Race and Income? Rich, White People See No Problems

Little Rock   According to researchers at Yale University, it’s the old story with a twist. It’s not “see no evil, hear no evil, speak no evil,” but “see no evil, hear no evil, and speak all evil,” at least when it comes to creating a mental dreamscape for the rich and most white Americans when it comes to understanding the persistent gap in economic progress for African-Americans.

A new study published in a peer-reviewed scientific journal by Yale researchers finds that people, especially wealthier, white people have convinced themselves that African-Americans are making great progress over recent decades in narrowing the economic divide created by years of discrimination. The researchers found that across all groups in their study the progress made by African-Americans was overestimated by 25%. Lower income whites came closest to understanding the gap still persisted, and wealthier whites missed the reality by the largest margin. All this in the words of the lead researcher, Professor Jennifer Richeson, was “shocking,” because it was so at odds with reality, because in their view, how can you solve a problem, if you are in denial that the problem even exists.

All of this comes in the wake of recently released Census Reports based on the true facts rather than the alternative reality being seen from above with rose-colored glasses. The US Census finds that African-Americans are the only group that has not made progress since 2000, even as others have advanced. Furthermore, the federal figures indicate that African-Americans are pretty much in the same place on the economic divide measure inequality as they were 50 years ago.

Describing the impact of the disconnect between what whites and the more wealthy think of progress, Richeson described the self-delusion this way:

So many of us grew up hearing this story about America that basically said there was slavery and then that was fixed. Martin Luther King marched and then that was fixed. And then we had Obama. That’s a nice, clean story that makes everyone feel good even though it’s shockingly inaccurate.

The researchers found that the myth of an American meritocracy was most delusional among the wealthiest Americans who want to believe that their success, wealth and position in society is based on something they earned, rather than privilege and advantage, especially if achieved as the result of de facto discrimination. Yet the facts of the Census indicate that African-Americans only gained $5 of citizen wealth for every $100 gained by other groups.

Meanwhile as the researchers observe, and our own daily lives and work establish every day, persistent discrimination in bank lending, housing and educational segregation have no effective policy or programmatic cures, so the inequality widens, rather than shrinking even as the economy improves. The crisis is exacerbated when we also consider their average survey gap would have departed reality to an even more distant white people planet, if the current occupants of the White House and Congress had been among the survey groups.

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Repetition in Land Contracts Confronts Simple Predatory Assumptions

New Orleans  One of the most interesting things the ACORN Home Savers Campaign has learned is to pay very close attention to what families are saying on the doors when we visit. Over and over we have had some of our operating assumptions challenged by what we learn when we are actually visiting with contract signers who are the owner-occupants in these deals.

None of this changes the basic paradigm at the heart of all potentially predatory transactions. On one side a company or individual or slumlord-wannabe is seeking to take advantage of a market dysfunction, usually financial, for consumers, usually low-and-moderate income. On the other side the consumer, often a family, is desperate for its tax refund or for affordable housing or for money to pay a health or funeral or education expense or access to credit for anything and everything. It’s the premise that allows banks and payday lenders to charge usurious interest rates, tax preparers to advance refunds a couple of days quicker than the IRS at incredible rates, and hundreds of other schemes.

In the real estate market it is why a Harbour Portfolio can charge 12% interest on a 30-year loan with a low downpayment on a contract-for-deed property when mortgage interest is running at 4%. It’s why thousands of slumlords in city after city can charge exorbitant rents, deposits, and fees for barely livable housing to families who are simply desperate for housing. It’s also what hovers around the rent-to-own, lease-to-own, lease-option markets that offer below market rents in “as is” condition, often with minimal assurances of habitability to families also desperate for housing but also sometimes hoping for ownership.

In the first months of doorknocking in Philadelphia, Pittsburgh, Akron, Youngstown, Detroit, and Atlanta listening taught us that the search for lower rent and bargaining power against rising eviction rates for tenants was making various land purchase schemes more of an attractive alternative for many lower income families than any hope of ownership. Often in the early doorknocking when we actually explained the contracts they had signed with various companies, families would ask us straightforwardly whether they should flee or fight, though most wanted to fight if they had a way to do so and had already put too much money and sweat into their places to want to walk away.

More recently in Detroit visits we are finding that families are often on their second or third contracts with various companies. In Detroit we also found in talking to people and warning them about the predatory nature of some of the contracts, almost as many people were asking us how they could get into a contract as were asking us how to protect themselves in a contract. In Detroit and Atlanta we were finding family after family where people were asking us how they could get into additional contracts. One young man in Detroit told us he was embarrassed that his mother, uncle, and sister were all “bettering themselves” in contracts, and he was still just renting a place. In Atlanta a Harbour contract holder told me her mother had also had a contract with another company, and she had tried to see if Harbour had other properties available.

So, yes, in some cases people are willing to sign a contract to have secure rent, regardless of the situation for a couple of years, but others, along with their families, are climbing up the contract ladder in the hopes of owning a home and doing so over and over again, even after slipping to the bottom, and they are bringing friends and relatives with them. Sometimes what you learn in organizing is not what you expect, but you have to adapt, and in this case it is clear that the Home Savers Campaign has to fight on one front to make sure the homes on various contracts are habitable for families and fairly understood, and on the other hand has to devise the ways and means to help families over the last rungs of the ladder to their dreams of home ownership.

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