Mother Jones: Trump and Congress are making it easier for banks and companies to rip off black people

Mother Jones, February 25, 2018: Trump and Congress are making it easier for banks and companies to rip off black people

The access of federal regulators to good HMDA data,which requires lenders to report various data points on the mortgages they sell, has been key to many redemptive actions intended to help consumers. But the Trump administration recently made a move that threatens the integrity of the data. In December, the CFPB—whose new interim director is Mick Mulvaney, Trump’s budget director—announced that the agency will no longer fine lenders for reporting errors. This will make the information, “much less useful,” says Makada Henry-Nickie, a governance studies fellow at the Brookings Institution and former senior analyst at the CFPB. “Every single mortgage discrimination or redlining case is supported by the HMDA data, even if it didn’t originate there,” she adds. “So with Mulvaney’s decision, we’re losing a lot.”

These recent changes are just one piece of a broader trend that has swept across government since Trump took office—a gutting of anti-discrimination measures across the financial services, including mortgages, car loans, payday loans, and more. “This is a pattern we have observed, and it’s fairly alarming,” says Yana Miles, senior legislative counsel at the Center for Responsible Lending. “You have good policy that protects consumers and tries to address discrimination. We’re seeing these rules delayed, picked at, or invalidated.”

The CFPB did not respond to a request for comment about the impacts of its policy changes on communities of color, but the administration’s broad attack on anti-discrimination measures has raised the ire of Democratic lawmakers. Last week, 53 Democrats wrote to the CFPB demanding more information on how the agency went about deciding to roll back the protections, including the changes to mortgage data reporting and the reorganization of the fair lending office. “Laws that prohibit discrimination in consumer financial markets, like other consumer protection laws, were not prioritized by regulators before the financial crisis,” they wrote. “We are concerned that in taking these actions, you will frustrate the CFPB’s efforts to ensure all ‘consumers are protected from unfair, deceptive, or abusive acts and practices and from discrimination.’”

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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