Re: Redlining

[ichudov@algebra.com (Igor Chudov @ home)]

Timothy C. May wrote:
> What is lost on many people who denounce "racism" and demand that banks
> give equal percentages of banks to various allegedly aggrieved "oppressed
> minorities," based on various quotas, is that the loan process is almost
> totally driven by _greed_, as it should be. Any bank which practices
> "stupid racism," e.g, by ignoring good payback prospects because of
> tangential or unimportant criteria, faces lost business.

Please correct me, but your representation of what such people demand
is totally wrong.

No one demands that blacks should be given as much loans as whites.

The idea of equal opportunity is that people of equal standing (ie,
people with similar credit histories, incomes, levels of savings, and
so on) be given same consideration regardless of race.

Example: Suppose Mr. White makes $50,000 a year, has 3 credit cards and
has never defaulted on anything. Suppose Mr. Black makes $50,000 a year,
has 3 credit cards and has never defaulted on anything. The law, as I 
understand it, required that they both must be treated equally.

Understanding of that definition of discrimination by many laypeople is
simply distorted by the fact that blacks, on average, have lower incomes
due to many factors, of which many are often their own fault. Since
incidence of poor credit standing is higher among blacks, the average
amount of loans received by blacks is _not an evidence of discrimination_,
at least it should not be to reasonable people.

There are other issues when some demand that there should be programs
helping blacks (or any other category) achieve higher income. These
programs are separate issue from what we are discussing.

Also, some posters here mix totally different issues: 1) what is 
discrimination and 2) should the government do anything about it
or not.

	- Igor.