André Douglas Pond Cummings
Permission Pending: André Douglas Pond Cummings, Families of Color in Crisis: Bearing the Weight of the Financial Market Meltdown, 55 Howard Law Journal 303 (Winter 2012) (66 footnotes omitted)
The financial market crisis of 2008 has landed heaviest and hardest upon communities of color. In the minority communities that continue to bear the crushing weight of this crisis--which continues unrequited--women of color, and by extension, their families, are by far the group most devastated by the global market meltdown. In an ultimate irony, most economists, scholars, and commentators now agree that the collapse, which continues to ravage Main Street, was caused primarily by a select group of privileged white men-i.e., Wall Street executives, bankers, and the politicians purchased by Wall Street largess. The impact of Wall Street's fascination with securitizing subprime mortgages, creating worthless collateralized debt obligations, and trading these unregulated exotic instruments recklessly, has been a government bailout of the reckless institutions, absolution of Wall Street banks by the media, and America's leaders, and a citizenry left adrift. No Main Street bailouts have materialized as American citizens continue to deal with foreclosures, joblessness, and chaos. Those citizens struggling most with foreclosure, joblessness and chaos are women of color and their families. Women of color and urban families in the years preceding the mortgage crisis were targeted by the lending industry to receive disproportionate percentages of onerous subprime home loans leading to devastating foreclosure rates in urban city centers and an overwhelming drop in median minority wealth. Further, chaos abounds in minority communities because vast percentages of male wage earners, fathers, and sons, are behind bars, simply absent from their communities, imprisoned on a massive scale due to America's War on Drugs.
Much has been written about the causes of the mortgage crisis of 2008. Wide-ranging agreement focuses primary causation for the crisis on legislative deregulation of the capital markets dating back to the 1970s, a housing bubble that inflated and imploded, and Wall Street's activities and behavior in connection with this deregulation and housing bubble. Legislative deregulation, a housing boom and bust, and Wall Street greed and recklessness nearly collapsed the global economy. Yet, Wall Street executives, national legislators, and most commercial and investment banks responsible for inflating the housing bubble and massively profiting from that bubble prior to the collapse have all mostly escaped the devastation of the mortgage meltdown and now appear either completely recovered or nicely recovering. Conversely, those who continue to suffer crippling unemployment, continuing foreclosure abuse and erratic housing prices, and consequences of a massive taxpayer bailout of Wall Street include the general global public, particularly middle class taxpayers, urban communities, and people of color.
This Essay explores the specific impact the financial market crisis of 2008 has had on families of color, particularly African American families. The Essay begins by detailing the dreadful impact of the financial market crisis of 2008 on communities of color. More than any other group of citizens, minority Americans suffered the crisis burden disproportionately and more harshly than any other because in large percentages minority citizens were predatorily targeted by lenders in the mortgage industry for incredible short term lender profit at the expense of long term needs of the family. Next, this Essay analyzes why communities of color suffered most harshly from the financial market crisis by examining the mass incarceration of men of color and the relationship between financial crises and discriminatory imprisonment. Finally, the Essay concludes.