Redlining
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Part of a series of articles on Racial segregation |
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In the United States, redlining is the practice of denying services, either directly or through selectively raising prices, to residents of certain areas based on the racial or ethnic composition of those areas. While the best known examples of redlining have involved denial of financial services such as banking or insurance, other services such as health care or even supermarkets have been denied to residents (or in the case of retail businesses like supermarkets, simply located impractically far away from said residents) to result in a redlining effect. The term "redlining" was coined in the late 1960s by John McKnight, a sociologist and community activist. It refers to the practice of marking a red line on a map to delineate an area where banks would not make loans; later the term was applied to discrimination against a particular group of people (usually on the basis of race or sex) irrespective of geography.
During the heyday of redlining, the areas most frequently discriminated against were black inner city neighborhoods. For example, in Atlanta in the 1980s, a Pulitzer Prize-winning series of articles by investigative-reporter Bill Dedman showed that banks would often lend to lower-income whites but not to middle- or upper-income blacks. The use of blacklists is a related mechanism also used by redliners to keep track of groups, areas, and people that the discriminating party feels should be denied business or aid or other transactions. In the academic literature, redlining falls under the broader category of credit rationing.
Reverse redlining occurs when a lender or insurer targets nonwhite consumers, not to deny them loans or insurance, but rather to charge them more than could be charged to a comparable white consumer.
Although informal discrimination and segregation had existed in the United States, the specific practice called "redlining" began with the National Housing Act of 1934, which established the Federal Housing Administration (FHA). Racial segregation and discrimination against minorities and minority communities pre-existed this policy. The implementation of this federal policy aggravated the decay of minority inner city neighborhoods caused by the withholding of mortgage capital, and made it even more difficult for neighborhoods to attract and retain families able to purchase homes. In 1935, the Federal Home Loan Bank Board (FHLBB) asked Home Owners' Loan Corporation (HOLC) to look at 239 cities and create "residential security maps" to indicate the level of security for real-estate investments in each surveyed city. The assumptions in redlining resulted in a large increase in residential racial segregation and urban decay in the United States. Urban planning historians theorize that the maps were used by private and public entities for years afterwards to deny loans to people in black communities. But, recent research has indicated that the HOLC did not redline in its own lending activities, and that the racist language reflected the bias of the private sector and experts hired to conduct the appraisals.
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