I’m still celebrating our 2012 victory every day in ways big and small. Mostly I celebrate by giving thanks, often silently, for so many things that we’ve created and averted by re-electing the 44th President. Sometimes there are shared conversations with friends and acquaintances where we speak with gratitude of the increased possibilities for our children, and our communities. I am thankful that there will be help for the unemployed, vigilance over our food supply, policies to address global warming…And we may actually be able to avoid World War III in the Middle East to name a few. But like I always say, we also need to focus on what we want, not just what we don’t want. Thus I am putting forth my thoughts on a Black Agenda in hopes of being part of a process of seeking specific outcomes for our community.
THE BLACK AGENDA #3: HOUSING/FINANCIAL REFORM
The so-called “housing bubble,” the great recession and the credit tightening that followed The Bush Crash of ’08 hit the Black community harder than any other. The Pew Research analysis finds that from 2005 to 2009 inflation-adjusted median wealth fell 53% among Black households compared with just 16% among white households. The research also found that the erosion of wealth was largely due to plummeting house values. Wealth gaps are at record highs with the median wealth of white households now 20 times greater than that of Black households.
Since the Black community has been targeted with sub-prime loans and high cost credit, hit hard by the foreclosure crisis and battered by the recession with a level of wealth erosion that has literally set us back generations, real help for homeowners and financial reform must be part of a Black Agenda.
• Principal Reduction – Widespread principal reduction for communities that are proven to have been targeted with high percentages of sub prime loans.
• Compulsory Home Loan Modifications – Whether it’s government bailing out homeowners by purchasing massive housing inventory from banks or creating programs with real teeth to force banks to modify more home loans, something has to be done here. Again an emphasis on areas targeted by subprime loans would ensure that the African American community gets the help it needs.
• Support Expansion of Consumer Protection Agency & Financial Regulation – In his first term President Obama set the stage with the creation of a Consumer Protection Agency. Republicans have been steadily trying to dismantle and/or weaken it ever since. We must lobby and vote for just the opposite and make sure racial disparities are high on this agencies agenda. The same goes with the rest of the finance reform law that the president signed in 2010. We need to be vigilant to make sure it is made stronger and given more teeth and not watered down.
• Modification Oversight/Brokers – Prosecution of shady modification brokers is one aspect of this idea, in order to protect vulnerable homeowners particularly in areas typically targeted by high cost credit.
• Modification Oversight/Banks/Servicers – Penalties for banks that offer multiple or conflicting modification and/or temporary modification orders. Penalties for banks that do not respond in a timely manner. Requirement that small services are held to same standards as big banks in handling of individual homeowners.
• Homeowners Bill of Rights – The provisions of California’s Homeowners Bill of Rights should be strengthened and extended nationally.
• Foreclosure Credit Adjustment Act – Homeowners who came from communities targeted with sub-prime loans and homeowners who can show that they were misled or unnecessarily lured into a sub prime loan (IE they would likely have qualified for a general market loan,) should have access to a federally mandated foreclosure forgiveness program with the three credit reporting agencies. This will enable home owners to get back on their feet more quickly, as credit scores are currently used to calculate rates paid for most purchases, to qualify to rent a home and even on job applications.
• Outlaw or Severely Limit Payday Loans – If this is allowed at all it should be through a federally or state-subsidized consumer service.
• Cap Interest Rates for Payday Loans/Check Cashing Services/Car Title Loans – Make it illegal to charge more than say, 30% for any type of loan, financial service or line of credit. Stop the loan-sharking in Black & Brown communities – by law!
• Serious Penalties for Discriminatory Lending/Credit – The Justice Department needs to go after banks, car dealers and lenders who target African Americans with higher costs for loans and credit lines. It should be more expensive to perpetrate racial disparities in financial services than to simply adhere to fair practices.
I don’t claim to be a financial expert, nor is this even the tip of the iceberg in terms of what needs to be done to protect and rebuild African American wealth in this country. But it is a start. If even half of the things on this list were implemented, it would have a huge, long-lasting impact on our community immediately and for generations to come. Let’s talk about it, be about it, and make it manifest. We did it for the president…Now let’s do it for ourselves!