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Decades of housing discrimination have 
helped create an enormous wealth gap

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between white and black families.

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- The enduring legacy of red-lining, the 
legal government sponsored effort to

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deny mortgages and home ownership 
opportunities to African-Americans and

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other minorities continues to undermine 
their quality of life. This violation of

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basic civil rights continues to negatively 
impact education attainment, health

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outcomes, wealth accumulation,
self-esteem, mortality rates, and

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civic engagement.

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- Home ownership has proved to both the 
doorway and gatekeeper to success and

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well-being in America. It is at the 
core of todays racial wealth gap.

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- There's a very powerful myth in this
country, and that is that residential

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segregation in this country is something 
we call de-facto segregation.

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Something to happen by accident.

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Every textbook that's used in American 
high schools and middle schools today

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lies about this history. 
It talks about how

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northern cities were de facto segregated,
without government involvement.

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They talk about how the Federal Housing 
Administration, did a wonderful job of

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creating single family homes in the 
suburbs for working class families

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without mentioning that the working 
class families they had created these

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homes for, could only be white.

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- This began a history of excluding people
of color from government housing programs.

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Intended to lower the cost of mortgages
and increase home ownership.

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Segregated neighborhoods 
by race using a code system.

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Outlined minority neighborhoods
using the color red.

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Intended to expand the secondary 
mortgage market by securitizing

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mortgage loans.

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Community boards often denied 
minority veterans mortgages.

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Many minority vets could not be 
buried in the same cemetery as

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whites.

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It wasn't until 1970 that lending to 
communities of color began to

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increase.

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- The way this manifested itself is 
through the drawing of maps.

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Different neighborhoods were underwritten
as being riskier or safer and the

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principle component that determined 
riskiness or safety from a lending

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standpoint was ethnic 
and racial composition.

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It was at that point that the real estate 
developers began to drop strings

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around areas.

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The local banker could choose 
who would get mortgages, where.

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So that we could not have gotten 
a loan out in the suburbs because

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those were whites only.

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The concept of a middle class black
only exists in the mind of a middle

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class black.

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Everywhere else in the suburbs 
you are that nigger family on the

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corner of Warren road 
and Boulevard Way.

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Well the truth is that we've had in this
country generations of affirmative action

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for whites.

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And the sad truth of it is that 
whites don't know that that's

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happened or they refuse to
accept it or don't understand

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the history.

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And what that leads to is this false
kind-of narrative that "I did it myself".

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You know this, racial (inaudible), 
individual responsibility narrative.

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- They were many federal, state, 
and local policies explicitly racial

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designed to create segregation in 
every Metropolitan area in the

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country. And policies that were so
powerful that they still determine

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the racial boundaries of 
Metropolitan areas today.

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The Federal Housing Administration began 
a program to suburbanize the entire white

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working class population 
into single family homes.

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- This is Levittown, Pennsylvania. 
A new suburban community of

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sixty thousand people with its 
giant shopping center, winding

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lanes named for flowers and 
trees. It is (inaudible) typical of

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communities all over America.

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Where families are pursuing the American
dream to give their children a better

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chance in life.

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Nearly all are young people.

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A large proportion are veterans. 
For many it is the first house of

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their own and it represents a 
major financial investment.

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- In August 1957, Levittown,
Pennsylvania attracted

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international attention as William Myers 
Jr. and his family moved into the three

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bedroom house. They are very close 
to the Levittown norm. Except in one

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respect.

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William Myers Jr. and his family are 
negroes in an all-white community.

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If more colored are allowed to move in,
Levittown is going to go downhill.

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- The only way that those developers 
could get the capital to do that was

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by going to the Federal Housing 
Administration. In order to get

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that approval, they had to commit never
to sell a home to an African-American.

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Access to leverage allowed middle-class 
whites to build wealth. The white

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families who bought those homes were able 
to use their wealth to send children to

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college. And they use that to bequeath 
wealth to their children, who can use

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it as down payments for their own homes.

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Restrictive covenants ensured that 
minorities could not buy into white

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neighborhoods.

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Properties shall continue to be 
occupied by the same social

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and racial classes.

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- When Karen and I purchased this home that 
was built in 1948 we found some documents

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in a closet.

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Neither the whole or any part of 
said tract shall be sold, rented,

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or leased to any persons or persons
not of white or caucasian race.

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- Created greatest growth of the middle
class in the history of the world.

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In 1940, 42 percent of white 
families owned their own home.

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In 2000, 71 percent of white
families owned their own home.

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- So consequently those 71 percent, 
72 percent of white home owners

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who own their own home
should be thankful to the

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federal government for providing 
them this opportunity.

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What did not happen or what 
happened at the same time

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was that we people of color where 
discriminated against and were

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prevented from taking advantage
of those opportunities.

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- The recent housing and foreclosure
crisis were a continuation of a form

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of red-lining.

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Financial institutions practiced 
unrealistic credit scoring and

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predatory lending.

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Subprime mortgages grew nearly 250 
percent. In 1998, subprime mortgages

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made up 9.8 percent of the mortgage
market. By 2006, they made up 23.5

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percent of the market.

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- And the gap between white home ownership
rates and black home ownership rates is

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30 percentage points larger than it was
back in 1968. In 1968 the typical black

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family had one-sixth as much 
wealth as the typical white family.

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Now it is one-tenth.

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We have gone backwards 
since the civil rights era.

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- Latinos lost close to a 170 billion
dollars worth of equity that they

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had accumulated in the home 
that they purchased many

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many years before then.

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- When they come to access products
the choices that they are given are

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limited.

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So you're given, instead of a 
conventional loan, you're given

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a special loan that have higher 
interest rates or higher fees

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that again set you up for 
foreclosure or failure as well.

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- The scandal of your tenure is your 
unwillingness to do your job and

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enforce the laws that reduce 
housing discrimination.

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- The housing crisis affected all 
communities but disproportionally

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devastated minority families.

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Black and hispanic families lost
nearly 20 years of wealth between

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2007 and 2013.

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Minority home ownership is the 
lowest it's been since 1996.

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- Red-lining discrimination in the 
Asian-American communities, live

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and kicking. And in California,
you'll see that Asians have the

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second highest probability
of going to foreclosure.

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Very comparable to Latinos. 
Latinos were 1.4, for Asians it

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was 1.3.

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And so whether it is in home 
ownership, rental, small business,

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foreclosure, across the 
board there is red-lining.

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- Between 1934 and 1962, 120 billion
in FHA and VA loans were issued.

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Over that period of time, 
98 percent of the loans

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went to white families
and less than two

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percent went to African-Americans 
and other minorities.

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Using the average Home Price Index
between 1934 through 2018, those

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FHA, VA loans equates to at least 
three trillion dollars in current

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real estate value.

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Assuming that as loans were paid off
and excess funds were invested in

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stocks and other investments
conservatively, another two

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trillion were created.

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This "White Subsidy" is the major 
contributor to the current racial

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wealth gap.

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- So many way Americans experience
this sense of self esteem, a sense of

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you know superiority, if you will.

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This sense of mastery, that they 
have created their own destiny

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in their lives. And they have no 
acknowledgment of this invisible

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hand that supported them throughout
their lives and not just them, but there's

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a legacy of that invisible hand across 
generations that has translated itself

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from the original affirmative action
to trillions of dollars of head start

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ahead of other communities, like 
African-Americans, Latinos, Native

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Americans, others who don't 
have the same benefit.

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Children of homeowners are more likely
to graduate from high school, have less

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childhood behavioral problems
and achieve higher college

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graduation rates.

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- In segregated housing, and in 
neighborhoods that everybody is

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segregated that tend to be low
income neighborhoods.

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There is the greater likelihood that 
the youngsters will be involved in

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gangs, or will be recruited 
to be in gangs.

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- I noticed an absence of hope, 
an absence of light. These kids

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were barraged with a message 
every single day of their lives,

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that they weren't valued, that they
didn't matter. And they internalized

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that. And that caused frustration 
and anger, and eventually despair

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and a loss of hope.

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There is now a very good science 
that shows the sense of not

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belonging, the sense of lacking 
self-esteem raises cortisol levels

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in your blood. And cortisol is good for 
you when you're in an extremely

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stressful situation, but when you're 
constantly bathed in cortisol,

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because you're constantly feeling these 
stressors of being marginalized and

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being told that you're less worthy, 
less valuable and being in constant

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state of really fear and anxiety,
it changes your physiology

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completely.

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It makes you more prone 
to cardiovascular disease,

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it makes you more prone 
to diabetes, it makes

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changes in your brain,
which actually makes it

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more difficult to engage 
in what we call executive

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function.

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This kind of chronic stress which is 
driven by the policies that we've

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created is lethal as any 
knife or any gun.

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- Suppose discrimination did end today?

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How many generations would it take
to get to rough equality and wealth

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across races.

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France was seven generations, 
more than 200 years.