Court for the District of Connecticut
, alleging that Sallie Mae discriminated against African American
and Hispanic
private student loan applicants. http://www.newamerica.net/files/sallie%20mae%20lawsuit.pdf
The case further alleged that the factors Sallie Mae used to underwrite private student loans caused a disparate impact on students attending schools with disproportionate minority populations. The suit also alleged that Sallie Mae failed to properly disclose loan terms to private student loan borrowers.
can also act as a form of environmental racism
, which in turn have an impact on public health. Urban minority communities may face environmental racism in the form of parks that are smaller, less accessible and of poorer quality than those in more affluent or white areas in some cities. This may have an indirect impact on health, since young people have fewer places to play and adults have fewer opportunities for exercise.
Robert Wallace writes that the pattern of the AIDS
outbreak during the '80s was affected by the outcomes of a program of 'planned shrinkage
' directed at African-American and Hispanic communities. It was implemented through systematic denial of municipal services, particularly fire protection resources, essential to maintain urban levels of population density and ensure community stability. Institutionalized racism affects general health care as well as the quality of AIDS health intervention and services in minority communities. The overrepresentation of minorities in various disease categories, including AIDS, is partially related to environmental racism. The national response to the AIDS epidemic in minority communities was slow during the '80s and '90s, showing an insensitivity to ethnic diversity in prevention efforts and AIDS health services.
Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...
, access to jobs
Job (role)
A job is a regular activity performed in exchange for payment. A person usually begins a job by becoming an employee, volunteering, or starting a business. The duration of a job may range from an hour to a lifetime . If a person is trained for a certain type of job, they may have a profession...
, access to health care, or even supermarkets to residents in certain, often racially determined, areas. The term "redlining" was coined in the late 1960s by John McKnight, a Northwestern University
Northwestern University
Northwestern University is a private research university in Evanston and Chicago, Illinois, USA. Northwestern has eleven undergraduate, graduate, and professional schools offering 124 undergraduate degrees and 145 graduate and professional degrees....
sociologist and community activist. It describes the practice of marking a red line on a map to delineate the area where banks would not invest; later the term was applied to discrimination
Discrimination
Discrimination is the prejudicial treatment of an individual based on their membership in a certain group or category. It involves the actual behaviors towards groups such as excluding or restricting members of one group from opportunities that are available to another group. The term began to be...
against a particular group of people (usually by race
Racism
Racism is the belief that inherent different traits in human racial groups justify discrimination. In the modern English language, the term "racism" is used predominantly as a pejorative epithet. It is applied especially to the practice or advocacy of racial discrimination of a pernicious nature...
or sex
Sexism
Sexism, also known as gender discrimination or sex discrimination, is the application of the belief or attitude that there are characteristics implicit to one's gender that indirectly affect one's abilities in unrelated areas...
) no matter the geography. During the heyday of redlining, the areas most frequently discriminated against were black inner city
Inner city
The inner city is the central area of a major city or metropolis. In the United States, Canada, United Kingdom and Ireland, the term is often applied to the lower-income residential districts in the city centre and nearby areas...
neighborhoods. For example, in Atlanta, through at least the 1980s, this practice meant that banks would often lend to lower-income whites but not to middle- or upper-income blacks.
Reverse redlining occurs when a lender or insurer particularly targets minority consumers, not to deny them loans or insurance, but rather to charge them more than would be charged to a similarly situated majority consumer.
History
Although in the United StatesUnited States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
informal discrimination and segregation have always existed, the practice called "redlining" began with the National Housing Act of 1934
National Housing Act of 1934
The National Housing Act of 1934, , also called the Capehart Act, was part of the New Deal passed during the Great Depression in order to make housing and home mortgages more affordable. It created the Federal Housing Administration and the Federal Savings and Loan Insurance Corporation.It was...
, which established the Federal Housing Administration
Federal Housing Administration
The Federal Housing Administration is a United States government agency created as part of the National Housing Act of 1934. It insured loans made by banks and other private lenders for home building and home buying...
(FHA). The federal government contributed to the early decay of inner city neighborhoods by withholding mortgage capital and making it difficult for these neighborhoods to attract and retain families able to purchase homes. In 1935, the Federal Home Loan Bank Board
Federal Home Loan Bank Board
The Federal Home Loan Bank Board was a board created by the Federal Home Loan Bank Act of 1932 that created and oversaw the Federal Home Loan Banks also created by the act. It was superseded by the Federal Housing Finance Board and the Office of Thrift Supervision in the Financial Institutions...
(FHLBB) asked Home Owners' Loan Corporation
Home Owners' Loan Corporation
The Home Owners' Loan Corporation was a New Deal agency established in 1933 by the Home Owners' Loan Corporation Act under President Franklin D. Roosevelt. Its purpose was to refinance home mortgages currently in default to prevent foreclosure. This was accomplished by selling bonds to lenders in...
(HOLC) to look at 239 cities and create "residential security maps" to indicate the level of security for real-estate investments in each surveyed city. Such maps defined many minority neighborhoods in cities as ineligible to receive financing. The maps were based on assumptions about the community, not accurate assessments of an individual's or household's ability to satisfy standard lending criteria. Since African-Americans were unwelcome in white neighborhoods, which frequently instituted racial restrictive covenant
Restrictive covenant
A restrictive covenant is a type of real covenant, a legal obligation imposed in a deed by the seller upon the buyer of real estate to do or not to do something. Such restrictions frequently "run with the land" and are enforceable on subsequent buyers of the property...
s to keep them out, the policy effectively meant that blacks could not secure mortgage loan
Mortgage loan
A mortgage loan is a loan secured by real property through the use of a mortgage note which evidences the existence of the loan and the encumbrance of that realty through the granting of a mortgage which secures the loan...
s at all. At various times the practice also affected other ethnic groups, including Latinos, Asians, and Jews. The assumptions in redlining resulted in a large increase in residential racial segregation
Racial segregation
Racial segregation is the separation of humans into racial groups in daily life. It may apply to activities such as eating in a restaurant, drinking from a water fountain, using a public toilet, attending school, going to the movies, or in the rental or purchase of a home...
and urban decay
Urban decay
Urban decay is the process whereby a previously functioning city, or part of a city, falls into disrepair and decrepitude...
in the United States. Urban planning historians theorize that the maps were used by private and public entities for years afterwards to deny loans to people in black communities. However, recent research has indicated that the HOLC did not redline in its own lending activities, and that the racist language reflected the bias of the private sector and experts hired to conduct the appraisals.
On the maps, the newest areas — those considered desirable for lending purposes — were outlined in blue and known as "Type A". These were typically affluent suburbs on the outskirts of cities. "Type B" neighborhoods were considered "Still Desirable", whereas older "Type C" were labeled "Declining" and outlined in yellow.
"Type D" neighborhoods were outlined in red and were considered the most risky for mortgage support. These neighborhoods tended to be the older districts in the center of cities; often they were also black neighborhoods.
Some redlined maps were also created by private organizations, such as J.M. Brewer's 1934 map of Philadelphia. Private organizations created maps designed to meet the requirements of the Federal Housing Administration
Federal Housing Administration
The Federal Housing Administration is a United States government agency created as part of the National Housing Act of 1934. It insured loans made by banks and other private lenders for home building and home buying...
's underwriting manual. The lenders had to consider FHA standards if they wanted to receive FHA insurance for their loans. FHA appraisal manuals instructed banks to steer clear of areas with "inharmonious racial groups" and recommended that municipalities enact racially restrictive zoning ordinances, as well as covenants
Restrictive covenant
A restrictive covenant is a type of real covenant, a legal obligation imposed in a deed by the seller upon the buyer of real estate to do or not to do something. Such restrictions frequently "run with the land" and are enforceable on subsequent buyers of the property...
prohibiting black owners.
Impact
Redlining paralyzed the housing market, lowered property values and further encouraged landlord abandonment. As abandonment increased, the population density became lower. Abandoned buildings would serve as havens for drug dealing and other illegal activity.The film Revolution '67
Revolution '67
Revolution '67 is a 2007 documentary film about the black rebellions of the 1960s. With the philosophy of nonviolence giving way to the Black Power Movement, race riots were breaking out in Jersey City, Harlem, and Watts, Los Angeles. In 1967, black Newark taxi driver John Smith was arrested for a...
examines the practice of redlining that occurred in Newark, NJ in the 1960s.
Challenges
In the United StatesUnited States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, the Fair Housing Act of 1968 was passed to fight the practice. It prohibited redlining when the criteria for redlining are based on race, religion, gender, familial status, disability, or ethnic origin. The Community Reinvestment Act
Community Reinvestment Act
The Community Reinvestment Act is a United States federal law designed to encourage commercial banks and savings associations to help meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods...
of 1977 further required banks to apply the same lending criteria in all communities. Although open redlining was made illegal in the 70s through community reinvestment legislation, the practice may have continued in less overt ways. AIDS activists allege redlining of health insurance against the LGBT community in response to the AIDS crisis, though no evidence exists to support this claim.
ShoreBank
ShoreBank
ShoreBank was a community development bank founded and headquartered in Chicago. At the time of its closing it was the oldest and largest such institution, and in 2008 had $2.6 billion in assets. It was owned by ShoreBank Corporation, a regulated bank holding company.ShoreBank had branches in...
, a community-development bank in Chicago
Chicago
Chicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
's South Shore
South Shore
South Shore may refer to:In Canada:*South Shore , Quebec, the region of the greater Montreal area on the south shore of the Saint Lawrence River*South Shore , geographic region of Nova Scotia*South Shore—St...
neighborhood, was a part of the private-sector fight against redlining. Founded in 1973, ShoreBank sought to combat racist lending practices in Chicago's African-American communities by providing financial services, especially mortgage loans, to local residents. Many sources characterize ShoreBank's efforts as overwhelmingly inspirational and successful. In a 1992 speech, then-Presidential candidate Bill Clinton
Bill Clinton
William Jefferson "Bill" Clinton is an American politician who served as the 42nd President of the United States from 1993 to 2001. Inaugurated at age 46, he was the third-youngest president. He took office at the end of the Cold War, and was the first president of the baby boomer generation...
called ShoreBank "the most important bank in America."On August 20, 2010, the bank was declared insolvent, closed by regulators and most its assets were acquired by Urban Partnership Bank.
Current issues
Dan Immergluck writes that in 2002 small businesses in black neighborhoods still received fewer loans, even after accounting for business density, business size, industrial mix, neighborhood income, and the credit quality of local businesses. Gregory D. Squires wrote in 2003 that it is clear that race has long affected and continues to affect the policies and practices of the insurance industry. Workers living in American inner cities have a harder time finding jobs than suburban workers. Redlining has helped preserve segregated living patterns for blacks and whites in the United States, because discrimination motivated by prejudicePrejudice
Prejudice is making a judgment or assumption about someone or something before having enough knowledge to be able to do so with guaranteed accuracy, or "judging a book by its cover"...
is often contingent on the racial composition of neighborhoods where the loan is sought and the race of the applicant. Lending institutions such as Wells Fargo
Wells Fargo
Wells Fargo & Company is an American multinational diversified financial services company with operations around the world. Wells Fargo is the fourth largest bank in the U.S. by assets and the largest bank by market capitalization. Wells Fargo is the second largest bank in deposits, home...
have been shown to treat black mortgage applicants differently when they are buying homes in white neighborhoods than when buying homes in black neighborhoods.
Mortgages
Reverse redlining occurs when a lender or insurer particularly targets minority consumers, not to deny them loans or insurance, but rather to charge them more than would be charged to a similarly situated majority consumer, specifically marketing the most expensive and onerous loan products. These communities had largely been ignored by most lendersMortgage discrimination
Mortgage discrimination or mortgage lending discrimination is the practice of banks, governments or other lending institutions denying loans to one or more groups of people primarily on the basis of race, ethnic origin, sex or religion...
just a couple decades earlier. However these same financial institutions in the 2000s saw black communities as fertile ground for subprime mortgages. Wells Fargo
Wells Fargo
Wells Fargo & Company is an American multinational diversified financial services company with operations around the world. Wells Fargo is the fourth largest bank in the U.S. by assets and the largest bank by market capitalization. Wells Fargo is the second largest bank in deposits, home...
for instance partnered with churches in black communities, where the pastor would deliver "wealth buildling" seminars in their sermons, and the bank would make a donation to the church in return for every new mortgage application. There was pressure on both sides, as working-class blacks wanted a part of the nation’s home-owning trend.
A survey of two districts of similar incomes, one being largely white and the other largely black, found that branches in the black community offered largely subprime loans and almost no prime loans. Studies found out that high-income blacks were almost twice as likely to end up with subprime home-purchase mortgages as low-income whites. Loan officers were also apparently aware that what they were doing was exploitative, as they referred to blacks as “mud people” and to subprime lending as “ghetto loans.”
A lower savings rate and a distrust of banks stemming from a legacy of redlining may help explain why there are fewer branches in minority neighborhoods. In recent years while subprime loans were not sought out by borrowers, brokers and telemarketers actively pushed them. A majority of the loans were refinance transactions allowing homeowners to take cash out of their appreciating property or pay off credit card and other debt.
Several state attorney generals have begun investigating these practices, which may violate fair lending laws, and the NAACP
National Association for the Advancement of Colored People
The National Association for the Advancement of Colored People, usually abbreviated as NAACP, is an African-American civil rights organization in the United States, formed in 1909. Its mission is "to ensure the political, educational, social, and economic equality of rights of all persons and to...
have filed a class-action lawsuit charging systematic racial discrimination by more than a dozen banks.
Redlining Property Type. Other forms of redlining include the nullification of mortgage loans based on internal bank policies and procedures that fail to recognize complex property types. Co-Op and Condo Conversions in New York City are one such example. These building types are often made up of legacy rent controlled and rent stabilized units or may contain another protected class of tennant. Lenders who practice redlining often cite sponsor concentration or high rental concentration as an excuse to redline the property type. Such internal policies run counter to state and municipal laws and statutes, and are an illegal form of silent judgment on the economic and racial makeup of a building.
Retail
RetailRetail
Retail consists of the sale of physical goods or merchandise from a fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser. Retailing may include subordinated services, such as delivery. Purchasers may be...
redlining is a spatially discriminatory practice among retailers, of not serving certain areas, based on their ethnic-minority composition, rather than on economic criteria, such as the potential profitability of operating in those areas. Consequently, consumers in these areas often find themselves vulnerable because no other retailers will serve them. They may be exploited by other, often smaller, retailers who charge them higher prices and/or offer them inferior goods.
Credit cards
Credit cardCredit card
A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services...
redlining is a spatially discriminatory practice among credit card issuers, of providing different amounts of credit to different areas, based on their ethnic-minority composition, rather than on economic criteria, such as the potential profitability of operating in those areas. Many believe policies of credit card companies such as American Express
American Express
American Express Company or AmEx, is an American multinational financial services corporation headquartered in Three World Financial Center, Manhattan, New York City, New York, United States. Founded in 1850, it is one of the 30 components of the Dow Jones Industrial Average. The company is best...
that reduce credit lines of individuals that make purchases at retailers frequented by so-called "high-risk" customers to be akin to redlining.
Insurance
Racial profilingRacial profiling
Racial profiling refers to the use of an individual’s race or ethnicity by law enforcement personnel as a key factor in deciding whether to engage in enforcement...
or redlining has a long history in the property-insurance
Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...
industry in the United States. From a review of industry underwriting and marketing materials, court documents, and research by government agencies, industry and community groups, and academics, it is clear that race has long affected and continues to affect the policies and practices of the insurance industry. Home-insurance agents are generally able to detect the race of someone who contacts them by telephone. This information affects the services provided to those who inquire about purchasing a home-insurance policy. This type of discrimination is called linguistic profiling
Linguistic profiling
Linguistic profiling is the practice of identifying the social characteristics of an individual based on auditory cues, in particular dialect and accent. The theory was first developed by Professor John Baugh to explain discriminatory practices in the housing market based on the auditory redlining...
. There have also been concerns raised about redlining in the automotive insurance industry. Credit-based insurance score
Insurance score
An insurance score - also called an insurance credit score - is a numerical point system based on select credit report characteristics. There is no direct relationship to financial credit scores used in lending decisions, as insurance scores are not intended to measure creditworthiness but rather...
s have been shown to produce unequal results by ethnic group.
Student loans
In December 2007, a class actionClass action
In law, a class action, a class suit, or a representative action is a form of lawsuit in which a large group of people collectively bring a claim to court and/or in which a class of defendants is being sued...
lawsuit
Lawsuit
A lawsuit or "suit in law" is a civil action brought in a court of law in which a plaintiff, a party who claims to have incurred loss as a result of a defendant's actions, demands a legal or equitable remedy. The defendant is required to respond to the plaintiff's complaint...
was brought against student loan lending giant Sallie Mae in the United States District Court for the District of Connecticut
United States District Court for the District of Connecticut
The United States District Court for the District of Connecticut is the Federal district court whose jurisdiction is the state of Connecticut. The court has offices in Bridgeport, Hartford and New Haven. Appeals from the court are heard by the United States Court of Appeals for the Second Circuit...
, alleging that Sallie Mae discriminated against African American
African American
African Americans are citizens or residents of the United States who have at least partial ancestry from any of the native populations of Sub-Saharan Africa and are the direct descendants of enslaved Africans within the boundaries of the present United States...
and Hispanic
Hispanic
Hispanic is a term that originally denoted a relationship to Hispania, which is to say the Iberian Peninsula: Andorra, Gibraltar, Portugal and Spain. During the Modern Era, Hispanic sometimes takes on a more limited meaning, particularly in the United States, where the term means a person of ...
private student loan applicants. http://www.newamerica.net/files/sallie%20mae%20lawsuit.pdf
The case further alleged that the factors Sallie Mae used to underwrite private student loans caused a disparate impact on students attending schools with disproportionate minority populations. The suit also alleged that Sallie Mae failed to properly disclose loan terms to private student loan borrowers.
Environmental racism
Policies related to redlining and urban decayUrban decay
Urban decay is the process whereby a previously functioning city, or part of a city, falls into disrepair and decrepitude...
can also act as a form of environmental racism
Environmental racism
Environmental racism is a sociological term referring to policies and regulations that disproportionately burden minority communities with negative environmental impacts....
, which in turn have an impact on public health. Urban minority communities may face environmental racism in the form of parks that are smaller, less accessible and of poorer quality than those in more affluent or white areas in some cities. This may have an indirect impact on health, since young people have fewer places to play and adults have fewer opportunities for exercise.
Robert Wallace writes that the pattern of the AIDS
AIDS
Acquired immune deficiency syndrome or acquired immunodeficiency syndrome is a disease of the human immune system caused by the human immunodeficiency virus...
outbreak during the '80s was affected by the outcomes of a program of 'planned shrinkage
Planned shrinkage
Planned shrinkage is a public policy, practiced most notably in the 1970s in New York City, of withdrawing essential city services from neighborhoods suffering from urban decay, crime, and poverty so that neighborhoods may be claimed by outside interests for new development...
' directed at African-American and Hispanic communities. It was implemented through systematic denial of municipal services, particularly fire protection resources, essential to maintain urban levels of population density and ensure community stability. Institutionalized racism affects general health care as well as the quality of AIDS health intervention and services in minority communities. The overrepresentation of minorities in various disease categories, including AIDS, is partially related to environmental racism. The national response to the AIDS epidemic in minority communities was slow during the '80s and '90s, showing an insensitivity to ethnic diversity in prevention efforts and AIDS health services.
Liquorlining
Instead of denial of services to low-income neighborhoods, sometimes the exact opposite can occur as well when it is the most lucrative option for the service providers. When those services are believed to have adverse effects on a community, that can be considered to be a form of "reverse redlining." The term "liquorlining" is sometimes used to describe high densities of liquor stores in low income and/or minority communities relative to surrounding areas. As neighborhoods decline in income, supermarkets, grocery stores, and other retail outlets move out, but liquor stores remain. However, unlike redlining, this is usually not illegal.See also
- Black flightBlack flightBlack flight is a term applied to the out-migration of African Americans from predominantly black or mixed inner-city areas in the United States to suburbs and outlying edge cities of newer home construction...
- BlockbustingBlockbustingBlockbusting is a business practice of U.S. real estate agents and building developers meant to encourage white property owners to sell their houses at a loss, by implying that racial, ethnic, or religious minorities — Blacks, Hispanics, Jews et al. — were moving into their previously racially...
- Computer-assisted reportingComputer-assisted reportingComputer-assisted reporting describes the use of computers to gather and analyze the data necessary to write news stories.The spread of computers, software and the Internet changed how reporters work...
- Community Reinvestment ActCommunity Reinvestment ActThe Community Reinvestment Act is a United States federal law designed to encourage commercial banks and savings associations to help meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods...
- Cream skimmingCream skimmingCream skimming is a pejorative term used to refer to the perceived business practice of a company providing a product or a service to only the high-value or low-cost customers of that product or service....
- Housing SegregationHousing SegregationHousing Segregation is the practice of denying African American or other minority groups equal access to housing through the process of misinformation, denial of realty and financing services, and racial steering. Misinformation can take the form of realtors or landlords not giving African American...
- Inclusionary zoningInclusionary zoningInclusionary zoning, also known as inclusionary housing, is an American term which refers to municipal and county planning ordinances that require a given share of new construction to be affordable by people with low to moderate incomes...
- Mortgage DiscriminationMortgage discriminationMortgage discrimination or mortgage lending discrimination is the practice of banks, governments or other lending institutions denying loans to one or more groups of people primarily on the basis of race, ethnic origin, sex or religion...
- Planned shrinkagePlanned shrinkagePlanned shrinkage is a public policy, practiced most notably in the 1970s in New York City, of withdrawing essential city services from neighborhoods suffering from urban decay, crime, and poverty so that neighborhoods may be claimed by outside interests for new development...
- RacismRacismRacism is the belief that inherent different traits in human racial groups justify discrimination. In the modern English language, the term "racism" is used predominantly as a pejorative epithet. It is applied especially to the practice or advocacy of racial discrimination of a pernicious nature...
- Racial steeringRacial steeringRacial steering refers to the practice in which real estate brokers guide prospective home buyers towards or away from certain neighborhoods based on their race...
- Urban renewalUrban renewalUrban renewal is a program of land redevelopment in areas of moderate to high density urban land use. Renewal has had both successes and failures. Its modern incarnation began in the late 19th century in developed nations and experienced an intense phase in the late 1940s – under the rubric of...
- Timeline of Racial Tension in Omaha, NebraskaTimeline of racial tension in Omaha, NebraskaThe timeline of racial tension in Omaha, Nebraska lists events in African-American history in Omaha. These included racial violence, but also include many firsts as the African- American community built its institutions. Omaha has been a major industrial city on the edge of what was a rural,...
- White flightWhite flightWhite flight has been a term that originated in the United States, starting in the mid-20th century, and applied to the large-scale migration of whites of various European ancestries from racially mixed urban regions to more racially homogeneous suburban or exurban regions. It was first seen as...
External links
- Revolution '67 - Documentary about the Newark, New Jersey race riots of 1967
- Redlining in Philadelphia. Amy Hillier, PhD
- Redlining, and Neighborhood Appraisals in Philadelphia
- Housing Policy History, NC Housing Coalition
- From 'black-balling' to 'marking': the suburban origin of redlining in Canada
- http://powerreporting.com/color/"The Color of Money": Bill DedmanBill DedmanBill Dedman, an American journalist, is an investigative reporter for news site msnbc.com and a recipient of the Pulitzer Prize for Investigative Reporting....
received the Pulitzer Prize in investigative reporting in 1989 for this series of articles, which described racial discrimination in mortgage lending in the Atlanta area.] - Kozmo delivering consumer racism? Investigative probe by MSNBC.com unearths first case of "cyber-redlining."
- Crossney and Bartelt 2005. Residential Security, Risk, and Race: The Home Owners' Loan Corporation and Mortgage Access in Two Cities. Urban Geography
- Crossney and Bartelt. The Legacy of the Home Owners' Loan Corporation. Housing Policy Debate.