In the last few weeks, I have undertaken an aggressive campaign directed at the nation’s financial leaders to dispel the dangerous and growing myth that minority borrowers are primarily responsible for our country’s current economic crisis.
In the last few weeks, I have undertaken an aggressive campaign directed at the nation’s financial leaders to dispel the dangerous and growing myth that minority borrowers are primarily responsible for our country’s current economic crisis. In letters to Treasury Secretary Henry Paulson and Federal Reserve Chairman, Benjamin Bernanke, I have asked that they both publicly refute claims by some conservative pundits and politicians that most of the defaulted subprime loans at the root of the crisis were made to African Americans, Hispanics and other so-called “unproductive borrowers.’’
As the New York Times pointed out in an August 3 article, Subprime Loans’ Wide Reach, “While subprime loans deeply penetrated low-income and minority groups, a new study suggests that more upper-income borrowers and more whites took out such loans than any other groups.’’
It is becoming clearer everyday that a large number of people who ended up with subprime loans could have qualified for a prime loan. That’s where the abuse lies.
In the face of these facts, we have heard conservatives–from Fox News commentator, Neil Cavuto to ABC News analyst George Will to Washington Post columnist Charles Krauthammer say that government efforts to increase homeownership “put people in homes they could not afford’’ and are “at the root of our current calamity.’’
Rep. Michele Bachman, R-Minn., added Congressional weight to this myth when she quoted an Investor’s Business Daily article from the floor of the House that said banks made loans “on the basis of race and little else.’’
In my view, this blatant scapegoating is an ugly attempt by the rich and powerful to shift the blame for this crisis from Wall Street and Washington, where it belongs, onto middle class families on Main Street and Martin Luther King Boulevard who are most victimized by their excesses.
I have taken up this issue for several reasons. First, now more than ever, America needs unity and real solutions to fix the economic mess that has engulfed our country.
Instead of having a healthy debate on what must be done to curb too much Wall Street greed and too little Washington oversight, too many are willing to waste precious time and energy blaming the victims.
Second, history provides too many lessons about the consequences of singling out only certain segments of the population as culprits for a country’s woes.
On the basis of hearsay, rumors and misinformation, seeds of division are being sown all across the United States in a volatile political environment where Americans are terrified by the economic situation.
That is why I have called on both Paulson and Bernanke to quell this false and unnecessary tempest. I took my concerns directly to Congress on October 16 at a special hearing on this issue before the Senate Banking Committee.
The National Urban League is also once again calling on the major broadcast and cable TV networks to increase racial diversity in their newsrooms as a way to prevent the dissemination of this and other dangerous myths by certain commentators and politicians.
Marc Morial is President and CEO of the National Urban League
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