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Ridgerunner
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Excellent work. But as you say, it is definitely work.
Kamala Harris announces $100B plan for black homeownership, tackling racial wealth gap
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dvdjs
Guest
That is not in dispute. This program will be a gret benefit to those who have suffered a loss of potential gains because of red-lining. Most of those beneficiaries be black, because most of the people who lost out from this practice are black. Is that a problem?
The program is targeted to the victims of the practice. There is no indication that blacks who were not victims of the practice would not qualify. There is no indication that people of other racial groups would not qualify. Framing this as a program targeted to blacks misses the mark.
Why make this frame?
And stating that Harris is quoted as saying the program is targeted to blacks, just isn’t accurate Why not just stick to the actual facts?
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dvdjs
Guest
That is true, but misses the essential point in this discussion.
- For most Americans, their home is their major investment and a major source for the production of their wealth.
- For some that investment did not work out so well; for some of those these was not a matter of time and chance that happeneth to them all, it was the result of deliberate polices that had an undeniable racist tinge to them and consequently disproportionately affected ce3rtain minority groups, and continue to be a major factor in the wealth inequities.
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DENNYINMI
Guest
Have you read Chesterton’s angle on “ownership” because its the principle of ownership that this very topic is based on.
That mule may not go too far in the city, but the capability to own a home is a far better opportunity for income equality and growth…income and growth, hmmm, sounds like one of my 401-k funds.
ownership opens the door for the ability to better provide for oneself, rent is at an all time high, a reasonable mortgage provides equity that will appreciate, with the added ability to save money on ones own.
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Xystus
Guest
Because that is how it was presented by Senator Harris. There is no use in denying this. That the program can help non-blacks does not mean the program is intended primary for blacks as evidenced by Harris’ own statement. here it is yet again (with some additional commentary of my own in [ ] to try to help the obtuse.
“A typical black family [notice how Harris is specifically talking about black families that are at a wealth disadvantage] has just $10 of wealth for every $100 held by a white family,” she said. “So we must right that wrong [the wrong this program aims(targets) to right is the wealth disadvantage of black families mentioned in the previous sentence] and, after generations of discrimination, give black families a real shot [notice there is no mention of giving anybody a “real shot” except black families] at homeownership — historically one of the most powerful drivers of wealth in our country."
also note how the comments were given at Essence Music Festival which is a music festival to celebrate Essence Magazine. Essence Magazine is a publication for African American women. There is no credible way to say Senator Harris was not aiming this (targeting) program at the black community.
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Jeanne_S
Guest
It’s as clear as can be what KH stated.Yet some just like to argue for arguing sake
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dvdjs
Guest
The program is targeted to victims of red-lining. Not to blacks.
However, the victims were predominately blacks.
And the effect of such programs have an enduring effect that predominately affect blacks.
So blacks will appropriately be the predominant beneficiaries of this program.
Is the something wrong with redressing an injustice that was primarily visited upon, and has a continuing detrimental affect upon blacks?
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midori
Guest
How does a house produce wealth?
A house is a place to keep your stuff.
It sucks up your wealth— taxes, maintenance, upkeep – until it’s time to sell it.
Then you see what your market price is. Just because you bought your house for $250,000 20 years ago doesn’t mean that you can now sell it for $550,000. How many people overbought houses during the subprime mortgage crisis, and were now upside-down on their mortgage? A giant part of the Bubble was the erroneous theory that “housing prices only go up.” They go up “in general”---- but the specifics depend very much on the local economy.
Don’t forget to account for the buying power of $100,000 then, versus the buying power of $100,000 now. (Hint: $100,000 in 1999 dollars has the buying power of $154,000 2019 dollars. So a house someone buys for $200,000 in 1999 that sells for $300,000 in 2019 merely breaks even, and even loses a bit, and loses a lot when you take into account repairs/upkeep/taxes.)
People rent when it makes sense. People buy a house when it makes sense. When we rented, we rented because we were poor; we were living paycheck to paycheck and just starting off; we didn’t have a solid job; we weren’t sure where we’d be in 5 or 10 years and didn’t want to be tied to a geography because we weren’t able to sell our house.
When we bought a house, we did it because we had saved up a down payment and a cash cushion; there were no rentals in our area; we were both entering careers we expected to be in long-term; we had no intention of leaving the area for the next 20, 30 years.
In one case, flexibility was important, and rent was what we paid to get that flexibility. In the other case, stability was important, and we purchased a house to get that stability.
But ultimately, housing costs are connected to the economic desirability of an area. If everyone and their brother wants to live somewhere, then housing prices are in the stratosphere— San Francisco, Los Angeles, Seattle, Boston, Denver, NYC, DFW, etc. If there’s no real draw into an area, and the population is pretty stagnant, prices are going to be very reasonable. (Insert list of places no-one’s-ever-heard-of.)
There was a girl with a burger-flipping-type job who was complaining about not being able to buy a house in Boston. Since her skillset didn’t limit her to a particular geography (in the way that, say, being a NASA employee would limit her ability to choose a place of residency), I asked her why she didn’t go further inland, where there were plenty of starter houses for sale in the $50-$100k range.
She thought I was an alien from another planet. Why would she possibly want to leave Boston?
Ummm… because you want to be a homeowner, whereas in Boston, you can maybe buy a parking space for $75k? You can maybe get a vacant lot for $200k?
Nope. She just wanted to be upset that she couldn’t afford to be a homeowner in Boston— but being a homeowner an hour down the road was just straight out of the question.
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dvdjs
Guest
It is clear. And it not what some have alleged.
The intriguing question is: why the stubborness about making this program to seem like some race-based hand out?
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dvdjs
Guest
My in-laws bought a home in 1970 for ~$30k. In that area, homes have appreciated in value by about 7%/yr. Its market value is approaching $1.5M now. That wealth has passed to their beneficiaries.
Beyond that, rent-takers are in a position to generate income without production.
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Xystus
Guest
The intriguing question is: why the stubborness in denying Harris specifically singled out black families in her comments?
Nobody said it was a race based handout except you, so that you could argue against that point instead of what we are actually saying.
Nobody said it was a race based handout except you, so that you could argue against that point instead of what we are actually saying.
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dvdjs
Guest
Ther4e has been no denial of this.
The statement is that blacks are targeted (and that she was quoted as saying that).
Those statements are not true, and the first makes it a race-based program.
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Jeanne_S
Guest
Time to bring out that dead horse for another beating !
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Xystus
Guest
Great! now maybe we can get somewhere… since you do not deny Harris specifically singled out black families you can now try to explain how “singling out” and “targeting” are different.Xystus:
Ther4e has been no denial of this.
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midori
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That’s great. $30k in 1970 has the same buying power as $200k in 2019 money.
But it still is a burden, because their heirs now have a home that has a value of $1.5M, and is taxed at $1.5M, but they presumably don’t have the income of a millionaire.
Property taxes vary by state-- in Texas, we’re over 2%, because we don’t have state income tax, but then again, NY is over 2% as well, on top of their state income tax. Most places are between 1-2%. Some places-- CO, WY, TN, LA, etc-- are under 1%. So a $1.5M place in New Orleans is going to be taxed way less than a $1.5M place in Chicago or Austin.
But let’s call it 1.5%. That’s a hypothetical $22,500 tax bill every year that the value is in that $1.5M range. And you have 50 years’ worth of tax bills, as it hiked its way up in value from $30k to $1.5M. Plus all the maintenance and repairs. Three roofs? Four roofs? Five roofs? etc.
So suppose I have in-laws, too, who die and leave me their $1.5M home in, say, Crowley. (South of Fort Worth; I have some friends there. It was a very small, sleepy, nowhere town 20 years ago, but the population exploded post-Katrina. You very well could have bought a house there for $30k 50 years ago, and it would very well be worth $1.5M today.) Crowley taxes me at a nice, even 3%-- which is $45k/year to keep the house.
But I only make $16/hr as a librarian. I only earn $33k/year, before taxes. I have to eat, I have to maintain my own home, or pay my own rent. The property taxes are a burden on me. But if I don’t pay them, I lose the entire thing, and it doesn’t matter that it’s been successfully maintained for 50 years before me; I’m not paying the taxes now, let alone worrying about paint or drains or siding or shingles.
So I look at selling. But that’s a whole different set of income taxes, plus realtors’ fees, plus whatever. And while it might benefit me, in the short term, I’m probably not going to do anything with that money that would lead to “generational wealth”. People with real generational wealth have teams of people to make sure that it doesn’t get squandered by impulsive trust-fund kids.
And that’s why we all (presumably) know of someone who got a windfall insurance payout, or won a life-changing amount of money in the lottery, or whatever… and ten years later, they’re right back to where they started. Because they were never taught how to hold on to money and make it grow/work.
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Ridgerunner
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I agree. A home is not wealth. It is a consumer good that might or might not gain or lose value. You get no income from it. It costs money to maintain. If you sell it to get the cash, you still have to re-purchase or rent somewhere.
A lot of people were convinced that somehow a home is wealth and invested half a lifetime of earnings into it. Most of the payments go to interest, and the buyer ends up paying twice the price or more if it’s a long term loan. And, of course, designs and interior décor go out of fashion. There are a few places in the U.S. where home prices have had spectacular gains, but most have not, and some have declined.
But even if a home really was an investment, that doesn’t mean redlining is a current problem. It’s illegal to do it for racial or ethnic reasons (or even the appearance of it) and CRA requires reinvestment in those areas from which deposits come. Lenders are carefully scrutinized for it by regulators.
And if one’s grandfather was redlined back in 1958, that has no bearing on one’s ability to own a home today.
A lot of people were convinced that somehow a home is wealth and invested half a lifetime of earnings into it. Most of the payments go to interest, and the buyer ends up paying twice the price or more if it’s a long term loan. And, of course, designs and interior décor go out of fashion. There are a few places in the U.S. where home prices have had spectacular gains, but most have not, and some have declined.
But even if a home really was an investment, that doesn’t mean redlining is a current problem. It’s illegal to do it for racial or ethnic reasons (or even the appearance of it) and CRA requires reinvestment in those areas from which deposits come. Lenders are carefully scrutinized for it by regulators.
And if one’s grandfather was redlined back in 1958, that has no bearing on one’s ability to own a home today.
A bank trust officer quoted to me a statement from one of their publications that the average longevity of an inheritance is 18 months. I am inclined to believe him. Truth is, most people don’t inherit much of anything to begin with, and when they do, it doesn’t last.
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Ridgerunner
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I doubt Harris’ boondoggle will ever come to pass, but boondoggle it will be if it does. Throwing dollars at a problem that does not exist usually ends up in the pockets of the politically favored.
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Jeanne_S
Guest
Wait let me get some popcorn first!
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Theo520
Guest
Nope, compared to other countries our history of racism is quite short.
The USA was also not an outlier in both ending the slave trade and then abolishing slavery.
I also severely doubt your claim that the rest of world magically stopped all forms of racism upon abolishing slavery. I expect again the US is within the norm.
Please stop making assertions without evidence
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Convert3
Guest
Anytime the government gets involved it just drives costs up. Lyndon Johnson initiated the War on Poverty and the US has spent over $1 Trillion fighting that war with very little progress in reducing the percentage of the population living in poverty. He also started Medicare and Medicaid, which also began the skyrocketing costs of healthcare. Government got involved with student loans and grants for college, and the cost of college keeps increasing. The backing of mortgages and pushing to provide mortgages led to the rapid rise of real estate prices in the mid 2000’s, and we saw that bubble burst in 2008.
The last thing we need is for the government to “help.” They should provide for defense, safety in the workplace, transportation regulations, reasonable environmental regulations and ensure current laws are enforced equally among all people. Everything else should be left to the states.
The last thing we need is for the government to “help.” They should provide for defense, safety in the workplace, transportation regulations, reasonable environmental regulations and ensure current laws are enforced equally among all people. Everything else should be left to the states.
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