Exploitation Entrepreneurialism

NB: This post is part of a series in our Race for Profit symposium. Read all posts here.

Mehrsa Baradaran–

Keeanga-Yamahtta Taylor’s Race for Profit is an essential read not just for anyone interested in racism, housing segregation and post-Civil Rights era racial politics, but for anyone interested in understanding the American economy. It is impossible to understand contracts, property deeds, government guarantees, homeowner’s associations, or lending without knowing how each of these building blocks of the market can be used for race-based exploitation.   Taylor describes the relationship between exploitation and inclusion as real estate players shaping government policies “in ways beneficial to the industry and not the public.” Throughout the book, Taylor comes back to further refine her exploration of exploitation that differentiate and contrast her theory from other theorists who link exploitation to the higher prices, higher interest, or worse terms offered to Black homeowners.

As I highlight in my book, the definition of exploitation was pivotal in Alan Greenspan and President Nixon’s rejection of claims for reparations. Greenspan explained that because lending in segregated Black neighborhoods was “higher risk,” the lender had to charge more in interest and thus claims of exploitation were unjustified. Whether this was a cynical rhetorical move or not, this limited view of exploitation was adopted by Nixon and most administrations thereafter and was used to block remedial demands to rectify unequal housing. Taylor’s definition of exploitation is both more refined and more expansive. She finds exploitation in the government-guaranteed avoidance of risk in lending to and insuring low-income black buyers and exploitation in government programs that targeted Black homeowners with products that produced more debt rather than wealth.

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Addressing Race and Gender Inequities at the Root of Housing Injustice

NB: This post is part of a series in our Race for Profit symposium. Read all posts here.

Rasheedah Phillips–

As Keeanga-Yamahtta Taylor demonstrates in Race for Profit, housing exclusion, instability, and segregation are all racialized in nature, and sewn into the very fabric of American institutions, policies, and value systems. During the height of redlining in the mid-20th century, for example, a single black household in a middle-class area could make the whole neighborhood “risky” for mortgage loans in the eyes of the federal government. Black families – prohibited from buying homes in the suburbs in the 1940s, 50s, and into the 60s by the Federal Housing Administration – gained none of the equity appreciation that suburban whites gained over that crucial period.  Denied mortgages, Black people were often involuntarily driven into the rental housing market, where they faced ever more scarcity and less affordable rental housing.

Today, more than fifty years after the passage of the Fair Housing Act of 1968’s prohibition against housing discrimination, we find that exploitive real estate practices and the inequities that flow from them are not merely artifacts of history. Instead, these inequitable practices, particularly in the rental context, continue to show up in any number of permutations. They may appear as realtors showing Black renters fewer options (a 2013 study by the Urban Institute and HUD for example showed that Black renters saw about 11 percent fewer rental units than others). It may appear as “exclusionary zoning” practices that discourage density and multifamily buildings in wealthier, whiter areas. It may take the form of tenants with housing choice vouchers unable to rent in higher income neighborhoods, causing a concentration in so called “low opportunity” districts.

Through my work as a housing attorney, I’ve seen the continued impact of structural housing injustice on low-income tenants, particularly for Black women in Philadelphia, the site of much of Taylor’s powerful book. Although the focus in Race for Profit is on the role of systemic racism and predatory inclusion in the context of home ownership, the aftermath of those failures has led to exploitation in the rental context. Below, I focus on one issue – eviction records – and highlight some large-scale and individual approaches to ameliorating the problems Taylor encourages us to confront.

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Predatory Inclusion: A Long View of the Race for Profit

NB: This post is part of a series in our Race for Profit symposium. Read all posts here.

K-Sue Park–

The ascending slope of our current housing crisis is a good vantage point from which to think about Keeanga-Yamahtta Taylor’s new history of the federal response to an earlier point of crisis: she gives us reason to reconsider the role of the state in historic housing inequality, and new tools for demanding systemic change from the government going forward. At its core, Race for Profit is a rich and dense account of the government’s effort to finally include black people in its New Deal homeownership initiatives after decades of redlining erupted in riots over – among other grievances – housing starvation. In a literature that has focused principally on the history of racial segregation and formal exclusion through redlining, restrictive covenants, and racial zoning, Taylor instead highlights “predatory inclusion” as a principle mode of the American real estate market.

By focusing on this dynamic and the public-private partnerships that enabled it, her critique of the real estate system runs to its very foundations. As I elaborate below, this analysis resonates profoundly with other patterns of the real estate market’s development over a long historical arc—in particular, the government’s reliance on energies unleashed by incentives for private actors to accomplish public goals, its elevation of businessgrowth over social provision, and the way that real estate value continues to hinge on the race of the people present in a place, and to rise based on white presence and white desire.

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Symposium: Race for Profit: How Banks and the Real Estate Industry Undermined Black Homeownership

NB: This post is part of a series in our Race for Profit symposium. Read all posts here.

Keeanga-Yamahtta Taylor

In Houston’s upscale Galleria-Uptown neighborhood, the mall known simply as “TheGalleria” is, according to its website, “Texas’ largest and most luxurious shopping destination.” A local real estate website confirmed the value of the location, pointing out that housing values in the neighborhood sustained a “55 percent appreciation rate from 2005 to 2014.” The prize of rising property values was the promise to keep the neighborhood as white and middle class as possible.

In 2015, the Houston Housing Authority proposed building two hundred and thirty-three units of affordable housing in Galleria-Uptown, a neighborhood that is eighty-seven percent white. Swarming to the public meeting the way Texans flock to Friday night football, hundreds of mostly white residents packed public meetings to register, not just their disagreement, but their vehement opposition to building “affordable” housing units in their neighborhood. When a 281-unit apartment complex had been built two years earlier, there had been no outcry, but also no affordable units in that development.

White residents, two decades into the twenty-first century, have long perfected the art of talking about race by way of cues and codes to avoid talking specifically about Black or Latinx people. In this meeting organized to discuss the future of affordable housing in the Galleria district, residents complained about traffic, overcrowded schools, the construction costs of the project, and, of course, the potential effect on property values. But in a fit of frustration, one resident set aside time to write to the Department of Housing and Urban Development, and she wasted little time getting to the unvarnished point. Her opposition to the new, affordable development because it threatened to introduce “an unwelcome resident who, due to poverty and a lack of education, will bring the threat of crime, drugs, and prostitution to the neighborhood.” The woman writing the letter went on to extol her personal virtues as a hard worker, while disparaging those who she believed to were not, “I will fight very hard…before I give up that privilege and dignity to those who, either from lack of initiative or misfortune, don’t deserve to be [here].” These views may seem extreme in our era of coded and duplicitous double talk, but the sanctity of property value extracts a deeper truth that might otherwise remain hidden. Consider the comments of Galleria’s City Councilman, Greg Travis. His opposition to the affordable housing development that would bring Black residents to this white neighborhood was that, “People of different socioeconomic status sometimes have different values based on their socioeconomic status. Some people can afford things that other people cannot.”

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