Recent executive orders pose grave threats to our communities and our values. As we organize to counter, undo, and prevent further damage, strategic messaging is more important than ever. We hope the following quick tips, based on communications research, experience, and input from partners around the country, helps with this task as we all move forward.
Building a Message – Value, Problem, Solution, Action
Values
Communications research shows that audiences are more receptive to new arguments when they are framed by shared values. For recent Executive Orders, there are three sets of recurring values that we want to keep at the center of the conversation:
1) Our Core National Values
Remind people of the kind of country we want to be, drawing on our best ideals. For some audiences, describing times in our history when we have done the right thing is inspiring. Values: Opportunity, freedom, justice, our founding legal documents.
We see tonight what I believe is a clear violation of the Constitution, and so clearly tonight we have to commit ourselves to the longer fight. Clearly tonight, we have to commit ourselves to the cause of our country. Clearly tonight, we have to be determined to show this world what America is all about.
– Senator Cory Booker
Trump’s actions are hurting Netflix employees around the world, and are so un- American it pains us all…It is time to link arms together to protect American values of freedom and opportunity.
– Netflix CEO Reed Hastings
A nation founded with the promise of religious freedom. This nation wants to ban Muslim immigrants? #NoBanNoWall
– Franchesca Ramsey, Youtuber
2) Our Moral Responsibility
Remind audiences of our responsibilities to our fellow humans and how we must rise above fear and xenophobia to find our “better angels” as Abraham Lincoln once said. We share responsibility for one another and for protecting and uplifting human rights. Values: Empathy, compassion community.
America is better when we lead with freedom, not fear. We cannot allow fear to dictate our decisions. We must act with requisite caution, but also with compassion and moral clarity.
– National Immigration Forum
We need to protect all our brothers and sisters of all faiths, including Muslims, who have lost family, home and country.
– Bishop Joe S Vásquez, US Conference of Catholic Bishops
Even though Dory gets into America, she ends up separated from her family, but the other animals help Dory. Animals that don’t even need her. Animals that don’t have anything in common with her. They help her, even though they’re completely different colors. Because that’s what you do when you see someone in need – you help them.
– Ellen DeGeneres, using the plot from her film Finding Dory to comment on the border wall.
3) Our “Can-do” Spirit
Audiences are hungry for solutions in times like these. We have to remember to highlight what we want moving forward – and how we can get there – in addition to pointing out what we’re against. Sympathetic audiences need to be primed to feel proud of our country’s capacity to accommodate all kinds of people, and our history of providing opportunity for those seeking it. Those in our base need to hear forward-leaning messages about working together to counter, demolish, and replace bad policies. Values: Pragmatism, common sense, innovation, determination to do the right thing, our shared responsibility to fix flawed policies, solidarity
It doesn’t make sense to spend billions of dollars of taxpayer money on something that is really not necessary. This is a 15th century solution to a nonexistent problem. We need a 21st century, common-sense border policy that upholds the dignity of our border residents.
– Vicki Gaubeca, Director, ACLU New Mexico Regional Center for Border Rights, New Mexico.
I think this is a problem that will need diplomatic solutions, political solutions, military solutions, educational, social, and other solutions. So, this is a problem that is multi- faceted and therefore requires a multi-faceted solution. Muslims are an integral part of that solution.
– Dr. Khalid Qazi, Muslim Public Affairs Council of Western New York.
There is something more important and powerful than all three branches of government. It is you – the people.
– New York City Mayor Bill DeBlasio in support of protesters.
Problem
Frame problems as threats to our shared values. This is the place to pull out stories and statistics that are likely to resonate with the target audience. But choose facts carefully. We all have a lot of evidence to support our claims. However, facts do not tend to change minds if the facts are not couched in values.
We vehemently oppose any proposal or statements calling for a ban on refugees, as well as discrimination based on religion or nationality. As a nation founded in part by refugees and immigrants, these kind of discriminatory policies dishonor our history, beliefs and values.
– Welcoming America
[The Muslim order is] a stunning violation of our deepest American values, the values of a nation of immigrants: fairness, equality, openness, generosity, courage… As an immigrant and the child of refugees, I join them, with deep feeling, in believing that the policies announced Friday tear at the very fabric of our society.
– Massachusetts Institute of Technology president L. Rafael Reif.
Solution
Pivot quickly to solutions. Positive solutions leave people with choices, ideas, and motivation. They are the hero of the story and rescue the values at stake. In the case of these Executive Orders, our existing laws and their enforcement, our resiliency, and our values will all point us in the right direction when it comes to solutions.
Restricting a religion… is as short-sighted as it is immoral. More intelligent would be to increase resources dedicated to regional refugee process centers so security checks occur in timely fashion.
– National Immigration Forum
The United States is a nation governed by the rule of law and not the iron will of one man. President Trump now has learned that we are a democratic republic where the powers of government are not dictatorial. They are limited. The courts are the bulwark of our democracy that protects individual rights and guards against the overreaching of an administration that confuses its will for the American public’s.
– American Civil Liberties Union
Action
Assign an action. What can this specific target audience do? Try to give them something concrete that they can picture themselves doing: making a phone call, sending an email. Steer clear of vague “learn more” messages, when possible. For people who have only recently become active due to the events of the past few months, it is particularly important to be explicit about action. Include specific steps and assurances that they can help make a difference by following through.
Additional Tips
Balance Individual Stories with System-Wide Solutions
Storytelling features, at its core, heroes and heroines who bring issues such as immigration to life, so stories about individual triumph and tragedy are an obvious component. However, without sufficient context, audiences can limit a story’s implication to the individual level, attributing successes and failures to personal responsibilities and actions that have little to do with the system-level change we are seeking in our immigration policies.
Tell Affirmative Stories
We’re all faced with misleading, inaccurate, and untruthful statements about our issues. And we certainly can’t allow misinformation to go unchallenged. But the best way to counter false information is to tell our affirmative story in ways that overcome the other side’s falsehoods. By contrast, we should avoid myth busting, or restating the false argument and then explaining why it’s wrong.
In fact, repeating misinformation, even to refute it, can cause audiences to remember it better, but not necessarily remember that it was wrong. This is particularly true when information is stated in the affirmative, as happens with the “Myth/Fact” format of disputing untruths, for example: “Myth: The flu vaccine can sometimes cause the flu. Fact: The flu vaccine does not cause the flu.” The better approach is to proactively put forward what is true. “The flu vaccine prevents the flu.” Or “This order assumes that refugees don’t already go through a comprehensive vetting system, but they do.” A better approach: “Refugees undergo months of vetting and interviews before they are considered for entry into the U.S. And perhaps as a result, rates of unlawful behavior among these groups is lower than among people who were born here. They are on average one of the most law-abiding groups of people you could hope for in your community.”
The analysis in this report is based on publicly available survey data and public opinion studies by reputable research organizations, news outlets, government bodies, and social issue groups related to poverty. Analysis includes an exploration of perceptions about seriousness and causes of poverty, attitudes toward those living in poverty, beliefs about upward mobility, and support for anti-poverty policies. We reviewed data from more than 40 sources, including peer-reviewed articles. Data from the Opportunity Survey, a national representative survey of more than 2,000 respondents, was also analyzed for new insights. These studies meet The Opportunity Agenda’s standards and best practices for research.
LIMITATIONS
Because this report reviews existing studies, our analysis is limited by the severe gaps in data regarding many demographic groups, including Latinos, Native Americans, Asian Americans, biracial and multiracial Americans, undocumented immigrants, LGBTQ people, and people with disabilities. This is an important limitation—data from Pew Research Center indicates that roughly 29.1 percent of Native Americans/Alaska Natives live below the federal poverty line,1 yet survey and polling research often fails to examine these communities. Existing research similarly overlooks the many differences within Asian American, Latino, and other groups in terms of national origin, immigrant status, and other characteristics. In an effort to bring a more intersectional lens to this research, we have included data examining public support for policies that directly affect the ability of underserved communities to climb out of poverty, including affordable health care, subsidized housing, and a rise to the minimum wage.
TERMINOLOGY
The use of secondary sources has limitations related to language and terminology use. We have noted instances in this report when the data or source quoted makes use of terms and phrases that are not in line with our organizational guidelines and objectives.
As America prepares for what promises to be a pivotal election and history-defining presidency, the mood of the nation is shifting. In the past two years, the rise of social justice movements such as Black Lives Matter and populist sentiments within a large segment of the electorate has pushed the issue of systemic inequality to the forefront of public discourse. These major social shifts – coupled with declining poverty rates and bipartisan recognition that poverty is a serious issue in need of redress- indicate that we are in a critical moment when it comes to tackling poverty, and more broadly, inequality in America.
The American public is primed to hear a new story and new solutions for poverty. In order to leverage this moment, it is necessary for anti-poverty advocates and social justice leaders to understand how Americans currently think and feel about the issue, how attitudes on poverty intersect with other social justice issues, and what specific policies are likely to galvanize widespread support.
This report examines existing polling and survey data in an effort to identify major attitudinal shifts, lasting challenges, and opportunities for advocates and leaders seeking to advance anti-poverty narratives and policies.
SUMMARY
In 2014, fifty years after President Lyndon Johnson declared an “unconditional war on poverty,” the Opportunity Agenda published A Window of Opportunity, a three-part examination of prevailing public opinion and media representation of poverty in America. The report set out to answer several key questions: What is the public perception about the causes of poverty? Do people still have faith in the American Dream? What do Americans feel is the responsibility of government in tackling poverty and income inequality? What role, if any, do stereotypes and other biases play in shaping attitudes towards people living in poverty? Are there major differences in opinion between demographic groups? How has opinion changed over time?
Our analysis found that two competing, often conflicting narratives—individualism and personal responsibility on the one hand, and equal opportunity and shared responsibility on the other— have governed the American public’s overall perception of poverty-related issues. Our research also identified key openings of support for anti-poverty policies.
Our examination of data since 2014 and additional, previously unexplored data points reveal that Americans’ simultaneous belief in equal opportunity and individualist ideals largely persist and continue to influence support for anti-poverty policies. For instance, as of January 2016, more than 7 in 10 (72 percent) of surveyed Americans said that reducing poverty is an “extremely/very important” issue for the next president of the United States, while just under 6 in 10 (57 percent) express the same belief about reducing the “gap between the rich and the poor.”2 Despite public concern about poverty and income inequality, our analysis of recent polling and survey data shows that this concern has not resulted in significantly higher levels of support for tax reform. In fact, recent research shows that public support for higher taxation of the rich and/or expansion of social safety nets has remained stable over the last three decades.3
While many trends in public opinion have stayed the same in the last two years, there have been some notable attitudinal shifts. While the majority of Americans (60 percent) still believe in the power of hard work and other individualistic ideals, there is growing discontent about the possibility of people born into poverty being able to achieve the American Dream—that is, the belief that hard work can overcome poverty and inequality. As of 2015, nearly 6 in 10 Americans (57 percent) believe that the American Dream no longer holds true, up from 48 percent in 2014.4
Americans’ skepticism about the viability of the American Dream is coupled with rising concern about the state of equal opportunity in the United States and the fairness of the economic system. The somewhat unexpected popularity of former presidential candidate Senator Bernie Sanders pushed the discussion of income inequality into the forefront of political debates, and survey data from 2010 to 2015 suggests that Americans are more concerned about equal opportunity today than at any other time within the last five years. As of 2015, 65 percent of Americans believe that “one of the big problems in this country is that we don’t give everyone an equal chance in life,” while fewer than three in ten (28 percent) believe that “it is not really that big a problem if some people have more of a chance in life than others.”5 Concern about the lack of equal opportunity has increased considerably since 2014, when 55 percent said that one of the big problems in the U.S. was the lack of equal opportunities for all. Survey data also indicates that Americans are increasingly concerned about unfair economic systems and corporate greed, while there is rising public awareness about the structural barriers faced by black Americans— an important opening for advocates seeking to educate the public and increase support for policies aimed to alleviate systemic inequality. In addition, research conducted by Topos Partnership indicates that there is a strong correlation between public perception of quality of life and the willingness to pay more in taxes6.
Finally, while research is still lagging in terms of providing data that examines the intersections of race, gender, sexuality, and public opinion of poverty and low-income people, available survey data indicates strong support for policies that directly concern populations disproportionately affected by poverty, particularly a rise in the federal minimum wage and government housing subsidies. More than 7 in 10 people (74 percent) surveyed expressed the belief that housing subsidies would be very or somewhat effective in helping people struggling in the current economic climate.7 Taken together, there is clearly reason to be optimistic about tackling poverty in America.
This report begins with a series of key findings and concludes with recommendations for narrative and message building, audience engagement, and future research.
Our nation aspires to be a place where everyone enjoys full and equal opportunity. Unfortunately, there is a significant gulf between that goal and the daily reality for millions of Americans living in poverty. However, more Americans than at any other time in the past 50 years are ready to hear a new, more accurate story about poverty and to take action to address it. And most Americans—75 percent—think that unequal treatment of poor people is a problem.1
This is an amazing window of opportunity. Yet we need to proceed strategically in our messaging, as these positive attitudes also coexist with longstanding negative stereotypes about welfare dependency, government ineptitude, and irresponsible individual choices, as well as implicit and explicit racial, ethnic, and gender biases. We also face challenges in the form of growing economic inequality, corporate political power, and partisan gridlock on Capitol Hill. We should also be aware that as the economy gradually improves for some groups, empathy for people living in poverty may well diminish.
By combining a sophisticated communications strategy with ongoing research, advocacy, and other approaches, however, we can build public support for transformative change and tackle poverty in our country.
This memo shares what we’ve learned from our research on attitudes and opinions about poverty plus messaging advice for crafting compelling messages about poverty and economic inequality.
10 Tips for Talking about Poverty
Connect with shared values: Opportunity, Community (Interconnection), Mobility, Security.
Illustrate systemic causes, including the geography of opportunity.
Amply document unequal opportunity (not just unequal outcomes).
Use thematic storytelling with enlightened insiders, affected change agents, group stories.
Emphasize solutions— contemporary, historic, and visionary.
Describe the practical and moral societal benefits.
Be aware of implicit racial, ethnic, gender bias—avoid over-representation and stereotypes, explain current discrimination (including implicit bias).
Avoid “new poor”/“old poor” false dichotomy.
Tell a nuanced story regarding the role of government.
Offer a range of actions, from individual to societal.
Insight from Public Opinion Research
American attitudes toward poverty, poor people, and the role of government tend to be grounded in two competing—but not always mutually exclusive—sets of values: individualism and personal responsibility on the one hand and equal opportunity and interconnection on the other. In fact, people often hold conflicting opinions concurrently. For example, significant majorities of Americans simultaneously oppose cutbacks in aid to poor people and believe that poor people have become too dependent on government assistance programs.
Additionally, our research shows a majority of Americans believe:
Living standards for the poorest Americans are an important national issue.
Poverty is mostly due to external circumstances, not lack of effort by poor people.
The government should do more to reduce the gap between rich and poor.
Government programs for poor people are a critical safety net that helps people get back on their feet in hard times, and should not be cut.
Income and wealth inequality hold back economic growth.
An increased minimum wage, improved education, and college access are important anti- poverty approaches that should be adopted.
Yet, a majority of Americans also:
Believe poor people have become too dependent on government assistance programs.
Feel it is not the responsibility of government to reduce the differences in income between people with high and low incomes.
Believe poverty is an acceptable part of our economic system that does not need to be fixed.
Are unaware of most structural causes and solutions.
Hold negative racial stereotypes and beliefs relating to poverty.
Narrative, Messaging, and Storytelling Recommendations
Our research points to a need, as well as an opportunity, for anti-poverty leaders to communicate in new, more impactful ways. Our messaging recommendations include:
Craft a shared narrative and uplift each other’s voices and concerns. Anti-poverty voices are relatively prominent in the public discourse, but they are diffuse, lacking a coherent narrative that can persuade undecided audiences or counter the disciplined narrative of their most frequent opponents.
We recommend that while anti-poverty leaders and groups maintain their individual perspectives and priorities, they also craft a shared narrative in which they:
Emphasize the values of equal opportunity and community.
Highlight systemic causes.
Describe a path from poverty to economic participation.
Promote effective solutions and successes.
Invoke a positive role for government.
Shared messaging should build on public concerns about growing inequality, low wages, and long-term unemployment while educating audiences about less visible forces like racial and gender bias, globalization, and tax and labor policies.
Avoid the simplistic “new poor”/“old poor” dichotomy. The common storyline in news reporting on poverty is that the newly poor are victims of structural problems with the economy, and are generally viewed sympathetically, while those living in deep poverty (the “old poor”) are poor for other, largely unexplained, reasons. The framing of those stories also tends to reinforce inaccurate stereotypes about poor people, as well as race, and obscures systemic factors that affect both recently and persistently poor people. Communications should move beyond this illusory distinction. Consistent with that approach, stories about the challenges and progress of communities facing deep poverty are needed to ensure a full and accurate picture. Furthermore, the voices of people in deep and persistent poverty need to be heard.
Document and explain unequal obstacles. Researchers have amply documented the disparate obstacles that contribute to higher poverty rates among communities of color, women, immigrants, and other demographic groups. Yet there is still a dearth of reporting on those dynamics—and for that reason, among others, many audiences are skeptical that such obstacles still exist. Moreover, research and experience show unchallenged subconscious stereotypes will infect attitudes about poverty generally and erode support for positive solutions. Our communications need to both explore and explain this evidence, as well as tell the human stories behind it. A focus on unequal obstacles—not only unequal outcomes or disparities—is an important part of that formula.
Highlight systemic solutions for systemic problems. While news reports generally ascribe poverty to systemic causes, they do so through fleeting references to general trends such as plant closings, the scarcity of jobs, or the “weak economy.” Few stories explain root causes in any detail, and forces behind the disparate impact of poverty based on race, ethnicity, and gender receive practically no attention.
However, our research shows that a majority of Americans agree that “the primary cause of America’s problems is an economic system that results in continuing inequality and poverty,”2 so there is an opening for advocates to talk about the systemic underpinnings of poverty and system-wide changes needed to address it. Because Americans are not knowledgeable about effective solutions to poverty, anti-poverty policies and programs that have demonstrable positive results and (research pointing the way to positive outcomes) should be made more visible, as should the positive role that government plays in creating opportunity.
Build on policies with high levels of support. A number of anti-poverty strategies receive high levels of support from the public. Lifting up these popular solutions while explaining and promoting more complex or less popular ones can help to build broader and more lasting support. Solutions with the greatest support include:
Show the connections. The idea that we are interconnected and all in this together is crucial to the success of anti-poverty communications. Americans intuitively understand that increasing inequality and poverty hold back the economy and country as a whole and also create an environment in which serious social problems develop and worsen. But their thinking on poverty easily defaults to an extreme “personal responsibility” and “bad decisions” frame. Both showing and telling how we’re all affected and connected—through images, research, spokespeople, and storytelling, as well as specific messaging—is crucial.
Talking about Race and Poverty
Americans strongly believe that opportunity should not be hindered by race, gender, ethnicity, or other aspects of who we are. However, much of the public is skeptical of the existence of racial discrimination in particular, and negative racial stereotypes about poor people persist among many Americans. For example, in 2010, close to half of the American public (47 percent) agreed that “African Americans have worse jobs, income, and housing than white people because most African Americans just don’t have the motivation or willpower to pull themselves up out of poverty.”3 We need to acknowledge and confront these deep-seated stereotypes.
To do that, our messaging on poverty needs to take into account that race matters in at least four crucial ways:
Stereotypes and bias warp perceptions of poor people.
Stereotypes and bias can undermine support for solutions.
Views and beliefs about poverty differ significantly across demographic groups.
People’s conscious values on racial equity are generally more positive than their subconscious stereotypes.
Taken together, these trends call for talking about race explicitly and strategically, through the lens of shared values. Keep these guidelines in mind when talking about barriers that hamper opportunity for diverse populations and promoting solutions:
Show that it’s about all of us. Remind audiences that racial equity is not just about people of color; achieving racial equity upholds our values and benefits our entire society. For example, lax federal regulators allowed predatory subprime lenders to target communities of color, only to see that practice spread across communities, putting our entire economy at risk.
Over-document the barriers to equal opportunity—especially racial bias. Don’t lead with evidence of unequal outcomes alone, which can sometimes reinforce stereotypes and blame. Amply document how people of color frequently face stiff and unequal barriers to opportunity. For example:
DON’T begin by discussing the income gap between whites and African Americans
DO lead by talking about how studies have found that employment agencies frequently preferred less qualified white applicants to more qualified African Americans.
Acknowledge the progress we’ve made. This helps to persuade skeptical audiences to lower their defenses and have a reasoned discussion rooted in reality rather than rhetoric.
Present data on racial disparities through a contribution model instead of just a deficit model. When we present evidence of unequal outcomes, we should make every effort to show how closing those gaps will benefit society as a whole. The fact that the Latino college graduation rate is a fraction of the white rate also means that closing the ethnic graduation gap would result in many more college graduates each year to help America compete and prosper in a global economy—it’s the smart thing to do as well as the right thing to do.
Be thematic instead of episodic. Select stories that demonstrate institutional or systemic causes and solutions over stories that highlight largely focus on individual choices.
Use opportunity as a bridge, not a bypass. Opening conversations with the ideal of opportunity helps to emphasize society’s role in affording a fair chance to everyone. But starting conversations there does not mean avoiding discussions of race. We suggest bridging from the value of opportunity to the roles of racial equity and inclusion in fulfilling that value for all.
Engaging Strategic Audiences
Key to building the national will to address poverty is activating the base of existing supporters while persuading undecided groups over time. That, in turn, requires prioritizing strategic audiences by:
Activating the base. The most fertile ground for anti-poverty policy and activism lies with Progressives, African Americans, and Latinos. These groups should be prioritized for organizing and calls to action.
Persuading undecided audiences. Millennials, independent voters, women, and people of faith are disproportionately open and persuadable on poverty issues. White Evangelical Christians, for example, seem to be increasingly in play; 53 percent of them agree that “society would be better off if the distribution of wealth was more equal.”4
Engaging those most affected. Public opinion research suggests that low-income Americans, while knowledgeable about the realities of living in poverty and interested in change, tend to lack information about structural causes and solutions, and are doubtful about their influence in society. Providing that information, and opportunities for leadership and civic engagement, should be priorities.
Create an Echo Chamber
Traditional and social media trends show a predictable pattern: national election events, the release of census numbers, budget debates, and anniversaries of anti-poverty and civil rights events reliably increase attention to poverty. Demonstrations, strikes, and major think-tank reports also frequently generate media interest.
We recommend that anti-poverty communicators:
Chart these “news hook” events well in advance.
Prepare a multi-platform media strategy that is proactive, builds upon the activity of high- profile voices, and lifts up the voices of those most affected.
Be more intentional and collaborative about sharing and jointly promoting new research and activities across the field.
These efforts should complement rapid-response communications when relevant, but unpredictable, events occur.
Every couple of generations, national values, demographic change, attitudes, and experiences converge to create the potential for transformative social change. We must leverage this moment of profound public openness to shift the discourse around poverty to change hearts, minds, and policy.
Build a Strategic Message
One formula for building an effective message is Value, Problem, Solution, Action. Using this structure, we lead with the shared values that are at stake, outline why the problem we’re spotlighting is a threat to those values, point toward a solution, and ask our audience to take a concrete action.
Lead with values. Most communicators agree: people don’t change their minds based on facts alone, but rather based on how those facts are framed to fit their emotions and values. Shared values help audiences “hear” messages more effectively than do dry facts or emotional rhetoric.
This country is built on the idea of opportunity for all, regardless of where you come from or what you look like.
Our economic policies should be propelled by the values of accountability, economic security, and opportunity for all, not greed, privilege, or the interests of a few.
Introduce the problem. Frame problems as a threat to your vision and values. This is the place to pull out stories and statistics that are likely to resonate with the target audience.
But that’s far from what we’re seeing today, with working Americans’ living standards declining and the richest 1% holding 40% of the nation’s wealth.
Pivot quickly to solutions. Positive solutions leave people with choices, ideas, and motivation. Assign responsibility—who can enact this solution?
Reclaiming the promise of opportunity means demanding an economy that works for everyone, not just the richest members of society. Corporations need to pay their fair share, and banks need to invest in building up communities sustainably.
Assign an action. Try to give people something concrete they can picture themselves doing: making a phone call, sending an email. Steer clear of vague “learn more” messages when possible.
Join us by[include a concrete action that your audience can take].
Say What You’re For, as Well as What You’re Against
Anti-poverty advocates may not share a single list of policy demands, but we can and should paint a positive picture of the society we’re trying to create. Most people already have a lot to worry about, and are in no mood for problems with no solutions in sight. We can cut through the clutter of stories about how bad things are by painting a picture of what our country would look like if it embraces and promotes:
Opportunity: for honest work that pays a decent, living wage.
Accountability: with fair rules, enforcement, and prosecution where appropriate of the corporations and individuals who lawlessly wrecked our economy.
Fairness: including a tax system in which the wealthiest companies, millionaires, and billionaires contribute their fair share to the nation that gives them so much.
Voice: a political system in which every American’s voice and vote are equal, and large sums of money are not allowed to corrupt the democratic process.
Economic Mobility: access to an affordable college education for everyone who has the ability and desire to attend, without the crippling burden of loan debt.
Economic Security: including a halt to unnecessary foreclosures, the restoration of devastated neighborhoods, and reductions in mortgage payments to fair, realistic levels.
Notes:
The Opportunity Agenda, Opportunity Survey: Understanding the Roots of Attitudes on Inequality, 2014.
Public Religion Research Institute, American Values Survey, September 2012.
Gallup/USA Today poll, June 2010.
Public Religion Research Institute, American Values Survey, September 2011.
Building public support to close the racial wealth gap requires a nuanced understanding of existing attitudes, as well as challenges and opportunities for change. This memo draws on the findings of the Opportunity Survey—a national study of public opinion commissioned by The Opportunity Agenda—to examine those attitudes, and to chart a path forward. It covers basic values, as well as views on discrimination, housing, the role of government, and other relevant issues.
Survey Methodology
Administered by Langer Research Associates, the Opportunity Survey was conducted between February 4 and March 10, 2014, among a random national sample of 2,055 respondents. The survey oversampled very low-income adults (those living below 50 percent of the federal poverty line), African American men, and Asian Americans—groups whose voices are frequently overlooked in opinion polling. And it includes a special analysis of the views of the rising American electorate—Millennials, people of color, and unmarried women—who have increasingly greater sway in elections. Respondents whose first language is Spanish had the option to take the survey in that language. The research also includes a cluster analysis that identifies the demographic characteristics, personal experience, values, and core beliefs that predict support for social justice policies and motivate people to action.
Major Findings
1. Americans Deeply Value Opportunity and Equality
The notion of opportunity is at the core of the American ethos. It evokes the belief that each person in our country can and should receive equal treatment, have a fair chance to achieve his or her full potential, enjoy economic security, and have a voice in the decisions that affect them.
In a broad endorsement of opportunity principles, an overwhelming 85 percent of Americans feel that society functions better when all groups have an equal chance in life, including 57 percent who feel this way strongly. Only 15 percent say it’s better to have “some groups on top and others on the bottom.” Likewise, just one in 10 calls it entirely acceptable for one group to have more opportunities in society than others, while slightly more than six in 10 call this unacceptable, including 23 percent who say it’s entirely unacceptable.
These numbers reveal that Americans are deeply concerned with inequality, and the feeling that it is incompatible with their vision of American society and damaging to broader well being. Diving even further, the Opportunity Survey finds that seeing group inequalities as unacceptable is one of the top predictors of perceiving discrimination against groups as serious, seeing more discrimination in housing, supporting measures to address poverty and a path to citizenship, and being willing to act on a range of social policy issues.
At the same time, most Americans recognize threats to the ideals of opportunity and equality as well, with just 37 percent saying that society currently offers equal opportunities to most or all groups, while as many, four in 10, say just some or only a few groups have an equal chance to succeed. (The rest, a quarter, take the middle position, saying “a good number” have equal opportunities.)
While audiences may be split on how much opportunity is available, perceptions of inequality are widespread: nine in 10 Americans in the Opportunity Survey see unfair treatment of at least one minority group as a serious problem. Leading the list by a wide margin, 75 percent of the public views unequal treatment of poor people as a serious problem, including 35 percent who see it as “very” serious. Fifty-‐two to 60 percent see a serious problem in unequal treatment of eight other groups tested, including people who have served a prison sentence, undocumented immigrants, black men, black women, Native Americans, gays and lesbians, women overall and Latinos.
Additionally, sixty percent of Americans report sometimes or often experiencing unfair treatment themselves because of their membership in one or more groups. Most prevalent, four in 10 say they’ve been treated unfairly because of their economic class. Three in 10 report the same based on their gender (32 percent) or their race or ethnicity (31 percent).
Implications for Racial Wealth Gap messaging: Leverage Americans’ veneration for equality of opportunity by portraying economic gaps as a threat to that value. Emphasize how it should matter to all of us when we allow such gaps to persist. Show and tell how we’re all in it together when it comes to economic opportunity, security, and mobility.
2.Perceptions of Equal Opportunity and Discrimination Vary by Group
Personal experience of unfair treatment because of one’s group memberships has a profound impact on a person’s attitudes about discrimination overall. Those reporting unfair treatment themselves are more likely than others to perceive unjust treatment of groups in general as a serious problem, to recognize discrimination in housing, and to say they’d take a variety of specific actions on behalf of issues and groups that are important to them.
Yet, simply having experiences with unfair treatment does not automatically translate to concern for other groups’ experiences with it. Group members are substantially more likely than others to regard unequal treatment of their own group as a serious concern.
Eighty-‐three percent of black women and 79 percent of black men see discrimination against their groups as serious; just 54 and 56 percent of non-‐black women and men share those views. Asian Americans, LGBT Americans, Latinos, and women generally all are more likely than non-‐group members – by double-‐digit margins – to view disadvantageous treatment of their groups as a serious problem.
But the survey does reveal four important predictors of seeing discrimination against groups – not just one’s own -‐ as a serious problem:
The extent to which people see group-‐based inequality as unacceptable,
Belief in “linked fate” (i.e., the notion that the prosperity of one is linked to the prosperity of all),
Personal experiences with unfair treatment, and
The importance of group membership in one’s self-‐identity.
Concern about inequality thus relies in part on feelings that it’s incompatible with American society and damaging to broader well being.
Other predictors also are informative. Perceived seriousness of unequal treatment is less strong among those with a greater preference for tradition in general, and traditional morality in particular; among people who perceive basic systems of American society as fair; and among those who prioritize loyalty, respect for authority and behaving honorably. Increased concern among these audiences may then rest on the notion that discrimination and inequality violate traditional values of liberty, fairness and equal opportunity.
Implications for Racial Wealth Gap Messaging:
Underscore the values that are associated with caring about discrimination and unequal treatment: the importance of protecting and upholding equal opportunity, and the notion that we’re all in this together.
Frame unequal opportunity as a challenge facing all of us, with some communities facing particular—and particularly steep—obstacles.
Segment audiences strategically: Most Americans have felt that they’ve been treated unequally, but fewer recognize unfair treatment of groups outside of their own. Consider the “base” for racial wealth gap messages as people of color. But then work with the Cluster Analysis (below) to think through who other allies might be in telling the story of racial gaps in economic power.
Remind people when unfair treatment is a serious concern for their own group, and for our society as a whole.
3.There Exists Some Understanding of Structural Causes of Inequality
Most Americans, 70 percent or more, understand that group-‐based inequality is at least partially due to social conditions, rather than solely reflecting group members’ own behavior. However, there is wide variability in this view depending on the group in question. At one end of the spectrum, most adults blame the unfair treatment of women and Native Americans mainly or entirely on social conditions; just 13 percent, in both cases, blame those groups’ own behavior. That shifts dramatically when it comes to people who have served a prison sentence – 49 percent blame those individuals’ behavior – or those who are undocumented immigrants, blamed by 36 percent.
These views make a difference. Those who tend to attribute inequality more to formerly incarcerated people’s own behavior, for example, are significantly less apt than others to support policies focused on rehabilitation and re-‐employment. Similarly, support for a path to citizenship for undocumented immigrants declines among those who see this group as largely to blame for the inequality its members’ experience. In another example, while comparatively few people view poor people as responsible for their own plight, those who do are less likely to support anti-‐poverty programs.
While many recognize the role that society plays in protecting equal opportunity, most Americans still look to individual behavior to explain people’s level of prosperity, with two-‐thirds believing that individuals are responsible for their own prosperity. Forty-‐two percent feel that way strongly. Far fewer, 32 percent, perceive linked fate – the notion that the prosperity of one is linked to the prosperity of all. Those who are more inclined to believe that individuals are responsible for their own outcomes also are more apt to emphasize group behavior as the main cause of inequality.
Just like behavioral versus societal explanations for inequality, views on linked fate predict policy preferences and the intention to take action on inequality, as well as attitudes about discrimination more generally. Those who are more inclined to see prosperity as linked are more likely to view unequal treatment of groups as a serious problem, to support the opportunity-‐expanding solutions tested, and to express greater willingness to take action on opportunity issues. Elevating an understanding of linked fate, therefore, may move more people towards support for social justice issues and action. Additionally, emphasizing societal explanations for inequality, rather than perceived “deservingness,” will likely help combat the belief that some groups in society deserve to be treated better (or worse) and afforded more opportunities than others.
Implications for Racial Wealth Gap Messaging:
Emphasize the ways in which individual success and broader societal opportunities are linked, showing the underlying and historic causes of the wealth gap.
Highlight the (often invisible) systemic causes of economic and racial inequality. Don’t rely on stories that focus solely on individuals to tell the story. Doing so can reinforce the individual-‐focused mindset that can lead audiences to block out systemic causes in favor of blaming or celebrating individual people. When telling human stories, choose ones that are inherently systemic and change-‐oriented, connecting multiple people, systems, and institutions.
Consider starting with issues that may be easier for audiences to understand. For instance, discriminatory lending practices have been a barrier to home ownership among African American families. And because home ownership is an important pathway to building and maintaining economic stability, African American families have faced steeper obstacles to building wealth than white Americans.
Attitudes about Specific Issues and Solutions
Government Role and Efficacy in Protecting Economic Security
While perceptions of inequality are substantial, public discontent with public institutions is rife. Eight in 10 adults say the U.S. political system needs major improvements, including three in 10 who feel it ought to be redesigned entirely. Views of the economic, educational and criminal justice systems are almost as negative, with seven in 10 to three-‐quarters saying each needs major change. Fewer than 5 percent feel that any one of these is “as good as it can be.”
People who are more likely to see these systems as needing improvement also are more likely to see unequal treatment of groups as a serious problem, to see housing discrimination as prevalent, and to support measures to address poverty and related issues.
Assessments of the success of the government’s attempts to reduce discrimination are tepid at best. Four in 10 Americans think government programs to reduce discrimination are working well overall, including just 4 percent who think they’re working very well. Six in 10 see such programs as largely ineffective, including 16 percent who call them completely unsuccessful.
These perceptions are another important element of support for opportunity policies. In statistical modeling, seeing government programs as effective independently predicts support for a range of initiatives, including anti-‐poverty efforts and criminal justice and immigration reforms.
Implications for Racial Wealth Gap Messaging
Show concrete examples of how policy interventions have worked to address racial wealth gap issues.
When critiquing policies, make sure not to fall into criticizing government generally. Be specific about what needs to change, and who needs to change it.
Anti-poverty Programs and Policies
In terms of funding, the survey finds a division between preferences to maintain or to increase spending on four poverty-related government programs, with little constituency for cuts – albeit with sizable program-specific and group-based differences.
Spending on college loan and student lunch programs wins the most support: Forty-seven percent of Americans think funding for college loan programs should be increased and 43 percent think it should be held steady; it’s a similar 44 and 48 percent for school lunch programs. Just 10 and 8 percent, respectively, advocate cutbacks.
There’s slightly more support for cutting back on the two other items tested, “food stamps” (SNAP) and unemployment benefits, but it’s still only about 20 percent. Forty-seven and 53 percent, respectively, favor keeping spending levels on these the same; three in 10 would spend more.
Political partisanship sharply divides these views. Averaged across the four items, Democrats are 32 percentage points more likely than Republicans to support increased spending. There also are double-digit differences between racial and ethnic groups, with African Americans and Latinos more apt than whites and Asian Americans to favor higher spending on these programs.
When it comes to Americans’ priorities for various social policies intended to reduce poverty, improving public education leads the way; more than three-quarters say it should be a high priority for public policy, including 45 percent who think it should be a “very” high priority. That’s followed by some bread-and-butter items: Avoiding cutbacks to Social Security, cited as a priority by 65 percent; holding down interest rates on student loans, 62 percent; and raising the minimum wage, 52 percent.
Americans give three other areas somewhat lower priority: Forty-five, 44 and 43 percent say high priority should be given to expanding government funded job-training programs, increasing spending on infrastructure, and cutting business taxes to encourage job creation, respectively.
Again there’s substantial political partisanship on these issues, especially views of the minimum wage, job training and infrastructure spending. Democrats are more apt to favor each of the policies tested, save one – cutting business taxes to encourage job growth.
Key predictors of prioritizing anti-poverty programs – and increasing their funding – have implications for framing these issues. The most important predictor, by far, is seeing unequal treatment of poor people as a serious problem. That’s followed by the importance of group identification, seeing group inequalities as unacceptable, frequency of personal contact with diverse group members, attributing inequality to societal factors rather than to group members’ own behavior, and seeing government programs to reduce discrimination as effective.
Implications for Racial Wealth Gap Messaging
Be sure to show how the wealth gap persists even when different racial groups have the same level of education. Give the history of why this continues to happen.
Build on support for educational programs, but connect the dots to how those programs are not enough to address economic inequalities and must work with other policies.
Housing Discrimination
Housing discrimination provides a specific example of more general views on opportunity and economic inequality: the vast majority of Americans, 83 percent, believe that one or more groups face substantial bias when trying to buy or rent a home or apartment.
Such perceptions depend on the group in question. Seven in 10 adults feel that people who have served a prison sentence experience discrimination when they try to buy or rent a home, and 64 percent say the same of undocumented immigrants. Across the spectrum, just 15 and 16 percent, respectively, say the same about Asian Americans and women.
Other groups fall in the middle. Housing bias against Muslims is seen by 47 percent, against gay and lesbian Americans by 40 percent, against African Americans by 38 percent, against people with disabilities by 36 percent and against Latinos by a third. Roughly a quarter see discrimination in housing against Native Americans and single parents.
Perceptions of housing discrimination against one’s own group are highest among African American respondents, especially women, and lowest among whites and Asian Americans. For example, 69 percent of black women perceive either a great deal or substantial amount of housing discrimination against blacks, whereas just 15 percent of Asian Americans think Asian Americans experience discrimination when trying to obtain housing.
Given the overall level of concern, support for existing laws designed to prevent housing bias is broad. Just one in 10 says such laws are too strong; six in 10 think they’re about right, and three in 10 say they’re too weak. Among blacks, moreover, six in 10 say such laws are too weak.
As with other spending, the survey finds a division on whether programs intended to boost home-‐ownership and construction of affordable housing should be expanded or maintained as they are now, but very little support for reducing them. Forty-six and 44 percent, respectively, support maintaining current policies on the tax deductibility of mortgage interest payments and tax enticements to encourage development of affordable housing. Forty-three and 42 percent, respectively, say they should be expanded. Only about one in 10 favors cutting these back.
Implications for Racial Wealth Gap Messaging
Build on key audiences’ understanding of housing discrimination to point out the link between home ownership and wealth accumulation. Use this understanding to make connections to how other forms of discrimination, historic trends, and specific policies have caused the racial wealth gap to persist.
Leverage support for fair housing programs to explain how other policies work similarly to ensure fair treatment and to encourage and support economic equality.
Cross-issue Support
The Opportunity Survey reveals a great deal of cross-issue congruence. A key takeaway of this survey is the finding that views on issues are highly correlated, as is willingness to take action (detailed next) on those issues. These orientations derive from deep-seated values and experiences and often results in individuals showing similar support, or opposition, across a variety of social issues.
To examine these relationships, variables were created based on respondents’ support for each issue tested. For example, the number of individual anti-poverty policies and programs each respondent supported was tabulated, with the public then divided into groups reflecting low, moderate and high levels of support for anti-poverty initiatives overall. A similar strategy was used to group individuals by their support levels for each of the other issue categories.1
There is a strong relationship between support for anti-poverty measures and support for each of the other social issues examined, with those Americans who support the highest number of anti-poverty initiatives between 28 and 36 points more likely than those who back the fewest anti-poverty policies to support a pathway to citizenship, view housing discrimination as a problem for many groups, and support reforms to the criminal justice system. This pattern of cross-issue support is robust regardless of the issues compared, and reflects a general orientation of support or opposition across the social policies tested.
Implications for Racial Wealth Gap Messaging:
Use the audience section (below) to identify groups who are most likely to support a broad array of social justice issues, as well as those who are likely to be persuadable or skeptical on those issues.
Audience Considerations and Strategy
The Opportunity Survey findings paint a rich picture of shared core values, beliefs, and attitudes that contribute to a social justice orientation, and reveal that a significant number of groups—including the “New American Majority” of Millennials, People of Color, and Unmarried Women—can be motivated to support more equitable policies. In addition, several stand-alone findings from this research indicate that the American public is now primed to tackle a number of social justice issues in the United States and positioned to drive lasting change.
By identifying how attributes and experiences correspond with support for social justice policies and willingness to take action, the survey profiles key audiences—totaling 60 percent of the American public—that can be moved to help advance greater and more equal opportunity.
Cluster Analysis
Cluster analysis allows us to identify unique subsets of the population that are more or less apt to back social issues and be willing to take action. Using key attitudes and behaviors relating to social policy on opportunity issues, we identified six distinct population segments (Figure 2). These groups differ substantially in their values and concepts of equality, fairness, and tradition – and, in turn, in their policy preferences and openness to action.
Source: The Opportunity Survey, 2014
Core Catalysts largely represent the engaged base of the opportunity movement, while Potential Advocates, and Ambivalents represent persuadable target audiences. Taken together, these three groups represent over half of the U.S. population, and are presented in more detail below. Among the remaining groups, the Disengaged are simply less interested (14%), Skeptics lean against these issues (17%) and Resistants are more firmly opposed (10%).
Core Catalysts (19%) are the most committed to advancing equal opportunity. Including disproportionate numbers of racial and ethnic minorities and political liberals, and slightly more women than average – especially unmarried women – members of this group are the most likely to have experienced unfair treatment personally, to think it’s a serious problem and to be willing to act to address it. They have strong in-group identities, eschew tradition, reject notions of inherent superiority and are more apt than others to see people’s prosperity as linked rather than as individual outcomes. They’re also more confident they can bring about change, a precursor to taking action. Core catalysts are the only group in which equal treatment ranks first, followed by compassion and acting honorably.
Potential Advocates (18%) are less apt than core catalysts to have experienced unequal treatment but are highly attuned to it nonetheless. Including many white liberals, they broadly support an active social policy agenda, rank “equal treatment” prominently as a value and are more likely than average to attribute inequality to social conditions rather than to group behaviors. Yet they’re among the least apt to have strong in-group identities of their own and much less inclined than core catalysts to believe they personally, or groups generally, can bring about change.
Ambivalents (22%) are conflicted. Many perceive inequality of opportunity, support policies intended to address it and think it’s better when everyone has an equal chance. But they also hold some core values – including traditionalism, individualism and a stress on acting honorably – that militate against activism. They’re the oldest of the six groups on average, with numerically the highest share of women.
Demographic Groups Most Open to Racial Wealth Gap Solutions:
A number of individual characteristics are highly predictive of either support or opposition to social justice issues and policies, even when beliefs, values and experiences are held constant.
The most supportive audiences for anti-‐poverty solutions and activism are Democrats, African Americans and Latinos.
Millennials, independent voters, and unmarried women are disproportionately open to anti-‐poverty solutions.
Low-‐income Americans understand the realities of living in poverty and are interested in change, have higher levels of personal and group efficacy, and more experience of unfair treatment – all of which predict higher likelihood of being willing to take action.
In addition:
Older Americans are more likely to:
See unequal treatment as a serious problem,
View housing discrimination as widespread,
Favor greater efforts to address poverty,
Be willing to act to improve opportunities for groups, and
Say they would take specific actions on behalf of a social cause.
African Americans and Latinos are more likely to:
See unfair treatment of groups as problematic, and
Be willing to take action on behalf of groups and issues.
Support anti-‐poverty programs.
Taking Action
Americans express a willingness to take a variety of actions on behalf of greater opportunity. A majority of Americans (67%) say they are likely to talk with people they know about their views (including 8 percent who say they already do) and 62 percent say they’d sign a petition (or have done so). Those compare with 52 percent who express a willingness to boycott products or vendors in pursuit of social change, and 46 to 50 percent for contacting an elected official, volunteering with a community or political organization or donating money.2 Many fewer, just more than a third, say they’d be likely to write or post something online or in print to persuade or motivate others on behalf of a cause (36 percent), or to participate in a creative or artistic project that brings attention to the issue (34 percent). And 27 percent say it’s likely they’d take part in a protest, march or demonstration.
Notably, for each of the actions tested, far fewer indicate they’re “very” likely to participate, and, as noted, only a handful say they’ve actually done so – highlighting the gap between willingness to act and actually taking action. Understanding the top predictors of expressed willingness to get involved might help bridging that gap. Most important is frequency of personal contact with members of different groups, suggesting that personal interactions with people from different backgrounds are particularly critical in motivating action on equality issues. Those who indicate a willingness to take action in support of one issue are generally more likely to act on other issues as well.
The finding that simply being willing to talk with others about one’s views is so strongly tied to willingness to take other, more committed action suggests that convincing people to take even small steps ultimately can have a major impact. While 62 percent of the population stated willingness to sign a petition, those who expressed interest in talking to others about their views are nearly 20 percent more likely to say so. Similar differences arise relating to willingness to boycott products or vendors (52 percent vs. 68 percent), and every other type of action measured in this study. As decades of psychological research has shown, getting a person to commit to one small action makes it far easier to convince them to commit to bigger ones.
Recommendations
Segment audiences using the cluster analysis. Strategically, we do not have to speak to or convince everyone, which is good news given that we all have limited resources. Instead, we can consider where we can find and reach the Core Catalysts, Potential Advocates and Ambivalents, what kinds of messages and spokespeople motivate them, and how to move them to action.
Build messages that underscore the values that matter to target audiences, namely equal opportunity and opportunity for all. We know that people who prioritize these values are more likely to support our issues, so it’s important to keep these groups highly motivated. But it’s also important to raise the profile of these values in general so that they are consistently part of national conversations, expanding the groups of people who prioritize them.
Remind people of their own experiences of discrimination when explaining types of bias that they are less familiar with, or skeptical of. But then quickly pivot to the kinds of solutions that can protect groups from discrimination. Remember that audiences are generally worried about the efficacy of government programs and will likely need a few concrete examples of success to motivate support.
Balance audiences’ tendencies to rely on personal responsibility as a solution to social problems with reminders of our linked fates. Show the interconnected nature of our economic and cultural lives and emphasize the shared responsibility we have for each other.
Make sure to have a call to action. Even if you’re just asking people to start a conversation about racial and economic inequality, getting them to act in some way is the first step in motivating them around more in-‐depth involvement in the issue.
Structure messaging with a Value, Problem, Solution, Action approach:
Lead with values. Starting with shared values helps audiences to “hear” our messages more effectively than do dry facts or emotional rhetoric.
Introduce the problem. Frame problems as a threat to values. Include stories and statistics that are likely to resonate with the target audience. Where possible, include the cause of the problem, as well as who is responsible for fixing it.
Pivot quickly to solutions. Positive solutions leave people with choices, ideas, and motivation. Assign responsibility—who can enact this solution?
Provide a clear “ask” to your audiences that is aligned with your overarching goals.
Value: Access to an affordable home under fair terms is central to the American promise of opportunity, and to our nation’s economic security.
Problem: But misconduct by the lending industry and inadequate rules and enforcement helped to wreck our economy and deny that promise to millions of Americans.
Solution: Fortunately, solutions exist that can prevent further foreclosures and restore the American Dream. They include steps like mandatory mediation, reducing loan principal to fair market rates, and ensuring that reforms of Fannie Mae and Freddie Mac keep homeownership available to working Americans.
Action: Tell your member of Congress to work with the Administration to implement these solutions today.
Notes:
1. See Appendix D for details of these indices; the same items are used here, but as counts, rather than the average scores used in the regression analysis.
2. These items were asked of those who said, in general, that they were very or somewhat likely to take action, or already were taking action, on behalf of a group or issue. Those who did not indicate a willingness to take action in general (252 of the 2,055 respondents) are grouped in this analysis with those who indicated an unwillingness to take a particular action. Therefore, the percentages reported here reflect how many people in the population overall are willing to take each action.
On January 21, 2015, the U.S. Supreme Court heard oral arguments in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project. The case poses the question whether the Fair Housing Act will continue to prohibit housing policies that unnecessarily exclude or segregate some groups of people in practice—known as unjustified “disparate impact”—or only those motivated by intentional bigotry.
In order to assess the communications landscape surrounding the case, The Opportunity Agenda analyzed a random sample of 50 news and opinion pieces, from a total of 575 appearing in mainstream media between December 20, 2014 and January 23, 2015.1 Our analysis focused on positions taken, facts and arguments cited, and sources and spokespeople quoted, as well as overarching themes and narratives.
Major findings of the analysis include:
The large majority of opinion pieces supported disparate impact.
The majority of quotes were pro-‐disparate impact and, aside from the Justices and litigants, the majority of sources interviewed were fair housing proponents.
News articles framed the opposing interests in the case as Civil Rights groups and the Obama Administration versus Big Banks, Conservative groups, and the State of Texas.
Coverage reflected the fact that disparate impact is a longstanding principle, embraced by HUD and every court of appeals to consider the issue.
Reporters routinely misconstrued how disparate impact works, or shorthanded it in a harmful way—suggesting that any unequal outcome would violate the Fair Housing Act. This occurred even in many otherwise friendly articles.
Almost every article that we reviewed depicted the Supreme Court’s decision to consider the issue as an ominous sign, likely to result in a weakened Fair Housing Act.
The “Why” of disparate impact was often missing from journalistic coverage—there was little explanation of why this principle matters from a values or impact perspective.
There were very few descriptions of the practical applications or benefits of the disparate impact standard, and even fewer involving “real people.” The few that did appear were compelling.
Opinion pieces, by contrast, were strong on both values and implications.
Articles mentioned only the racial implications of the Act, omitting the other types of discrimination that it prohibits.
There was no indication from reporting or commentary that an adverse Supreme Court decision might be corrected through legislative action.
Based on these findings, our primary recommendation for fair housing proponents going forward is to communicate a clear and compelling narrative that: lifts up the values of equal opportunity, common sense, and the national interest advanced by the Act; offers compelling examples and human stories that illustrate systemic causes and shared benefits; discusses the persistence of segregation; explains in plain language how the disparate impact approach actually works; details the characteristics other than race that the Act also covers; and lays the groundwork for a legislative fix, if necessary at the federal, state, and local levels.
DETAILED FINDINGS
Arguments, Facts and Narratives:
Pro-‐disparate impact voices and arguments dominated the discourse in our random sample. Supportive quotes outnumbered opposing ones in the news articles surveyed, and opinion pieces were overwhelmingly on the side of preserving disparate impact. Only two of the nine opinion pieces in our sample opposed the principle.
Most articles defined the opposing camps in the case as Civil Rights groups and the Obama Administration on one side, and Big Banks, Conservatives, and the State of Texas on the other. Insurance companies were also mentioned frequently, while there was little or no mention of landlords or real estate companies. Some articles noted that a number of states filed a bipartisan friend-‐of-‐the-‐court brief supporting disparate impact. And several articles reference supportive commentary by Senators Elizabeth Warren (D-‐MA) and Tim Kaine (D-‐VA).
Almost all stories noted that the disparate impact standard is a longstanding principle recognized by every court of appeals to consider the question.
Most stories stated or suggested that the disparate impact standard is vulnerable at best and doomed at worst, with civil rights voices most frequently articulating that idea. Most stories similarly made clear that eliminating that cause of action would “limit,” “narrow the scope,” “weaken” or “gut” the Act’s current protections. And several stories mentioned recent Supreme Court cases weakening the Voting Rights Act and Title VII of the 1964 Civil Rights Act.
Many stories included the idea that the Supreme Court aggressively reached out to take this case, noting that the Court has granted review on the same issue twice before, only to see the cases settled before argument. Several stories asserted that the Obama Administration had a hand in at least one of those settlements.
Many stories mentioned that the U.S. Department of Housing and Urban Development (HUD) supports disparate impact and recently issued regulations to implement the principle. One suggested, incorrectly, that the HUD regulations created the principle.
Opinion pieces more frequently carried a clear values statement, connecting The Act and disparate impact to our national aspirations and interests. For example:
“Fair housing is a bedrock civil rights principle that is needed to ensure the promise of equal opportunity for all.” (Barbara Arnwine, To realize Dr. King’s dream, promote desegregation, MSNBC, January 18, 2015).
“The availability of a safe, affordable home is part of the American dream, and we should be working to see that dream become a reality for all Americans.” (Tim Kaine statement on Supreme Court hearing on housing discrimination case, Augusta Free Press (online), January 21, 2015).
The vast majority of stories described the Fair Housing Act, the disparate impact standard, and the Inclusive Communities case as about race. Exceedingly few mentioned the other characteristics covered by the Act—color, national origin, gender, religion, disability, or family status.
Reporters routinely misconstrued how disparate impact works, or shorthanded it in a harmful way—suggesting that any unequal outcome would violate the Fair Housing Act. This occurred even in many otherwise friendly articles. Examples include:
“The suit couldn’t prove intent, but it was successful in showing that blacks and other minorities were disproportionately affected by the housing agency’s policies….The Dallas non-‐profit cited a legal argument called ‘disparate impact.; This means ICP doesn’t have to prove intentional racial discrimination, only that the result hurt a protected group.” (Doualy Xaykaothao, Dallas housing discrimination case takes center stage at U.S. Supreme Court, KERA News, January 21, 2015)
“…disparate impact claims, which are allegations made based on neutral practices that may have a discriminatory effect—thus allowing litigation to be brought for discrimination even when there is no discriminatory intent.”
“The justices will weigh whether the Fair Housing Act bars only intentional discrimination, or whether discriminatory effects, regardless of intent, are illegal too.” (Catherine Dunn, Supreme Court could limit discrimination claims in fair housing case, International Business Times, January 21, 2015).
“In other words, America’s highest court is going to decide if companies and policies can be accidentally racist.” (Melvin Backman, Can you discriminate without meaning to? The US Supreme Court will decide, Quartz, January 21, 2015.)
A few stories did, however, set out the proper standard. A standout article in this and many other respects was one by Nikole Hannah-‐Jones of ProPublica: “For four decades, federal courts have held that the law should be interpreted more broadly, ruling again and again that if the policies of governmental agencies, banks or private real estate companies unjustifiably perpetuate segregation, regardless of their intent, they could be found in violation of the Fair Housing Act.…Landlords or lenders who implement policies or practices that disproportionately impact racial minorities can be found in violation of civil rights law if they cannot justify those practices—even if no one can show they acted out of racial animus.” (Nikole Hanna-‐Jones, US Supreme Court’s latest race case: Housing discrimination, Money Life, January 22, 2015).
Opinion pieces on both sides generally provided an accurate description as well, e.g.:
“Those challenges are only successful if the defendant in such a case does not have a substantial justification for their policy or if there is an alternative policy that would also serve that interest without resulting in a disparate impact.” (Barbara Arnwine, To realize Dr. King’s dream, promote desegregation, MSNBC, January 18, 2015).
Some stories mentioned as a justification for disparate impact covert and subtle (intentional) discrimination that is difficult to prove and, therefore, requires the disparate impact standard. A widely published AP story, for example, notes, “fair housing advocates say eliminating such claims means courts will recognize only the crudest forms of intentional discrimination and not more subtle forms of bias that persist today.” (Sam Hananel, Supreme Court sharply divided over housing bias cases,” Associated Press, January 21, 2015).
A Los Angeles Times editorial also offered a succinct and persuasive case: “This is a reasonable and nuanced response to the fact that while residential segregation in the U.S. has declined, black Americans still live apart from whites in significant numbers as a result of myriad factors, including exclusionary zoning, poverty and countless transactions rooted in racial bias but difficult to prove in a court of law. As Justice Ruth Bader Ginsburg observed: ‘There was a grand goal Congress had in mind. It meant to undo generations of rank discrimination.’” (Editorial: Discrimination is discrimination even if it’s not intentional, Los Angeles Times, January 22, 2015).
Very few stories described concrete examples of the disparate impact standard in action. Again, an exception is Nikole Hanna-‐Jones’s ProPublica piece, which provided one of the most compelling examples: “A fair housing group used disparate impact to topple a ‘blood relative’ ordinance passed by nearly all-‐white St. Bernard’s Parish in the wake of Hurricane Katrina. The ordinance barred homeowners from renting to anyone who was not kin. Civil rights lawyers were convinced officials passed this law to keep out black renters, but could not prove racist motivations. But when St. Bernard’s Parish could not come up with a plausible justification for the ordinance, a court struck it down.” (Nikole Hanna-‐Jones, US Supreme Court’s latest race case: Housing discrimination, Money Life, January 22, 2015).
Other exceptions to this trend are mentions of how the federal government used the Act to hold big banks accountable, and references to how “unrest” in Ferguson, MO, might relate to housing discrimination.
A number of stories cited the State of Texas’s contention that complying with the disparate impact standard will require governments and companies to make “race-‐conscious” decisions to avoid liability. No story discussed this idea in any depth, however.
Very few of the journalistic pieces that we reviewed discussed the persistence of residential segregation in the 21st century.
By contrast, supportive op-‐eds and commentary described both the benefits and the harms. For example:
Richard Rothstein of the Economic Policy Institute described at length the implications of disparate impact and residential integration for public education. (Valerie Strauss: A Supreme Court case that public education advocates should be watching, Washington Post Answer Sheet, January 13, 2015 (Republishing a piece from the EPI website)).
Senator Elizabeth Warren wrote that “the wrong decision would reduce economic opportunities for working families and raise the risk of another financial crisis,” and that “Housing segregation has a powerful impact on opportunities to build economic security….Data show that lower-‐ and middle-‐income families living in more segregated communities have a harder time climbing the economic ladder.” (Stephanie Condon, Elizabeth Warren warns Supreme Court may continue “assault” on civil rights, CBS News, January 22, 2015 (quoting extensively from Warren’s Washington Post op-‐ed).
There were very few stories in news or opinion pieces of “everyday” people affected by Disparate Impact, or by the Act generally. The few exceptions to this were compelling, however.
In a radio story, Doaly Xaykaothao interviewed Lupe Gutierrez, a woman “who’s been helping minorities find housing for years.” Gutierrez voiced the commonsense nature of disparate impact, as well as the human consequences: “She says building new low-‐ income housing in already poor neighborhoods doesn’t make sense. ‘Yes, because they’re still stuck in the same place,’ she says. She’s had a hard time moving low-‐ income families out of South Dallas….’They want to help us,’ Gutierrez says. ‘They want us to become better persons or live in a better community, but if you’re low income, hello, you don’t have funds? And to fight against a developer, who has the upper hand?” (Doualy Xaykaothao, Dallas Housing Discrimination Case Takes Center Stage at U.S. Supreme Court, KERA News, January 21, 2015).
A local Ohio television station profiled Vonda and Eric Williams, a Toledo couple who experienced disparate impact discrimination—they “were denied a home loan because Vonda was pregnant, and would soon be on maternity leave,” despite having the resources to pay the mortgage — and were activated by the experience. The piece describes the personal impact on the couple, their use of the Fair Housing Act, and their activism to see the Act preserved for others:
“’It was upsetting to know that despite planning, and saving money and still being paid while on maternity leave that they would discount my income’
….Sitting at home thinking about what we could have lost, I just felt like I needed to talk to someone to figure out what we could do because it just didn’t feel right’….So they went to the Toledo Fair Housing Center in Toledo, took the case to court and after a lengthy process, proved the family was discriminated against. Proving disparate impact is what helped the Williams, which is why the couple and [fair housing advocate Diana] Patton are going to Washington…. It’s exciting for us to be a part of history, but it’s more important to be able to help others that may encounter any discrimination.’” (Ali Hoxie, Toledo couple headed to Washington D.C. for Supreme Court decision on Fair Housing Regulations).
When stories described the facts of the Texas case, they generally did so in sympathetic terms, e.g.:
“The Inclusive Community [sic.] Project argues that Texas was approving tax credits for low-‐income housing only in heavily African-‐American neighborhoods of Dallas, and denying tax credits in white neighborhoods. That approach, they say, has prolonged the city’s racial segregation, making it harder for poor blacks to have a shot at upward mobility.” (Zachary Roth, Roberts Court could cripple another key civil rights law, MSNBC, January 19, 2015).
“Using statistical evidence to back up its argument, the group contends Texas officials are doing a form of red-‐lining, the finance practice that directs or limits minorities in the housing market to neighborhoods populated by the same ethnic group.” (Ray Gronberg, City weighing in on federal housing case, Herald Sun, Dec. 29, 2014).
The Inclusive Communities Project, which advocates for integrated neighborhoods, has criticized the state’s approach as limiting low-‐income black families from being able to move to areas with better opportunities. (Catherine Dunn, Supreme Court could limit discrimination claims in fair housing case, International Business Times, January 21, 2015).
“The latest case involves an appeal from officials accused of awarding federal housing tax credits in a way that steered low-‐income housing to mostly poor, black neighborhoods in Dallas and generally kept the units out of wealthier white enclaves.” (Sam Hananel, Scalia could be surprise vote in Supreme Court housing case, Atlanta Journal-‐Constitution/AJC.com, January 21, 2015).
“Housing advocates say the program concentrates poverty by putting too many developments in poor, minority areas and too few in wealthier, whiter neighborhoods.” (Melvin Backman, Can you discriminate without meaning to? The US Supreme Court will decide, Quartz, January 21, 2015).
A number of stories noted Dr. Martin Luther King Jr.’s role in the birth of the Act, and the fact that the case was argued just after the holiday celebrating his birth.
Quotes in news stories tended to lack statements about the role of the Fair Housing Act in fulfilling our national values or goals. An exception is John Relman’s widely quoted statement that “Housing lies at the fulcrum of civil rights….Where you live affects the opportunities that you have for jobs, for better schools, for connections that allow you to have opportunity in your life.”
Quotes and Sources:
The large majority of sources quoted were supporters of the disparate impact standard. Individuals quoted most frequently included fair housing attorney John Relman, Sherrilyn Ifill of the NAACP Legal Defense and Educational Fund, Myron Orfield of the Institute on Metropolitan Opportunity at the University of Minnesota, and Professor Ian Haney Lopez of UC Berkeley Law School.
In post-‐argument reporting, the Justices’ comments from the bench were most frequently quoted:
Justice Scalia received the most attention, noting his apparent “skepticism” of Texas’ arguments in light of the text of the Act as amended in 1988. Justice Scalia’s question to Petitioners’ counsel, “Why doesn’t that kill your case?” was widely quoted. Several articles also noted that Justice Scalia critiqued the Inclusive Communities Project’s position, stating that “racial disparity is not racial discrimination,” and “the fact that the NFL is largely black players is not discrimination.”
Several stories quoted Justice Breyer for the proposition that disparate impact is a longstanding doctrine upheld by 11 Courts of Appeals, and “as far as I can tell, the world hasn’t come to an end.”
A few articles cite Chief Justice Roberts’s, assertion that it’s difficult to distinguish “good” from “bad” housing decisions under the disparate impact doctrine.
Justice Kennedy’s comment that it “seems very odd” that two jurisdictions could be potentially liable for placing affordable housing in either a predominantly white or a predominantly minority neighborhood received some press attention.
Some pieces cited Justice Ginsburg’s comment that Texas’s argument was “a little artificial” because disparate impact theory was not “mainstream” until the Supreme Court approved its use for employment discrimination cases in 1971.
Courtroom statements by the oralists (Scott Keller, Michael Daniel, and Solicitor General Donald Verrilli) were also frequently quoted in post-‐argument coverage, often as foils for the Justices.
Other sources quoted were predominantly elected officials, such as Senators Warren (D-‐MA) (pro) and Kaine (D–VA)(pro), Congressman Randy Neugebauer (R-‐Texas) (con), Durham, NC City Attorney Patrick Baker (pro), Texas Attorney General Greg Abbott (con), and Congresswoman Maxine Waters (D-‐Calif.) (pro).
Images
While we did not analyze the imagery used in broadcast media or newsstand editions of articles, we did perform a basic review of images accompanying the online versions of the 50 randomly selected stories.
Most of the online versions did not include a photo. Those that did used mostly neutral imagery:
The plurality of images were of the U.S. Supreme Court building with no identifiable individuals present.
Several pieces included an image of the front door of the Texas Department of Housing and Community Affairs.
Opinion pieces by Senators Elizabeth Warren and Tim Kaine carried those Senators’ images.
Two pieces featured photos of Supreme Court Justices.
One photo featured a row of apartment buildings.
Only two photos included an obvious narrative element:
One photo included pro-‐disparate impact demonstrators in front of the Supreme Court with signs reading “Keep Housing Fair.”
An opinion piece carried a black and white AP photo of a “white mob that greeted a black Philadelphia family that attempted to move into an all-‐white housing development in 1963.”
Implications and Recommendations:
Mainstream media coverage of Inclusive Communities during the period that we studied was, on the whole, positive for Fair Housing supporters. The case garnered over 500 stories, most of which featured pro-‐disparate impact quotes and spokespeople. Op-‐eds and other commentary were overwhelmingly favorable and many stories cast unpopular big banks and insurance companies as the chief enemies of disparate impact.
Supportive opinion pieces carried strong justifications of disparate impact on moral, factual, and legal grounds. At the same time, however journalistic coverage, lacked a common fair housing narrative rooted in shared values and societal benefits in reporting or commentary, and harmfully distorted how disparate impact works in practice. Audiences relying solely on these media outlets for information about the issue might be hard pressed to understand why the issue matters, or what the consequences of an adverse decision might be.
Accordingly, our main recommendation for fair housing advocates and allies is to communicate a more coordinated and compelling narrative, that includes:
How addressing unjustified disparate impact advances our nation’s shared values of equal opportunity for all, common sense, and the national interest.
The societal harm caused by contemporary housing segregation and exclusion.
The benefits of diverse, inclusive, and prosperous communities fostered by the disparate impact approach.
Compelling examples and human stories that illustrate those systemic causes and solutions.
A plainspoken, accurate explanation of how the Fair Housing Act works, with an emphasis on unjustified disparate impact and knocking down unnecessary barriers to fair housing.
The characteristics other than race—religion, gender, family status, disability, and national origin—that the Act also covers.2
For the existing base of fair housing supporters, it will also be important to lay the groundwork for a legislative fix, if necessary, at the federal, state, and local levels.
Also important going forward will be:
Continuing to flood the media with pro-disparate impact stories, spokespeople, and commentary. The Associated Press and Reuters have, thus far, occupied a large share of the news hole – and should, therefore, receive disproportionate attention. ProPublica is also influential, and has featured stellar reporting thus far.
Gathering and disseminating images that illustrate the narrative principles described above.
Encouraging additional supportive statements from business, faith, and bipartisan elected leaders.
Preparing communications responses now for the different ways in which the Court might decide the case.
Using social media (#KeepHousingFair) as well as ethnic media, progressive media, and community organizing to rally the base in advance of decision day.
Notes:
1. We identified the larger pool of articles through a search of the Critical Mention database using the following search terms: (“disparate impact” OR “Texas Dept. of Housing and Community Affairs” OR “Inclusive Communities Project”) AND “housing.” We then identified 50 articles for content analysis using a random number generator.
2. The Opportunity Agenda’s Pre-‐Argument Messaging Memo on the Inclusive Communities case discusses many of these elements in greater detail.
The Opportunity Agenda wishes to thank and acknowledge the many people who contributed their time, energy and expertise to the research and writing of these reports on deep and persistent poverty. Our sincerest gratitude goes to the leaders and experts in the field with whom we consulted. The Media Analysis and the Meta-Analysis of Public Opinion were researched and written by Loren Siegel. The Social Media Analysis was researched and written by Jill Mizell and Jhanidya Bermeo. It was edited by Ellen Braune and Eleni Delimpaltadaki Janis of The Opportunity Agenda. We also want to express our great appreciation to Christopher Moore who designed, Jill Bailin who edited, and Margo Harris who proofread all three reports. Special thanks to Carol Schlitt who managed the project.
The Opportunity Agenda’s research on deep and persistent poverty is funded by the JPB Foundation, with support for additional research from The Leadership Conference on Civil and Human Rights, The Libra Foundation, and the Open Society Foundations. The statements made and views expressed are those of The Opportunity Agenda.
Access to an affordable home under fair and sustainable terms is central to the American promise of opportunity, a source of security and pride. But years of misconduct by banks and lenders, inadequate rules and enforcement, and record unemployment have ravaged the ideal of Home Opportunity that is integral to the American Dream. Rebuilding that dream is in our national interest and crucial to our economic recovery.
Though it has been over five years since the economic collapse and commencement of the Great Recession in 2008, the recovery is far from complete and has failed to be equitable for all Americans. As of November 2013, there were approximately 812,000 homes in some stage of the foreclosure process.1 The number represents a significant drop since the preceding month and year, and indicates improvement in the housing market.
However, there are still millions of Americans who are at risk of losing not only their material assets and savings, but their homes as well. The massive loss of homes, moreover, means families uprooted, children disconnected from their schools and communities, and senior citizens’ economic security destroyed. It hampers employment, education, public safety, and our nation’s broader economic recovery.
In November 2013, there were 46,000 completed foreclosures, new foreclosure filings on 113,454 properties, and approximately two million mortgages that were in delinquency, defined as 90 days or more past due.2 In addition, as of December 2013, there are 9.3 million homes that are deeply underwater, meaning that the combined loan amount secured by the property is at least 25 percent higher than the property’s market value.3 Even as the housing market improves, the Obama administration cautions that the economic recovery remains fragile.4
Furthermore, the recovery has not reached all Americans. Unequal opportunity and racial discrimination by banks, brokers, and others continue to disproportionately harm communities of color. According to a study released in May 2013 by the Alliance for a Just Society, communities that are majority people of color experienced foreclosures at almost double the rate of predominantly white communities. Families in communities of color suffered a loss of wealth on an average of 30 percent higher per household. While some wealth has been regained since the beginning of the crisis, it has mostly been through the stock market, and thus, affluent Americans are disproportionately benefiting from the recovery. As a result, communities of color are being left behind.5
The impact of the crisis has not been limited to homeownership. According to a report by the U.S. Conference of Mayors, the number of renters affected by foreclosures has tripled since the beginning of the crisis. An estimated 20 percent of foreclosures are in rental properties, and 40 percent of families facing foreclosure-related evictions are renters. This translates into millions of Americans at risk of homelessness, many of whom are children.6 In addition, there is still residential discrimination and segregation throughout the country. This historical legacy concentrates economic downturns into particular communities and as a result, the crisis hits African Americans and Latinos with strong force.7
In response, experts and affected communities have worked together to identify a range of practical solutions to this troubling reality. Their efforts have focused on stemming foreclosures, restoring communities, protecting fair housing, and assuring that homeownership remains an accessible pathway to American opportunity. In early 2012, The Opportunity Agenda and its partners proposed a Compact for Home Opportunity that assembled and explained the most promising of those solutions in plain terms. The Compact is intended to propel these much-needed proposals into the public and political discourse and to inform concrete policymaking.
This report updates the status of the Compact’s recommendations from May 1, 2013 to December 1, 2013, and includes major developments in December 2013. It documents the progress that was made around the country in adopting and implementing these proposals. As to each recommendation, we provide an overall update, as well as specific actions taken—or not taken—by such relevant actors as the Obama administration, Congress, states and municipalities, and the lending industry. This update supplements two prior ones that covered February through August of 2012 and September 2012 through May 2013, respectively. The previous updates were released in January 2013 and August 2013.
As we describe below, there was significant progress, as well as frustrating delay, and even regression, by some actors. Positive developments include the confirmation of Mel Watt, a longtime champion of consumer protection and civil rights, as head of the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac; Richmond, California, and other cities using the power of eminent domain to purchase and refinance mortgages; federal regulators’ proposal of a new Qualified Residential Mortgage rule that lowers the down-payment requirement and benefits low- to middle-income borrowers; Nebraska’s enactment of a land bank law; localities increasingly passing vacant property registration legislation; Utah’s homelessness prevention program; the U.S. Department of Housing and Urban Development’s proposal of a rule on Affirmatively Furthering Fair Housing; coordination and success on equal opportunity enforcement; the Consumer Financial Protection Bureau’s roll-out of new mortgage servicing rules; and increased use of inclusionary zoning by cities across the country.
However, there was a lack of progress, and even regression, on several important solutions, such as making mediation a mandatory part of the foreclosure process, requiring principal corrections, refinancing legislation, positive reform of Government-Sponsored Enterprises, ensuring consumer readiness, and supporting community development and homelessness prevention programs. Congress has been particularly recalcitrant, ignoring multiple opportunities to help stem foreclosures, restore communities, protect fair housing, and assure that homeownership remains accessible. At this critical moment in time, this status report provides a roadmap to the progress made, and the work still to be done.
Breaking Developments
This report covers developments from May 1, 2013 to December 1, 2013, and includes major developments in December 2013. While a future report will discuss in detail developments in 2014, we note here several important items that occurred as this report was going to press.
On January 6, Mel Watt was sworn in as the new director of the Federal Housing Finance Agency. One of his first actions was to delay a proposed increase in the fees that Fannie Mae and Freddie Mac charge lenders to guarantee mortgages. The increase had been announced by former Acting Director Edward DeMarco and would have gone into effect in March and April, making mortgages more expensive. The “g-fees,” which would have been increased by 0.1 percent, are usually passed on by lenders to borrowers.8
In January 2014, Congress allowed the Mortgage Forgiveness Debt Relief Act to expire. This means that, for the first time since 2007, people who have had their homes foreclosed upon will have to pay income taxes on forgiven debt that was accumulated due to a mortgage. Congress allowed this benefit to expire despite an estimate from the National Association of Attorneys General that 7.1 million homes with mortgages, 14.5 percent of the national total, are still in negative equity.9
On January 29, the House of Representatives passed farm subsidy and nutrition program legislation that would cut $8.6 billion from the Supplemental Nutritional Assistance Program (SNAP or “food stamps”).10 The legislation does not contain the originally proposed work and drug testing requirements for SNAP recipients; however it would effectively cut $90 in monthly food aid for approximately 850,000 households. Anti-hunger advocates warned that it would eliminate 34 meals per month for the affected households, and critiqued the legislation as corporate welfare at the expense of struggling families.11 On February 4, the Senate passed the legislation and President Obama, on February 7, signed it into law.12
On January 9, President Obama announced five of the areas that will be part of the “Promise Zones” Initiative to help restore communities particularly hard hit by the Great Recession. The areas include San Antonio, Los Angeles, Philadelphia, Southeastern Kentucky, and the Choctaw Nation of Oklahoma. As part of the initiative, the federal government will give the communities preferential consideration for 25 federal grant programs and provide technical assistance to help them realize their economic revitalization plans. The plans include expanding affordable housing as well as bolstering adult education, job training, and early literacy programs.13
In January 14, 2014, Chicago Mayor Rahm Emanuel proposed a five-year plan to increase housing opportunities and community development. The plan, which Emanuel introduced to the Chicago City Council, would invest $1.3 billion to rebuild, rehabilitate, and preserve 41,000 housing units, 75 percent of which would be reserved for Chicagoans who earn 60 percent of the local median income, or $44,000 for a family of four. The plan also includes putting 8,000 vacant and foreclosed properties back on the market by using vacant properties for residential development, community gardens, or allowing residents to expand their private yards by purchasing adjacent vacant lots. In addition, the City would encourage banks to offer better foreclosure prevention counseling and neighborhood lending in distressed neighborhoods, and expand affordable housing units in mixed-income communities to low-income renters and recipients of welfare services. Nevertheless, multiple Council members, affordable housing advocates, and housing voucher holders state that the plan does not go far enough and fails to address the City’s most vulnerable communities. They call for an amendment to the plan that would provide for more oversight of the Chicago Housing Authority as well as a “one-for-one replacement” of public housing units that the City demolishes.14
On January 17, 2014, President Obama signed a $1.1 trillion budget that keeps the government funded until September 2014. The budget cuts $687 million from the Department of Housing and Urban Development and leaves it with $32.8 billion in 2014. This allocates $40.1 million for the Fair Housing Initiative, which provides assistance to victims of housing discrimination; $90 million for the Choice Neighborhoods Initiative, which aims to transform distressed areas of poverty into viable and sustainable mixed-income neighborhoods through a variety of public services and improvements; $2.1 billion for Homeless Assistance Grants; $330 million for Housing Opportunities for Persons with AIDS; $3.03 billion for Community Development Block Grants; and $1 billion for the HOME Program, which provides grants to state and local governments to fund housing programs that address local needs and priorities.15
In mid-January of 2014, U.S. Rep. Frank Pallone (D-NJ), announced that the Inspector General of HUD was investigating whether New Jersey Governor Chris Christie misused Superstorm Sandy relief funds for political benefits during an election year.16 There have been multiple controversies related to New Jersey’s use of federal funds after the storm. The Fair Share Housing Center revealed, via a lawsuit against the state for public records, great disparities among the rates of assistance received by African Americans and Latinos as opposed to whites. According to state documents, 38.1 percent of African Americans and 20.4 percent of Latinos were rejected from receiving settlement grants, compared to 14.5 percent of whites; while 35.1 percent of African Americans and 18.1 percent of Latinos were rejected from reconstruction or rehabilitation grants.17
In two separate cases, trade groups representing homeowners’ insurance companies filed suit against HUD in federal court. They claim that the federal agency lacked the authority to promulgate its disparate impact rule, which allows and strengthens disparate impact claims under the Fair Housing Act. There is a possibility that the cases will, because of the issues involved, reach the U.S. Supreme Court.18
Acknowledgments
This report was authored by Diego Iniguez-Lopez, Robert L. Carter Fellow at The Opportunity Agenda, and Beverly Prewitt, Jacob Wentworth, and James V. Williams, III at Schulte Roth & Zabel LLP. Special thanks to those who contributed to the analysis, review, and editing of the report, including Megan Haberle, former Economic Opportunity Fellow and Associate Counsel at The Opportunity Agenda; Deidre Swesnik, Director of Public Policy and Communications at the National Fair Housing Alliance; Debby Goldberg, Special Project Director at the National Fair Housing Alliance; and James Carr, Distinguished Scholar at The Opportunity Agenda. This report was designed and produced by Christopher Moore and Jill Bailin.
Additional thanks to those who worked on the previous Compact for Home Opportunity and the original January 2013 status report and the August 2013 status report, including Annie J. Wang, former Robert L. Carter Fellow and Associate Counsel at The Opportunity Agenda; Michael Folger, Skadden, Arps, Slate, Meagher & Flom LLP; Patrick Ryan, Columbia School of Law class of 2015; Zachary Waisman, Georgetown University Law Center class of 2015; Mary-Ann Awada, Cornell Law School class of 2014; Megan Haberle, former Economic Opportunity Fellow and Associate Counsel at The Opportunity Agenda; James Carr, Distinguished Scholar at The Opportunity Agenda; Nikitra Bailey, Executive Vice President at the Center for Responsible Lending; Debby Goldberg, Special Project Director at the National Fair Housing Alliance; and Jose Garcia, former Policy Fellow, Wealth-Building Policy Project at the National Council of La Raza.
The Opportunity Agenda’s Home Opportunity initiative is funded with support from the Ford Foundation, Open Society Foundations, Annie E. Casey Foundation, W.K. Kellogg Foundation, and The JPB Foundation. The statements made and views expressed are those of The Opportunity Agenda.
The case of Mount Holly v. Mount Holly Gardens Citizens in Action, which was scheduled for oral argument on December 4, 2013, has been settled by the parties. However, the question posed by the case – whether the Fair Housing Act prohibits the full range of discriminatory obstacles to housing, or only those that a court finds to be motivated by subjective discriminatory intent – is likely to be an ongoing point of contention. Over the Act’s 45-year history, lower courts and the Department of Housing and Urban Development have consistently held that it outlaws both intentionally discriminatory acts and policies or practices that have an unnecessary or unjustified “disparate impact,” based on certain covered characteristics—race, color, religion, sex, disability, familial status, or national origin.
The parties—a New Jersey township and residents of a minority community that the township largely demolished to develop much more expensive housing—have chosen to settle the matter for the benefit of all. This memo offers recommendations for communicating about underlying issues as well as the benefits of the resolution of the case. The memo is intended for use by supporters of a full and robust reading of the Fair Housing Act that includes disparate impact claims.
Specific Talking Points on the Settlement:
The settlement resolves the matter in a way that benefits the town and all of its residents:
That unifies the parties;
That makes clear that Gardens residents, like everyone in the town, are valued members of the community;
That advances the town’s goals for redevelopment and greater economic prosperity;
That expands housing opportunities for everyone.
This settlement upholds fair housing and the basic American values of equal opportunity that benefit everyone in our nation.
Re disparate impact: It’s common sense that arbitrary and unnecessary barriers to equal housing opportunity should be set aside in favor of approaches that serve all people fairly. This has been established law for decades, and it was recently reaffirmed by the Department of Housing and Urban Development. That continues to be the case in light of this settlement.
Framing and Narrative
We believe the resolution of this case should be framed in terms of America’s interest in protecting equal opportunity and freedom from discrimination for everyone, a responsibility that benefits all of us and is shared by cities and states around the country. We should describe as common sense the notion that all forms of avoidable housing discrimination should be set aside to allow more fair and effective solutions. For example, “policies that serve no important purpose, yet discriminate in practice, should fail under the Fair Housing Act.” Where appropriate, we should discuss the continuing need for the disparate impact standard by making visible the structural and institutional barriers to fair housing, like zoning ordinances that prohibit the building of smaller homes or apartments that working people can afford, which in many places excludes most people of color.
We recommend breaking the stereotype of minority communities as inherently “blighted” by lifting up a positive image of Mount Holly Gardens, the community at issue in this case. In their Supreme Court brief, Gardens residents described their neighborhood as a “close-knit” and “cohesive community … with unusually high rates of minority home-ownership.”
Opponents of fair housing laws have already begun to portray the settlement of the case inaccurately as an attempt to “buy” a better resolution of the case than could have been achieved in court. Rather than repeating or “mythbusting” that flawed argument, we should tell our affirmative story.
For example:
“This case was about the obligation of cities and towns to protect equal opportunity in housing. That includes avoiding unnecessary policies that discriminate in practice, as well as those that are intentionally discriminatory. Mount Holly did the right thing by devising a resolution that works for all.”
“The resolution of this case will benefit all residents of the township as well as protecting fair housing principles core to the intent of the Fair Housing Act.”
“Settlement in this case reinforces the well-established understanding that the Fair Housing Act prohibits discrimination in practice, as well as discrimination by design. That’s been the law for over 45 years, and we’re confident that it will remain the law.” Note: Opponents will similarly describe the disparate impact standard as affirmative action (which it is not), as well as “racial bean counting” and closet “quotas.” With the public and the media, it is important to avoid arguing within that frame, but rather, to use our own frame of a resolution that protects fair housing and equal opportunity for all.
“If a policy unnecessarily impacts people of a particular racial or ethnic group, or families with children, for example, it’s common sense that it should be set aside in favor of one that accomplishes the same goal fairly, effectively, and without discrimination. That’s been the law for over forty years, and it’s appropriate that it will continue to be the law.”
“Governments have a responsibility to ensure equal opportunity and freedom from discrimination for everyone. That requires watching how different policies play out on the ground. When a city or town has evidence that a particular policy (such as the proposed redevelopment plan) is likely to be discriminatory, it has a responsibility to reexamine or abandon that process and find one that’s fair and effective.”
Facts of the Case:
Q: What happened to start the case?
A: The case involves a redevelopment plan for a cohesive Mount Holly neighborhood (“the Gardens”), containing the only predominately minority population in the Township. The redevelopment plan would have demolished the neighborhood to build new dwellings that few of the current residents would have been able to afford, thus excluding most of the town’s minority residents. For this reason, the Gardens’ current residents sued, arguing that the redevelopment plan violated the Fair Housing Act. The district court dismissed this argument, and the court of appeals reversed the lower court’s ruling, holding that the residents had established that they would experience an unlawful “disparate impact” under the redevelopment plan.
Q: What is the significance of the Fair Housing Act today?
A: The Fair Housing Act represents our national commitment to equal opportunity for all. The Act is critical because, despite the progress that our country’s made, discrimination and segregation still persists in many communities around the nation. Those harms hold us back as a nation, and they prevent millions of Americans from accessing housing.
That, in turn, often worsens their access to quality education, employment, public services, and a healthy environment, among other opportunities. Congress recognized this when it passed the Fair Housing Act, and has since reaffirmed this determination. Today, the Fair Housing Act continues to protect Americans of all races, religions, abilities, and families from discrimination and segregation in housing.
Q: Why is disparate impact liability such an important part of the Fair Housing Act?
A: The Fair Housing Act recognizes that actions that have the consequence of perpetuating exclusion and unequal access to housing can be just as harmful to society as intentionally discriminatory acts.
Q: Won’t this settlement rob the Court and the nation of the chance to consider what the Fair Housing Act says in this situation?
A: Settling cases through mutual agreement of the parties is an established and effective way of resolving legal disputes. The Supreme Court’s role, as required by the U.S. Constitution, is to take up only active controversies. When the parties come to an agreement, as they were able to do here, there’s no case to be decided. That’s how our legal system has always operated, and, in this case as in many others, it serves the interests of justice.
The meaning of the Fair Housing Act, and its coverage of all unjustified barriers to fair housing, are clear and well-established over more than four decades. In fact, the U.S. Department of Housing and Urban Development just reaffirmed that through federal regulations. So the law is clear, and it continues to protect the rights of all Americans throughout our nation.
Q: What are the terms of the settlement?
A: The terms of the settlement include the construction of 44 new emerging market homes on an expedited schedule within Mount Holly Gardens. 20 of these 44 houses will be provided to current residents of the Gardens in exchange for allowing the redevelopment of their existing homes, at no adverse economic consequence to them. Existing residents will have the right to remain in their community pending the development of the new homes, and seven households that have chosen to relocate out of the neighborhood will be compensated. The remainder the of Gardens development will move forward, creating additional new homes as well as commercial and retail development that will provide significant economic benefits to Mount Holly Township.
Q: What is the impact of the settlement?
A: The disparate impact standard continues to be an important tool in the effort to combat housing discrimination.
Q: Who paid for the settlement?
A: TRF Development Partners, Inc., a Philadelphia-based leader in neighborhood revitalization and supporter of community development in New Jersey for decades, will develop the 44 new homes in Mount Holly.
Q: Does the settlement involve quotas?
A: No, the parties have agreed to protect current residents of the Gardens from a redevelopment plan that would have effectively destroyed the Township’s only predominately minority neighborhood. In terms of the Fair Housing Act, the decision of the Court of Appeals remains the law in the Third Circuit, and it is consistent with how every court of appeals has interpreted the Act.
Q: Isn’t this just an example of rich interests buying the outcome of a case?
A: This is an example of two opposing parties who were able to work out their differences and settle a case in a way that benefits everyone. That’s how the system is supposed to work.
Q: Aren’t these fair housing cases settling because civil rights groups are afraid the Court will strike down that part of the Fair Housing Act?
A: This was a lawsuit between residents of Mount Holly Gardens and the town, and those two groups came together to resolve the matter in a way that benefits everyone.
The meltdown of the home mortgage market, the scourge of foreclosures, and the decimation of family and community assets that have ravaged the U.S. economy affect virtually every American and our nation as a whole. At the same time, communities of color have been especially hard hit by the crisis, in uniquely damaging ways that are potentially long lasting. This fact sheet documents the role that discrimination and unequal opportunity have played in the home opportunity crisis, as well as some of the harm that those practices have caused to our nation.
Key findings include:
A longstanding pattern by lenders and brokers of targeting communities of color for risky, high-cost loans, controlling for other factors such as credit history—with higher income families of color receiving the most unequal treatment.
Racial discrimination in the terms and conditions of loans by some of the nation’s largest banks.
Unequal maintenance of foreclosed properties, with banks and others disproportionately neglecting properties in communities of color.
Failure of governmental bodies, including the Departments of Treasury and Housing and Urban Development and the Federal Housing Finance Agency, to adopt or adequately enforce fair housing and lending protections.
Homeownership has long been an important steppingstone to the middle class for African Americans, Asian Americans, and Latinos, and the crisis struck at a time when access to homeownership had only recently opened up to these families on a significant scale. As politicians removed banking and consumer protections and neglected fair housing and lending enforcement, unscrupulous lenders and brokers targeted communities of color for risky subprime loans with high rates, exorbitant fees, and frequently deceptive terms. The racial targeting was made easier by America’s legacy of residential segregation, and by the relative lack of traditional banks in many communities of color. Millions of black and Latino homeowners—many of whom qualified for standard 30-year fixed mortgages—were marketed subprime loans that were destined to fail. Indeed, higher income African Americans were especially likely to receive risky loans, as compared with similarly qualified white homeowners.
Not surprisingly, then, families and communities of color have been especially hard hit by the fallout of the home opportunity crisis, in terms of lost homes and dislocation, diminished assets and credit, and neighborhoods dotted with foreclosed and shuttered properties. Some experts have predicted that the economic crisis will represent the greatest loss of wealth to the black community since the end of Reconstruction.
Conversely, effective and inclusive solutions to the crisis are especially important to the progress and equal opportunity of communities of color, as well as to the nation as a whole. This requires both general approaches that prevent foreclosures and restore communities across the board, as well as equal opportunity and civil rights approaches that target the particular harm that discriminatory practices and violations of fair housing and lending laws continue to cause in communities of color.
Housing, consumer protection, economic, and civil rights experts have assembled the most promising of those solutions in a Compact for Home Opportunity. The Compact is part of the Home for Good campaign, which calls for adopting the concrete, effective, and inclusive remedies that are needed to promote greater and more equal home opportunity for all.
What follow are the specifics of the impact of the home opportunity crisis on people of color.
Targeting of Communities of Color for Risky, High-Cost Loans
Housing discrimination, residential segregation, and unfair lending practices against people of color were long a feature of the U.S. home opportunity landscape. Civil rights laws like the Fair Housing Act and Equal Credit Opportunity Act have helped to reduce those practices, but have not eliminated them. These discriminatory patterns served as the foundation for unequal home opportunity in the current era.
During the 1990s, the rise of subprime lending and mortgage securitization created the tools and incentives that led subprime specialists to target communities previously denied access to conventional credit—especially African-American and Latino communities and families. Unscrupulous lenders sold these high-cost loans, which were originally intended as a temporary credit accommodation, to people who qualified for prime loans, and also to borrowers with weak credit who could not afford the loans.1 Lenders intensified these unethical practices in response to increasing demand from financial firms that bundled subprime mortgages into securities products.2
Over time, a “dual mortgage market” developed, in which different racial and ethnic communities were offered “a different mix of products and by different types of lenders,” and subprime lenders “disproportionately target[ed] minority, especially African American, borrowers and communities, resulting in a noticeable lack of prime loans among even the highest-income minority borrowers.”3 A large body of research documents these policies. For example:
In a 2006 report using federal data, The Opportunity Agenda, the National Community Reinvestment Coalition, and the Poverty and Race Research Action Council warned that— even controlling for income—African-American and Latino borrowers were significantly more likely to be sold high-cost, subprime loans than whites, despite the fact that as many as 50% of those borrowers qualified for prime loans. Racial inequity in lending actually increased with borrower income levels, and with the degree of neighborhood segregation. Loans in these communities were more costly, and were frequently predatory, carrying hidden fees and conditions or marketed through deceptive practices. Some, for example, were designed with built-in rate adjustment features making them unsustainable over the loan’s lifespan.4
One study found that, within the subprime market, “borrowers of color . . . were more than 30 percent more likely to receive a higher-rate loan than white borrowers, even after accounting for differences in risk.”5
Another study found that African Americans and Latinos were much more likely to receive subprime loans, and that “the disparities were especially pronounced for borrowers with higher credit scores.” (emphasis added)6
Researchers at Princeton University studied the links between neighborhood racial composition, subprime lending, and foreclosure rates, and found “strong empirical support for the hypothesis that residential segregation constitutes an important contributing cause of the current foreclosure crisis, that segregation’s effect is independent of other economic causes of the crisis, and that segregation’s explanatory power exceeds that of other factors hitherto identified as key causes (e.g., overbuilding, excessive subprime lending, housing price inflation, and lenders’ failure to adequately evaluate borrowers’ creditworthiness). Simply put, the greater the degree of Hispanic and especially black segregation a metropolitan area exhibits, the higher the number and rate of foreclosures it experiences.”7
Racial Discrimination in Terms and Conditions of Loans
In addition to targeting minority communities for risky subprime loans, many big and small institutions within the lending industry also discriminated against communities of color in the terms, conditions, and cost of the loans they did offer.
U.S. Department of Justice discrimination settlement with Wells Fargo Bank. In July 2012, the Department of Justice filed the second largest fair lending settlement in the its history to resolve allegations that Wells Fargo Bank, the largest residential home mortgage originator in the United States, engaged in a pattern or practice of discrimination against qualified African-American and Hispanic borrowers in its mortgage lending from 2004 through 2009. The settlement provides $125 million in compensation for wholesale borrowers who were steered into subprime mortgages or who paid higher fees and rates than white borrowers because of their race or national origin. The Justice Department’s complaint contends that Wells Fargo discriminated by steering approximately 4,000 African-American and Hispanic wholesale borrowers, as well as additional retail borrowers, into subprime mortgages when non-Hispanic white borrowers with similar credit profiles received prime loans. All the borrowers who were allegedly discriminated against qualified for Wells Fargo mortgage loans according to Well Fargo’s own underwriting criteria. The Justice Department further claimed that, between 2004 and 2009, Wells Fargo discriminated by charging approximately 30,000 African-American and Hispanic wholesale borrowers higher fees and rates than non-Hispanic white borrowers because of their race or national origin rather than the borrowers’ credit worthiness or other objective criteria related to borrower risk.8
U.S. Department of Justice $335 billion discrimination settlement with Countrywide Financial. In December 2011, the U.S. Department of Justice (DOJ) reached the largest fair lending settlement in its history with Countrywide Financial. The settlement resulted from a lawsuit in which DOJ alleged that Countrywide had discriminated on the basis of race and national origin against qualified African American and Hispanic borrowers between 2004 and 2008. The lawsuit alleged that Countrywide charged more than 200,000 African- American and Hispanic borrowers higher fees and interest rates than non-Hispanic white borrowers, and steered borrowers of color into subprime loans. The data indicated that these disparities were not due to borrowers’ creditworthiness or other objective criteria related to borrower risk.9
U.S. Department of Justice settlement with AIG subsidiaries. In March 2010, the U.S. Department of Justice settled a case against AIG Federal Savings Bank (FSB) and Wilmington Finance Inc. (WFI), two subsidiaries of American International Group, Inc., in which the Justice Department said the banks engaged in a pattern or practice of discrimination against African-American borrowers in violation of the Fair Housing Act and the Equal Credit Opportunity Act. DOJ alleged that the defendants charged higher fees to thousands of African-American borrowers nationwide between 2003 and 2006, and failed to supervise or monitor brokers in setting broker fees. The settlement terms required the defendants to pay $6.1 million to African-American customers who were charged higher broker fees than non-Hispanic white customers; required the defendants to invest at least $1 million in consumer financial education efforts; and prohibited the defendants from discriminating on the basis of race or color in any aspect of wholesale home mortgage lending.10
U.S. Department of Justice settlement with PrimeLending. In January 2011, the Justice Department announced a settlement resolving allegations that PrimeLending discriminated against African-American borrowers nationwide between 2006 and 2009 by charging African-American borrowers higher annual interest rates than it charged similarly situated white borrowers, including in loans guaranteed by the Federal Housing Administration and Department of Veterans Affairs. The terms of the settlement required PrimeLending to pay $2 million to borrowers identified as victims of discrimination, as well as to engage in loan pricing policies, monitoring and employee training designed to prevent future discrimination.11
U.S. Department of Justice settlement with C&F Mortgage Corporation. In September 2011, the Justice Department reached a settlement with C&F Mortgage Corporation, resolving allegations that the C&F had violated the Fair Housing Act and the Equal Credit Opportunity Act by charging higher interest rates (in the form of “overages”) and giving lesser discounts on mortgage loans to African-American and Hispanic borrowers. The consent decree required C&F to develop uniform policies for all aspects of its loan pricing and to phase out overages, as well as to pay $140,000 to black and Hispanic victims of discrimination, monitor loans for disparities based on race or national origin, and provide antidiscrimination training for employees.12
U.S. Department of Justice settlement with Midwest BankCentre. In June 2011, the Justice Department reached a settlement with Midwest BankCentre, which it said provided unequal home mortgage lending services to residents of majority African American neighborhoods, as compared to residents of predominantly white neighborhoods (in other words, that it was “redlining” the minority neighborhoods). These allegations focused on the Bank’s practices in the St. Louis metropolitan area. Midwest BankCentre agreed to open a full-service branch in an African-American neighborhood, and to invest in the formerly redlined majority areas through a special financing program extending credit to those areas, as well as spending $300,000 for consumer education and credit repair programs, and $250,000 for outreach to potential customers.13
U.S. Department of Justice settlement with Citizens Republic Bancorp. In June 2011, the Justice Department entered into a settlement with Citizens Republic Bancorp, Inc., which it alleged had violated the Fair Housing Act and the Equal Credit Opportunity Act by failing to provide mortgage lending services to the residents of majority African-American neighborhoods, as compared to residents of predominantly white neighborhoods (“redlining”). The allegations examined Citizens Republic’s lending services in the Detroit metropolitan area. Under the terms of the settlement agreement, the defendants were required to open and operate a lending office in an African-American neighborhood, and to invest in the formerly redlined areas of Wayne County through a $1.5 million financing program designed to increase the credit the bank extends in those areas. The bank also agreed to partner with the City of Detroit to provide $1.625 million in matching grants for existing homeowners to make exterior improvements, and to spend $500,000 for targeted outreach and consumer education.14
U.S. Department of Housing and Urban Development and Housing Authority of Baltimore City settlement with public housing residents. In a long-running legal battle over fair housing options in Baltimore, in August 2012, HUD and the city of Baltimore’s housing department filed a proposed settlement agreement of a class action in Thompson vs. HUD,15 brought by African-American residents of public housing in Baltimore. In 2005, a federal judge held that HUD violated the Fair Housing Act by concentrating public housing in the most impoverished, segregated areas of Baltimore. The conditions of the agreement included the continuation of the Baltimore Housing Mobility Program, which voluntarily places public housing tenants throughout the city or in the suburbs. Started in 2003, the program has assisted more than 1,800 families move to new areas. In November 2012, a U.S. District Court judge approved the proposed settlement agreement. Key elements of the approved settlement include, among other things, continuing the mobility program, which provides Housing Choice vouchers and counseling, for up to 2,600 additional families through 2018; and requiring HUD, for a period of at least three years, to conduct civil rights reviews of specific plans and other proposals submitted to HUD for approval, involving certain federally funded housing and community development programs in the Baltimore region.16
Pending litigation in Beverly Adkins et al. v. Morgan Stanley. On October 15, 2012, the ACLU, the National Consumer Law Center, and a San Francisco-based law firm brought a lawsuit on behalf of African-American homeowners in the Detroit area and Michigan Legal Services against the investment bank (as opposed to the subprime lender) for adopting mortgage securitization policies that caused predatory lending targeted at black homeowners. This is the first lawsuit that seeks to connect racial discrimination to the securitization of mortgage-backed securities.17
Pending litigation in National Fair Housing Alliance (NFHA) v. Bank of America. On October 23, 2012, NFHA filed a federal housing discrimination complaint with HUD against Bank of America resulting from an undercover investigation that found that the bank maintains and markets foreclosed homes in white neighborhoods in a much better manner than in African-American and Latino neighborhoods in Chicago, Milwaukee and Indianapolis.18
Unequal Maintenance of Foreclosed Properties
Discriminatory treatment continues even after foreclosure. A detailed undercover investigation by the National Fair Housing Alliance and several regional partners found not only that banks too frequently fail to maintain foreclosed properties that they own, but that they tend to neglect their properties in communities of color at a much higher rate, with devastating consequences. A large number of the neglected, bank-owned properties have broken or missing doors and windows, inviting vandalism and trespassers. And many have safety hazards that endanger the public. Those and other defects are significantly more prevalent in bank-owned properties located in communities of color. Another finding is that, on average, the banks are not marketing houses located in communities of color as aggressively to individual homebuyers as they do properties in white neighborhoods. The properties in white neighborhoods are, for example, more likely to have clear and professional “for sale” signs. When banks both poorly maintain and market foreclosed houses, the properties tend to stay vacant longer and to eventually be sold to speculators, rather than to people who would make the houses their home.19
Governmental Failure to Adopt or Enforce Fair Housing and Lending Protections
The lack of adequate fair housing and lending rules and enforcement was a significant contributor to the foreclosure crisis and its unequal impact. This neglect was particularly egregious during the Bush Administration, but some troubling patterns continue today.
Almost 50 years after the adoption of the Civil Rights Act of 1964, the Treasury Department is one of the only governmental entities that have not adopted regulations to enforce the Act.
While the U.S. Department of Housing and Urban Development finalized in February 2013 important regulations relating to “disparate impact” discrimination (i.e., policies that are unnecessarily discriminatory in their effect, though not their intent),20 the agency still has not issued regulations implementing its duty to affirmatively further fair housing.
In 2008, the bi-partisan National Commission on Fair Housing and Equal Opportunity found, among other things:21
“[T]hat despite strong legislation, past and ongoing discriminatory practices in the nation’s housing and lending markets continue to produce levels of residential segregation that result in significant disparities between minority and nonminority households, in access to good jobs, quality education, homeownership attainment and asset accumulation.”
“More than four million instances of housing discrimination occur annually in the United States and yet fewer than 30,000 complaints are filed every year. In 2007, the 10 HUD offices processed 2,440 complaints, the 105 [Fair Housing Assistance Program] agencies processed 7,700 inquiries, and the 81 private fair housing agencies processed 18,000 complaints. Literally millions of acts of rental, sales, lending, and insurance discrimination, racial and sexual harassment discrimination, and zoning and land use discrimination go virtually unchecked.”
Delays in the administrative processing of cases [by HUD] have been so severe that they have served as the basis for dismissal of cases by courts and administrative law judges.
“[The Government Accounting Office] found that only 16 percent of complainants who were identified as having potential cases were assisted with filing complaints. Even worse, 30 percent of callers who attempted to file a complaint could not get through on their first try, and some callers did not receive a call back even after three tries. Finally, when complaints were filed, only half were filed within 20 days from the initial date of contact with the agency. This kind of delay results in lost housing opportunities, missed opportunities to conduct testing, and loss of credibility about the agency’s functions.
The Result: Disproportionate Foreclosures and Loss of Assets
The combination of misconduct by banks and brokers, inadequate rules and enforcement, and record long-term unemployment have devastated the home opportunity and assets of millions of Americans, with communities of color shouldering a disproportionate and devastating burden.
Homeowners and communities of color have been especially hard hit by foreclosures. For mortgages originated between 2004 and 2008, 5.1% of non-Hispanic white borrowers lost their homes to foreclosure, compared to 9.8% of Blacks/African Americans and 11.9% of Hispanics/Latinos, and 6.6 percent of Asian Americans. (During the same period, while low- and moderate-income Asian-American borrowers had a lower foreclosure rate than lower-income non-Hispanic whites, the pattern is reversed among middle- and higher-income Asian Americans.)22
In a 2011 study of the loss in home equity among Asian American–Pacific Islanders, between 2007 and 2009, the median property value of Asian-American homeowners decreased by $42,900 while the property value loss for Native Hawaiians and Pacific Islanders (NHPI) was $47,000, compared to the national equity loss of $9,100 during the same period. The study attributed much of the large differential in equity loss to the fact that Asian Americans and NHPIs were highly concentrated in geographic areas where the housing downturn was more severe than in the rest of the country, e.g., Los Angeles, Chicago, and New York.23
One illustrative study looked at Prince George’s County, Maryland, the wealthiest African- American county in the nation, finding that the national foreclosure crisis has had a profound effect on it. Analyzing the likelihood of foreclosure in Prince George’s County, the study found that the borrowers in Black/African American neighborhoods with high-income were 42% more likely and Hispanic/Latino neighborhoods with high-income were 159% more likely than the borrowers in non-Hispanic white neighborhoods to go into foreclosure, controlling for key demographic, socioeconomic, and financial variables.24
The Center for Responsible Lending predicts that “the spillover wealth lost to African- American and Latino communities between 2009 and 2012 as a result of depreciated property values alone will be $194 billion and $177 billion, respectively.” [“spillover” costs refers to financial and nonfinancial consequences for homeowners who live near foreclosed properties].25 In an October 2012 white paper published by the National Community Reinvestment Coalition which reviewed the literature on the long-term social impacts and financial costs of foreclosure on communities of color, the authors cited U.S. Census Bureau figures that as of the fourth quarter of 2011, the non-Hispanic White, Black/African- American, and Hispanic/Latino homeownership rates were at 73.7, 45.1 and 46.6 percent, respectively. These rates compared to those reported for the fourth quarter of 2007, when the recession officially began, reflecting homeownership rates at 74.9, 47.7, and 48.5 percent, respectively.26
The Inspector General for the Federal Housing Finance Agency (FHFA)—the agency that controls Fannie Mae and Freddie Mac—found that the FHFA does not adequately oversee these enterprises’ compliance with consumer and civil rights protections in their dealings with entities (“counterparties”) that sell loans to or service them for the enterprises. The Office of the Inspector General (OIG) for FHFA declared “FHFA does not examine how the Enterprises monitor compliance with consumer protection laws, and, indeed, OIG determined that the Enterprises do not ensure that their counterparties’ business practices follow all federal and state laws and regulations designed to protect consumers from unlawful activities such as discrimination.”27
Solutions: The Compact for Home Opportunity
Concrete, pragmatic solutions exist that can address these discriminatory patterns and their aftermath while expanding opportunity and economic prosperity for all Americans and rebuilding our economy. In coalition with housing, consumer protection, economic, and civil rights experts, The Opportunity Agenda has assembled a Compact for Home Opportunity, containing over a dozen strategies designed to promote successful homeownership, fair housing and lending, and the restoration of community and family assets.
Department of Housing and Urban Development and Department of the Treasury, Curbing Predatory Home Mortgage Lending (2000); Ira Goldstein with Dan Urevick-Ackelsberg, The Reinvestment Fund, Subprime Lending, Mortgage Foreclosures and Race: How Far Have We Come And How Far Have We To Go? (2008).
See, e.g., KATHLEEN C. ENGEL AND PATRICIA A. MCCOY, The Subprime Virus: Reckless Credit, Regulatory Failure, and Next Steps 56-58 (2011).
William C. Apgar, Jr. and Allegra Calder, The Dual Mortgage Market: The Persistence of Discrimination in Mortgage Lending, in THE GEOGRAPHY OF OPPORTUNITY: RACE AND HOUSING CHOICE IN METROPOLITAN AMERICA 102 (Xavier De Souza Briggs, ed., 2005). See also William C. Apgar, Jr., Christopher E. Herbert and Priti Mathur, Department of Housing and Urban Development, Risk or Race: An Assessment of Subprime Lending Patterns In Nine Metropolitan Areas (Aug. 2009).
The report is available at opportunityagenda.org.
Debbie Gruenstein Bocian, Keith S. Ernst and Wei Li, Center for Responsible Lending, Unfair Lending: the Effect of Race and Ethnicity on the Price of Subprime Mortgages 3 (May 31, 2006).
Debbie Gruenstein Bocian, Wei Li, Carolina Reid, and Roberto G. Quercia, Center for Responsible Lending, Lost Ground, 2011: Disparities In Mortgage Lending and Foreclosures 5 (2011).
Jacob S. Rugh and Douglas S. Massey, Racial Segregation and the American Foreclosure Crisis, 75 AM. SOC. REV. 629, 644 (2010).
The consent decree, complaint, and Justice Department press release are available at justice.gov.
The DOJ press release is available at justice.gov.
The consent order is available at justice.gov.
The complaint is available at justice.gov.
The settlement agreement and complaint are available at justice.gov.
The settlement agreement and complaint are available at justice.gov.
The settlement agreement is available at justice.gov. The complaint is available at Settlement Agreement, Thompson v. HUD, No. MJG 95-309 (D. Md. filed August 24, 2012).
Department of Housing and Urban Development, “Court Approves Final Settlement Thompson v. HUD,” press release, November 20, 2012.
The ACLU press release and complaint are available at ACLU website.
The NFHA press release is available at National Fair Housing website.
National Fair Housing Alliance, The Banks Are Back – Our Neighborhoods Are Not: Discrimination in the Maintenance and Marketing of REO Properties, April 3, 2012.
78 Fed.Reg. 11460 (Feb. 15, 2013) and GPO website.
Department of Housing and Urban Development, “HUD Issues Rule Formalizing Standard on Discriminatory Effects in Housing,” press release, February 8, 2013.
Leadership Conference on Civil and Human Rights, The Future of Fair Housing (2008).
Debbie Gruenstein Bocian, Wei Li, Carolina Reid, and Roberto G. Quercia, Center for Responsible Lending, Lost Ground, 2011: Disparities in Mortgage Lending and Foreclosures (2011).
“AAPIs Experience Significant Loss of Home Equity,” AsianWeek.com, January 29, 2011.
Katrin B. Anacker, James H. Carr, and Archana Pradhan, Analyzing Foreclosures Among High-Income Black/African American and Hispanic/Latino Borrowers in Prince George’s County, Maryland, 39 HOUSING AND SOCIETY Issue 1, 1–28 (2012).
Debbie Gruenstein Bocian, Wei Li, and Keith S. Ernst, Center for Responsible Lending, Foreclosures by Race and Ethnicity: The Demographics of a Crisis 11 (June 18, 2010). See also James H. Carr, Katrin B. Anacker and Michelle L. Mulcahy, National Community Reinvestment Coalition, The Foreclosure Crisis and its Impact on Communities of Color: Research and Solutions 31 (Sept. 2011) (discussing the racial wealth gap).
James H. Carr and Katrin B. Anacker, National Community Reinvestment Coalition, Long Term Social Impacts and Financial Costs of Foreclosure on Families and Communities of Color: A Review of the Literature 3 (Oct. 2012).
Federal Housing Finance Agency Office of Inspector General, FHFA Should Develop and Implement a Risk- Based Plan to Monitor the Enterprises’ Oversight of Their Counterparties’ Compliance with Contractual Requirements Including Consumer Protection Laws 2, March 26, 2013.
This year, the United States Department of Housing and Urban Development (HUD) will issue regulations1 to better enforce and apply the Fair Housing Act (“the Act”) across our nation. This fair housing rule is an important tool for addressing America’s growing racial and ethnic inequality, an alarming trend rooted in our history of segregation, and one that threatens our national prosperity. In a country where zip code matters more than genetic code in determining life expectancy2, this rule will help communities understand the importance of place in promoting or prohibiting opportunity. It provides jurisdictions with the tools they need to address barriers to fair housing and expand opportunity.
Where you live determines a lot about how you live: the schools your children attend, the jobs you have access to, the transportation system you rely on, the quality of your physical environment, your access to grocery stores and other businesses, the level of violent crime in your community, and a host of other factors. Where you live has a big impact on how your life unfolds, and that varies tremendously by neighborhood. The Fair Housing Act helps ensure that all people – regardless of race, ethnicity, family status or disability – have a range of choices about where to live, and that all neighborhoods are good places to live, regardless of the demographics of their residents.
Congress, when it passed the Fair Housing Act, recognized that government policies, along with private practices, had locked many people of color into poor, racially isolated communities. To overcome this enduring legacy of government-sponsored segregation, the Fair Housing Act included a requirement that HUD and state and local governments that choose to receive federal funds must administer their programs and activities in a way that expands access to opportunity for all.
This provision of the Act—known as “affirmatively furthering fair housing”—aimed to undo discriminatory housing policies and remedy the harm they caused, but it has been largely unenforced. The forthcoming fair housing rule will clarify this existing mandate and provide a robust toolkit for jurisdictions to use to identify and address barriers to fair housing in their communities.
This memo offers communications guidance for talking about the new regulations, and fair housing generally, with a range of audiences. It draws on available opinion research, practical experience, and communications principles.3
Themes to Emphasize:
We recommend that communications on HUD’s AFFH regulations emphasize the following themes:
An Important Step in Expanding Opportunity for All: Access to a safe and affordable home near quality schools, transportation, and jobs is basic to the American Dream and to our nation’s future. Unequal access to vital community resources results in unequal access to opportunity, and undermines our prosperity and success as a nation. Segregation and racially concentrated poverty conflict with long-established public policy as well as our shared national values for access to opportunity. This proposed rule is an important step forward in America’s pursuit of greater and more equal opportunity for all.
A Tool to Combat Growing Inequality: The economic gulf between rich and poor has grown at an unprecedented rate over the past several decades. Although productivity has grown steadily since the 1980s, wage growth has been stagnant and the racial wealth gap has grown tremendously. These trends, coupled with the economic damage wrought during the housing crisis and the Great Recession that resulted, have made our society less equal and have threatened our collective prosperity. The AFFH rule provides a framework that will help decision-makers plan for using their housing and community development resources in a way that ensures fairness and equity for all. This, in turn, will help stem the growing trend of inequality.
Making Sure No Communities are Left Behind: The AFFH Rule will advance opportunity in America by shaping investments in housing, transportation, environment, health, education, infrastructure, and economic development. Implementation of this rule will help all our communities make progress toward the goals of achieving housing opportunity, overcoming historic patterns of racial and other segregation, and increasing public investment in areas of highly concentrated poverty.
Diversity and the Common Good: The AFFH rule is a necessary step towards clarifying and strengthening the federal government’s obligation to further fair housing. Housing choice – especially for low-income communities and communities of color — is a critical component of equitable and economically prosperous regions. When it comes to building strong communities, we’re all in it together.
Topple Barriers: When localities seek federal taxpayers’ funds to strengthen their communities, it’s only right that they must take specific steps to protect fair housing. That means addressing discrimination and toppling barriers to opportunity for all their residents.
Accountability and the Public Trust: Entities that choose to seek federal taxpayers’ funds for housing and community development projects have an obligation to protect fair housing and expand opportunity for all. This rule holds recipients of HUD funding accountable to that promise, while giving them the tools and information to do so.
The Fair Housing Narrative:
Like other fair housing matters, these regulations should be framed in terms of America’s interest in protecting equal opportunity and freedom from discrimination for everyone, a responsibility that benefits all of us and is crucial to a prosperous future in an increasingly diverse nation and world. We should describe as common sense the notion that public investment in our communities should be consonant with our values – inclusion, equal access to opportunity, and diversity as a national strength.
Our communication on this issue can make clear the connection between ensuring objective and effective approaches to community development that expand opportunity for everyone and creating concrete benefits for the entire community. For example, research has shown that diverse regions have economies that are more robust.4 In addition to the cultural, educational, and employment benefits of diversity to community members, the overall community reaps economic and business benefits by fostering inclusion.5
Moreover, we should make visible the ongoing structural and institutional barriers to fair housing—like unreasonable zoning restrictions, inadequate affordable housing, and the legacy of residential segregation,— that limit the options of all Americans while especially burdening people of color, people with disabilities, and families with children.
Sample Messages:
General Messaging
Where you live has a big impact on how your life unfolds, and that varies tremendously by neighborhood. This rule helps ensure that all people – regardless of race, ethnicity, family status or disability – have a range of choices about where to live, and that all neighborhoods are good places to live, regardless of the demographics of their residents.
It’s been the law for more than 40 years that anyone who utilizes federal funds must do so in a way that considers barriers to fair housing. This rule provides a flexible framework and the necessary data to comply with this existing mandate.
This rule gives jurisdictions the tools to identify barriers to fair housing and come up with their own solutions to the unique problems they face.
Theme 1: An Important Step in Expanding Opportunity for All
Access to a safe and affordable home near quality schools, transportation, and jobs is basic to the American Dream and to our nation’s future.
This rule provides a framework to help local jurisdictions use their federal funds in a way that creates opportunity for everyone, including communities of color, families with children, and people with disabilities.
The AFFH rule provides a framework that will help decision-makers plan for using their housing and community development resources in a way that ensures fairness and equity for all.
Theme 2: A Tool to Combat Growing Inequality
This new fair housing rule is an important tool for addressing America’s growing racial and ethnic inequality, an alarming trend rooted in our history of segregation.
Recent events in Ferguson, New York, and Baltimore underscore the need for policies that take into account the long legacy of segregation and unequal treatment in this country.
AFFH helps decision-makers understand segregated living patterns and create local solutions that address local issues.
Theme 3: Making Sure No Communities are Left Behind
The AFFH Rule will advance opportunity in America by shaping investments in housing, transportation, environment, health, education, infrastructure, and economic development.
AFFH will help all communities make progress toward the goals of achieving housing opportunity, overcoming historic patterns of racial and other segregation, and increasing public investment in areas of highly concentrated poverty.
In a country where zip code matters more than genetic code in determining life expectancy, this rule will help communities understand the importance of place in promoting or prohibiting opportunity.
Theme 4: Diversity and the Common Good
Housing choice – especially for low-income communities and communities of color — is a critical component of equitable and economically prosperous regions.
As our population becomes more diverse, we all have a stake in making sure that each of us has a fair chance to flourish and prosper. Policymakers must take proactive steps to ensure that this happens.
The more equitable access to opportunity that the rule creates will help ensure that our country’s increasing diversity is a source of strength and position us to be more competitive in the global economy.
Theme 5: Topple Barriers
The Fair Housing Act was intended to remove all barriers to fair housing, whether from intentional bigotry or bad practices and policies.
The AFFH rule will provide valuable data to inform the decisions of policy-makers, including demographic trends for cities, towns, regions and states; where concentrated poverty exists; and where segregation persists or is growing.
When localities seek federal taxpayers’ funds to strengthen their communities, it’s only right that they must take specific steps to protect fair housing. That means addressing discrimination and toppling barriers to opportunity for all their residents.
Theme 6: Accountability and the Public Trust
Entities that choose to seek federal taxpayer funds for housing and community development projects have an obligation to protect fair housing and expand opportunity for all. This rule holds recipients of HUD funding accountable to that promise, while giving them the tools and information to do so.
This rule is an important step forward for equal opportunity. It makes clear that states, cities, towns, and counties that seek federal taxpayer funds for public initiatives must consider fair housing in development to ensure that you can choose where to live—no matter what you look like, what accent you have, or whether you have children or a disability.
AFFH has served the country well by addressing biased mortgage lending practices, insurance redlining, discriminatory zoning ordinances, and other obstacles to equity. However, HUD has never set out the rules for applying AFFH through regulation, which is the clearest statement that an agency makes of its understanding of the law. It’s important that HUD is now providing that level of clarity for individuals, businesses, and public institutions.
Countering the Opposition:
Opponents have described the proposed AFFH rules as “social engineering,”6 “big government,”7 and “forced racial integration.”8 With the public and the media, it is important to avoid arguing within those frames, but rather, to describe the responsibility to affirmatively further fair housing and the resulting benefits to the entire community using our own. For example:
“It’s common sense that when we can topple unnecessary obstacles to equal opportunity, we should do that. That’s core to who we are as Americans, and it strengthens all communities.”
“We’ve made a lot of progress as a nation toward equal opportunity for all. But we still have a distance to go. Removing unnecessary barriers to equal opportunity like antiquated zoning rules or concentrating residents in segregated neighborhoods is the smart thing to do, as well as the right thing to do.”
“This is a matter of basic government accountability to the law. Cities and towns don’t have to seek HUD or federal funds for their projects, but when they do, they have to further fair housing.”
Possible Answers to Frequently Asked Questions
Q: Why do we need another regulation?
A: It’s been the law for more than four decades that when a locality chooses to receive HUD funds, it has an obligation to further fair housing proactively. However, many state and local governments historically have not lived up to that promise. Examples include St. Bernard Parish, Louisiana; the State of Texas; Joliet, IL; Westchester County, NY; the State of New Jersey; and Sussex County, DE, among others. All of these jurisdictions sought and received millions in taxpayer dollars, but failed to take the necessary action to foster fair housing. Some other local governments have wanted to comply, but felt they lacked the specific information and guidance to do so. This regulation addresses both types of problems by providing clear rules and also new information and guidance.
Q: Why are fair housing regulations important?
A: Overcoming unnecessary and unequal barriers to housing is crucial to ensuring equal opportunity for all and to building strong communities. Thanks to HUD’s action, we can be much more confident that our national progress will continue.
Q: How does the obligation to affirmatively further fair housing matter benefit all of us?
A: The chance to affirmatively further fair housing connects all communities to greater opportunity, which benefits both individuals and their communities. Individuals receive specific cultural, educational, and employment opportunities from more inclusive and diverse communities, and those communities benefit as well. Diverse and vibrant communities experience economic benefits, as do the businesses within those communities. Furthermore, your zip code should not determine your chances in life. Creating opportunities of choice where everyone has a fair shot upholds our most deeply-held national values.
Q: Times are tough. What if our county/locality can’t afford to comply with these new requirements?
A: These regulations don’t impose new obligations, they just explain in greater detail the options that localities have for living up to the commitment that they’ve already made. Moreover, by providing new sources of data and guidance, they should make it easier and often less costly to comply. In the end, though, it’s important to remember that governments that choose to receive HUD funds have to be accountable for advancing fair housing in their activities.
Q: Isn’t this just unwanted social engineering and forced political correctness?
A: This rule says that if a locality chooses to seek federal taxpayer funds, it has to uphold the basic American principle of equal opportunity through specific actions and accountability. Fair housing is a widely-held value in our nation, and it’s been the law of the land for over 45 years.
Q: This sounds like a huge bureaucratic burden for understaffed local governments:
A: This rule clarifies a longstanding obligation to foster fair housing. Moreover, it significantly eases the burden on localities by providing the data and guidance that local governments need to fulfill their responsibilities.
Q: Won’t this rule overburden small public housing authorities (PHAs) that have small staffs?
A: The rule, and the tools that accompany it, will actually make it easier for PHAs to fulfill their existing fair housing obligations. HUD has estimated that, for PHAs and other agencies covered by the rule, it will take one person one week per year to carry out their responsibilities. The rule also encourages small PHAs to work together with other entities to do joint fair housing planning. PHAs that take this path will likely have to spend even less staff time on this important job.
Q: How will the forced rezoning of our communities impact us?
A: Affirmatively furthering fair housing is not “forced rezoning,” it is a clarification of the longstanding obligation to proactively further fair housing when a locality chooses to receive HUD funds.
Q: Why is the current administration using executive action to force the AFFH regulation on communities?
A: The affirmatively furthering fair housing obligation is a long-standing requirement for all jurisdictions receiving federal housing and/or community development funding. It is also a requirement of all public housing authorities. With this regulation, HUD is simply using its existing authority under the Fair Housing Act to fulfill its responsibility to implement the law. The current system is vague and ineffective, as GAO pointed out in its 2010 report. The new rule provides greater clarity and guidance and sets up a more straightforward process for compliance.
Q: Does the AFFH regulation have hidden costs, and hurt homeowners in unanticipated ways, like increasing property taxes?
A: The AFFH regulation does not have any hidden costs and does not call for any type of tax hike. The regulation does not represent any new obligations for cities or jurisdictions. It simply gives jurisdictions the clear guidance they need in order to fulfill their existing fair housing obligations. If your city never had to increase property taxes in the past to receive federal funds from HUD, it is unlikely that your city will need to do so now to continue receiving federal dollars.
Q: Aren’t there other ways to increase affordable or fair housing, like through job creation?
A: First, let’s make clear that affordable housing and fair housing are two completely different concepts. Affordable housing involves expanding housing choices for persons who are low income. Fair housing involves removing barriers to housing access irrespective of income or housing costs. While there may be some overlap, they are not one and the same. That being said, there are many ways to expand fair housing and access to opportunity. Job creation may be one, and there are many others, as well. When communities perform a thorough assessment of fair housing barriers, they will undoubtedly find the need for a variety of solutions that will expand opportunities and make the community more viable. This rule helps communities identify local solutions to local problems.
Q: What if we don’t want our suburban communities to “urbanize”?
A: The AFFH regulation does not force suburban communities to “urbanize”, rather it asks jurisdictions to identify barriers to fair housing and to develop remedies that will enhance and strengthen the community by promoting access to equal housing opportunities.
Q: Why should the government decide who should live where?
A: It was government decisions made over many years at the federal, state and local levels that led to segregation to begin with. For example, early policies of the Federal Housing Administration (FHA), which fostered suburban development across the country, ensured that those developments would be open to white residents only, and denied people of color access to safe, affordable, government-insured mortgage loans. This set in motion a tremendous disparity in wealth accumulation that is still evident today, and limits the ability of people of color to buy a home, afford a college education, start a business, weather economic crises, and fund retirement. Government policies also influence the location of subsidized housing, much of which is concentrated in poor communities of color with struggling schools, few jobs, exposure to environmental hazards, limited access to healthy food, high levels of violent crime and other detrimental characteristics. This rule sets us on a path for government to make decisions that provide more equitable access to opportunity and benefit us all.
Challenges and Opportunities Related to This Rule
Challenges the rule addresses
Persistent segregation. Although we have made some progress, we remain a highly segregated society. In 1980, the average white person lived in a neighborhood that was 88% white. By 2010, that number had declined, but was still very high at 77%. In 1980, the average black person lived in a neighborhood that was 62% black and 31% white. By 2010, the average black person’s neighborhood was 48% black and 34% white. Averages don’t always tell the whole story, and maps of most of our major cities illustrate how segregated our society remains.
Concentrated poverty is increasing, as well, and disproportionately affects people of color. The number of high-poverty census tracts – tracts with poverty rates of 40% or more – increased by 50% between 2000 and 2011. These 3,764 tracts are home to more than 11 million people, nearly four percent of the US population. And the residents of these neighborhoods are disproportionately of people of color. Nationwide, the population of these high-poverty areas is 26% White, 37.4% Black, and 30.2% Hispanic.9
People with disabilities also face segregation and often have a limited set of housing choices available to them, particularly housing that is both affordable and accessible. Many people with disabilities live in segregated settings – such as institutions, adult care homes, large group homes, assisted living facilities, and homeless shelters – that leave them isolated from others in their communities and limit their access to opportunity. Approximately 2 million non-elderly adults with disabilities are either living in institutions or other facility-based congregate settings.10 This runs counter to the vision of Congress in passing both the Fair Housing Act, which prohibits discrimination against people with disabilities, and the Americans with Disabilities Act (ADA), which establishes community integration for people with disabilities as our national policy.
Segregation is not the result of self-selection, but rather the legacy of actions and policies taken by federal, state and local governments (as well as private individuals and institutions) over many decades. It will take a different set of actions and policies to undo its effects.11
Growing inequality. People of color are falling behind according to many measures: educational attainment, employment, health, income, homeownership and others.
The racial wealth gap is also growing. According to the Urban Institute, “In 1963, the average wealth of white families was $117,000 higher than the average wealth of nonwhite families. By 2013, the average wealth of white families was over $500,000 higher than the average wealth of African American families ($95,000) and of Hispanic families ($112,000). Put another way, white families on average had seven times the wealth of African American families and six times the wealth of Hispanic families in 2013.”12
Place matters. All of this is related, in part, to where people live. For example, recent research has found that over the last decade, the number of jobs within commuting distance of people in poor communities and communities of color has decreased, especially in suburban communities which are seeing increasing poverty and growing numbers of people of color.13
As our population becomes more diverse, we all have a stake in making sure that each of us has a fair chance to flourish and prosper. Although jurisdictions receiving federal housing and community development dollars should spend those funds in ways that promote greater opportunity and prosperity, this does not always happen.
Change is needed. HUD’s approach to fair housing has not worked to solve these problems. This was highlighted in a 2010 report from the Government Accountability Office, which raised questions about the effectiveness of the current fair housing planning process for helping jurisdictions identify and address barriers to fair housing. GAO suggested that this problem was caused by HUD’s limited regulatory requirements and oversight in this area.14
Opportunities the rule presents
Deeper understanding. The new rule will help jurisdictions better understand the segregation- related challenges they face by giving them a framework for analyzing local conditions, including who lives where and how different neighborhoods fare in terms of access to schools, jobs, transportation, a healthy environment and other factors.
Better coordination. The rule encourages jurisdictions to consider their housing and community development planning and expenditures in the broader context of their planning for other important community elements, including transportation, education, infrastructure, economic development and the like. It also encourages them to look at the trends inside their jurisdictional borders in the context of what’s happening in the broader region.
Less burden. HUD will reduce the burden jurisdictions bear in conducting this type of analysis by providing them with data, analytical tools (including mapping capacity) and technical support. Jurisdictions will be encouraged to use any additional data they may have that will help clarify their assessment of what is and isn’t working in their communities.
Clearer expectations. The rule clarifies HUD’s expectation that expanding access to opportunity includes both directing needed investments into communities that have been left behind and creating new affordable housing options in higher income areas where they may be lacking.
Community involvement. The rule emphasizes the importance of community engagement in the fair housing planning process and calls for jurisdictions to work with community partners to identify barriers to fair housing as well as solutions to expand opportunities.
Local flexibility. While sharpening the analytical framework and highlighting the issues to be examined, the rule allows jurisdictions tremendous flexibility in setting priorities, developing strategies for tackling their top problems, and setting benchmarks for progress.
Connecting plans with spending decisions. The rule creates a direct link between the priorities a jurisdiction identifies as part of the fair housing planning process (the Assessment of Fair Housing or AFH) and its plans for utilizing all of its housing and community development resources (the Consolidated Plan, or ConPlan).
More accountability. It increases accountability by setting the expectation that spending plans spelled out in the ConPlan will reflect the top priorities in the AFH and letting jurisdictions know that HUD will be looking at the progress they make toward meeting the benchmarks they establish.
Strength in diversity. The more equitable access to opportunity that the rule creates will help ensure that our country’s increasing diversity is a source of strength and position us to be more competitive in the global economy.
For additional communications advice or information on Affirmatively Furthering Fair Housing, go to opportunityagenda.org or nationalfairhousing.org
2. Marks, James, “Why Your ZIP Code May Be More Important to Your Health Than Your Genetic Code”
3. For a summary of public opinion research on housing, homeownership, and the American Dream, see Public Opinion on Opportunity and the American Dream, Homeownership, and Housing, at opportunityagenda.org
4. In a recent analysis of 118 US metropolitan areas, researchers found that regions with a higher degree of racial inclusion have higher regional economic growth (2006, 42). In two follow up reports, which analyzed 136 metropolitan areas, the “racial inclusion and income equality” indicator was the only one used that was associated with expansion in all four measures of economic growth. – Dashboard Indicators for the NorthEast Ohio Economy (Eberts, Erickcek, Kleinhenz 2006); An Update of the Regional Growth Model for Large and Mid-Size U.S. Metropolitan Areas: Northeast Ohio Dashboard Indicators (Austrian, Lendel, Yamoah 2007); Regional Dashboard of Economic Indicators 2008: Comparative Performance of Midwest and Northeast Ohio Metropolitan Areas (Austrian, Lendel, Yamoah 2008)
5. Racial diversity is associated with increased sales revenue, more customers, greater market share, and greater relative profits. Herring, Cedric. “Does Diversity Pay?: Race, Gender, and the Business Case for Diversity.” American Sociological Review 74.2 (2009): 208-24. JStor.
6. Townhall.com, “In the Name of Diversity, Social Engineering Coming to Communities Everywhere,”
7. Ibid
8. Investor’s Business Daily editorial, “HUD Launches Scheme To Racially Diversify Suburbs.”
9. Jargowsky, Paul A., “Concentration of Poverty in the New Millenium: Changes in Prevalence, Composition and Location of High Poverty Neighborhoods.” Report by the Century Foundation and Rutgers Center for Urban Research and Education, December 17, 2013.
10. Cooper, Emily, Ann O’Hara, Nikki Singer, and Andrew Zovistoski, “Priced Out in 2012: the Housing Crisis for People with Disabilities.” Technical Assistance Collaborative and Consortium for Citizens with Disabilities, Housing Task Force. May, 2013.
11. Richard Rothstein, of the Economic Policy Institute (EPI), has written extensively about the government actions that led to our current patterns of segregation. See, for example, “Modern Segregation,” “The Making of Ferguson: Public Policies at the Root of its Troubles,” and “From Ferguson to Baltimore: The Fruits of Government-Sponsored Segregation.” All are available on the EPI website.
12. Urban Institute, “Nine Charts about Wealth Inequality in America,” February, 2015.
13. Kneebone, Elizabeth and Natalie Holmes, “The growing distance between people and jobs in metropolitan America.” The Brookings Institution, March, 2015.
14. GAO 10-905, “HUD Needs to Enhance its Requirements and Oversight of Jurisdictions’ Fair Housing Plans.” Washington, DC, September, 2010.
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