Writer: Madeline Odau
Editor: Simran Khanuja
Spring 2024
Redlining is a process that was introduced around the 1930s with the increasing popularity of mortgages in the New Deal, where local authorities and committees would draw lines around certain neighborhoods that were deemed safe or unsafe for mortgages. These lines were mostly based on financial income and usually did not explicitly mention race, but still very clearly marked the neighborhoods that had fewer white individuals as the unsafe and usually ‘redlined’ areas. This process denied many people access to credit based on where they lived instead of any real financial evidence which helped to shape what used to be considered “de facto” segregation – also known as ‘by fact’ or social custom rather than by law. This old, explicit way of redlining and the modern more subtle ways help to explain current contrasts in the rates of home ownership in white and non-white communities in America which ultimately lead to a wider contrast in rates of family wealth.
Both racially restrictive “covenants,” or private contracts for homes, and racially motivated redlining were outlawed in the Shelley v. Kraemer decision of 1948 and the Fair Housing Act of 1968 respectively. The modern versions of redlining use a similar ‘cheat’ that many attorneys can use to step past the Batson challenge, which challenges that an attorney struck a potential juror based on their race or sex. Although it is now outlawed for people to mention racial reasons, they draw these lines and use certain potential juror challenges, the problems persist today while the perpetrators can make up another excuse for their actions.
There are not nearly as many redlining instances in the modern day, as many organizations now have specific employees hired to monitor if they are violating civil rights in any way. There are also increasing amounts of federal investigations going on to find current deceitful redlines and attempt to give settlements to communities still feeling the effects today.
Some modern forms of redlining are predatory high-interest loans almost exclusively being targeted towards people of color, companies refusing to service neighborhoods with large populations of people of color with common utilities or even food delivery and Wi-Fi services, some banks completely erasing these neighborhoods off their maps for mortgage-lending, and of course, the original arrangement of redlining and denying loans to people of color persist today as well. There have been cases in almost every major city in the U.S., and many of these have been discovered and made to settle lawsuits with the communities and create new branches specifically in these areas, but the work is far from over.
There are many viable solutions to this problem. One of the best is to continue to push our elected officials to investigate and settle these claims, invest in affordable housing opportunities for entire communities, and consider giving more property tax relief in communities still highly distressed from these methods. Doing so would, in theory, promote neighborhood growth while not becoming too expensive for current inhabitants to afford. Also, as a general rule, one should stay aware of ‘de facto’ segregation and how it is still perpetuated in the modern day.
References
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Federal Housing Programs in the 1930s. Journal of Urban Economics, 141, 103462. https://doi.org/10.1016/j.jue.2022.103462
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Mock, B. (2015, September 28). Redlining is Alive and Well—And Evolving. Bloomberg.Com.
Office of Public Affairs | PSA: Justice Department is Combating Modern-Day Redlining |
United States Department of Justice. (2023, November 9). https://www.justice.gov/opa/video/psa-justice-department-combating-modern-day-redlining
Winling, L. C., & Michney, T. M. (2021). The Roots of Redlining: Academic, Governmental,
and Professional Networks in the Making of the New Deal Lending Regime. Journal of American History, 108(1), 42–69. https://doi.org/10.1093/jahist/jaab066
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