Redlining

A 1937 HOLC "residential security" map of Philadelphia, classifying various neighborhoods by estimated "riskiness" of mortgage loans[1]

Redlining is a discriminatory practice in which financial services are withheld from neighborhoods that have significant numbers of racial and ethnic minorities.[2] Redlining has been most prominent in the United States, and has mostly been directed against African-Americans. The most common examples involve denial of credit and insurance, denial of healthcare, and the development of food deserts in minority neighborhoods.[3][4]

Reverse redlining occurs when a lender or insurer targets majority-minority neighborhood residents with inflated interest rates by taking advantage of the lack of lending competition relative to non-redlined neighborhoods.[5][6] The effect also emerges when service providers artificially restrict the supply of real estate available for loanable funds to nonwhites, thus providing alternative pretext for higher rates. Neighborhoods which were targeted for blockbusting were also subject to reverse redlining.[7]

In the 1960s, sociologist John McKnight originally coined the term to describe the discriminatory practice in the United States, Chicago, of banks classifying certain neighborhoods as "hazardous," or not worthy of investment due to the racial makeup of their residents.[8] In the 1980s, a Pulitzer Prize-winning series of articles[9] by investigative reporter Bill Dedman demonstrated how Atlanta banks would often lend in lower-income white neighborhoods but not in middle-income or even upper-income Black neighborhoods.[10][11] Blacklisting was a related mechanism employed by redlining institutions to keep track of areas, groups, and people that the discriminating party intended to exclude. In academic literature, redlining falls under the broader category of credit rationing.[12] The documented history of redlining in the United States is a manifestation of the historical systemic racism that has had wide-ranging impacts on American society, two examples being educational and housing inequality across racial groups.[13][14] Redlining is also an example of spatial inequality and economic inequality.

  1. ^ The HOLC maps are part of the records of the FHLBB (RG195) at the "National Archives". U.S. National Archives and Records Administration.
  2. ^ Locke, Dexter H.; Hall, Billy; Grove, J. Morgan; Pickett, Steward T. A.; Ogden, Laura A.; Aoki, Carissa; Boone, Christopher G.; O’Neil-Dunne, Jarlath P. M. (March 25, 2021). "Residential housing segregation and urban tree canopy in 37 US Cities". npj Urban Sustainability. 1 (1): 15. Bibcode:2021npjUS...1...15L. doi:10.1038/s42949-021-00022-0. S2CID 232342980.
  3. ^ Perrino, Julia (July 2, 2020). "Redlining and health indicators: Decisions made 80 years ago have health consequences today". National Community Reinvestment Coalition. Retrieved November 9, 2021.
  4. ^ Agyeman, Julian (March 9, 2021). "How urban planning and housing policy helped create 'food apartheid' in US cities". The Conversation. Retrieved November 9, 2021.
  5. ^ Levine, Hillel; Harmon, Lawrence (1992). The Death of an American Jewish Community: A Tragedy of Good Intentions. New York: Free Press. pp. 6–7, 68–72, 196–197, 276–277. ISBN 978-0-02-913865-6.
  6. ^ Rothstein, Richard (2017). The Color of Law: A Forgotten History of How Our Government Segregated America. New York: Liveright Publishing Corporation. pp. 64–67. ISBN 978-1-63149-453-6.
  7. ^ Hightower, Cameron; Fraser, James C. (March 2020). "The Raced–Space of Gentrification: 'Reverse Blockbusting,' Home Selling, and Neighborhood Remake in North Nashville". City & Community. 19 (1): 223–244. doi:10.1111/cico.12444. S2CID 210384415.
  8. ^ "IPR at 40" (PDF). Northwestern IPR. Northwestern University Institute for Policy Research. September 2018. Retrieved November 9, 2021.
  9. ^ "Awards: Pulitzer Prizes Awarded to The Atlanta Journal-Constitution". The Atlanta Journal-Constitution. Retrieved November 9, 2021.
  10. ^ Dedman, Bill (May 1–4, 1988). "The Color of Money" (PDF). The Atlanta Journal-Constitution. Archived from the original (PDF) on July 3, 2021.
  11. ^ "Investigative Classics: 'The Color of Money,' on Housing Redlining, 1988". RealClearInvestigations. Retrieved November 9, 2021.
  12. ^ Gabriel, Stuart A.; Rosenthal, Stuart S. (May 1991). "Credit rationing, race, and the mortgage market". Journal of Urban Economics. 29 (3): 371–379. doi:10.1016/0094-1190(91)90007-T.
  13. ^ George, Janel (January 11, 2021). "A Lesson on Critical Race Theory". americanbar.org. American Bar Association. Retrieved November 6, 2021.
  14. ^ Martin, Lori; Varner, Kenneth (May 1, 2017). "Race, Residential Segregation, and the Death of Democracy: Education and Myth of Postracialism". Democracy and Education. 25 (1).