Structural Racism: What do FDR and Barack Obama have in common?

What do President Franklin D. Roosevelt and President Barack Obama have in common?  Unfortunately, a lot.

lender foreclosure

A recent report by the Kirwan Institute on Race and Ethnicity at Ohio State University projects that the relief purposed to come from the American Recovery and Reinvestment Act (ARR Act) will not benefit all groups to the same degree (Creative Commons License photo credit: TheTruthAbout…) . Because of the racial stratification of occupations and employment opportunities, the jobs created in the stimulus package are designed for industries where blacks, in particular, are underrepresented (e.g., the construction industry).
In parallel fashion, the economic benefits of Franklin Delano Roosevelt’s New Deal disproportionately benefited white middle class America.  FDR’s New Deal funded the seeds of post-World War II suburbanization and with it, white flight, through the National Housing Act of 1934 implemented by the Federal Housing Administration. These government handouts are in part responsible for the crystallization of a large black-white gap in wealth we still see today.

Fortunately, unlike the 30s, we currently have laws that criminalize racial discrimination in hiring and wage allotment. However, sociological studies show that the racial wage gap is largest in the private sector, particularly in occupations where earnings are decided by the capital of one’s client-base. In a society where both interracial friendships and interracial employment contracts are rare, it is not difficult to see where inequalities in earnings can be built into a privatized client-driven pay scale. Many of the new jobs the ARR Act seeks to create will be rooted in the private sector (e.g., infrastructure investments and the energy sector), not the public sector where racial wage gaps are more equitable.

What we essentially have is an example of institutional discrimination, also known as “structural racism”—that is, a range of policies and practices of an institution that lead to the systematic disadvantage of members of certain racial groups (disparate impact). Not coincidentally, the mechanisms of structural racism operate among us invisibly and create an inert force once activated.

We are only now seeing one of the many unintended consequences of the government subsidization of white wealth – twenty-first century black foreclosure.

Analysts have noted that since 2004 black homeownership gains have been reversed and that even before this time rates of foreclosure were on a steady rise in areas with large minority populations. While the media likes to place the onus on blacks – citing poor investment practices and bad credit, they forget that, unlike their white counterparts, black homeowners financed much of their American Dream through their own means. They also did not catch on to urban flight until the 80s and 90s, once housing prices in urban areas were prohibitively expensive and the rise in housing values (and therefore, escrow capital) had already begun to stagnate.  Furthermore, predatory lending practices, redlining, and urban decline have largely eroded the capital out of their most valuable asset.

Thus, in times where the median black family income is dropping for the first time since World War II, there is little to bail people of color out of the depression they have entered into with the current economic crisis. According to United for a Fair Economy, black unemployment rates have been indicative of an economic recession for the past five years.

Could the American Recovery and Reinvestment Act of 2009 be the 1930s New Deal all over again? In “Silent Depression: The State of the Dream 2009,” United for a Fair Economy draws more parallels between these two periods than one would like. Lax lending standards, a housing and construction boom, and later foreclosure were all features of the 20s and 30s, much as they are features of our current economic situation.

How do we stop this cycle of structural racism?

If the ARR Act goes into effect without oversight into how and to whom jobs and other monetary benefits are distributed, it seems unlikely that we will be able to do so. One place we already see the process of structural racism in the making is in the response of certain governors to accepting funds earmarked for their state due to their political ideology. Six governors – all Republican and some 2012 presidential candidate hopefuls – have displayed hesitancy in accepting funds from the American Recovery and Reinvestment Act, and the governor of Alabama has already refused stimulus funds for unemployment funds.

While everyone has a right to their politically ideology regarding government intervention into state affairs, the impact of statesmen refusing stimulus funds most likely will only aggravate the current racial gap in unemployment and contribute to the further decline in median family income within black household. These statesmen’s rationalization of government policies is part of the larger white racial frame undergirding American systemic racism simply because of the centrality of race to American racial and non-racial politics. In all of the states where governors are dancing the political two-step, black unemployment is at least twice that of whites. By withholding stimulus funds that will benefit all constituents of a state and stymie the short- and long-term effects of the current recession – both which were derivatives of Franklin D. Roosevelt’s New Deal, these governors actively participate in maintaining structural racism and racialized experiences.

The time to be assertive, deliberate, and informed about how racism works is now. has already begun an online petition calling out the social and humanistic irresponsibility of these governors. Time is repeating itself: This time there are no excuses.