An American Nightmare

The Article: An American Nightmare in Tremble the Devil.

The Text: Things had been looking up for black families, back in 1963 as MLK gave his “I Have A Dream” speech about 70% of black families were headed by a married couple. But that percentage steadily began to drop, between 1970 and 2001 it declined by 34%, double the white decline, and by 2002 it had bottomed out at just 48%.

But if the War on Drugs didn’t directly precipitate the destruction of the African-American family, why did the decline in married black women triple during the first decade of the War?

In fact, the impact of the War on Drugs has been so racially biased that although only 14% of all illicit drug users are black, blacks make up about half of those in prison for drug offenses. (When you adjust for the fact that the Department of Justice simply throws prisoners who identify as mixed race half-black and half-white out of their data, the proportion is well over half.) A black man is eight-times as likely as a white man to be locked up at some point in his life. And by 2006 America had, proportionally, almost six-times as many blacks locked up as South Africa did at the height of Apartheid.

Our penal system has grown so massive that the U.S. criminal justice system now employs more people than America’s two largest private employers, Wal-Mart and McDonald’s, combined.

After all, drug laws in America “have originally been based on racism… all of these laws are based on the belief that there is a class in society that can control themselves, and there is a class in society which cannot.” Nixon’s public motivation for the War on Drugs is that it was a response to the growing numbers of military serviceman who were getting hooked on heroin and other narcotics while serving in the Vietnam War.

Although that was a troublesome issue, when you know the history of all past American drugs laws it quickly becomes apparent that there’s no way in hell drug-using veterans was the only impetus behind this wave of anti-drug legislation, and that Nixon was using soldiers’ addiction as opportunistic displacement. As one Nixon’s Chief of Staff wrote in his diary: ”Nixon emphasized that you have to face the fact the whole problem is really the blacks. The key is to devise a system that recognises this while not appearing to.”

And if there’s any doubt about the weight that quote might have had on legislation, here are Nixon’s own words on abortion: “There are times when an abortion is necessary. I know that. ” And when exactly would that be? “When you have a black and a white.”

As the Arab world is wracked by the spasms of popular violence brought on by their social and economic inequality, many Americans have begun to stop and consider the possibility that violent fissures in our own society may begin to open. Much has been made of the emerging upperclass in American society, but the reality is that with the median white family having over twenty-times as much wealth as a black family – no economic disparity is starker than the one that correlates directly with race.

In the same way that the Arab Street finally erupted when food prices simply became too much, is there a timer on our own innercities ticking down as food stamp use and food inflation continue to skyrocket? Could a wave of urban homegrown terrorism erupt in American cities once our urban poor finally reach a tipping point and decide to lash out?

Maybe it doesn’t mean much to you that the average black family has eight-cents of wealth for every dollar of wealth owned by whites, that the the ongoing recession has doubled the wealth gap between blacks and whites, or that the unemployment rate of blacks is edging up on twice as high as the white rate – easily surpassing it when you count incarcerated blacks. After all, a black child in American is nine-times more likely than a white child to have a parent who’s locked up.

But let’s look into the data and the implications a little bit more.

The precise era that saw a drug-law fueled explosion in our prison population, the early 1970s, are the exact same years that the economic situation of blacks began to starkly worsen and that the gap between rich and poor is wrenched wide open. Beginning in those years and continuing into today, “the economic status of black compared to that of whites has, on average, stagnated or deteriorated.”

Up until 1973, the precise year the Rockefeller Drug Laws were passed, the difference between black and white median income had been closing. But then that year it changed course, and in “an ominous bellwether… the gap between black and white incomes started to grow wider again, in both absolute and relative terms.” Direct empirical research into incarceration’s economic effects weren’t done until recently, when a Pew Charitable Trusts research paper showed that prior to imprisonment two-thirds of male inmates were employed and half were their family’s primary source of income. Additionally, upon release an ex-con’s annual earnings were reduced by 40%

In the nearly forty years since America’s modern drug laws were passed, there has been a massive increase in economic inequality by any measure. In the early 1970?s not only did the income gap between black and white begin to widen again, it also becomes much more top-heavily favored to the very rich – who happen to be almost exclusively white as well.

With home equity making up 44% of an average American’s family’s net worth and fully 60% among our middle class, the statistics around homeownernship further delineate the racial schisms of American wealth. Not only do blacks pay higher interest rates, have higher downpayments, have less access to credit, get turned down more frequently for loans no matter what’s controlled for, and pay what amounts to an 18% “segregation tax” because homes in black neighborhoods have much less equity than homes in white neighborhoods – but since 1970 black homes have appreciated in value roughly half as much as white homes.

Even Eminem seemed to have little sense of the irony that was invoked as his self-consciously white autobiographical film, 8 Mile, highlighted the hopeless plight of Detroit’s urban black community. The 8 Mile district was created in 1941, when a six-foot wall was built around a black enclave that was deemed unfit to accept loans from the Federal Housing Administration. This was “part of a system that divided the whole city, in theory by credit-rating, in practice by colour.” And so the segregation that emerged in Detroit “was not accidental, but a direct consequence of government policy.”

This policy of segregated mortgages became known as “red-lining,” and by the 1950s one in five black borrowers was paying interest at over 8%, while it was about impossible to find a white family paying more than 7%.

And yet this economic line extends far past that generation. The fact that blacks are foreclosing at a much higher rate than whites in the current crisis was predestined by the conditions of the loans they received, as banks turn down equally-qualified blacks much more often than whites, and forced blacks to pay higher interest on their loans. Housing values are indelibly color-coded, as the average value of a white house appreciates much quicker than a black house. All of this is snowballing into a collective institutional bias that cost black families at least $82 billion even before this current crisis began.

Hotlanta served as a case study for mortgage-based racism, as the Pulitzer-winning series in the Atlanta Journal and Constitution ”The Color of Money” so aptly captured.

It showed how blacks were routinely rejected for loans which whites in a comparable economic situation were accepted for. And this phenomenon wasn’t isolated to one city, as a 1991 study showed that out of 6.4 million mortgage applications nationwide, even after income was controlled for – blacks were rejected twice as often as their white counterparts. However that wasn’t the worst of it, in urban centers such as Boston, Philly, Chicago, Minneapolis, blacks were rejected three-times more often than whites.

Even well-to-do blacks have been unable to escape from this institutional prejudice.

Wealthy black neighborhoods in the DC suburbs have a much tougher time getting loans than low-income white areas, and in Boston blacks living on the exact same street as their white neighbors and earning similar incomes found it much tougher to get a mortgage than their white neighbors. Joe Kennedy summed up the cumulative effect of this racial injustice well, describing “an America where credit is a privilege of race and wealth, not a function of ability to pay back a loan.”

The city of Baltimore partly captures how higher-rate loans to blacks have affected foreclosure rates, with several Wells Fargo loan officers testifying that they targeted “mud people” for “ghetto loans,” resulting in 71% of foreclosures in that city being made on black homes in recent years. And so, even when income and credit score are controlled for, across the nation blacks are more than three-times more likely than whites to have their home foreclosed and be thrown out into the streets.

America may have nominally advanced from “separate but equal,” however the reality of racial disparity still haunts the bottomlines of black mortgages and checkbooks, holding them back from fully embracing the dream we’re all supposed to share.

The very idea of what it means to be poor is color-coded, as while 1 in 3 blacks live in poverty, less than 1 in 10 whites do. And yet the very definition of poverty itself now varies to the point of absurdity, since “poverty level whites control nearly as many mean net financial assets as the highest-earning blacks, $26,683 to $28,310. For those surviving at or below the poverty level, this indicates quite clearly that poverty means one thing for whites and another for blacks.”

The impact of these facts have echoed across generations, as nearly three-quarters of all black children grow up in homes with no net financial assets. That’s nearly double the rate of white kids. And nine in ten black kids grow up in homes without enough monetary reserves to last more than three months at the poverty line if their income were to drop, roughly four times the white ratio.

Nearly any way you look at it, our current economic crisis is impacting our poor black communities much more acutely than our poor white ones. The most obvious indicator is the still skyrocketing unemployment rate, which for young black males is now twice as high as their young white counterparts.

But simple unemployment doesn’t capture the full scope of economic distress, to understand where we are now you have to take a look at where we’re coming from.