Monday, November 30, 2020

Systemic Racism in the Home Mortgage Context: We Don't Have Time to Notice

In 2020, pivotal events ushered in a season of antiracism rhetoric in the U.S. The brutal deaths of unarmed black Americans at the hands of police officers and white vigilantes, and the disproportionately harsh impact of COVID-19 in the black American community, launched the nation into a discussion about systemic racism. Unfortunately, it seems likely that the 2020 antiracism discourse was merely seasonal rather than enduring, and unlikely to result in meaningful change. 

Black American’s vulnerability in the face of systemic racism is not limited to death, sickness and injury as a result of COVID-19 or antiblack bias in police departments. Our vulnerability is precipitated by things like lack of access to nonpredatory financial services. This is just one of the contexts that compromise black Americans’ economic survival. Unacknowledged systemic racism destroys the wealth and wellbeing of black individuals, families and communities, sometimes causing working and middle-class black Americans to plummet into poverty. As 2020 comes to a close, an election that threatened democracy in the U.S. and the existential threats of an uncontrolled pandemic, eclipse a system of intentional antiblack racism on the part of the financial institutions that engaged in predatory mortgage lending in the years leading up to and beyond the 2008 recession. It is now well documented that lenders, brokers, and mortgage servicers engaged in conduct that was fraudulent and misleading. The mortgage market charged excessively high rates and fees, engaged in high-pressure sales tactics, imposed unnecessarily harsh prepayment penalties, and distorted loan structures to avoid the application of consumer protection statutes.  But, more than a decade later, many black Americans are still fighting to prevent financial institutions from taking away their homes. 

In a book I coauthored with Dr. Janis Sarra, a law professor at the University of British Columbia, Predatory Lending and the Destruction of the African American Dream (Cambridge University Press, 2020), we describe new iterations of predation that continue to target black consumers years after financial institutions settled litigation that alleged pervasive fraud on their part for steering black Americans into predatory subprime loans. But these renovated predatory practices are obscured by the nation’s focus on COVID-19 and a vitriolic election season. Meanwhile, more black Americans will lose their homes even after investing all or most of their wealth in attempts to keep them. This reality requires the calls for moratoriums on mortgage foreclosures to be answered in the affirmative.

Thursday, November 12, 2020

The Political Economy of Inequality, Democracy & Oligarchy - Panel Presentation - November 13, 2020

The Law and Political Economy Project at Yale Law School is hosting the following panel:

The Political Economy of Inequality, Democracy & Oligarchy, on Friday, November 13, 2020 at 5:00 pm eastern time.

This panel discussion will focus upon the erosion of democratic institutions and the rise of oligarchy that has followed in the wake of unprecedented economic inequality. The panel will address elite efforts to entrench themselves politically as well as economically, including the consequences of such efforts in terms of human development. The panel will focus upon the specific context of election 2020 and the uncertainty it is creating. The subversion of democracy and the law governing our democracy naturally holds many costs, and each panelist will address such costs. Each panelist will also seek to articulate some mechanism for a path forward.  Register here


Emma Coleman Jordan, Georgetown Law Center

andré douglas pond cummings, Univ. of Arkansas at Little Rock William H. Bowen School of Law

Atiba Ellis, Marquette University Law School

Steven Ramirez, Loyola University of Chicago School of Law

Gerald Torres, Yale Law School

Friday, November 6, 2020

Do Black Lives Matter to Major Corporations?

The summer of Black Lives Matter protests responding to the police killings of George Floyd, Breonna Taylor and Rayshard Brooks, among others, has led to stunning commitments from major banks and corporations to commit to social justice and promoting practices to recruit, hire and retain underrepresented populations, including black Americans, Latinx and female colleagues.  American Express just announced its pledge to invest $1 Billion to advance racial and gender equity.  JP Morgan Chase in October announced a $30 Billion commitment to advance racial equity.  Similarly, Citi and Bank of America have each pledged $1 Billion to promote economic mobility among communities of color.  Goldman Sachs, famously referred to as a vampire squid during the mortgage crisis in 2008, has announced its "Launch With Goldman Sachs" program "to increase capital and facilitate connections for women, Black, Latinx and other diverse entrepreneurs and investors."  These commitments represent huge infusions of capital into causes that these major corporations have just recently found religion upon.  Numerous corporations have made recent pledges to financially support social justice and economic equality including Google, Disney, Facebook, Amazon,  Cisco, DoorDash, Etsy, Home Depot, Intel, TikTok, Lego, Nike, Proctor & Gamble, Fashion Nova, WeWork, and YouTube, among so many others.

Jamie Dimon, CEO of JP Morgan Chase stated in announcing its $30 billion-over-five-year commitment, that “[s]ystemic racism is a tragic part of America’s history. . . . We can do more and do better to break down systems that have propagated racism and widespread economic inequality, especially for Black and Latinx people. It’s long past time that society addresses racial inequities in a more tangible, meaningful way.”

For those long-time followers of the Corporate Justice Blog, these corporate pronouncements may seem ironic or perhaps will be received with trepidation or doubt.  Profit maximization has for years furiously driven corporate leadership to dizzying examples of fraud, corruption, and malfeasance as recorded on these blog pages for years.  Still, these Billion dollar commitments respond to a summer of true discontent and protest over inequality and the value of black lives, and if these corporations are to be taken seriously, these capital infusions could come as true gamechangers.  Will these corporations truly put their money where their commitments are?  And how do we hold these companies accountable to their commitments to advancing racial equality and economic mobility for those communities previously shut out?  

photo: Jamie Dimon, Wikimedia Commons

hat tip: Jessica Smith, 3L, Arkansas Little Rock Bowen School of Law